<PAGE>
As filed with the Securities and Exchange Commission on January 21, 1998
Registration No. ___________
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
------------------
WESTERN BANCORP
(Exact name of registrant as specified in its charter)
CALIFORNIA 95-3863296
(State or other jurisdiction (I.R.S. employer
of incorporation or organization) identification number)
4100 NEWPORT PLACE, SUITE 900, NEWPORT BEACH, CALIFORNIA 92660
(Address of Principal Executive Offices) (Zip Code)
WESTERN BANCORP 401(K) PLAN
(Full title of the Plan)
HUGH S. SMITH, JR. COPY TO:
Chairman of the Board KEN IKARI, ESQ.
Western Bancorp Irell & Manella LLP
4100 Newport Place, Suite 900 333 S. Hope Street, Suite 3300
Newport Beach, California 92660 Los Angeles, CA 90071
(714) 863-2300 (213) 620-1555
(Name, address including zip code and telephone number, including
area code, of registrants' agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
<CAPTION>
Proposed Proposed
Maximum Maximum
Title of Amount to be Offering Price Aggregate Amount of
Securities to be Registered Registered Per Share (1) Offering Price (1) Registration Fee
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, without par value 31,189 shares $32.0625 $1,000,000 $295
- ----------------------------------------------------------------------------------------------------
Interests in the Plan (2) Indeterminate N/A N/A $ 0
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee and,
pursuant to Rule 457(c) and Rule 457(h) under the Securities Act of 1933,
as amended, based upon the bid and ask prices of Western Bancorp common
stock on January 14, 1998 as reported by NASDAQ.
<PAGE>
(2) In addition, pursuant to Rule 416(c) under the Securities Act of 1993, this
Registration Statement also covers an indeterminate amount of interests to
be offered or sold pursuant to the employee benefit plan described herein.
-2-
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION.*
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.*
*INFORMATION REQUIRED BY PART I OF FORM S-8. The document(s) setting forth the
information specified in Part I of this Form S-8 will be sent or given to
participating employees as specified by Rule 428(b)(1) of the Securities Act of
1933, as amended (the "Securities Act"). These documents and the documents
incorporated by reference into this Form S-8 pursuant to Item 3 of Part II of
this Registration Statement, taken together, constitute a prospectus that meets
the requirements of Section 10(a) of the Securities Act and are on file at the
Registrant's principal executive offices and available without charge, upon
written or oral request to Julius G. Christensen, Executive Vice President,
General Counsel and Secretary, Western Bancorp, 4100 Newport Place, Suite 900,
Newport Beach, California 92660. Telephone requests may be directed to Julius
G. Christensen at (714) 863-2459.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The documents listed in (a) through (d) below are incorporated by reference
in this Registration Statement. In addition, all documents subsequently filed
by Registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), prior to the filing of a
post-effective amendment that indicates that all securities offered have been
sold or that deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference in this Registration Statement and to be part
hereof from the date of filing of such documents:
(a) The Company's Annual Report, as amended, on Form 10-KSBA as of and for
the year ended December 31, 1996 (which amends and restates the Form
10-KSB as of and for the year ended December 31, 1996);
(b) The Company's Quarterly Report on Form 10-QSB (filed under the name
"Monarch Bancorp") as of and for the three-month period ended
March 31, 1997;
(c) The Company's Quarterly Reports on Form 10-Q as of and for the
three-month period ended June 30, 1997 and September 30, 1997; and
(d) The Company's Current Reports on Form 8-K filed with the Commission on
April 14, 1997, May 2, 1997, June 19, 1997, July 17, 1997 (presenting
Western Bancorp's restated consolidated financial statements
reflecting the effect of the merger of Western Bancorp with California
Commercial Bankshares ("CCB") on a pooling-of-interests basis),
August 11, 1997, August 28, 1997, October 3, 1997, October 24, 1997,
(presenting
-3-
<PAGE>
Western Bancorp's supplemental consolidated financial statements
reflecting the effect of the merger of Western Bancorp with
SC Bancorp ("SCB") on a pooling-of-interests basis), October 31, 1997,
November 13, 1997 (presenting Western Bancorp's supplemental condensed
consolidated financial statements reflecting the effect of the merger
of Western Bancorp with SCB on a pooling-of-interests basis as of
September 30, 1997) and December 29, 1997.
Any statement contained herein or in a document incorporated or deemed to
be incorporated herein by reference shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any subsequently filed document pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act which also is incorporated or
deemed to be incorporated herein by reference modifies or supersedes such prior
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Registration
Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
The authorized capital stock of the Company as of the date hereof
consists of 100,000,000 shares of common stock, no par value, of which
10,648,317 shares are issued and outstanding and 5,000,000 shares of serial
preferred stock, no par value, none of which are outstanding. Holders of
shares of common stock of the Company are entitled to one vote for each share
of record on all matters voted upon by shareholders of the Company, except
that in connection with the election of directors, the shares subject to
notice may be voted cumulatively. Shares of common stock of the Company are
not subject to redemption, conversion or sinking fund provisions. Holders of
common stock are entitled to receive such dividends as may be declared by the
Board of Directors out of funds legally available therefor under the laws of
the State of California, subject to the rights of holders of any preferred
stock of the Company that may be issued after the date hereof.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 317 of the California General Corporation Law (the "CGCL")
authorizes a court to award, or a corporation's Board of Directors to grant,
indemnity to directors, officers and employees in terms sufficiently broad to
permit such indemnification under certain circumstances for liabilities
(including reimbursement for expenses incurred) arising under the Securities
Act. Article Five of Western Bancorp's restated articles of incorporation
provides for elimination of liability for monetary damages of its directors, and
Article Six of Western Bancorp's restated articles of incorporation and Article
VI of Western Bancorp's bylaws provide for indemnification of its directors,
officers, employees and other agents to the fullest extent permitted by the
CGCL. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of Western
Bancorp pursuant to the
-4-
<PAGE>
foregoing provisions, or otherwise, Western Bancorp has been advised that in
the opinion of the Commission such indemnification is against public policy
as expressed in the Securities Act and is, therefore, unenforceable.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
4 Western Bancorp 401(K) Plan
5.1 Opinion of Irell & Manella LLP as to the legality of the securities
being registered
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Irell & Manella LLP (included in Exhibit 5.1)
23.3 Consent of Deloitte & Touche LLP
23.4 Consent of Vavrinek, Trine, Day & Co.
24 Powers of Attorney (included on signature page of this Registration
Statement)
ITEM 9. UNDERTAKINGS.
a. The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in this Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high and of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than 20 percent
change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement;
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in this
Statement or any material change to such
information in this Registration Statement;
-5-
<PAGE>
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the registration statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by Registrant pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in this Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial BONA FIDE offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.
b. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Exchange Act (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial BONA FIDE offering thereof.
c. Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions or otherwise, the
Registrant has been advised that in the opinion of the Securities and
Exchange Commission, such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense
of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question of whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
d. The undersigned Registrant will submit the Plan to the Internal Revenue
Service ("IRS") and will make all changes required by the IRS in order to
qualify the Plan.
-6-
<PAGE>
SIGNATURES
The Registrant. 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 this Registration Statement on Form S-8 and has
duly caused this Registration Statement on Form S-8 to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of Newport Beach,
State of California, on January 21, 1998.
WESTERN BANCORP
By: /s/ ARNOLD C. HAHN
----------------------------------------
Arnold C. Hahn
Executive Vice President and Chief
Financial Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby authorizes and appoints each of Arnold C. Hahn and Julius G.
Christensen, his true and lawful attorney-in-fact and agent, each acting alone,
with full power of substitution for him and in his name, place and stead, in any
and all capacities, to sign and to file with the Commission any and all
amendments (including without limitation post-effective amendments) to this
Registration Statement, and to file the same, with all exhibits thereto and
other documents in connection therewith, granting unto said attorney-in-fact and
agent, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary 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 attorney-in-fact and agent, or any of them, 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 by the following persons in the
capacities and on the date indicated.
Signature Title Date
--------- ----- ----
/s/ MATTHEW P. WAGNER Director, President and Chief January 21, 1998
- ------------------------ Executive Officer (Principal
Matthew P. Wagner Executive Officer)
/s/ ARNOLD C. HAHN Executive Vice President and January 14, 1998
- ------------------------ Chief Financial Officer
Arnold C. Hahn (Principal Accounting Officer)
/s/ HUGH S. SMITH, JR. Director and Chairman of January 21, 1998
- ------------------------ the Board
Hugh S. Smith, Jr.
-7-
<PAGE>
Signature Title Date
--------- ----- ----
/s/ HAROLD A. BEISSWENGER Director January 12, 1998
- --------------------------
Harold A. Beisswenger
/s/ RICE E. BROWN Director January 12, 1998
- --------------------------
Rice E. Brown
/s/ JOSEPH J. DIGANGE Director January 21, 1998
- --------------------------
Joseph J. Digange
/s/ JOHN M. EGGEMEYER Director January 21, 1998
- --------------------------
John M. Eggemeyer
/s/ WILLIAM C. GREENBECK Director January 12, 1998
- --------------------------
William C. Greenbeck
/s/ LARRY D. HARTWIG Director January 9, 1998
- --------------------------
Larry D. Hartwig
/s/ WILLIAM H. JACOBY Director January 15, 1998
- --------------------------
William H. Jacoby
/s/ ROBERT L. MCKAY Director January 21, 1998
- --------------------------
Robert L. McKay
/s/ JOHN W. ROSE Director January 9, 1998
- --------------------------
John W. Rose
/s/ MARK H. STUENKEL Director January 15, 1998
- --------------------------
Mark H. Stuenkel
/s/ DALE E. WALTER Director January 21, 1998
- --------------------------
Dale E. Walter
/s/ DONALD E. WOOD Director January 9, 1998
- --------------------------
Donald E. Wood
-8-
<PAGE>
The Plan. Pursuant to the requirements of the Securities Act of 1933, the
trustees (or other persons who administer the employee benefit plan) have
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the city of Minneapolis, State of
Minnesota, on January 21, 1998.
WESTERN BANCORP RETIREMENT
PLAN COMMITTEE
By: /s/ MATTHEW P. WAGNER
------------------------------
Matthew P. Wagner
By: /s/ ARNOLD C. HAHN
------------------------------
Arnold C. Hahn
By: /s/ CHERYL RUDIN
------------------------------
Cheryl Rudin
-9-
<PAGE>
EXHIBIT INDEX
4 Western Bancorp 401(K) Plan
5.1 Opinion of Irell & Manella LLP as to the legality of the securities being
registered
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Irell & Manella LLP (included in Exhibit 5.1)
23.3 Consent of Deloitte & Touche LLP
23.4 Consent of Vavrinek, Trine, Day & Co.
24 Powers of Attorney (included on signature page of this Registration
Statement)
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ADOPTION AGREEMENT #001
FOR USE WITH
401(k) PROTOTYPE
BASIC PLAN DOCUMENT #02
1989 RESTATEMENT
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
----------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE I. PLAN ADOPTED
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
By execution of this Adoption Agreement, the Employer and the Trustee agree
that this Adoption Agreement and the related document entitled "Section 401(k)
Prototype Basic Plan Document #02 (1989 Restatement)" as amended, are adopted as
the formal written instrument under which the Employer will maintain a defined
contribution profit sharing plan (the "Plan") for the benefit of its Employees
who are eligible to participate. The Plan which the Employer maintains is
intended to qualify under Internal Revenue Code section 401(a) and to be funded
through a fund exempt from federal income taxes under Internal Revenue Code
section 501(a).
(i) The Prototype Sponsor will furnish the Employer a copy of the
opinion letter issued by the Internal Revenue Service with
respect to the form of the Prototype Documents.
(ii) If the Prototype Sponsor amends the Prototype Documents, the
Prototype Sponsor will furnish the Employer a copy of the
amendment and a copy of any opinion letter issued by the
Internal Revenue Service with respect to the form of such
amendment.
(iii) If the Employer desires a determination letter from the IRS on
the qualification of the Plan, the Employer (and not the
Trustee or the Prototype Sponsor) is responsible for obtaining
the determination letter.
(iv) The Employer will furnish the Trustee with a copy of any
determination letter it receives on the Plan created by the
Employer under the Prototype Documents.
(v) The Employer (and not the Trustee or the Prototype Sponsor) is
responsible for the compliance with all laws regarding the
filing of the Annual Report/Return with the government and
distributing the Summary Plan Description, Summary Annual
Report and Summary of Material Modifications to Participants
and Beneficiaries.
(vi) The Employer hereby directs the Trustee to withhold federal
income taxes from distributions from the Plan subject to the
Employer's obligation to furnish the Trustee with all
information necessary for the Trustee to properly withhold
federal income taxes from distributions.
(vii) The Employer understands that failure to properly fill out or
amend this Adoption Agreement may result in disqualification
of the Plan.
-1-
<PAGE>
(viii) If the Prototype Sponsor discontinues or abandons the
Prototype Documents, the Prototype Sponsor will inform the
Employer.
(ix) This Adoption Agreement is not effective unless the Prototype
Sponsor (or its authorized representative) has consented, in
writing, to the use of this Adoption Agreement and the
Prototype Documents.
(x) The Employer understands that this is a legal document with
significant tax and other legal effects and represents that
this document has been reviewed by the Employer's own legal
counsel.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE II. THE EMPLOYER
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A. The Employer's(1) name and address is:
Western Bancorp
--------------------------------------
4100 Newport Place, Suite 900
--------------------------------------
Newport Beach, California 92660
--------------------------------------
--------------------------------------
[Section 1.1.11]
B. The Employer is organized under the laws of the state of California as a
(check one): -------------
X corporation.
-----
S corporation.
-----
partnership.
-----
proprietorship.
-----
other (specify) .
----- ----------------------------------------
[Section 1.1.11]
C. The Employer's principal trade or business with respect to which this Plan
is established is: Bank holding company; 6060. (2)
---------------------------------
D. The Employer's annual accounting period (federal income tax year) ends:
December 31.
-----------
E. The Employer's federal taxpayer identification number is: 95-3863296 .
---------------
- ------------------
(1) Under the Internal Revenue Code, all Employees of corporations,
partnerships and proprietorships which constitute a controlled group of
businesses are treated as if they were employed by a single employer.
Accordingly, the exclusion of Employees of corporations, partnerships or
proprietorships which are affiliated with the Employer may result in
prohibited discrimination.
(2) Describe the business and insert the proper business code from the
current instructions to IRS Form 5500.
-2-
<PAGE>
F. The Employer designates the following person(s) as the Administrator's
Representative.
Western Bancorp Retirement Plan Committee
------------------------------------------------
------------------------------------------------
------------------------------------------------
------------------------------------------------
[Section 1.1.2]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE III. THE TRUSTEE
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A. The name and address of the Trustee to be used for reporting and disclosure
purposes is:
First Trust National Association
------------------------------------------------
180 East Fifth Street
------------------------------------------------
P.O. Box 64488
------------------------------------------------
St. Paul, Minnesota 55164-0488
------------------------------------------------
[Section 1.1.29]
B. Effective date of appointment of the Trustee listed above: January 1, 1998 .
----------------
C. The Prototype Sponsor's Authorized Representative for inquiries regarding
the adoption of the Prototype Documents, intended meaning of the Prototype
Documents and effect of the opinion letter is:
First Trust National Association
------------------------------------------------
180 East Fifth Street
------------------------------------------------
P.O. Box 64488
------------------------------------------------
St. Paul, Minnesota 55164-0488
------------------------------------------------
(612) 244-0053
------------------------------------------------
-3-
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE IV. HISTORY OF THE PLAN
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A. The execution of this Adoption Agreement is intended to (check one):
X create a new Plan.
-----
amend an existing Plan (complete the following).
-----
The existing Plan which is being amended was:
maintained under this prototype or another prototype also
----- sponsored by the same Trustee as this Plan.
maintained under some other master, prototype or individually
----- designed document.
[Section 1.1.23]
The name of the Plan under the earlier Plan document was: .(3)
------
The original effective date of the Plan was: .
-------------------
The Trustee under the earlier Plan document was: .
---------------
The date that the earlier Plan document was executed (or most
recently amended) was: .
--------------------
[Section 1.1.23]
B. Upon the execution of this Adoption Agreement, the Plan name for reporting
and disclosure purposes will be: Western Bancorp 401(k) Plan .(4)
---------------------------------
[Section 1.1.20]
C. The three digit Plan serial number ("PN") which will be used by the Employer
for reporting and disclosure purposes is: 001 .(5)
---------
- ---------------------
(3) Do not insert the name of an earlier prototype document but rather the
name of the Plan.
(4) Use a name that combines the Employer's name and words like "Retirement
Savings Plan" or "Savings Plan" or "401(k) Plan." Do not use "Prototype"
in the Plan name. Whatever name is chosen must be consistently used for
reporting and disclosure purposes.
(5) Select a number such as "001", "002", "003", etc. This number must never
have been previously used by the Employer to identify any plan but this
Plan. The number must be used consistently to identify only this Plan.
-4-
<PAGE>
D. The Effective Date (the date upon which this Adoption Agreement is to be
effective) is: January 1, 1998 .(6)
---------------------
[Section 1.1.8]
E. The last day of the Plan Year (the fiscal year of the Plan) is:
December 31 .(7)
--------------
[Section 1.1.22]
F. Is this Plan an exempt profit sharing plan as defined in Section 7.3.4(d)
of the Basic Plan Document and, therefore, exempt from the qualified joint
and survivor annuity rules?
X Yes [Except for amounts transferred to the Plan which remain
----- subject to the Qualified Joint Survivor Annuity rules of IRC
Section 417.]
No
-----
[Section 7.3.4(d)]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE V. ELIGIBILITY REQUIREMENTS
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A. AGE. The minimum age which each Employee must satisfy before becoming a
Participant in the Plan is (check one and complete):
X No minimum age requirement.
-----
Minimum age ___ years (not greater than 21).
-----
[Section 2.1, Section 1.2]
B. SERVICE FOR 401(k) PARTICIPATION. To become a Participant in the Plan for
the purpose of enrolling for retirement savings 401(k) participation, each
Employee must complete at least (check one):(8)
X No years of Eligibility Service.
-----
One year of Eligibility Service with at least 1,000 Hours of
----- Service.
- -------------------------
(6) If this is a new Plan, enter the first day of the Plan Year in which
the Adoption Agreement is signed (or any later date). The Effective
Date should be no earlier than the first day of the first Plan Year
beginning after December 31, 1988, or the first day of the Plan Year
in which the Plan is adopted if this is a new Plan or if the Plan has
been previously amended for the Tax Reform Act of 1986 and received
an IRS determination letter regarding that amendment; provided,
however, certain provisions specified in the Plan Statement shall be
applicable prior to that date for any Employer maintaining a Plan
prior to January 1, 1989.
(7) It is generally recommended that the Plan Year coincide with the
Employer's tax year, but this is not required. If the Employer's tax
year is changed, the Plan Year does not automatically change.
(8) Each Employee eligible to enroll for retirement savings 401(k)
contributions prior to completing the necessary Eligibility Service
for Employer contributions shall be treated as a Participant solely
with respect to such retirement savings 401(k) contributions during
the period prior to an Employee completing such Eligibility Service.
-5-
<PAGE>
One year of Eligibility Service with at least 1,000 Hours of
----- Service or __________ months (less than 12) of continuous service
without regard to Hours of Service credited.
[Section 2.1, Section 1.1.9]
C. SERVICE FOR EMPLOYER CONTRIBUTIONS. To become a Participant in the Plan for
purposes of receiving Employer matching contributions and Employer profit
sharing contributions each Employee must complete at least (check one):(9)
No years of Eligibility Service.
-----
X One year of Eligibility Service with at least 1,000 Hours of Service.
-----
One year of Eligibility Service with at least 1,000 Hours of Service
----- or ______ months (less than 12) of continuous service without regard
to Hours of Service credited.
Two years of Eligibility Service without an intervening One-Year
----- Break in Service.
[Section 2.1, Section 1.1.9]
D. COMPUTATION PERIOD. The computation period for Eligibility Service will be:
The year beginning with the date the Employee first performs an Hour
----- of Service and then Plan Years.(10)
X Successive years beginning on the date the Employee first performs an
----- Hour of Service and annual anniversaries of that date.
[Section 1.1.9]
E. RECOGNIZED EMPLOYMENT. Recognized Employment is all service in the
employment of the Employer except employment by Employees covered under
collective bargaining agreements (unless the agreement provides for the
inclusion of such Employees), non-resident aliens and the following
classifications or categories (check the classifications to be
excluded):(11)
Salaried Employees.
-----
Hourly Employees.
-----
Employees compensated principally on a commissioned basis.
-----
Owner Employees (including Partners who own more than a 10%
----- interest).
- -------------------
(9) Unless the Adoption Agreement provides that the Employer Contributions
Accounts and Employer Matching Accounts are fully (100%) Vested and
nonforfeitable at all times, no more than one year of Eligibility Service
may be required.
(10) This is the easier rule to administer but it does result in counting some
of the same Hours of Service in both "the year beginning on the date the
Employee first performs an Hour of Service" and the overlapping next
"Plan Year." Accordingly, the other rule may be more appropriate when
more than one year of Eligibility Service is required.
(11) More than one exclusion may be checked. Certain exclusions may, in
operation, discriminate in favor of officers, shareholders or highly
compensated Employees. If discrimination results, the Plan will cease
to be qualified. Employers may not directly or by subterfuge indicate
exclusions which are really exclusions of Employees because they are
part-time Employees.
-6-
<PAGE>
Partners.
-----
The following described groups, classifications or individual
----- employees:
- -------------------------------------------------------------------------------
[Section 1.1.27]
F. ENTRY DATE(S). The Entry Date(s) shall be (check one):
the first day of the Plan Year.(12)
-----
the first day of the Plan Year and the first day of the 7th
----- calendar month of the Plan Year.
the first day of the Plan Year and the first day of the 4th, 7th and
----- 10th calendar months of the Plan Year.
X the first day of the Plan Year and the first day of the 2nd through
----- the 12th calendar months of the Plan Year.
[Section 1.1.12]
G. VALUATION DATE(S). The Valuation Date(s) for accounting and valuation
purposes shall be (check only one):(13)
the Annual Valuation Date.
-----
the Annual Valuation Date and the last day of the 6th month of the
----- Plan Year.
the Annual Valuation Date and the last day of the 3rd, 6th and 9th
----- months of the Plan Year.
the Annual Valuation Date and the last day of the 1st through the
----- 11th months of the Plan Year.
X the Annual Valuation Date and each other business day of the Plan
----- Year.
[Section 1.1.30]
- ------------------------
(12) If an age or service requirement must be satisfied before becoming a
Participant in the Plan, this Entry Date cannot be used.
(13) The Valuation Date(s) selected here will be used whenever the term
"Valuation Date" is used in the Basic Plan Document except
Sections 7.1.2, 7.1.3, 7.2, 7.3.4, 7.8 and 7.9 and Article X of the
Adoption Agreement. For the definition of Valuation Date for those
Sections and Article X, see Article X item A of this Adoption Agreement.
-7-
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE VI. RETIREMENT SAVINGS (401(k)) CONTRIBUTIONS(14)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A Participant may enter into a Retirement Savings Agreement with the Employer to
reduce his or her Recognized Compensation by any amount the Participant chooses
between 1% and 20% of such Participant's Recognized Compensation.(15)
---- ----
[Section 3.2]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE VII. EMPLOYER CONTRIBUTIONS AND FORFEITURES(16)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A. REQUIRED MATCHING CONTRIBUTIONS. Will Employer required matching
contributions be allowed?
X No
-----
Yes (check only one and complete):
-----
FIXED MATCH WITH % LIMIT. An amount equal to _____ % of
----- each Participant's retirement savings contributions,
ignoring, however, retirement savings contributions in
excess of _____ % of the Participant's Recognized
Compensation.
FIXED MATCH WITH DOLLAR LIMIT. An amount equal to _____ %
----- of each Participant's retirement savings contributions,
ignoring, however, retirement savings in excess of $_____.
- -----------------------
(14) Federal law limits the amount which may be contributed to a Participant's
Retirement Savings Account per taxable year of the Participant (the
adjusted limit for 1994 is $9,240). This limit also includes any similar
contributions made by the Participant to any other retirement plan
sponsored by the Employer or any other employer.
(15) The amount of such reduction will be considered the contribution of the
Employer. The Plan must meet the nondiscrimination requirements of
Internal Revenue Code section 401(k) (see Section 2.7 of the Basic Plan
Document). The Employer (and not the Trustee) is responsible for testing
and complying with those requirements unless the Employer and the Trustee
agree otherwise. Any amounts contributed by a Participant through pay
reduction shall be 100% Vested at all times and shall be held in a
separate Retirement Savings Account. Under no circumstances may pay
reduction elections be made retroactively.
(16) If Employer matching contributions and/or nondeductible voluntary
employee contributions are permitted, the Plan must meet the
nondiscrimination requirements of Internal Revenue Code section 401(m)
(see Section 3.10 of the Basic Plan Document). The Employer (and not
the Trustee) is responsible for testing and complying with those
requirements unless the Employer and the Trustee agree otherwise.
-8-
<PAGE>
GRADED MATCH. An amount determined as follows:(17)
-----
If the Participant has The Employer will contribute
contributed this percentage this percentage of the
of Recognized Compensation: Participant's contribution:
--------------------------- ----------------------------
Up to % % (50 to 100)
--- ---
From % to % % (25 to 50)
--- --- ---
From % to % % (1 to 25)
--- --- ---
[Section 3.3]
B. DISCRETIONARY CONTRIBUTIONS. Will Employer discretionary contributions be
allowed?(18)
No
-----
X Yes (check one or both and complete):
-----
X DISCRETIONARY MATCHING CONTRIBUTIONS. Employer discretionary
----- matching contributions will be allocated to the Employer
Matching Accounts of eligible Participants to match a
percentage, determined by the Employer, of each eligible
Participant's retirement savings contribution, ignoring,
however, retirement savings contributions in excess of ____ %
of the Participant's Recognized Compensation.
X DISCRETIONARY PROFIT SHARING CONTRIBUTIONS. (check only
----- one)(19)
X STRAIGHT PERCENT OF PAY. Employer discretionary profit
----- sharing contributions are not integrated with Social
Security contributions. Employer discretionary profit
sharing contributions will be allocated to the Employer
Contributions Accounts of eligible Participants (whether
or not they are making retirement savings contributions)
pursuant to Section 3.4.5(a) of the Basic Plan Document.
INTEGRATED WITH SOCIAL SECURITY. Employer discretionary
----- profit sharing contributions are integrated with Social
Security contributions. Employer discretionary profit
sharing contributions will be allocated to the Employer
Contributions Accounts of eligible Participants (whether
or not they are making retirement savings contributions)
pursuant to Section 3.4.5(b) of the Basic Plan Document.
- -----------------------
(17) The percentages in the left column should be increasing. Each percentage
in the right column must be within the range indicated in the
parenthesis, but these percentages do not have to total 100%. The third
line is optional; it does not have to be completed.
(18) The allocation described here is the allocation which would follow the
curative allocations described in Section 3.4.2 or Section 3.4.4.
Normally, if the Plan is carefully administered and the requirements of
Section 2.7 and Section 3.10 are closely observed during the year, there
will be no curative allocations under Section 3.4.2 or Section 3.4.4.
Either discretionary matching contributions or discretionary profit
sharing contributions, or both may be elected.
(19) Minimum contribution and allocation requirements apply in any Plan Year
that the Plan is "top heavy" as defined in Appendix B to the Basic Plan
Document.
-9-
<PAGE>
The Integration Level will be equal to (check one):(20)
-----
The Taxable Wage Base ("TWB")
-----
$ (a dollar amount not greater than the TWB)
----- -----
[Section 3.4.3, Section 3.4.5]
C. LAST DAY RULE. Will Participants be required to be in employment on the
last day of a Plan Year to share in the Employer contributions (and
forfeited Suspense Accounts, if any) to be allocated for that Plan Year?(21)
EMPLOYER REQUIRED EMPLOYER DISCRETIONARY EMPLOYER DISCRETIONARY
MATCHING CONTRIBUTIONS MATCHING CONTRIBUTIONS PROFIT SHARING CONTRIBUTIONS
- ---------------------- ---------------------- ----------------------------
Yes X Yes X Yes
----- ----- -----
No No No
----- ----- -----
X Not Applicable Not Applicable Not Applicable
----- ----- -----
[Section 3.5]
D. HOUR RULE EMPLOYER REQUIRED MATCHING CONTRIBUTIONS. To be eligible to
share in the Employer required matching contributions to be allocated for
that Plan Year, a Participant must have performed at least (check
one):(22)
No service requirement.
-----
Five Hundred (500) Hours of Service in that Plan Year.
-----
One Thousand (1,000) Hours of Service in that Plan Year.
-----
- --------------------
(20) The integration rate is determined as follows:
If the Integration
Level is more than but not greater than then the integration rate is:
------------------ -------------------- -----------------------------
$0 X * 5.7%
X * 80% of TWB 4.3%
80% of TWB Y ** 5.4%
* X = the greater of $10,000 or 20% of the TWB.
** Y = any amount more than 80% of the TWB but less than 100%
of the TWB.
If the Integration Level is the TWB, then the excess contribution
percentage cannot exceed the base contribution percentage by more than
the lesser of the base contribution percentage or 5.7%.
If the Integration Level is less than the TWB, then the excess
contribution percentage cannot exceed the base contribution percentage
by more than the lesser of the base contribution percentage or the
integration rate determined by the chart above.
(21) An Employee who left employment during the Plan Year and who performed
more than 500 Hours of Service before leaving, must be included for
testing the Plan's compliance with the Internal Revenue Code Section
410(b) coverage requirements, whether or not such person is eligible to
share in the contribution. Accordingly, if the Plan requires employment
on the last day of the Plan Year or 1,000 Hours of Service to be eligible
to share in the contribution there is some risk that the Plan will fail
the Section 410(b) coverage requirements.
(22) If the Plan is (or becomes) "top heavy" as defined in Appendix B to the
Basic Plan Document, this rule will be subject to the special provisions
in Appendix B.
-10-
<PAGE>
X Not Applicable.
-----
[Section 3.5]
E. HOUR RULE EMPLOYER DISCRETIONARY MATCHING CONTRIBUTIONS. To be eligible to
share in the Employer discretionary matching contributions and forfeited
Suspense Accounts, if any, to be allocated for that Plan Year, a Participant
must have performed at least (check one):(22)
No service requirement.
-----
Five Hundred (500) Hours of Service in that Plan Year.
-----
X One Thousand (1,000) Hours of Service in that Plan Year.
-----
Not Applicable.
-----
[Section 3.5]
F. HOUR RULE EMPLOYER DISCRETIONARY PROFIT SHARING CONTRIBUTIONS. To be
eligible to share in the Employer discretionary profit sharing contribution
and forfeited Suspense Accounts, if any, to be allocated for the Plan Year,
a Participant must have performed at least (check one):(22)
No service requirement.
-----
Five Hundred (500) Hours of Service in that Plan Year.
-----
X One Thousand (1,000) Hours of Service in that Plan Year.
-----
Not Applicable.
-----
[Section 3.5]
G. EARNINGS ON ADVANCE CONTRIBUTIONS. If the Employer makes a required or
discretionary contribution in advance of the Valuation Date as of which the
contribution is allocated to Participant's Accounts, then the earnings on
such advance contribution will be (check only one):
Added to the Employer's contribution and allocated as part of the
----- contribution (which may serve to reduce the Employer's total
contribution for the Plan Year).
X Added to the general earnings of the fund and allocated as part of
----- such earnings.
This does not affect the treatment of earnings on advance retirement savings
(401(k)) contributions, which are always allocated to the electing
Participant's Retirement Savings Account.
[Section 4.2]
-11-
<PAGE>
H. RECOGNIZED COMPENSATION. For purposes of allocating the Employer's required
or discretionary matching contributions and discretionary profit sharing
contributions, if any, a Participant's Recognized Compensation shall not
include (check all applicable choices):(23)
FOR EMPLOYER FOR EMPLOYER PROFIT
MATCHING CONTRIBUTIONS SHARING CONTRIBUTIONS
---------------------- ---------------------
Reimbursements or other Reimbursements or other
----- expense allowances; welfare ----- expense allowances; welfare
and fringe benefits; moving and fringe benefits; moving
expenses and deferred expenses and deferred
compensation (both when compensation (both when
deferred and when received). deferred and when received).
Overtime. Overtime.
----- -----
Holiday and Vacation Pay. Holiday and Vacation Pay.
----- -----
Shift differential. Shift differential.
----- -----
Bonuses. Bonuses.
----- -----
Commissions in excess Commissions in excess
----- of $ . ----- of $ .
----- -----
All Recognized Compensation All Recognized Compensation
----- in excess of $ . ----- in excess of $ .
------ ------
Other (Specify): Other (Specify):
----- ------------- ----- -------------
----------------------------- -----------------------------
-----------------------------. -----------------------------.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
ARTICLE VIII. PARTICIPANT CONTRIBUTIONS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
A. NONDEDUCTIBLE VOLUNTARY CONTRIBUTIONS. Will Participants be allowed to
make nondeductible voluntary contributions?
Yes
-----
X No
-----
[Section 3.8]
(23) If any exclusions operate in fact to discriminate in favor of highly
compensated employees, the Plan will cease to be qualified. If you elect
any exclusions other than the first exclusion, you must test the Plan's
definition of Recognized Compensation each year to determine if it
discriminates in favor of highly compensated employees. These exclusions
will not affect the compensation that must be included for purposes of
performing the nondiscrimination tests under Internal Revenue Code
sections 401(k) and 401(m).
-12-
<PAGE>
B. WITHDRAWALS FROM VOLUNTARY ACCOUNT. Will Participants be allowed to
withdraw their nondeductible voluntary contributions and deductible
voluntary contributions (and earnings thereon) before an Event of Maturity?
Yes
-----
No
-----
X Not Applicable
-----
[Section 7.8]
C. ROLLOVER CONTRIBUTIONS. Will Employees in Recognized Employment be allowed
to make rollover contributions?
X Yes
-----
No
-----
[Section 3.7]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE IX. VESTING OF EMPLOYER MATCHING
ACCOUNTS AND EMPLOYER CONTRIBUTIONS ACCOUNTS
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A. EMPLOYER MATCHING ACCOUNT. Effective for Participants who perform one or
more Hours of Service on or after the Effective Date, each Participant's
Employer Matching Account shall become Vested as follows (check
one):(24)
***ALL PARTICIPANTS IN THE SOUTHERN CALIFORNIA BANK EMPLOYEE RETIREMENT PLAN
WHO WERE ACTIVE EMPLOYEES ON DECEMBER 31, 1997 BECAME 100% VESTED IN THEIR
ACCOUNT BALANCES.
NOT APPLICABLE.
-----
FULL VESTING. Each Participant's Employer Matching Account
----- shall be fully (100%) Vested at all times.
X GRADUATED OR CLIFF VESTING.(25) Each Participant's Employer
----- Matching Account shall be Vested in accordance with the
following schedule:
- ---------------
(24) If contributions allocated to the Employer Matching Account are to be
used in the 401(k) test (pursuant to Section 2.7 of the Basic Plan
Document), the Employer Matching Account must be fully (100%) Vested at
all times and not be subject to any in-service distributions.
(25) This Vesting provision can be elected only if the Adoption Agreement
provides for an Eligibility Service requirement of 1 year or no years.
-13-
<PAGE>
The Vested Portion of the
When the Participant has Completed Participant's Employer
the Following Vesting Service: Matching Account will be:(26)
---------------------------------- -------------------------------------
Not Top Heavy Top Heavy
-------------------- ---------------
3 to 7 5 year cliff 2 to 6 3 year
------ ------------ ------ ------
Less than 1 year 0% (0%) (0%) (0%) (0%)
---
1 year but less than 2 years 0% (0%) (0%) (0%) (0%)
---
2 years but less than 3 years 25% (0%) (0%) (20%) (0%)
---
3 years but less than 4 years 50% (20%) (0%) (40%) (100%)
---
4 years but less than 5 years 75% (40%) (0%) (60%)
---
5 years but less than 6 years 100% (60%) (100%) (80%)
---
6 years but less than 7 years 100% (80%) (100%)
---
7 years or more 100%
[Section 5.1.1]
B. EMPLOYER CONTRIBUTIONS ACCOUNT. Effective for Participants who perform one
or more Hours of Service on or after the Effective Date, each Participant's
Employer Contributions Account shall become Vested as follows (check one):
***ALL PARTICIPANTS IN THE SOUTHERN CALIFORNIA BANK EMPLOYEE RETIREMENT PLAN
WHO WERE ACTIVE EMPLOYEES ON DECEMBER 31, 1997 BECAME 100% VESTED IN THEIR
ACCOUNT BALANCES.
NOT APPLICABLE.
-----
FULL VESTING. Each Participant's Employer Contributions
----- Account shall be fully (100%) Vested at all times.
X GRADUATED OR CLIFF VESTING.(25) Each Participant's Employer
----- Contributions Account shall be Vested in him in accordance
with the following schedule:
- ---------------
(26) If the Plan is not top-heavy, the percentage at every level must not be
less than the percentages in the 3 to 7 year column or the 5 year cliff
column. If the Plan is top-heavy, the percentage at every level must
not be less than the 2 to 6 year column or the 3 year cliff column.
-14-
<PAGE>
The Vested Portion of the
When the Participant has Completed Participant's Employer
the Following Vesting Service: Matching Account will be:(26)
---------------------------------- -------------------------------------
Not Top Heavy Top Heavy
-------------------- ---------------
3 to 7 5 year cliff 2 to 6 3 year
------ ------------ ------ ------
Less than 1 year 0% (0%) (0%) (0%) (0%)
---
1 year but less than 2 years 0% (0%) (0%) (0%) (0%)
---
2 years but less than 3 years 25% (0%) (0%) (20%) (0%)
---
3 years but less than 4 years 50% (20%) (0%) (40%) (100%)
---
4 years but less than 5 years 75% (40%) (0%) (60%)
---
5 years but less than 6 years 100% (60%) (100%) (80%)
---
6 years but less than 7 years 100% (80%) (100%)
---
7 years or more 100%
[Section 5.1.1]
C. FULL VESTING SERVICE. Notwithstanding any of the foregoing, each
Participant's Employer Matching Account and Employer Contributions Account
shall become 100% Vested upon the Participant's death, disability or
attainment of Normal Retirement Age or, if earlier, attainment of age N/A
years while in the employment of the Employer.
[Section 5.1.2]
D. NORMAL RETIREMENT AGE. The Normal Retirement Age for each Participant is:
The Participant's _______ birthday (not greater than 65th).
-----
X The Participant's 65th birthday (not greater than 65th) or,
----- if later, the 5th anniversary (not greater than 5th) of the
first day of the Plan Year in which the Participant first
became a Participant.
[Section 1.1.17]
E. VESTING SERVICE EXCLUSION. Will Vesting Service earned before the Employer
established this Plan be counted to determine the Vested portion of the
Participant's Employer Matching Account and Employer Contributions Account?
X Yes
-----
No(27)
-----
[Section 1.1.32, Section 5.1.1]
- ---------------
(27) If this is an amendment of an existing Plan, the Employer (i) may not
reduce the Vested percentage of any Participant's Employer Matching
Account or Employer Contributions Account, and (ii) the Plan must
comply with the rules contained in Section 5.2 of the Basic Plan
Document.
-15-
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE X. DISTRIBUTIONS
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A. VALUATION DATES. For distribution purposes, the Valuation Dates for the
Plan shall be (check only one):(28)
the Annual Valuation Date.
-----
the Annual Valuation Date and the last day of the 6th month
----- of the Plan Year.
the Annual Valuation Date and the last day of the 3rd, 6th,
----- 9th months of the Plan Year.
the Annual Valuation Date and the last day of the 1st through
----- 11th months of the Plan Year.
X the Annual Valuation Date and each other business day of the
----- Plan Year.
[Section 1.1.30]
B. EVENT OF MATURITY. Will the Participant's attainment of age 59-1/2 be an
Event of Maturity (in addition to the other Events of Maturity listed in
Section 6.1 of the Plan Statement)?
X Yes ***SEE PRESUMPTIVE FORMS OF DISTRIBUTION ATTACHED FOR
----- PARTICIPANTS WHO HAVE TRANSFERRED AMOUNTS FROM THE SOUTHERN
CALIFORNIA BANK EMPLOYEE RETIREMENT PLAN AND NATIONAL BANK
OF SOUTHERN CALIFORNIA 401(k) PLAN.
No
-----
[Section 6.1]
C. TIME OF DISTRIBUTION. Distribution will occur (check only one):(29)
X As of any Valuation Date specified in writing by the
----- Participant or Beneficiary which is coincident with or
following a Participant's Event of Maturity and following the
filing of any required application for distribution.
As of a date specified in writing by the Participant or
----- Beneficiary which is the Valuation Date coincident with or
immediately preceding the Participant's Event of Maturity or
any following Valuation Date preceding the filing of any
required application for distribution.(30)
- ---------------
(28) The Valuation Date(s) selected here will only be used for purposes of
Sections 7.1.2, 7.1.3, 7.2, 7.3.4, 7.8 and 7.9 of the Basic Plan
Document and this Article X of the Adoption Agreement. The term
Valuation Date used throughout the remaining Sections of the Basic
Plan Document will be used in reference to the Valuation Dates
selected in Article V item G of this Adoption Agreement.
(29) These rules only applies if a written application for distribution is
required. See Sections 7.1.2 and 7.1.3 of the Basic Plan Document for
the rules that apply to small amount distributions and required
beginning date distributions.
(30) The selection of this option carries with it the risk of adverse
selection for investment performance that will be borne by the
remaining Participants and Beneficiaries and not the Distributee.
This option cannot be selected if the Plan is subject to the qualified
joint and survivor annuity rules. (See Article IV, item F of this
Adoption Agreement.)
-16-
<PAGE>
As of a date specified in writing by the Participant or
----- Beneficiary which is the Valuation Date immediately preceding
or coincident with the Participant's Event of Maturity or any
Valuation Date following a Participant's Event of Maturity
and the filing of any required application for
distribution.(30)
[Section 7.2]
D. FORM OF DISTRIBUTION. Participants will be allowed to receive distributions
in the following forms (check one or more):
***SEE PRESUMPTIVE FORMS OF DISTRIBUTION ATTACHED FOR PARTICIPANTS WHOSE
ACCOUNTS TRANSFERRED FROM THE NATIONAL BANK OF SOUTHERN CALIFORNIA 401(k)
PLAN, THE SOUTHERN CALIFORNIA BANK EMPLOYEE RETIREMENT PLAN, AND THE WESTERN
BANK 401(k) & PROFIT SHARING PLAN, WHICH ARE APPLICABLE TO THE TRANSFERRED
AMOUNTS.
X LUMP SUM - (check only one of the lump sum options):
-----
X Lump sum - single payment as of the Valuation Date
----- specified by the Participant and allowed in item C.
Lump sum - including if the Participant requests, a
----- partial advance payment not to exceed the value of the
Vested Total Account on the Valuation Date immediately
preceding the Participant's Event of Maturity.(31)
X FIXED INSTALLMENTS - substantially equal annual installments,
----- the number of such installments to be specified by the
Participant before the first payment is made, but not to
exceed the Participant's life expectancy.(32)
MINIMUM INSTALLMENTS - substantially equal annual
----- installments, the number of such installments to be
determined by the Participant's life expectancy or the joint
and last survivor life expectancy of the Participant and his
or her Beneficiary.(32)
Beneficiaries will be allowed to receive distributions in one of the
following forms (check one or more):
X LUMP SUM - (check only one of the lump sum options):
-----
X Lump sum - single payment as of the Valuation Date
----- specified by the Beneficiary and allowed in item C.
Lump sum - including if the Beneficiary requests, a
----- partial advance payment not to exceed the value of the
Vested Total Account on the Valuation Date immediately
preceding the Participant's death.(31)
INSTALLMENTS(33)
-----
- ---------------
(31) This option can only be selected if the Plan provides Annual
Valuations. If the Distributee requests a partial payment, the
Distributee may limit the possible tax treatment of the distribution
unless the partial payment is received in the same taxable year as the
remaining payment. The selection of this option carries with it the
risk of adverse selection for investment performance that will be
borne by the remaining Participants and Beneficiaries and not the
Distributee.
(32) Substantially equal and life expectancy are defined in the Basic Plan
Document.
(33) This can only be selected if Installments to Participants are allowed.
If the Participant died on or after the April 1 following the
calendar year in which the Participant attained age seventy and
one-half (70-1/2) years, the only installment payments that will be
allowed to such a Beneficiary are a continuation of installment
payments scheduled (or commenced) prior to the death of the
Participant. No other form of installment payments shall be allowed
to such a Beneficiary. Substantially equal and life expectancy are
defined in the Basic Plan Document.
-17-
<PAGE>
5 years of substantially equal annual installments
----- commencing within one year of the Participant's death.
Substantially equal annual installments based on the
----- Beneficiary's life expectancy commencing within one
year of the Participant's death.
Substantially equal annual installments payable to the
----- Participant's spouse (if such spouse is a Beneficiary)
based on the spouse's life expectancy commencing not
later than when the Participant would have attained
age 70-1/2 years.
[Section 7.3]
E. HARDSHIP DISTRIBUTIONS. Hardship distributions during employment are
available to Participants for the following purposes (one or more may be
checked):(34)
X medical expenses described in section 213(d) of the Internal
----- Revenue Code incurred by the Participant, the Participant's
spouse or any dependents of the Participant (as defined in
section 152 of the Internal Revenue Code).(35)
X the purchase (excluding mortgage payments) of a principal
----- residence of the Participant.(35)
X payment of tuition and related educational fees for the next
----- 12 months of post-secondary education for the Participant,
his or her spouse, children or dependents.(35)
X the need to prevent the eviction of the Participant from his
----- principal residence or foreclosure on the mortgage of the
Participant's principal residence.(35)
[Section 7.9]
- ---------------
(34) More than one may be checked. A Participant must submit a written
application specifying the amount of the hardship distribution. The
application shall require a Participant to establish his or her
entitlement to the distribution. The distribution shall be made as
soon as administratively feasible after the Valuation Date coincident
with or next following the approval of a completed application.
(35) The following conditions must be satisfied to receive a hardship
distribution from the Retirement Savings Account during employment:
(i) the distribution shall not exceed the amount of the
Participant's immediate and heavy financial need;
(ii) the Participant has obtained all distributions, other than
hardship distributions, and all nontaxable loans currently
available under all plans maintained by the Employer;
(iii) the Plan, and all other plans maintained by the Employer,
provide that the Participant's elective contributions and
employee contributions (as defined in regulations issued by
the Secretary of the Treasury) will be suspended until the
first Entry Date 12 months after receipt of the hardship
distribution; and
(iv) the Plan, and all other plans maintained by the Employer,
provide that the Participant may not make elective
contributions (as defined in regulations issued by the
Secretary of the Treasury) for the Participant's taxable
year immediately following the taxable year of the
hardship distribution in excess of the applicable limit
under section 402(g) of the Internal Revenue Code for such
next taxable year less the amount of such Participant's
elective contributions for the taxable year of the
hardship distribution.
These conditions do not apply unless part of the distribution comes from
a Retirement Savings Account.
-18-
<PAGE>
F. SOURCE OF HARDSHIP DISTRIBUTIONS. Hardship distributions during employment
WILL NOT be allowed from the following Accounts (one or more may be
checked):
Retirement Savings Account
-----
Employer Contributions Account
-----
Employer Matching Account
-----
Nondeductible Voluntary Account
-----
Rollover Account
-----
Transfer Account
-----
Deductible Voluntary Account
-----
[Section 7.9]
G. SOURCE OF HARDSHIP DISTRIBUTIONS. May the Participant request a partial
advance of up to fifty percent (50%) of the amount approved as a hardship
distribution?(36)
Yes
-----
X No
-----
[Section 7.9]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE XI. INVESTMENT OPTIONS
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A. LIFE INSURANCE. Will Participants be permitted to direct the investment of
a part of their Accounts into life insurance contracts?
Yes
-----
X No
-----
[Section 4.1, Section 10.11]
B. COMMINGLED INVESTMENT SUBFUNDS. Can commingled investment Subfunds be
created so that Participants can control the investment of their Accounts?
X Yes(37)
-----
No
-----
[Section 4.1.1]
- ---------------
(36) If advances are not allowed, the entire hardship distribution shall be
made as soon as administratively feasible after the Valuation Date
coincident with or next following the approval of a completed
application.
(37) If commingled investment Subfunds or individual investment Subfunds
are created, the Employer must agree with the Trustee, in writing, on
the operational rules for the Subfunds.
-19-
<PAGE>
C. INDIVIDUALLY DIRECTED ACCOUNTS. Will individual investment Subfunds be
created so that all Participants can control the investment of their
Accounts?
Yes(37)
-----
X No
-----
[Section 4.1.2]
D. EMPLOYER DIRECTION. Will the Employer have the authority to direct the
Trustee in the investment of the Fund?
X Yes
-----
No
-----
If yes, enter name and title of the person(s) who is (or are) authorized to
communicate such directions to the Trustee in writing: Matthew Wagner,
President and Arnold Hahn, Executive Vice President and Chief Financial
Officer.
[Section 10.12]
E. EMPLOYER SECURITIES OR REAL ESTATE. Will the Trustee be subject to the
directions of the above-named person(s) to purchase qualifying employer
securities or qualifying employer real estate?
X Yes
-----
No
-----
If yes, the maximum percentage of the Fund which may be invested in
qualifying employer securities and qualifying employer real estate is:
100 percent
-----
[Section 10.12, Section 10.6(a)]
F. ERISA SECTION 404(c). Does the Plan intend to comply with ERISA
Section 404(c)?
X Yes
-----
No
-----
[Section 4.1.5]
G. MUTUAL FUNDS. By execution of this Adoption Agreement, the Employer
authorizes the Trustee to invest the Plan's assets in mutual funds
affiliated with the Trustee (First American Funds, Inc. and First American
Investment Funds, Inc.) and approves the investment advisory and other fees
to be paid by such mutual funds in relation to the fees paid by the Plan,
as set forth in the prospectuses and written disclosure described in
Section 10.6(a) and Section 10.12 of the Basic Plan Document.
-20-
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE XII. LOANS
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A. Will loans from the Plan be available to Participants and Beneficiaries
(other than Owner-Employees and Shareholder-Employees)?
X Yes
-----
No
-----
[Section 7.11]
B. Will each loan be made from the individual Accounts of the recipient (as
opposed to the general trust assets)?
X Yes
-----
No
-----
[Section 7.11]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE XIII. INTERNAL REVENUE CODE SECTION 415 LIMITATIONS(38)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A. Does any controlled group member now maintain or has any controlled group
member ever maintained another qualified plan in which any Participant in
this Plan is (or was) a participant or could possibly become a participant
or does the Employer maintain a welfare benefit fund or an individual
medical account (as defined in Appendix A) under which amounts are treated
as annual additions with respect to any Participant in this Plan?
No [complete only E below]
-----
X Yes [complete the rest of this Article XIII]
-----
[Appendix A]
B. Such other qualified plan was or is a [select one or more as appropriate]:
X Master or prototype defined contribution plan(39)
----- [complete E below]
Master or prototype defined benefit plan [complete D and E
----- below]
X Individually designed defined contribution plan(39)
----- [complete C and E below]
Individually designed defined benefit plan [complete D and E
----- below]
Welfare benefit fund [complete C and E below]
-----
- ---------------
(38) See footnote 21.
(39) For purposes of Appendix A, nondeductible employee contributions to a
qualified defined benefit plan are treated as a separate defined
contribution plan.
-21-
<PAGE>
Individual medical account [complete C and E below]
-----
C. To the extent that any Participant in this Plan is, may become or ever has
been a participant in another qualified defined contribution plan, welfare
benefit fund or individual medical account maintained by any controlled
group member, other than a master or prototype qualified defined
contribution plan:
X The provisions of Section 3 of Appendix A will apply, as if
----- the other plan was a master or prototype plan.
The method under which the plans will limit total annual
----- additions to the maximum permissible amount, and will
properly reduce any excess amounts, in a manner that
precludes Employer discretion is set forth in an
attachment to this Adoption Agreement.
D. To the extent that any Participant is, may become or ever has been a
participant in another qualified defined benefit plan maintained by any
controlled group member:
In any limitation year, the annual additions credited to the
----- Participant under this Plan may not cause the sum of the
defined benefit plan fraction and the defined contribution
plan fraction to exceed 1.0. If the Employer
contributions that would otherwise be allocated to the
Participant's Account under the Plan during such year
would cause the 1.0 limitation to be exceeded, the
allocation will be reduced so that the sum of the
fractions equals 1.0. Any contributions not allocated
because of the preceding sentence will be allocated to the
remaining Participants in this plan under the allocation
formula under this Plan. If the 1.0 limitation is
exceeded because of an excess amount, such excess amount
will be reduced in accordance with Section 2.4 of
Appendix A.
The method under which the plans involved will satisfy the
----- 1.0 limitation in a manner that precludes Employer
discretion is set forth in an attachment to this Adoption
Agreement.
E. The limitation year is the following 12-consecutive month period:
X the Plan Year
-----
the calendar year
-----
other (specify): ______________________________.
-----
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE XIV. INTERNAL REVENUE CODE SECTION 416 LIMITATIONS
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
A. To avoid duplication of minimum benefits under section 416 of the Internal
Revenue Code because of the required aggregation of multiple plans, 401(k)
Prototype Basic Plan Document #02 is amended as follows:(40)
- ---------------
(40) If the Employer only sponsors this Plan, it is unnecessary to complete
this section. Also, if the Employer maintains other plans, it may be
unnecessary to complete this section.
-22-
<PAGE>
[Section 9.1.1 and Appendix B]
B. For purposes of establishing the present value to compute the top heavy
ratio, any benefit under a defined benefit plan shall be discounted only for
mortality and interest based on the following:(40)
Interest rate (select only one): PBGC Interest Assumption
-------- as if Plan terminated on
valuation date.
Other ________________.
--------
Mortality table (select only one): PBGC Mortality Assumption
-------- as if Plan terminated on
valuation date.
-------- Other ________________.
[Appendix B]
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE XV. HOURS OF SERVICE
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
For the purpose of determining the Employee's One-Year Breaks in Service,
Vesting Service, Eligibility Service and minimum annual service requirement to
share in the Employer contribution made for a Plan Year, Hours of Service shall
be determined on the following basis:
X On the basis of actual recorded hours for which an Employee
----- is paid or entitled to payment.
On the basis that, without regard to his actual recorded
----- hours, an Employee shall be credited with 10 Hours of
Service for a day if under Section 1.1.15 such Employee
would be credited with at least 1 Hour of Service during
that day.
On the basis that, without regard to his actual recorded
----- hours, an Employee shall be credited with 45 Hours of
Service for a calendar week if under Section 1.1.15 such
Employee would be credited with at least 1 Hour of Service
during that calendar week.
On the basis that, without regard to his actual recorded
----- hours, an Employee shall be credited with 95 Hours of
Service for a semi-monthly pay period if under Section
1.1.15 such Employee would be credited with at least 1 Hour
of Service during that semi-monthly pay period.
On the basis that, without regard to his actual recorded
----- hours, an Employee shall be credited with 190 Hours of
Service for a calendar month if under Section 1.1.15 such
Employee would be credited with at least 1 Hour of Service
during that calendar month.
[Section 1.1.15]
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<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
ARTICLE XVI. COLLECTIVE INVESTMENTS
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
The Trustee's collective investment fund or funds incorporated by reference into
this Plan Statement are:
The Plans and Declaration of Trust - First Trust National Association
Collective and Pooled Investment Funds for Employee Retirement Benefit
Trusts, as amended from time to time.
[Section 10.6(q)]
IN WITNESS WHEREOF, I have hereunto subscribed my name this 7th day of
January, 1995.
FOR THE EMPLOYER
/s/ [ILLEGIBLE]
------------------------------------
(Signature and official capacity)
The Employer may NOT rely on an opinion letter issued by the National Office of
the Internal Revenue Service as evidence that the Employer's Plan is qualified
under section 401 of the Internal Revenue Code. In order to obtain reliance
with respect to plan qualification, the Employer must apply to the appropriate
key district director of the IRS for a determination letter. This Adoption
Agreement may be used only in conjunction with 401(k) Prototype Basic Plan
Document #02 1989 Restatement.
ACCEPTED this _____ day of ______________, 19___.
FOR THE PROTOTYPE SPONSOR FOR THE TRUSTEE
By By
----------------------------- -----------------------------
Its Its
-------------------------- --------------------------
And
----------------------------
Its
-------------------------
First Trust National Association
First Trust Center
P.O. Box 64367
St. Paul, Minnesota 55164
Prototype Sponsor
(612) 223-7559
-24-
<PAGE>
WORKING COPY
SECTION 401(k) PROTOTYPE
BASIC PLAN DOCUMENT #02
1989 RESTATEMENT
AND
As Amended By
The FIRST AMENDMENT Effective January 1, 1993
The SECOND AMENDMENT Effective January 1, 1993 and January 1, 1994
The THIRD AMENDMENT Effective January 1, 1994 and January 1, 1995
The FOURTH AMENDMENT Generally Effective December 12, 1994
NOTE: Material added or modified by the First, Second, Third and Fourth
Amendments is shown in ITALICS. Modified section numbers are not
generally shown in ITALICS. Material deleted without replacement
is indicated by a [caret] .
<PAGE>
SECTION 401(k) PROTOTYPE
BASIC PLAN DOCUMENT #02
1989 RESTATEMENT
TABLE OF CONTENTS
PAGE
SECTION 1. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1. Definitions.
1.1.1. Accounts
(a) Total Account
(b) Retirement Savings Account
(c) Employer Matching Account
(d) Employer Contributions Account
(e) Rollover Account
(f) Nondeductible Voluntary Account
(g) Deductible Voluntary Account
(h) Transfer Account
(i) Suspense Account
1.1.2. Administrator's Representative
1.1.3. Affiliate
1.1.4. Annual Valuation Date
1.1.5. Beneficiary
1.1.6. Board of Directors
1.1.7. Disability
1.1.8. Effective Date
1.1.9. Eligibility Service
1.1.10. Employee
1.1.11. Employers
1.1.12. Entry Date
1.1.13. Event of Maturity
1.1.14. Fund
1.1.15. Hours of Service
1.1.16. Investment Manager
1.1.17. Normal Retirement Age
1.1.18. One-Year Break in Service
1.1.19. Participant
1.1.20. Plan
1.1.21. Plan Statement
1.1.22. Plan Year
1.1.23. Prior Plan Statement
1.1.24. Prototype Documents
1.1.25. Prototype Sponsor
1.1.26. Recognized Compensation
1.1.27. Recognized Employment
1.1.28. Retirement Savings Agreement
1.1.29. Trustee
1.1.30. Valuation Date
1.1.31. Vested
1.1.32. Vesting Service
1.2. Rules Of Interpretation
1.3. Establishment Of New Plan
1.4. Amendment And Change Of Trustee
1.5. Amendment And Continuation
-i-
<PAGE>
1.6. Automatic Exclusion From Prototype Plan
1.7. Special Requirements
1.7.1. Discriminatory Benefits
1.7.2. Discriminatory Coverage
1.7.3. Control Defined
SECTION 2. ELIGIBILITY AND PARTICIPATION . . . . . . . . . . . . . . . . 14
2.1. Initial Entry Into Plan
2.2. Special Rule For Former Participants
2.3. Enrollment
2.4. Waiver Of Enrollment Procedures
2.5. Retirement Savings Agreement
2.6. Modifications Of Retirement Savings Agreement
2.6.1. Increase
2.6.2. Decrease
2.6.3. Voluntary Termination
2.6.4. Termination Of Recognized Employment
2.6.5. Form Of Agreement
2.7. Section 401(k) Compliance
2.7.1. Special Definitions
2.7.2. Special Rules
2.7.3. The Tests
2.7.4. Remedial Action
2.8. Annual Certification
SECTION 3. CONTRIBUTIONS AND ALLOCATION THEREOF . . . . . . . . . . . . 20
3.1. Employer Contributions - General
3.1.1. Source Of Employer Contributions
3.1.2. Limitation
3.1.3. Form of Payment
3.2. Retirement Savings Contributions
3.2.1. Amount
3.2.2. Allocation
3.3. Required Matching Contributions
3.3.1. Amount
3.3.2. Allocation
3.4. Discretionary Employer Contributions
3.4.1. General
3.4.2. Curative Allocation - Section 401(k)
3.4.3. Discretionary Matching Contributions
3.4.4. Curative Allocation - Section 401(m)
3.4.5. Discretionary Profit Sharing Contributions
3.5. Eligible Participants
3.6. Make-Up Contributions For Omitted Participants
3.7. Rollover Contributions
3.7.1. Eligible Contributions.
3.7.2. Specific Review
3.7.3. Allocation
3.8. Nondeductible Voluntary Contributions
3.8.1. Method Of Contribution
3.8.2. Payment To Trustee
3.8.3. Allocation
3.9. Deductible Voluntary Contributions
3.10. Section 401(m) Compliance
3.10.1. Special Definitions
3.10.2. Special Rules
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<PAGE>
3.10.3. The Tests
3.10.4. Remedial Action
3.11. Limitation On Allocations
3.12. Effect Of Disallowance Of Deduction Or Mistake Of Fact
SECTION 4. INVESTMENT AND ADJUSTMENT OF ACCOUNTS . . . . . . . . . . . . 32
4.1. Establishment Of Subfunds
4.1.1. Establishing Commingled Subfunds
4.1.2. Individual Subfunds
4.1.3. Operational Rules
4.1.4. Revising Subfunds
4.1.5. ERISA Section 404(c) Compliance
4.2. Valuation And Adjustment Of Accounts
SECTION 5. VESTING . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
5.1. Employer Matching Account And Employer Contributions
Account
5.1.1. Progressive Vesting
5.1.2. Full Vesting
5.1.3. Special Rule For Partial Distributions
5.1.4. Effect Of Break On Vesting
5.2. Optional Vesting Schedule
5.2.1. Election
5.2.2. Qualifying Participant
5.2.3. Procedure For Election
5.2.4. Conclusive Election
5.3. Other Accounts
SECTION 6. MATURITY . . . . . . . . . . . . . . . . . . . . . . . . . . 39
6.1. Events Of Maturity
6.2. Disposition Of Non-Vested Portion Of Account
6.2.1. No Break
6.2.2. A Break
6.2.3. Forfeiture Date
6.3. Restoration Of Forfeited Accounts
SECTION 7. DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . 42
7.l. Application For Distribution
7.1.1. Application Required
7.1.2. Exception For Small Amounts
7.1.3. Exception for Required Distributions
7.1.4. Direct Rollover
7.1.5. Notices
7.1.6. Lost Distributees
7.2. Time of Distribution
7.2.1. Earliest Beginning Date
7.2.2. Required Beginning Date
7.3. Forms Of Distribution
7.3.1. Forms Available
7.3.2. Substantially Equal
7.3.3. Life Expectancy
7.3.4. Presumptive Forms
7.3.5. Effect Of Reemployment
7.3.6. TEFRA Section 242(b) Transitional Rules
-iii-
<PAGE>
7.4. Designation Of Beneficiaries
7.4.1. Right To Designate
7.4.2. Spousal Consent
7.4.3. Failure Of Designation
7.4.4. Definitions
7.4.5. Special Rules
7.5. Death Prior To Full Distribution
7.6. Distribution In Cash
7.7. Deleted by the First Amendment
7.8. Withdrawals From Voluntary Accounts
7.8.1. When Available
7.8.2. Sequence of Accounts
7.8.3. Limitations
7.8.4. Coordination With Section 4.1
7.9. In-Service Distributions
7.9.1. When Available
7.9.2. Purposes.
7.9.3. Limitations.
7.9.4. Coordination With Retirement Savings Agreement
7.9.5. Sequence Of Accounts
7.9.6. Coordination With Section 4.1
7.10. Transitional Rules
7.11. Loans
7.11.1. General Rules
7.11.2. Interest Rate
7.11.3. Loans Made From Participant's Accounts
7.11.4. Loan Rules
7.12. Corrective Distributions
7.12.1. Excess Deferrals ($7,000 Limit)
7.12.2. Excess Contributions (Section 401(k) Test)
7.12.3. Excess Aggregate Contributions (Section 401(m)
Test)
7.12.4. Priority
7.12.5. Matching Contributions
SECTION 8. SPENDTHRIFT PROVISIONS . . . . . . . . . . . . . . . . . . . 64
SECTION 9. AMENDMENT AND TERMINATION . . . . . . . . . . . . . . . . . . 65
9.1. Amendment
9.1.1. Amendment By Employer
9.1.2. Amendment By Prototype Sponsor
9.1.3. Limitation On Amendments
9.1.4. Resignation Of Prototype Sponsor
9.2. Discontinuance Of Contributions And Termination Of Plan
9.3. Merger, Etc., With Another Plan
9.4. Adoption By Affiliates
9.4.1. Adoption With Consent
9.4.2. Procedure For Adoption
9.4.3. Effect Of Adoption
SECTION 10. CONCERNING THE TRUSTEE . . . . . . . . . . . . . . . . . . . 68
10.1. Dealings With Trustee
10.1.1. No Duty To Inquire
10.1.2. Assumed Authority
10.2. Compensation Of Trustee
-iv-
<PAGE>
10.3. Resignation And Removal Of Trustee
10.3.1. Resignation, Removal And Appointment
10.3.2. Surviving Trustees
10.3.3. Successor Organizations
10.3.4. Co-Trustee Responsibility
10.4. Accountings By Trustee
10.4.1. Periodic Reports
10.4.2. Special Reports
10.4.3. Review Of Reports
10.5. Trustee's Power To Protect Itself On Account Of Taxes
10.6. Other Trust Powers
10.7. Investment Managers
10.7.1. Appointment And Qualifications
10.7.2. Removal
10.7.3. Relation To Other Fiduciaries
10.8. Fiduciary Principles
10.9. Prohibited Transactions
10.10.Indemnity
10.11.Investment In Insurance
10.11.1. Limitation On Payment Of Premiums
10.11.2. Miscellaneous Rules For Purchase Of Contract
10.11.3. Payment Of Expenses
10.11.4. Authority For Contract
10.11.5. Payment Of Contract Upon Death
10.11.6. Payment Of Contract -- Not Upon Death
10.11.7. Value Of Contract
10.11.8. Interpretation
10.12.Employer Directed Investments
SECTION 11. DETERMINATIONS -- RULES AND REGULATIONS . . . . . . . . . . . 78
11.1. Determinations
11.2. Rules And Regulations
11.3. Method Of Executing Instruments
11.3.1. Employer Or Administrator's Representative
11.3.2. Trustee
11.4. Claims Procedure
11.4.1. Original Claim
11.4.2. Claims Review Procedure
11.4.3. General Rules
11.5. Information Furnished By Participants
SECTION 12. OTHER ADMINISTRATIVE MATTERS . . . . . . . . . . . . . . . . 80
12.1. Employer
12.1.1. Officers
12.1.2. Delegation
12.1.3. Board Of Directors
12.2. Administrator's Representative
12.3. Limitation On Authority
12.4. Conflict Of Interest
12.5. Dual Capacity
12.6. Administrator
12.7. Named Fiduciaries
12.8. Service Of Process
12.9. Residual Authority
12.10.Administrative Expenses
-v-
<PAGE>
SECTION 13. IN GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . 83
13.1. Disclaimers
13.1.1. Effect On Employment
13.1.2. Sole Source Of Benefits
13.1.3. Co-Fiduciary Matters
13.2. Reversion Of Fund Prohibited
13.3. Execution In Counterparts
13.4. Continuity
13.5. Contingent Top Heavy Plan Rules
APPENDIX A -- SECTION 415 LIMITATIONS ON ALLOCATIONS . . . . . . . . . . . . A-1
APPENDIX B -- CONTINGENT TOP HEAVY PLAN RULES . . . . . . . . . . . . . . . B-1
APPENDIX C -- QUALIFIED DOMESTIC RELATIONS ORDERS . . . . . . . . . . . . . C-1
APPENDIX D -- HIGHLY COMPENSATED EMPLOYEE . . . . . . . . . . . . . . . . . D-1
APPENDIX E -- TEFRA SECTION 242(B) TRANSITIONAL RULES . . . . . . . . . . . E-1
APPENDIX F -- TRANSITIONAL DISTRIBUTION RULES . . . . . . . . . . . . . . . F-1
APPENDIX G -- PLAN LOAN RULES . . . . . . . . . . . . . . . . . . . . . . . G-1
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<PAGE>
SECTION 401(k) PROTOTYPE
BASIC PLAN DOCUMENT #02
1989 RESTATEMENT
SECTION 1
INTRODUCTION
1.1. DEFINITIONS. When the following terms are used herein with initial capital
letters, they shall have the following meanings:
1.1.1. ACCOUNTS -- the following Accounts will be maintained under this
Plan for Participants:
(a) TOTAL ACCOUNT -- a Participant's entire interest in the Fund,
including his Retirement Savings Account, his Employer Matching
Account, his Employer Contributions Account, his Rollover Account, his
Nondeductible Voluntary Account, his Deductible Voluntary Account, and
his Transfer Account, if any, (but excluding his interest in a
Suspense Account).
(b) RETIREMENT SAVINGS ACCOUNT -- the Account maintained for each
Participant to which are credited the Employer contributions made in
consideration of such Participant's earnings reductions pursuant to
Section 3.2 (or comparable provisions of the Prior Plan Statement, if
any) or made pursuant to Section 3.4.2, together with any increase or
decrease thereon.
(c) EMPLOYER MATCHING ACCOUNT -- the Account maintained for each
Participant to which is credited his allocable share of the Employer
contributions and his allocable share of forfeited Suspense Accounts
made pursuant to Section 3.3 or Section 3.4.3 (or comparable
provisions of the Prior Plan Statement, if any) or made pursuant to
Section 3.4.4, together with any increase or decrease thereon.
(d) EMPLOYER CONTRIBUTIONS ACCOUNT -- the Account maintained for each
Participant to which is credited his allocable share of the Employer
contributions and his allocable share of forfeited Suspense Accounts
made pursuant to Section 3.4.5 (or comparable provisions of the Prior
Plan Statement, if any), together with any increase or decrease
thereon.
(e) ROLLOVER ACCOUNT -- the Account maintained for each Participant to
which are credited his rollover contributions made pursuant to Section
3.7 (or comparable provisions of the Prior Plan Statement, if any),
together with any increase or decrease thereon.
(f) NONDEDUCTIBLE VOLUNTARY ACCOUNT -- the Account maintained for each
Participant to which are credited his nondeductible voluntary
contributions made pursuant to Section 3.8 (or comparable provisions
of the Prior Plan Statement, if any), together with any increase or
decrease thereon.
(g) DEDUCTIBLE VOLUNTARY ACCOUNT -- the Account maintained for each
Participant to which are credited his deductible voluntary
contributions made pursuant to Section 3.6 of the Prior Plan Statement
(or other comparable provisions of the Prior Plan Statement, if any),
together with any increase or decrease thereon.
<PAGE>
(h) TRANSFER ACCOUNT -- the Account maintained on behalf of a Participant
to which is credited the amount transferred to the Trustee pursuant to
Section 9.3, and not allocated to any other Account pursuant to that
section (or comparable provisions of the Prior Plan Statement, if
any), together with any increase or decrease thereon.
(i) SUSPENSE ACCOUNT -- the Account maintained for each Participant to
which is credited the portion of his Employer Matching Account and his
Employer Contributions Account which is not Vested in him upon the
occurrence of an Event of Maturity (pending reemployment or forfeiture
pursuant to Section 6.2), together with any increase or decrease
thereon.
1.1.2. ADMINISTRATOR'S REPRESENTATIVE -- the person or committee
appointed to make administrative decisions and rules, to communicate on behalf
of the Employer and to take other actions specified in this Plan Statement and
which is selected pursuant to Section 12.2.
1.1.3. AFFILIATE -- a business entity which is under "common control"
with the Employer or which is a member of an "affiliated service group" that
includes the Employer, as those terms are defined in section 414(b), (c) and (m)
of the Internal Revenue Code. A business entity which is a predecessor to the
Employer shall be treated as an Affiliate if the Employer maintains a plan of
such predecessor business entity or if, and to the extent that, such treatment
is otherwise required by regulations prescribed by the Secretary of the Treasury
under section 414(a) of the Internal Revenue Code. A business entity shall also
be treated as an Affiliate if, and to the extent that, such treatment is
required by regulations prescribed by said Secretary under section 414(o) of
said Code. In addition to such required treatment, the Employer may, in its
discretion, designate as an Affiliate any business entity which is not such a
"common control," "affiliated service group" or "predecessor" business entity
but which is otherwise affiliated with the Employer, subject to such
nondiscriminatory limitations as the Employer may impose.
1.1.4. ANNUAL VALUATION DATE -- unless indicated otherwise in the
Adoption Agreement, the last day of the Employer's taxable year for federal
income tax purposes.
- -------------------------------------------------------------------------------
FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
1.1.5. BENEFICIARY -- a person designated by a Participant (or
automatically by operation of this Plan) to receive all or a part of the
Participant's Vested Total Account in the event of the Participant's death prior
to full distribution thereof. A PERSON SO DESIGNATED SHALL NOT BE CONSIDERED A
BENEFICIARY UNTIL THE DEATH OF THE PARTICIPANT.
1.1.6. BOARD OF DIRECTORS -- the Board of Directors if the Employer is a
corporation, any general partner if the Employer is a partnership, or the
proprietor if the Employer is a sole proprietor. If the Employer is a
corporation, the Board of Directors shall also mean and refer to any properly
authorized committee of the directors. If there is more than one Employer under
this Plan, the Board of Directors shall be the Board of Directors of the
Employer which is the PRINCIPAL EMPLOYER of this Plan.
- --------------------------------------------------------------------------------
1.1.7. DISABILITY -- a medically determinable physical or mental
impairment which is of such a nature that it (i) renders the individual
incapable of performing any substantial gainful employment, (ii) can be expected
to be of long-continued and indefinite duration or result in death, and (iii) is
evidenced by a determination to this effect by a doctor of medicine approved by
the Administrator's Representative. The Administrator's Representative shall
determine the date on which the Disability shall have occurred if such
determination is necessary. In lieu of such a certification, the Employer may
accept, as proof of Disability, the official written determination that the
individual will be eligible for disability benefits under
-2-
<PAGE>
the federal Social Security Act as now enacted or hereinafter amended (when
any waiting period expires).
1.1.8. EFFECTIVE DATE -- the date set forth in the Adoption Agreement as
of which this Plan Statement is effective; provided, however, certain provisions
specified in this Plan Statement shall be applicable prior to that date for any
Employer maintaining a Plan prior to the first day of the Plan Year beginning
after December 31, 1988.
1.1.9. ELIGIBILITY SERVICE -- a measure of an Employee's service with
the Employer and all Affiliates (stated as a number of years) which is equal to
the number of computation periods for which the Employee is credited with one
thousand (1,000) or more Hours of Service; subject, however, to such of the
following rules as are applicable under the Adoption Agreement:
(a) COMPUTATION PERIODS. The computation periods for determining the
Employee's Eligibility Service (and One-Year Breaks in Service as
applied to his Eligibility Service) shall be (i) unless (ii) is
indicated in the Adoption Agreement:
(i) the twelve (12) consecutive month period beginning with the date
the Employee first performs an Hour of Service plus all Plan
Years beginning after the date the Employee first performs an
Hour of Service (irrespective of any termination of employment
and subsequent reemployment), or
(ii) the twelve (12) consecutive month period beginning with the date
the Employee first performs an Hour of Service plus all twelve
(12) consecutive month periods commencing on the annual
anniversaries of such date (irrespective of any termination of
employment and subsequent reemployment).
An Employee who is credited with 1,000 Hours of Service in both the
initial eligibility period described in (i) above and the first Plan
Year commencing prior to the end of such initial eligibility period
shall be credited with two years of Eligibility Service.
(b) COMPLETION. A year of Eligibility Service shall be deemed completed
only as of the last day of the computation period (irrespective of the
date in such period that the Employee completed one thousand Hours of
Service). (Fractional years of Eligibility Service shall not be
credited.)
(c) PRE-EFFECTIVE DATE SERVICE. Eligibility Service shall be credited for
Hours of Service earned and computation periods completed before the
Effective Date as if the rules of this Plan Statement were then in
effect.
(d) BREAKS IN SERVICE -- BEFORE EFFECTIVE DATE. Eligibility Service
cancelled before the Effective Date by operation of the Plan's break
in service rules as they existed before the Effective Date shall
continue to be cancelled on and after the Effective Date.
(e) BREAK IN SERVICE. Subject to Section 1.1.9(d), if the Employee has
any break in service occurring before or after the Effective Date, his
service both before and after such break in service shall be taken
into account in computing his Eligibility Service for the purpose of
determining his entitlement to become a Participant in this Plan.
(f) PREDECESSOR EMPLOYER. If the Employer maintains a plan previously
maintained by a business entity that is merged with or becomes an
Affiliate
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of the Employer, then Eligibility Service that would have been
earned by persons employed by such predecessor employer had the
rules of this Plan been in effect, shall be counted as Eligibility
Service under this Plan.
1.1.10. EMPLOYEE -- each individual who is, with respect to the Employer,
or an Affiliate, or both, a Common Law Employee (including Shareholder-Employee)
or a Self-Employed Person (including an Owner-Employee) or a Leased Employee,
which shall be further defined as follows:
(a) COMMON LAW EMPLOYEE -- an individual who performs services as an
employee of the Employer or an Affiliate (including, without limiting
the generality of the foregoing, a Shareholder-Employee) but who is
not a Self-Employed Person with respect to the Employer.
(b) SHAREHOLDER-EMPLOYEE -- an individual who owns, or is deemed with
attribution to own, more than five percent (5%) of the outstanding
stock of the Employer on any one day of the taxable year of the
Employer with respect to which the Plan is established; provided,
however, that during any taxable year that the Employer is not an
electing small business corporation (S corporation) there shall be no
Shareholder-Employees. All Shareholder-Employees are Common Law
Employees.
(c) SELF-EMPLOYED PERSON -- an individual who owns either a capital
interest or a profits interest in the Employer with respect to which
the Plan is maintained at a time when such Employer is either a
partnership or a proprietorship or an individual who has earned income
from such Employer (or would have had earned income if the Employer
had had net profits). A proprietor shall be deemed to be an Employee
of a proprietorship which is the Employer and each partner shall be
deemed to be an Employee of a partnership which is the Employer.
(d) OWNER-EMPLOYEE -- an individual who is a Self-Employed Person and who
is either the proprietor of the Employer (when it is a proprietorship)
or a partner owning more than ten percent (10%) either of the capital
interests or profits interest of the Employer (when it is a
partnership). All Owner-Employees are Self-Employed Persons.
(e) LEASED EMPLOYEES -- an individual (other than an employee) who,
pursuant to an agreement with a leasing organization has performed
services for the Employer, or for the Employer and related persons
(determined in accordance with section 414(n)(6) of the Internal
Revenue Code) on a substantially full-time basis for a period of at
least one (1) year and has performed services which are of a type
historically performed by employees of the Employer or an Affiliate.
For services performed prior to January 1, 1987, such an individual
shall not be considered a Leased Employee (with respect to the
Employer or an Affiliate) if such individual is covered by a money
purchase pension plan which provides for: (i) a nonintegrated
employer contribution rate of at least seven and one-half percent
(7-1/2%) of compensation; and (ii) immediate participation; and
(iii) full and immediate vesting. For services performed after
December 31, 1986, such an individual shall not be considered a Leased
Employee (with respect to the Employer or an Affiliate) if such
individual is covered by a money purchase pension plan which provides
for: (i) a nonintegrated employer contribution rate of at least ten
percent (10%) of "Section 415 compensation" as defined in Appendix A
to this Plan Statement, but including amounts contributed by the
Employer pursuant to a salary reduction agreement which are excludible
from the individual's gross income under section 125, section
402(a)(8), section 402(h) or section 403(b) of the Internal Revenue
Code; and
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(ii) immediate participation (except for those individuals whose
compensation from the leasing organization in each plan year
during the four-year period ending with the plan year is less than one
thousand dollars); and (iii) full and immediate vesting; provided,
however, that such an individual will be considered a Leased Employee
(with respect to the Employer or an Affiliate) if Leased Employees
constitute more than twenty percent (20%) of the recipient's nonhighly
compensated work force as determined in accordance with section
414(n)(5)(C)(ii) of the Internal Revenue Code. An individual shall
also be treated as a Leased Employee of the Employer or an Affiliate
if, and to the extent that, such treatment is required by regulations
prescribed by the Secretary of the Treasury under section 414(o) of
the said Code. Contributions or benefits provided by the leasing
organization to a Leased Employee which are attributable to services
performed for the recipient Employer shall be treated as provided by
the recipient Employer.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
1.1.11. EMPLOYERS -- THE BUSINESS ENTITY WHICH ESTABLISHES A PLAN BY
EXECUTING THE ADOPTION AGREEMENT AND ANY AFFILIATE OF ANY SUCH BUSINESS ENTITY
THAT ADOPTS THIS PLAN WITH THE CONSENT OF THE EMPLOYER AS PROVIDED IN SECTION
9.4. IF ANY SUCH BUSINESS ENTITY ADOPTS THIS PLAN, THE BUSINESS ENTITY THAT
EXECUTED THE ADOPTION AGREEMENT (THE "PRINCIPAL EMPLOYER") RETAINS THE SOLE
AUTHORITY TO AMEND THE ADOPTION AGREEMENT, TERMINATE THE PLAN, ACT AS THE PLAN
ADMINISTRATOR AND TAKE OTHER ACTIONS AS ARE DESCRIBED IN SECTION 9.4. A SOLE
PROPRIETOR SHALL BE TREATED AS HIS OR HER OWN EMPLOYER. A PARTNERSHIP SHALL BE
TREATED AS THE EMPLOYER OF EACH PARTNER.
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1.1.12. ENTRY DATE -- the dates (as indicated in the Adoption Agreement)
which shall be either:
(i) the first day of the Plan Year, or
(ii) the first day of the Plan Year and the first day of the
seventh month of the Plan Year, or
(iii) the first day of the Plan Year and the first day of the
fourth, seventh and tenth months of the Plan Year, or
(iv) the first day of the Plan Year and the first day of the
second through twelfth months of the Plan Year.
The Entry Date shall also include (i) the date upon which an individual who had
previously met the age and service requirements of Section 2.1 but who was not
then in Recognized Employment is transferred to Recognized Employment, (ii) the
date upon which an individual who had previously been a Participant is
reemployed in Recognized Employment, and (iii) such other dates as the
Administrator's Representative may by uniform, nondiscriminatory rules
established from time to time for the commencement of retirement savings under
Section 2.5.
1.1.13. EVENT OF MATURITY -- any of the occurrences described in Section
6 by reason of which a Participant or Beneficiary may become entitled to a
distribution from the Plan.
1.1.14. FUND -- the assets of the Plan held by the Trustee from time to
time, including all contributions and the investments and reinvestments,
earnings, profits and losses thereon, whether invested under the general
investment authority of the Trustee or under the terms applicable to any
investment Subfund established pursuant to Section 4.1.
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1.1.15. HOURS OF SERVICE -- a measure of an Employee's service with the
Employer and all Affiliates, determined for a given computation period and equal
to the number of hours credited to the Employee according to the following
rules:
(a) PAID DUTY. An Hour of Service shall be credited for each hour for
which the Employee is paid, or entitled to payment, for the
performance of duties for the Employer or an Affiliate. These hours
shall be credited to the Employee for the computation period or
periods in which the duties are performed.
(b) PAID NONDUTY. An Hour of Service shall be credited for each hour for
which the Employee is paid, or entitled to payment, by the Employer or
an Affiliate on account of a period of time during which no duties are
performed (irrespective of whether the employment relationship has
terminated) due to vacation, holiday, illness, incapacity (including
disability), layoff, jury duty, military duty or leave of absence;
provided, however, that:
(i) no more than five hundred one (501) Hours of Service shall
be credited on account of a single continuous period during
which the Employee performs no duties (whether or not such
period occurs in a single computation period),
(ii) no Hours of Service shall be credited on account of payments
made under a plan maintained solely for the purpose of
complying with applicable worker's compensation,
unemployment compensation or disability insurance laws,
(iii) no Hours of Service shall be credited on account of payments
which solely reimburse the Employee for medical or medically
related expenses incurred by the Employee, and
(iv) payments shall be deemed made by or due from the Employer
or an Affiliate whether made directly or indirectly from
a trust fund or an insurer to which the Employer or an
Affiliate contributes or pays premiums.
These hours shall be credited to the Employee for the computation
period for which payment is made or, if the payment is not computed by
reference to units of time, the hours shall be credited to the first
computation period in which the event, for which any part of the
payment is made, occurred.
(c) BACK PAY. An Hour of Service shall be credited for each hour for
which back pay, irrespective of mitigation of damages, has been either
awarded or agreed to by the Employer or an Affiliate. The same Hours
of Service credited under paragraph (a) or (b) shall not be credited
under this paragraph (c). The crediting of Hours of Service under
this paragraph (c) for periods and payments described in paragraph (b)
shall be subject to all the limitations of that paragraph. These
hours shall be credited to the Employee for the computation period or
periods to which the award or agreement pertains rather than the
computation period in which the award, agreement or payment is made.
(d) UNPAID ABSENCES.
(i) LEAVES OF ABSENCE. If (and to the extent that) the Employer
so provides in written rules of nondiscriminatory
application which are in writing and approved by the
Employer before the date upon which they are effective, an
assumed eight (8) hour day and forty (40) hour
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week shall be credited during each unpaid leave of absence
authorized by the Employer or an Affiliate for Plan
purposes under such rules; provided, however, that if the
Employee does not return to employment for any reason other
than death, Disability or attainment of Normal Retirement
Age at the expiration of the leave of absence, such Hours
of Service shall not be credited.
(ii) MILITARY LEAVES. If an Employee returns to employment with
the Employer or an Affiliate within the time prescribed by
law for the retention of veteran's reemployment rights, an
assumed eight (8) hour day and forty (40) hour week shall be
credited during service in the Armed Forces of the United
States if the Employee both entered such service and
returned to employment with the Employer or an Affiliate
from such service under circumstances entitling him to
reemployment rights granted veterans under federal law.
(iii) PARENTING LEAVES. To the extent not otherwise credited and
solely for the purpose of determining whether a One-Year
Break in Service has occurred, Hours of Service shall be
credited to an Employee for any period of absence from work
beginning after December 31, 1984, due to pregnancy of the
Employee, the birth of a child of the Employee, the
placement of a child with the Employee in connection with
the adoption of such child by the Employee, or for the
purpose of caring for such child for a period beginning
immediately following such birth or placement. The Employee
shall be credited with the number of Hours of Service which
otherwise would normally have been credited to such Employee
but for such absence. If it is impossible to determine the
number of Hours of Service which would otherwise normally
have been so credited, the Employee shall be credited with
eight (8) Hours of Service for each day of such absence. In
no event, however, shall the number of Hours of Service
credited for any such absence exceed five hundred one (501)
Hours of Service. Such Hours of Service shall be credited
to the computation period in which such absence from work
begins if crediting all or any portion of such Hours is
necessary to prevent the Employee from incurring a One-Year
Break in Service in such computation period. If the
crediting of such Hours of Service is not necessary to
prevent the occurrence of a One-Year Break in Service in
that computation period, such Hours of Service shall be
credited in the immediately following computation period
(even though no part of such absence may have occurred in
such subsequent computation period). These Hours of Service
shall not be credited until the Employee furnishes timely
information which may reasonably be required by the
Administrator's Representative to establish that the absence
from work is for a reason for which these Hours of Service
may be credited.
(e) SPECIAL RULES. To the extent not inconsistent with other provisions
hereof, Department of Labor regulations 29 C.F.R. Section
2530.200b-2(b) and (c) are hereby incorporated by reference herein.
For periods prior to the first day of the Plan Year beginning after
1975, Hours of Service may be determined using whatever records are
reasonably accessible and by making whatever calculations are
necessary to determine the approximate number of Hours of Service
completed during such prior period.
(f) EQUIVALENCY FOR EMPLOYEES. Notwithstanding anything to the contrary
in the foregoing, if the Adoption Agreement shall so provide, Hours of
Service for an Employee shall be credited on the basis that, without
regard to actual hours, such Employee shall be credited with ten (10)
Hours of Service for a
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calendar day, forty-five (45) Hours of Service for a calendar week,
ninety-five (95) Hours of Service for each semi-monthly pay period,
or one hundred ninety (190) Hours of Service for a calendar month
if, under the provisions of this section (other than this paragraph),
such Employee would be credited with at least one (1) Hour of Service
during such day, week, semi-monthly pay period or month.
1.1.16. INVESTMENT MANAGER -- that person other than the Trustee
appointed pursuant to Section 10.7 to manage all or a portion of the Fund.
1.1.17. NORMAL RETIREMENT AGE -- the date a Participant attains the age
specified in the Adoption Agreement or, if none is specified in the Adoption
Agreement, age sixty-five (65) years. If the Employer enforces a mandatory
retirement age, the Normal Retirement Age is the lesser of that mandatory
retirement age or the age specified in the Adoption Agreement. WARNING:
Generally, federal and state law prohibits enforcement of a mandatory retirement
age for Common Law Employees.
1.1.18. ONE-YEAR BREAK IN SERVICE -- a computation period for which an
Employee is not credited with more than five hundred (500) Hours of Service. (A
One-Year Break in Service shall be deemed to occur only on the last day of such
computation period.)
1.1.19. PARTICIPANT -- an Employee who becomes a Participant in this Plan
in accordance with the provisions of Section 2. An Employee who has become a
Participant shall be considered to continue as a Participant in the Plan until
the date of his death or, if earlier, the date when he is no longer employed in
Recognized Employment and upon which the Participant no longer has any Account
under the Plan (that is, he has both received a distribution of all of his
Vested Total Account, if any, and his Suspense Account, if any, has been
forfeited and disposed of as provided in Section 6.2).
1.1.20. PLAN -- the tax-qualified defined contribution profit sharing
plan of the Employer established for the benefit of Employees eligible to
participate therein, as set forth in the Prior Plan Statement and this Plan
Statement. (As used herein, "Plan" refers to the legal entity established by
the Employer and not to the instruments or documents pursuant to which the Plan
is maintained. Those instruments and documents are referred to herein as the
"Prior Plan Statement" and the "Plan Statement.") The Plan shall be referred to
by the name indicated in the Adoption Agreement.
1.1.21. PLAN STATEMENT -- the Prototype Documents as completed and
adopted by the Employer and pursuant to which this Plan is maintained on and
after the Effective Date.
1.1.22. PLAN YEAR -- the twelve (12) consecutive month period ending on
any Annual Valuation Date.
1.1.23. PRIOR PLAN STATEMENT -- the written instrument or instruments or
the series of written instruments under which this Plan was established and
maintained from time to time prior to the Effective Date. (If this Plan was
first established by the Employer's adoption of this Plan Statement, there will
have been no Prior Plan Statement and all references thereto shall be
disregarded.)
1.1.24. PROTOTYPE DOCUMENTS -- the unexecuted form of document entitled
"Section 401(k) Prototype Basic Plan Document #02 1989 Restatement," including
all Appendices thereto, and the unexecuted and uncompleted form of Adoption
Agreement #001 used in connection with it, including the prototype documents
prior to this 1989 Restatement.
1.1.25. PROTOTYPE SPONSOR -- First Trust National Association, a national
trust association of St. Paul, Minnesota (which has submitted the Prototype
Documents to the National Office of the Internal Revenue Service for an opinion
as to the acceptability of the
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form of the Prototype Documents under the Internal Revenue Code and has
retained the right to amend as provided in Section 9).
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
1.1.26. RECOGNIZED COMPENSATION -- AN AMOUNT DETERMINED FOR A PARTICIPANT
FOR A PLAN YEAR WHICH IS THE PARTICIPANT'S "SECTION 415 COMPENSATION" AS DEFINED
IN THE APPENDIX A TO THIS PLAN STATEMENT, SUBJECT, HOWEVER, TO THE FOLLOWING:
(a) INCLUDED ITEMS. IN DETERMINING A PARTICIPANT'S RECOGNIZED
COMPENSATION THERE SHALL BE INCLUDED ELECTIVE CONTRIBUTIONS MADE BY
THE EMPLOYER ON BEHALF OF THE PARTICIPANT THAT ARE NOT INCLUDIBLE IN
GROSS INCOME UNDER SECTIONS 125, 402(a)(8), 402(h), 403(b), 414(h)(2)
AND 457 OF THE INTERNAL REVENUE CODE INCLUDING ELECTIVE CONTRIBUTIONS
AUTHORIZED BY THE PARTICIPANT UNDER A RETIREMENT SAVINGS AGREEMENT, A
CAFETERIA PLAN OR ANY OTHER QUALIFIED CASH OR DEFERRED ARRANGEMENT
UNDER SECTION 401(k) OF THE INTERNAL REVENUE CODE.
(b) EXCLUDED ITEMS. FOR PURPOSES OF ALLOCATING THE EMPLOYER'S
DISCRETIONARY PROFIT SHARING CONTRIBUTION, IF ANY, UNDER SECTION
3.4.5. AND FORFEITED SUSPENSE ACCOUNTS, IF ANY, RECOGNIZED
COMPENSATION SHALL NOT INCLUDE REMUNERATION EXCLUDED BY THE EMPLOYER
IN THE ADOPTION AGREEMENT.
(c) PRE-PARTICIPATION EMPLOYMENT. REMUNERATION PAID BY THE EMPLOYER
ATTRIBUTABLE TO PERIODS PRIOR TO THE DATE THE PARTICIPANT BECAME A
PARTICIPANT IN THE PLAN SHALL NOT BE TAKEN INTO ACCOUNT IN DETERMINING
THE PARTICIPANT'S RECOGNIZED COMPENSATION.
(d) NON-RECOGNIZED EMPLOYMENT. REMUNERATION PAID BY THE EMPLOYER FOR
EMPLOYMENT THAT IS NOT RECOGNIZED EMPLOYMENT SHALL NOT BE TAKEN INTO
ACCOUNT IN DETERMINING A PARTICIPANT'S RECOGNIZED COMPENSATION.
(e) ATTRIBUTION TO PERIODS. A PARTICIPANT'S RECOGNIZED COMPENSATION SHALL
BE CONSIDERED ATTRIBUTABLE TO THE PERIOD IN WHICH IT IS ACTUALLY PAID
AND NOT WHEN EARNED OR ACCRUED.
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SECOND AMENDMENT-EFFECTIVE JANUARY 1, 1994
(f) ANNUAL MAXIMUM. A PARTICIPANT'S RECOGNIZED COMPENSATION FOR A PLAN
YEAR SHALL NOT EXCEED THE ANNUAL COMPENSATION LIMIT UNDER SECTION
401(a)(17) OF THE INTERNAL REVENUE CODE. IN DETERMINING A
PARTICIPANT'S RECOGNIZED COMPENSATION, THE RULES OF SECTION 414(q)(6)
OF THE INTERNAL REVENUE CODE APPLY, EXCEPT THAT IN APPLYING SUCH
RULES, THE TERM "FAMILY" SHALL INCLUDE ONLY THE SPOUSE OF THE
PARTICIPANT AND LINEAL DESCENDANTS OF THE PARTICIPANT WHO HAVE NOT
ATTAINED AGE NINETEEN (19) YEARS BEFORE THE CLOSE OF THE PLAN YEAR;
PROVIDED, HOWEVER, THAT THE RULE IN THIS SENTENCE SHALL NOT APPLY TO
THE SEVEN THOUSAND DOLLAR ($7,000) LIMIT SPECIFIED IN SECTION 2.5. IF
PARTICIPANTS ARE AGGREGATED AS SUCH FAMILY MEMBERS (AND DO NOT
OTHERWISE AGREE IN WRITING), THE RECOGNIZED COMPENSATION OF EACH
FAMILY MEMBER SHALL EQUAL THE ANNUAL COMPENSATION LIMIT UNDER SECTION
401(a)(17) OF THE INTERNAL REVENUE CODE MULTIPLIED BY A FRACTION, THE
NUMERATOR OF WHICH IS SUCH FAMILY MEMBER'S RECOGNIZED COMPENSATION
(BEFORE APPLICATION OF SUCH ANNUAL COMPENSATION LIMIT) AND THE
DENOMINATOR OF WHICH IS THE TOTAL RECOGNIZED COMPENSATION (BEFORE
APPLICATION OF SUCH ANNUAL COMPENSATION LIMIT) OF ALL SUCH FAMILY
MEMBERS. FOR PURPOSES OF THE FOREGOING, THE ANNUAL COMPENSATION LIMIT
UNDER SECTION 401(a)(17) OF THE INTERNAL REVENUE CODE
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SHALL BE TWO HUNDRED THOUSAND DOLLARS ($200,000) (AS ADJUSTED UNDER
THE INTERNAL REVENUE CODE FOR COST OF LIVING INCREASES) FOR PLAN
YEARS BEGINNING BEFORE JANUARY 1, 1994, AND SHALL BE ONE HUNDRED
AND FIFTY THOUSAND DOLLARS ($150,000) (AS SO ADJUSTED) FOR PLAN
YEARS BEGINNING ON OR AFTER JANUARY 1, 1994.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
1.1.27. RECOGNIZED EMPLOYMENT -- ALL EMPLOYMENT WITH THE EMPLOYER
EXCLUDING, HOWEVER, EMPLOYMENT CLASSIFIED BY THE EMPLOYER AS:
(a) EMPLOYMENT IN A UNIT OF EMPLOYEES WHOSE TERMS AND CONDITIONS OF
EMPLOYMENT ARE SUBJECT TO A COLLECTIVE BARGAINING AGREEMENT BETWEEN
THE EMPLOYER AND EMPLOYEE REPRESENTATIVES (FOR THIS PURPOSED, THE TERM
"EMPLOYEE REPRESENTATIVES" DOES NOT INCLUDE ANY ORGANIZATION WHERE
MORE THAN HALF OF ITS MEMBERS ARE EMPLOYEES WHO ARE OWNERS, OFFICERS
OR EXECUTIVES OF THE EMPLOYER). IF RETIREMENT BENEFITS WERE THE
SUBJECT OF GOOD FAITH BARGAINING AND IF TWO PERCENT OR LESS OF THE
EMPLOYEES WHO ARE COVERED PURSUANT TO SUCH COLLECTIVE BARGAINING
AGREEMENT ARE PROFESSIONALS AS DEFINED IN TREAS. REG. SECTION
1.410(B)-9 UNLESS (AND TO THE EXTENT) SUCH COLLECTIVE BARGAINING
AGREEMENT PROVIDES FOR THE INCLUSION OF THOSE EMPLOYEES IN THE PLAN,
(b) EMPLOYMENT OF A NONRESIDENT ALIEN (WITHIN THE MEANING OF SECTION
7701(b)(1)(B) OF THE INTERNAL REVENUE CODE) WHO IS NOT RECEIVING ANY
EARNED INCOME (WITHIN THE MEANING OF SECTION 911(d)(2) OF THE INTERNAL
REVENUE CODE) FROM THE EMPLOYER WHICH CONSTITUTES INCOME FROM SOURCES
WITHIN THE UNITED STATES (WITHIN THE MEANING OF SECTION 861(a)(3) OF
THE INTERNAL REVENUE CODE) UNLESS AND UNTIL THE ADMINISTRATOR'S
REPRESENTATIVE SHALL DECLARE SUCH EMPLOYMENT TO BE RECOGNIZED
EMPLOYMENT,
(c) EMPLOYMENT IN A DIVISION OR FACILITY OF THE EMPLOYER WHICH IS NOT IN
EXISTENCE ON THE EFFECTIVE DATE (THAT IS, WAS ACQUIRED, ESTABLISHED,
FOUNDED OR PRODUCED BY THE LIQUIDATION OR SIMILAR DISCONTINUATION OF A
SEPARATE SUBSIDIARY AFTER THE EFFECTIVE DATE) UNLESS AND UNTIL THE
ADMINISTRATOR'S REPRESENTATIVE SHALL DECLARE SUCH EMPLOYMENT TO BE
RECOGNIZED EMPLOYMENT,
(d) EMPLOYMENT OF A UNITED STATES CITIZEN OR A UNITED STATES RESIDENT
ALIEN OUTSIDE THE UNITED STATES UNLESS AND UNTIL THE ADMINISTRATOR'S
REPRESENTATIVE SHALL DECLARE SUCH EMPLOYMENT TO BE RECOGNIZED
EMPLOYMENT,
(e) SERVICES OF A PERSON WHO IS NOT A COMMON LAW EMPLOYEE OF THE EMPLOYER
INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, SERVICES
OF A LEASED EMPLOYEE, LEASED OWNER, LEASED MANAGER, SHARED EMPLOYEE,
SHARED LEASED EMPLOYEE OR OTHER SIMILAR CLASSIFICATION UNLESS AND
UNTIL THE ADMINISTRATOR'S REPRESENTATIVE SHALL DECLARE SUCH EMPLOYMENT
TO BE RECOGNIZED EMPLOYMENT,
(f) EMPLOYMENT OF A HIGHLY COMPENSATED EMPLOYEE (AS DEFINED IN APPENDIX D
TO THE PLAN STATEMENT) TO THE EXTENT AGREED TO IN WRITING BY THE
EMPLOYEE, AND
(g) EMPLOYMENT DESCRIBED AS EXCLUDED IN THE ADOPTION AGREEMENT.
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1.1.28. RETIREMENT SAVINGS AGREEMENT -- the agreement which may be
entered into by a Participant as provided in Section 2.
1.1.29. TRUSTEE -- the Trustee originally named in the Adoption Agreement
and its successor or successors in trust.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
1.1.30. VALUATION DATE -- THE ANNUAL VALUATION DATE AND EACH OTHER DATE,
IF ANY, SPECIFIED IN THE ADOPTION AGREEMENT. IF SO PERMITTED IN THE ADOPTION
AGREEMENT, VALUATION DATE FOR ACCOUNTING PURPOSES MAY BE DIFFERENT THAN
VALUATION DATE FOR DISTRIBUTION PURPOSES.
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1.1.31. VESTED -- nonforfeitable, i.e., a claim obtained by a Participant
or his Beneficiary to that part of an immediate or deferred benefit hereunder
which arises from the Participant's service, which is unconditional and which is
legally enforceable against the Plan.
1.1.32. VESTING SERVICE -- a measure of an Employee's service with the
Employer and all Affiliates (stated as a number of years) which is equal to the
number of computation periods for which the Employee is credited with one
thousand (1,000) or more Hours of Service; subject, however, to such of the
following rules as are applicable under the Adoption Agreement:
(a) COMPUTATION PERIODS. The computation periods for determining the
Employee's Vesting Service (and One-Year Breaks in Service as applied
to his Vesting Service) shall be Plan Years.
(b) COMPLETION. A year of Vesting Service shall be deemed completed as of
the date in the computation period that the Employee completes one
thousand (1,000) Hours of Service. (Fractional years of Vesting
Service shall not be credited.)
(c) PRE-EFFECTIVE DATE SERVICE. Vesting Service shall be credited for
Hours of Service earned and computation periods completed prior to the
Effective Date as if the rules of this Plan Statement were then in
effect.
(d) BREAKS IN SERVICE -- BEFORE EFFECTIVE DATE. Vesting Service cancelled
before the Effective Date by operation of the Plan's break in service
rules as they existed before the Effective Date shall continue to be
cancelled on and after the Effective Date.
(e) VESTING IN PRE-BREAK ACCOUNTS. If the Employee has five (5) or more
consecutive One-Year Breaks in Service, his service after such
One-Year Breaks in Service shall not be counted as years of Vesting
Service for the purpose of determining the Vested percentage of that
portion of his Employer contributions allocated with respect to his
service before such One-Year Breaks in Service and separately
accounted for under Section 5.1.4.
(f) VESTING IN POST-BREAK ACCOUNTS (VESTING RULE OF PARITY). Except as
provided in the following sentence and subject to Section 1.1.32(d),
if the Employee has any break in service occurring before or after the
Effective Date, his service both before and after such break in
service shall be taken into account in computing his Vesting Service
for the purpose of determining the Vested percentage of that portion
of his Employer Matching Account or Employer Contributions Account
derived from Employer contributions allocated with respect to his
service after such break in service and
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separately accounted for under Section 5.1.4. If the Employee does
not have any Vested right to any portion of an Employer Matching
Account or Employer Contributions Account, however, when he incurs
a One-Year Break in Service, Vesting Service completed before any
One-Year Break in Service shall be disregarded in determining his
Vesting Service (upon a subsequent return to employment) if the
number of his One-Year Breaks in Service equals or exceeds the
greater of five (5) or the aggregate number of his years of
Vesting Service (whether or not consecutive) completed before
such One-Year Breaks in Service. Such aggregate number of his
years of Vesting Service completed before such One-Year Breaks in
Service shall not include any years of Vesting Service which have been
disregarded under the preceding sentence by reason of any prior
One-Year Breaks in Service.
1.2. RULES OF INTERPRETATION. An individual shall be considered to have
attained a given age on his birthday for that age (and not on the day before).
The birthday of any individual born on a February 29 shall be deemed to be
February 28 in any year that is not a leap year. Notwithstanding any other
provision of this Plan Statement or any election or designation made under the
Plan, any individual who feloniously and intentionally kills a Participant or
Beneficiary shall be deemed for all purposes of this Plan and all elections and
designations made under this Plan to have died before such Participant or
Beneficiary. A final judgment of conviction of felonious and intentional
killing is conclusive for the purposes of this section. In the absence of a
conviction of felonious and intentional killing, the Administrator's
Representative shall determine whether the killing was felonious and intentional
for purposes of this section. Whenever appropriate, words used herein in the
singular may be read in the plural, or words used herein in the plural may be
read in the singular; the masculine may include the feminine; and the words
"hereof," "herein" or "hereunder" or other similar compounds of the word "here"
shall mean and refer to the entire Plan Statement and not to any particular
paragraph or section of this Plan Statement unless the context clearly indicates
to the contrary. The titles given to the various sections of this Plan
Statement are inserted for convenience of reference only and are not part of
this Plan Statement, and they shall not be considered in determining the
purpose, meaning or intent of any provision hereof. Any reference in this Plan
Statement to a statute or regulation shall be considered also to mean and refer
to any subsequent amendment or replacement of that statute or regulation. This
instrument has been executed and delivered in the State where the Trustee has
its principal place of business and has been drawn in conformity to the laws of
that State and shall, except to the extent that federal law is controlling, be
construed and enforced in accordance with the laws of that State.
1.3. ESTABLISHMENT OF NEW PLAN. If the Employer's execution of the Adoption
Agreement is an establishment of a new Plan by the Employer, such approval and
adoption is conditioned upon the qualification of the Plan under the pertinent
provisions of the Internal Revenue Code. If this Plan is found not to so
qualify, the Employer may, at its election, amend the Plan Statement, terminate
the Plan in its entirety, or both. If the denial of qualification was in
response to an application for advance determination on the establishment of a
new Plan which was made by the time prescribed by law for filing the Employer's
tax return for the taxable year in which the Plan is adopted (or effective, if
later), the Trustee may be directed by the Employer to return all contributions
made under this Plan to the Participants or to the Employer, as the case may be,
adjusted for their pro rata share of earnings and market gains or losses which
accrued while they were held in the Fund. Such a return of the contribution
shall not be made, however, unless the return is made within one (1) year after
the date the initial qualification of the Plan is denied.
1.4. AMENDMENT AND CHANGE OF TRUSTEE. If the Employer's execution of the
Adoption Agreement is an amendment of a Prior Plan Statement of which the
Trustee was not the trustee, such execution shall not be considered to be a
termination of one plan and the establishment of another but, on the contrary,
shall be considered to be the express continuation of the Plan under new
documents. The Employer has caused, or will forthwith
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<PAGE>
cause, the transfer of the existing trust fund to the Trustee to be held in
trust under this Plan Statement.
1.5. AMENDMENT AND CONTINUATION. If the Employer's execution of the Adoption
Agreement is an amendment of a Prior Plan Statement of which the Trustee was the
trustee, such execution shall not be considered to be a termination of one plan
and the establishment of another but, on the contrary, shall be considered to be
the express continuation of the Plan under new documents.
1.6. AUTOMATIC EXCLUSION FROM PROTOTYPE PLAN. In the event an Employer adopting
these Prototype Documents fails to obtain or fails to retain qualified status
under sections 401(a) and 501(a) of the Internal Revenue Code, such Employer
shall immediately cease participation under these Prototype Documents and, when
applicable, will be deemed to maintain its Plan under an individually designed
successor retirement plan document.
1.7. SPECIAL REQUIREMENTS.
1.7.1. DISCRIMINATORY BENEFITS. If this Plan provides contributions or
benefits for one or more Owner-Employees who control both the business with
respect to which this Plan is established and one or more other trades or
businesses, this Plan and any plan established for such other trades or
businesses must, when looked at as a single plan, satisfy sections 401(a) and
(d) of the Internal Revenue Code for the employees of this and all other trades
or businesses.
1.7.2. DISCRIMINATORY COVERAGE. If this Plan provides contributions or
benefits for one or more Owner-Employees who control one or more other trades or
businesses, the employees of the other trades or businesses must be included in
a plan which satisfies sections 401(a) and (d) of the Internal Revenue Code and
which provides contributions and benefits not less favorable than provided for
Owner-Employees under this Plan. If an individual is covered as an
Owner-Employee under the plans of two (2) or more trades or businesses which
are not controlled and the individual controls a trade or business, the
contributions or benefits for the employees under the plan of the trades or
businesses which are controlled must be as favorable as those provided for
the Owner-Employee under the most favorable plan of the trade or business
which is not controlled.
1.7.3. CONTROL DEFINED. For purposes of this Section 1.7, an
Owner-Employee, or two or more Owner-Employees, will be considered to control
a trade or business if the Owner-Employee, or two or more Owner-Employees
together:
(i) own the entire interest in an unincorporated trade or
business, or
(ii) in the case of a partnership, own more than 50 percent of
either the capital interest or the profits interest in the
partnership.
An Owner-Employee, or two or more Owner-Employees, shall be treated as owning
any interest in a partnership which is owned, directly or indirectly, by a
partnership which such Owner-Employee, or such two or more Owner-Employees, are
considered to control within the meaning of the preceding sentence.
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<PAGE>
SECTION 2
ELIGIBILITY AND PARTICIPATION
2.1. INITIAL ENTRY INTO PLAN. If this Plan Statement is adopted as an amendment
of a Prior Plan Statement, each Employee who immediately before the Effective
Date was a Participant in the Plan prior to the Effective Date and who continues
in Recognized Employment on the Effective Date shall continue as a Participant
in this Plan.
On and after the Effective Date (without regard to whether this Plan Statement
is an amendment of a Prior Plan Statement or the establishment of a new Plan),
each other Employee shall become a Participant on the first Entry Date
coincident with or next following the date that such Employee has both:
(a) satisfied the age requirement set forth in the Adoption Agreement, if
any, and
(b) satisfied the service requirement set forth in the Adoption Agreement,
if any,
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
if he is then employed in Recognized Employment. If he is not then employed in
Recognized Employment, he shall become a Participant on the first date
thereafter upon which he is employed in Recognized Employment. IN THE ADOPTION
AGREEMENT, THE EMPLOYER MAY ELECT DIFFERENT SERVICE REQUIREMENTS FOR ELIGIBILITY
TO ENROLL FOR RETIREMENT SAVINGS CONTRIBUTIONS UNDER SECTION 3.2 AND TO SHARE IN
THE EMPLOYER REQUIRED MATCHING CONTRIBUTIONS AND EMPLOYER DISCRETIONARY
CONTRIBUTIONS UNDER SECTIONS 3.3 AND 3.4.
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2.2. SPECIAL RULE FOR FORMER PARTICIPANTS. A Participant whose employment with
the Employer terminates and who subsequently is reemployed by the Employer shall
immediately reenter the Plan as a Participant as of the date of his return to
Recognized Employment.
2.3. ENROLLMENT. Each Employee who is or will become a Participant as provided
in Section 2.1 or Section 2.2 may enroll for retirement savings by completing a
Retirement Savings Agreement and delivering it to the Administrator's
Representative at least fifteen (15) days (or some other time period specified
by the Administrator's Representative) prior to the Entry Date as of which the
Employee desires to make it effective. If an Employee does not enroll when
first eligible to do so, he may enroll as of any subsequent Entry Date by
completing a Retirement Savings Agreement and delivering it to the
Administrator's Representative at least fifteen (15) days (or some other time
period specified by the Administrator's Representative) prior to that Entry
Date.
2.4. WAIVER OF ENROLLMENT PROCEDURES. The Administrator's Representative shall
have the authority to adopt rules that modify and waive the enrollment
procedures set forth in this Section 2 during the period beginning on the
Effective Date and ending twelve (12) months later, in order that an orderly
first enrollment might be completed. This authority to modify and waive the
enrollment procedures does not authorize the Administrator's Representative to
modify the minimum service, age or job classification requirements for
participation in the Plan.
2.5. RETIREMENT SAVINGS AGREEMENT. Subject to the following rules, the
Retirement Savings Agreement which each Participant may execute shall provide
for a reduction equal to not more than the percentage specified in the
Adoption Agreement of the amount of Recognized Compensation which otherwise
would be paid to him by the Employer each payday. Effective for Plan Years
beginning after December 31, 1986, the reduction in earnings agreed to by the
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Participant, however, shall not exceed Seven Thousand Dollars ($7,000) for
that Participant's taxable year. Such Seven Thousand Dollar ($7,000) limit
shall be adjusted for cost of living at the same time and in the same manner
as under section 415(d) of the Internal Revenue Code. In the case of a
Participant who is a Self-Employed Person, the reduction in earnings shall be
determined by multiplying such Participant's Recognized Compensation (for the
entire Plan Year) by the enrollment percentage elected by the Participant and
multiplying the resulting amount by the fraction of the Plan Year that each
election is in effect. The Administrator's Representative may, from time to
time under uniform, nondiscriminatory rules, change the minimum and maximum
allowable reductions in earnings. The reductions in earnings agreed to by
the Participant shall be made by the Employer from the Participant's
remuneration each payday on or after the Effective Date for so long as the
Retirement Savings Agreement remains in effect.
2.6. MODIFICATIONS OF RETIREMENT SAVINGS AGREEMENT. The Retirement Savings
Agreement of a Participant may be modified. Unless modified or terminated, the
Retirement Savings Agreement will remain in effect.
2.6.1. INCREASE. A Participant whose Retirement Savings Agreement does
not provide for the full, allowable reduction may, upon giving fifteen (15)
days' prior written notice to the Administrator's Representative, amend his
Retirement Savings Agreement to increase the amount of reduction as of the first
payday on or after any subsequent Entry Date.
2.6.2. DECREASE. A Participant whose Retirement Savings Agreement
provides for more than the minimum allowable reduction may, upon giving fifteen
(15) days' prior written notice to the Administrator's Representative, amend his
Retirement Savings Agreement to decrease the amount of reduction as of the first
payday on or after any subsequent Entry Date.
2.6.3. VOLUNTARY TERMINATION. A Participant who has a Retirement
Savings Agreement in effect may, upon giving fifteen (15) days' prior written
notice to the Administrator's Representative, completely terminate the
Retirement Savings Agreement as of the first day of any payroll period.
Thereafter, such Participant may, upon giving fifteen (15) days' prior written
notice to the Administrator's Representative, enter into a new Retirement
Savings Agreement effective as of the first payday on or after any subsequent
Entry Date if, on that Entry Date, he is employed in Recognized Employment.
2.6.4. TERMINATION OF RECOGNIZED EMPLOYMENT. The Retirement Savings
Agreement of a Participant who ceases to be employed in Recognized Employment
(and who thereby ceases to have Recognized Compensation) shall be terminated
automatically as of the date he ceased to be employed in Recognized Employment.
If such Participant returns to Recognized Employment, he may enter into a new
Retirement Savings Agreement effective as of any Entry Date following his return
to Recognized Employment upon giving fifteen (15) days' prior written notice to
the Administrator's Representative.
2.6.5. FORM OF AGREEMENT. The Administrator's Representative shall
specify the form of the Retirement Savings Agreement, the form of any notices
modifying the Retirement Savings Agreement and all procedures for the delivery
and acceptance of forms and notices.
2.7. SECTION 401(k) COMPLIANCE.(1)
2.7.1. SPECIAL DEFINITIONS. For purposes of this Section 2.7, the
following special definitions shall apply:
- ---------------
(1)Except as otherwise specifically provided in this Section, the provisions of
this Section apply for Plan Years beginning after December 31, 1986.
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<PAGE>
(a) "COVERED EMPLOYEE" means an individual who was entitled to enter into
a Retirement Savings Agreement for all or a part of the Plan Year
(whether or not he did so).
(b) "HIGHLY COMPENSATED COVERED EMPLOYEES" means those covered employees
defined as highly compensated employees in Appendix D to this Plan
Statement.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
(c) "DEFERRAL PERCENTAGE" MEANS THE RATIO (CALCULATED SEPARATELY FOR EACH
COVERED EMPLOYEE) OF:
(i) THE TOTAL AMOUNT, FOR THE PLAN YEAR, OF EMPLOYER CONTRIBUTIONS
CREDITED TO THE COVERED EMPLOYEE'S RETIREMENT SAVINGS ACCOUNT
(EXCLUDING EMPLOYER CONTRIBUTIONS TO THE RETIREMENT SAVINGS
ACCOUNT TAKEN INTO ACCOUNT IN DETERMINING THE CONTRIBUTION
PERCENTAGE IN SECTION 3.10, PROVIDED THE 401(k) TEST IN THIS
SECTION 2.7 IS SATISFIED BOTH WITH AND WITHOUT EXCLUSION OF SUCH
EMPLOYER CONTRIBUTIONS, AND EXCLUDING EMPLOYER CONTRIBUTIONS TO
THE RETIREMENT SAVINGS ACCOUNT RETURNED TO THE COVERED EMPLOYEE
PURSUANT TO APPENDIX A TO THIS PLAN STATEMENT AS AN EXCESS ANNUAL
ADDITION), AND IF THE ADMINISTRATOR'S REPRESENTATIVE ELECTS, ALL
OR A PORTION OF THE AMOUNT, FOR THE PLAN YEAR, OF EMPLOYER
CONTRIBUTIONS CREDITED TO THE COVERED EMPLOYEE'S EMPLOYER
MATCHING ACCOUNT OR EMPLOYER PROFIT SHARING ACCOUNT, OR BOTH, TO
(ii) THE COVERED EMPLOYEE'S COMPENSATION, AS DEFINED BELOW, FOR
THE PORTION OF SUCH PLAN YEAR THAT THE EMPLOYEE IS A COVERED
EMPLOYEE.
FOR THIS PURPOSE, EMPLOYER CONTRIBUTIONS WILL BE CONSIDERED MADE IN THE
PLAN YEAR IF THEY ARE ALLOCATED AS OF A DATE DURING SUCH PLAN YEAR AND ARE
DELIVERED TO THE TRUSTEE WITHIN TWELVE (12) MONTHS AFTER THE END OF SUCH
PLAN YEAR. A COVERED EMPLOYEE WHO DID NOT ENTER INTO A RETIREMENT SAVINGS
AGREEMENT SHALL BE TREATED AS HAVING ELECTED A DEFERRED PERCENTAGE OF ZERO.
- --------------------------------------------------------------------------------
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SECOND AMENDMENT-EFFECTIVE JANUARY 1, 1994
(d) "COMPENSATION" MEANS COMPENSATION FOR SERVICES PERFORMED FOR THE
EMPLOYER DEFINED AS "SECTION 415 COMPENSATION" IN APPENDIX A TO THIS
PLAN STATEMENT. THE ADMINISTRATOR'S REPRESENTATIVE MAY ELECT TO
INCLUDE AS COMPENSATION ANY ELECTIVE CONTRIBUTIONS MADE BY THE
EMPLOYER ON BEHALF OF THE COVERED EMPLOYEE THAT ARE NOT INCLUDIBLE IN
GROSS INCOME UNDER SECTIONS 125, 402(a)(8), 402(h), 403(b), 414(h)(2)
AND 457 OF THE INTERNAL REVENUE CODE. NOTWITHSTANDING THE DEFINITION
OF "SECTION 415 COMPENSATION" IN APPENDIX A TO THIS PLAN STATEMENT,
COMPENSATION SHALL ALWAYS BE DETERMINED ON A CASH (AND NOT ON AN
ACCRUAL) BASIS AND COMPENSATION SHALL BE DETERMINED ON A PLAN YEAR
BASIS (WHICH IS NOT NECESSARILY THE SAME AS THE LIMITATION YEAR). A
COVERED EMPLOYEE'S COMPENSATION FOR A PLAN YEAR SHALL NOT EXCEED THE
ANNUAL COMPENSATION LIMIT UNDER SECTION 401(a)(17) OF THE INTERNAL
REVENUE CODE. FOR PURPOSES OF THE FOREGOING, THE ANNUAL COMPENSATION
LIMIT UNDER SECTION 401(a)(17) OF THE INTERNAL REVENUE CODE SHALL BE
TWO HUNDRED THOUSAND DOLLARS ($200,000) (AS ADJUSTED UNDER THE
INTERNAL REVENUE CODE FOR COST OF LIVING INCREASES) FOR PLAN YEARS
BEGINNING BEFORE JANUARY 1, 1994, AND SHALL BE ONE HUNDRED AND FIFTY
THOUSAND
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<PAGE>
DOLLARS ($150,000) (AS SO ADJUSTED) FOR PLAN YEARS BEGINNING
ON OR AFTER JANUARY 1, 1994.
- --------------------------------------------------------------------------------
(e) "AVERAGE DEFERRAL PERCENTAGE" means, for a specified group of covered
employees for the Plan Year, the average of the deferral percentages
for all covered employees in such group.
2.7.2. SPECIAL RULES. For purposes of this Section 2.7, the following
special rules apply:
(a) ROUNDING. Effective for Plan Years beginning after December 31, 1988,
the deferral percentages and average deferral percentage for each
group of covered employees shall be calculated to the nearest
one-hundredth of one percent of the covered employee's compensation.
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SECOND AMENDMENT-EFFECTIVE JANUARY 1, 1994
(b) FAMILY MEMBER. IF A HIGHLY COMPENSATED COVERED EMPLOYEE IS SUBJECT TO
THE FAMILY AGGREGATION RULES OF SECTION 414(q)(6) OF THE INTERNAL
REVENUE CODE BECAUSE SUCH EMPLOYEE IS EITHER A FIVE PERCENT (5%) OWNER
OR ONE OF THE TEN (10) MOST HIGHLY COMPENSATED EMPLOYEES (AS DEFINED
IN APPENDIX D TO THIS PLAN STATEMENT), THE COMBINED DEFERRAL
PERCENTAGE FOR THE FAMILY GROUP (WHICH IS TREATED AS ONE HIGHLY
COMPENSATED COVERED EMPLOYEE) SHALL BE DETERMINED BY COMBINING THE
AMOUNTS DESCRIBED IN SECTION 2.7.1(c)(I) AND BY COMBINING THE
COMPENSATION DESCRIBED IN SECTION 2.7.1(d) OF ALL FAMILY MEMBERS WHO
ARE COVERED EMPLOYEES. THE FAMILY MEMBERS WHO ARE AGGREGATED WITH
RESPECT TO A HIGHLY COMPENSATED COVERED EMPLOYEE SHALL BE DISREGARDED
AS SEPARATE COVERED EMPLOYEES IN DETERMINING THE AVERAGE DEFERRAL
PERCENTAGE OF HIGHLY COMPENSATED COVERED EMPLOYEES AND THE AVERAGE
DEFERRAL PERCENTAGE OF ALL OTHER COVERED EMPLOYEES. IF A COVERED
EMPLOYEE IS REQUIRED TO BE AGGREGATED AS A MEMBER OF MORE THAN ONE
FAMILY GROUP IN THE PLAN, ALL COVERED EMPLOYEES WHO ARE MEMBERS OF
THOSE FAMILY GROUPS THAT INCLUDE THAT COVERED EMPLOYEE ARE AGGREGATED
AS ONE FAMILY GROUP. WITH RESPECT TO ANY HIGHLY COMPENSATED COVERED
EMPLOYEE, "FAMILY" SHALL MEAN THE EMPLOYEE'S SPOUSE AND LINEAL
ASCENDANTS AND DESCENDANTS AND THE SPOUSES OF SUCH LINEAL ASCENDANTS
AND DESCENDANTS. THE ANNUAL COMPENSATION LIMIT UNDER SECTION
401(a)(17) OF THE INTERNAL REVENUE CODE APPLIES TO THE ABOVE DEFERRAL
PERCENTAGE DETERMINATION EXCEPT THAT FOR PURPOSES OF THAT LIMIT, THE
TERM "FAMILY" SHALL INCLUDE ONLY THE SPOUSE OF THE COVERED EMPLOYEE
AND LINEAL DESCENDANTS OF THE COVERED EMPLOYEE WHO HAVE NOT ATTAINED
AGE NINETEEN (19) YEARS BEFORE THE CLOSE OF THAT PLAN YEAR. FOR
PURPOSES OF THE FOREGOING, THE ANNUAL COMPENSATION LIMIT UNDER SECTION
401(a)(17) OF THE INTERNAL REVENUE CODE SHALL BE TWO HUNDRED THOUSAND
DOLLARS ($200,000) (AS ADJUSTED UNDER THE INTERNAL REVENUE CODE FOR
COST OF LIVING INCREASES) FOR PLAN YEARS BEGINNING BEFORE JANUARY 1,
1994, AND SHALL BE ONE HUNDRED AND FIFTY THOUSAND DOLLARS ($150,000)
(AS SO ADJUSTED) FOR PLAN YEARS BEGINNING ON OR AFTER JANUARY 1, 1994.
- --------------------------------------------------------------------------------
(c) MULTIPLE PLANS. The average deferral percentage for any Participant
who is a highly compensated covered employee for the Plan Year with
respect to two or more arrangements described in section 401(k) of the
Internal Revenue Code, that are maintained by the Employer, shall be
determined as if all such arrangements were a single arrangement. If a
highly compensated covered employee participates in two or more such
arrangements that have different Plan Years, all arrangements ending
with or within the same calendar year shall be treated as a single
arrangement. In the event that this Plan satisfies
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<PAGE>
the requirements of sections 401(k), 401(a)(4) or 410(b)
of the Internal Revenue Code only if aggregated with one
or more other plans, or if one or more other plans
satisfy the requirements of such sections of the Internal
Revenue Code only if aggregated with this Plan, then this
section 2.7.2(c) shall be applied by determining the
average deferral percentage of covered employees as if
all such plans were a single plan. For Plan Years
beginning after December 31, 1989, plans may be
aggregated in order to satisfy section 401(k) of the
Internal Revenue Code only if they have the same Plan
Year.
(d) RECORDS. The Employer shall maintain records sufficient to
demonstrate satisfaction of the average deferral percentage test and
the amount of matching contributions (as defined in section
401(m)(4)(A) of the Internal Revenue Code which meet the requirements
of section 401(k)(2)(B) and (C) of the Internal Revenue Code) or
qualified nonelective contributions (within the meaning of section
401(m)(4)(C) of the Internal Revenue Code), or both, used in such
test. The determination and treatment of the average deferral
percentage amounts of any Participant shall satisfy such other
requirements as may be prescribed by the Secretary of the Treasury.
2.7.3. THE TESTS. Notwithstanding the foregoing provisions, Retirement
Savings Agreements in effect for each Plan Year shall be limited and modified
under uniform and nondiscriminatory rules established by the Administrator's
Representative and by the rules hereinafter provided in order that all such
Retirement Savings Agreements (in the aggregate) will satisfy at least one of
the following two (2) tests for that Plan Year:
TEST 1: The average deferral percentage for the group of highly
compensated covered employees is not more than the average
deferral percentage of all other covered employees multiplied by
one and twenty-five hundredths (1.25).
TEST 2: The excess of the average deferral percentage for the group of
highly compensated covered employees over that of all other
covered employees is not more than two (2) percentage points, AND
the average deferral percentage for the group of highly
compensated covered employees is not more than the average
deferral percentage of all other covered employees multiplied by
two (2).
The Administrator's Representative shall maintain records to demonstrate
compliance with one of the two (2) tests described above, including the extent
to which qualified matching contributions (as defined in Section 2.7.1(c)) and
qualified nonelective contributions (as defined in Section 2.7.1(c)) are used in
determining the deferral percentage.
2.7.4. REMEDIAL ACTION. If the Administrator's Representative
determines that neither of the tests will be satisfied (or may not be satisfied)
for a Plan Year, then during such Plan Year, the following actions may be taken
so that one of the tests will be satisfied for such Plan Year:
(a) The highly compensated covered employees who have the highest
enrollment percentage under Section 2.5 shall be deemed for all
purposes of the Plan to have elected for that Plan Year a lower
enrollment percentage (and the amounts credited pursuant to Section
3.2, and the applicable amount, if any, credited pursuant to Section
3.3, shall be reduced accordingly).
(b) If neither of the tests is satisfied after such adjustment, the
enrollment percentage under Section 2.5 of the highly compensated
covered employees who then have the highest enrollment percentage
(including any reduced under (a) above) shall be reduced to a lower
enrollment percentage.
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<PAGE>
(c) If neither of the tests is satisfied after such adjustment, this
method of adjustment shall be repeated one or more additional times
until one of the tests is satisfied.
The Administrator's Representative shall prescribe rules concerning such
adjustments, including the frequency of applying the tests and the commencement
and termination dates for any adjustments. Any amounts required to be
distributed as provided above which are distributed more than 2 1/2 months after
the close of the Plan Year being tested, will result in a ten percent (10%)
penalty tax on the Employer as provided in section 4979 of the Internal Revenue
Code.
2.8. ANNUAL CERTIFICATION. As of each Annual Valuation Date during the
continuance of the Plan, the Administrator's Representative shall certify in
writing the names of all Participants who are entitled to participate in the
Employer contribution for the Plan Year ending on that date and all other facts
that may be required to properly administer the provisions of this Plan.
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<PAGE>
SECTION 3
CONTRIBUTIONS AND ALLOCATION THEREOF (2)
3.1. EMPLOYER CONTRIBUTIONS - GENERAL.
3.1.1. SOURCE OF EMPLOYER CONTRIBUTIONS. All Employer contributions to
the Plan may be made without regard to profits.
3.1.2. LIMITATION. The contribution of the Employer to the Plan for any
year, when considered in light of its contribution for that year to all other
tax-qualified plans it maintains, shall, in no event, exceed the maximum amount
deductible by it for federal income tax purposes as a contribution to a
tax-qualified profit sharing plan under section 404 of the Internal Revenue
Code. Each such contribution to the Plan is conditioned upon its deductibility
for such purpose.
3.1.3. FORM OF PAYMENT. The appropriate contribution of the Employer to
the Plan, determined as herein provided, shall be paid to the Trustee and may be
paid either in cash or in other assets of any character of a value equal to the
amount of the contribution or in any combination of the foregoing ways.
3.2. RETIREMENT SAVINGS CONTRIBUTIONS.
3.2.1. AMOUNT. Within the time required by regulations of the United
States Department of Labor, the Employer shall contribute to the Trustee for
deposit in the Fund the reduction in Recognized Compensation which was agreed to
by each Participant pursuant to a Retirement Savings Agreement. The Retirement
Savings Agreement shall not apply retroactively.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
3.2.2. ALLOCATION. THE PORTION OF THIS CONTRIBUTION MADE WITH RESPECT
TO EACH PARTICIPANT SHALL BE ALLOCATED TO THAT PARTICIPANT'S RETIREMENT SAVINGS
ACCOUNT FOR THE PLAN YEAR WITH RESPECT TO WHICH IT IS MADE AND, FOR THE PURPOSES
OF SECTION 4, SHALL BE CREDITED AS OF THE VALUATION DATE COINCIDENT WITH OR
IMMEDIATELY FOLLOWING THE DATE SUCH CONTRIBUTION IS RECEIVED BY THE TRUSTEE OR,
IF THE EMPLOYER HAS SELECTED DAILY VALUATION DATES FOR ACCOUNTING PURPOSES IN
THE ADOPTION AGREEMENT, AS SOON AS PRACTICABLE AFTER SUCH CONTRIBUTION IS
RECEIVED BY THE TRUSTEE.
- --------------------------------------------------------------------------------
3.3. REQUIRED MATCHING CONTRIBUTIONS.
3.3.1. AMOUNT. The Employer shall contribute to the Trustee for deposit
in the Fund and for crediting to the Participant's Employer Matching Account
such amounts, if any, as are required pursuant to the Adoption Agreement as
Employer contributions to match each Participant's reduction in Recognized
Compensation which was agreed to by the Participant pursuant to a Retirement
Savings Agreement; provided, however, that a reduction in Recognized
Compensation above a percentage of a Participant's Recognized Compensation
specified in the Adoption Agreement shall not be used in allocating such
contribution. Such contributions shall be made only for Participants who are
eligible Participants within the meaning of Section 3.5. Such contributions
shall be delivered to the Trustee for deposit in the Fund not later than the
time prescribed by federal law (including extensions) for filing the federal
income tax return of the Employer for the taxable year in which the Plan Year
ends.
- ---------------
(2)Minimum contribution and allocation requirements apply in any Plan Year that
this Plan is top heavy. (See Appendix B, Section 3.3.)
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<PAGE>
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
3.3.2. ALLOCATION. THE EMPLOYER MATCHING CONTRIBUTION (INCLUDING
FORFEITED SUSPENSE ACCOUNTS, IF ANY) WHICH IS MADE WITH RESPECT TO AN ELIGIBLE
PARTICIPANT SHALL BE ALLOCATED TO THAT PARTICIPANT'S EMPLOYER MATCHING ACCOUNT
FOR THE PLAN YEAR WITH RESPECT TO WHICH IT IS MADE AND, FOR THE PURPOSES OF
SECTION 4, SHALL BE CREDITED AS OF THE VALUATION DATE COINCIDENT WITH OR
IMMEDIATELY FOLLOWING THE DATE SUCH CONTRIBUTION IS RECEIVED BY THE TRUSTEE OR,
IF THE EMPLOYER HAS SELECTED DAILY VALUATION DATES FOR ACCOUNTING PURPOSES IN
THE ADOPTION AGREEMENT, AS SOON AS PRACTICABLE AFTER SUCH CONTRIBUTION IS
RECEIVED BY THE TRUSTEE.
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3.4. DISCRETIONARY EMPLOYER CONTRIBUTIONS.
3.4.1. GENERAL. If the Adoption Agreement so provides, the Employer may
(but shall not be required to) make discretionary contributions from year to
year during the continuance of the Plan in such amounts as the Employer shall
from time to time determine. Such contributions shall be delivered to the
Trustee for deposit in the Fund not later than the time prescribed by federal
law (including extensions) for filing the federal income tax return of the
Employer for the taxable year in which the Plan Year ends.
The Employer's discretionary contribution, including forfeited Suspense
Accounts, if any, to be included with that contribution or reallocated as of the
Annual Valuation Date of such Plan Year, for a Plan Year shall be allocated as
follows.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
3.4.2. CURATIVE ALLOCATION - SECTION 401(k). If, for any Plan Year,
neither of the tests set forth in Section 2.7 has been satisfied and a
distribution of "Excess Contributions" has not been made pursuant to Section 7,
then all or a portion of the Employer's discretionary contribution for that Plan
Year shall be allocated as provided in this Section 3.4.2. Forfeited Suspense
Accounts, however, will not be included in this allocation. The Participants
eligible to share in such allocation shall be only those Participants who,
during such Plan Year, were not "highly compensated covered employees" (as
defined in Section 2.7) for that Plan Year and for whom some contribution was
made pursuant to Section 3.2 for such Plan Year. No other Participant shall be
eligible to share in this allocation of the Employer discretionary contribution
under this Section 3.4.2. The allocation to be made under this Section 3.4.2
shall be made to the eligible Participant with the least amount of compensation
(as defined in Section 2.7) and then, in ascending order of compensation (as
defined in Section 2.7), to other eligible Participants. The amount of the
Employer discretionary contribution to be allocated under this Section 3.4.2
shall be that amount required to cause the Plan to satisfy either of the tests
set forth in Section 2.7 for the Plan Year; provided, however, that in no case
shall amounts be allocated to a Participant's Retirement Savings Account under
this paragraph which would cause that Participant's deferral percentage (as
defined in Section 2.7) to exceed twenty percent (20%). THE EMPLOYER
DISCRETIONARY CONTRIBUTION SO MADE UNDER THIS SECTION 3.4.2 SHALL BE ALLOCATED
TO THAT PARTICIPANT'S RETIREMENT SAVINGS ACCOUNT FOR THE PLAN YEAR WITH RESPECT
TO WHICH THE CONTRIBUTION IS MADE AND, FOR THE PURPOSES OF SECTION 4, SHALL BE
CREDITED AS OF THE VALUATION DATE COINCIDENT WITH OR IMMEDIATELY FOLLOWING THE
DATE SUCH CONTRIBUTION IS RECEIVED BY THE TRUSTEE OR, IF THE EMPLOYER HAS
SELECTED DAILY VALUATION DATES FOR ACCOUNTING PURPOSES IN THE ADOPTION
AGREEMENT, AS SOON AS PRACTICABLE AFTER SUCH CONTRIBUTION IS RECEIVED BY THE
TRUSTEE.
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<PAGE>
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
3.4.3. DISCRETIONARY MATCHING CONTRIBUTIONS. If the Adoption Agreement
so provides, any portion of the Employer's discretionary contribution not
allocated under Section 3.4.2 shall be allocable to the Employer Matching
Accounts of Participants eligible to share in the allocation pursuant to Section
3.5; provided, however, that the Employer's discretionary contribution to be
allocated under this Section 3.4.3 shall be reduced by any amounts necessary to
make the curative allocation described in Section 3.4.4. The contribution, if
any, made by the Employer for a given Plan Year shall be allocated to the
Employer Matching Account of eligible Participants to match a percentage,
determined by the Employer, of each eligible Participant's reduction in
Recognized Compensation which was agreed to by the Participant pursuant to a
Retirement Savings Agreement; provided, however, that a reduction in Recognized
Compensation above a percentage of a Participant's Recognized Compensation
specified in the Adoption Agreement shall not be used in allocating such
contribution. THE EMPLOYER MATCHING CONTRIBUTION WHICH IS MADE WITH RESPECT TO
AN ELIGIBLE PARTICIPANT SHALL BE ALLOCATED TO THAT PARTICIPANT'S EMPLOYER
MATCHING ACCOUNT FOR THE PLAN YEAR WITH RESPECT TO WHICH IT IS MADE AND, FOR THE
PURPOSES OF SECTION 4, SHALL BE CREDITED AS OF THE VALUATION DATE COINCIDENT
WITH OR IMMEDIATELY FOLLOWING THE DATE SUCH CONTRIBUTION IS RECEIVED BY THE
TRUSTEE OR, IF THE EMPLOYER HAS SELECTED DAILY VALUATION DATES FOR ACCOUNTING
PURPOSES IN THE ADOPTION AGREEMENT, AS SOON AS PRACTICABLE AFTER SUCH
CONTRIBUTION IS RECEIVED BY THE TRUSTEE.
3.4.4. CURATIVE ALLOCATION - SECTION 401(m). If, for any Plan Year,
neither of the tests set forth in Section 3.10 has been satisfied and a
distribution of "Excess Aggregate Contributions" has not been made pursuant to
Section 7, then all or any portion of the Employer's discretionary contribution
for that Plan Year which has not been allocated under Section 3.4.2 above shall
be allocated as provided in this Section 3.4.4. Forfeited Suspense Accounts,
however, will not be included in this allocation. The Participants eligible to
share in such allocation shall be only those Participants who, during such Plan
Year, were not highly compensated eligible employees (as defined in Section
3.10) for that Plan Year and who were entitled to receive an Employer matching
contribution pursuant to Section 3.3 or Section 3.4.3 (or would have been
entitled to receive an Employer matching contribution if one had been made). No
other Participant shall be eligible to share in this allocation of the Employer
discretionary contribution under this Section 3.4.4. The allocation to be made
under this Section 3.4.4 shall be made to the Participant with the least amount
of compensation (as defined in Section 3.10) and then, in ascending order of
compensation (as defined in Section 3.10), to other Participants. The amount of
the Employer discretionary contribution to be allocated under this Section 3.4.4
shall be that amount required to cause the Plan to satisfy either of the tests
set forth in Section 3.10 for the Plan Year. The Employer discretionary
contribution so allocated to a Participant shall be credited to that
Participant's Employer Matching Account as of the Annual Valuation Date in the
Plan Year for which this Employer discretionary contribution is made. THE
EMPLOYER DISCRETIONARY CONTRIBUTION SO MADE UNDER THIS SECTION 3.4.4 SHALL BE
ALLOCATED TO THAT PARTICIPANT'S EMPLOYER MATCHING ACCOUNT FOR THE PLAN YEAR WITH
RESPECT TO WHICH THE CONTRIBUTION IS MADE AND, FOR THE PURPOSES OF SECTION 4,
SHALL BE CREDITED AS OF THE VALUATION DATE COINCIDENT WITH OR IMMEDIATELY
FOLLOWING THE DATE SUCH CONTRIBUTION IS RECEIVED BY THE TRUSTEE OR, IF THE
EMPLOYER HAS SELECTED DAILY VALUATION DATES FOR ACCOUNTING PURPOSES IN THE
ADOPTION AGREEMENT, AS SOON AS PRACTICABLE AFTER SUCH CONTRIBUTION IS RECEIVED
BY THE TRUSTEE.
3.4.5. DISCRETIONARY PROFIT SHARING CONTRIBUTIONS. IF THE ADOPTION
AGREEMENT SO PROVIDES, ANY PORTION OF THE EMPLOYER'S DISCRETIONARY CONTRIBUTION
NOT ALLOCATED UNDER SECTION 3.4.2, SECTION 3.4.3 AND SECTION 3.4.4 SHALL BE
ALLOCATED TO THE EMPLOYER CONTRIBUTIONS ACCOUNTS OF ELIGIBLE PARTICIPANTS UNDER
SECTION 3.5. THE DISCRETIONARY CONTRIBUTION FOR A PLAN YEAR SHALL BE ALLOCATED
TO THE EMPLOYER CONTRIBUTIONS ACCOUNTS OF ELIGIBLE PARTICIPANTS UNDER
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<PAGE>
THE FORMULA SET FORTH IN SECTION 3.4.5(a) OR SECTION 3.4.5(b) AS INDICATED IN
THE ADOPTION AGREEMENT.
(a) STRAIGHT PERCENT OF PAY PROFIT SHARING ALLOCATION. IF THE
DISCRETIONARY PROFIT SHARING CONTRIBUTION IS ADOPTED AS A NON-
INTEGRATED STRAIGHT PERCENT OF PAY PROFIT SHARING CONTRIBUTION, THE
CONTRIBUTION, IF ANY, MADE BY THE EMPLOYER FOR A GIVEN PLAN YEAR SHALL
BE ALLOCATED TO THE EMPLOYER CONTRIBUTIONS ACCOUNTS OF ELIGIBLE
PARTICIPANTS IN THE RATIO WHICH THE RECOGNIZED COMPENSATION OF EACH
SUCH ELIGIBLE PARTICIPANT FOR THE PLAN YEAR BEARS TO THE RECOGNIZED
COMPENSATION FOR SUCH PLAN YEAR OF ALL SUCH ELIGIBLE PARTICIPANTS.
(b) INTEGRATED PROFIT SHARING ALLOCATION. IF THE DISCRETIONARY PROFIT
SHARING CONTRIBUTION IS ADOPTED AS AN INTEGRATED PROFIT SHARING
CONTRIBUTION, THE CONTRIBUTION, IF ANY, MADE BY THE EMPLOYER FOR A
GIVEN PLAN YEAR SHALL BE DETERMINED AND ALLOCATED UNDER THE FOLLOWING
RULES:
(i) BASE CONTRIBUTION PERCENTAGE. SUBJECT TO THE RULES IN
SECTION 3.4.5(b)(iii) AND (iv), THE EMPLOYER SHALL DETERMINE
A UNIFORM BASE CONTRIBUTION PERCENTAGE FOR THE PLAN YEAR AND
SHALL CONTRIBUTE TO EACH ELIGIBLE PARTICIPANT'S EMPLOYER
PROFIT SHARING ACCOUNT AN AMOUNT EQUAL TO THAT BASE
CONTRIBUTION PERCENTAGE MULTIPLIED BY EACH SUCH ELIGIBLE
PARTICIPANT'S RECOGNIZED COMPENSATION UP TO THE INTEGRATION
LEVEL (AS DEFINED IN THE ADOPTION AGREEMENT) FOR THAT PLAN
YEAR.
(ii) EXCESS CONTRIBUTION PERCENTAGE. SUBJECT TO THE RULES IN
SECTION 3.4.5(b)(iii) AND (iv), THE EMPLOYER SHALL DETERMINE
A UNIFORM EXCESS CONTRIBUTION PERCENTAGE FOR THE PLAN YEAR
AND SHALL CONTRIBUTE TO EACH ELIGIBLE PARTICIPANT'S EMPLOYER
PROFIT SHARING ACCOUNT AN AMOUNT EQUAL TO THAT EXCESS
CONTRIBUTION PERCENTAGE MULTIPLIED BY EACH SUCH ELIGIBLE
PARTICIPANT'S RECOGNIZED COMPENSATION IN EXCESS OF THE
INTEGRATION LEVEL (AS DEFINED IN THE ADOPTION AGREEMENT) FOR
THAT PLAN YEAR.
(iii) RULES FOR NON-TOP HEAVY PLAN. THE BASE CONTRIBUTION
PERCENTAGE AND THE EXCESS CONTRIBUTION PERCENTAGE FOR A PLAN
YEAR IN WHICH THE PLAN IS NOT TOP HEAVY AS DEFINED IN
APPENDIX B TO THIS PLAN STATEMENT SHALL BE DETERMINED AS
FOLLOWS:
* TWO TIMES RULE. IF THE BASE CONTRIBUTION PERCENTAGE IS
EQUAL TO OR LESS THAN THE INTEGRATION RATE (AS
DETERMINED IN THE ADOPTION AGREEMENT), THE EXCESS
CONTRIBUTION PERCENTAGE SHALL NOT EXCEED THE PRODUCT OF
THE BASE CONTRIBUTION PERCENTAGE MULTIPLIED BY TWO (2).
* INTEGRATION LIMITATION. IF THE BASE CONTRIBUTION
PERCENTAGE IS GREATER THAN THE INTEGRATION RATE (AS
DETERMINED IN THE ADOPTION AGREEMENT), THE EXCESS
CONTRIBUTION PERCENTAGE SHALL NOT EXCEED THE SUM OF THE
BASE CONTRIBUTION PERCENTAGE PLUS THE INTEGRATION RATE.
(iv) RULES FOR TOP HEAVY PLAN. THE BASE CONTRIBUTION PERCENTAGE
AND THE EXCESS CONTRIBUTION PERCENTAGE FOR A PLAN YEAR IN
WHICH THE PLAN IS TOP HEAVY AS DEFINED IN APPENDIX B TO
THIS PLAN STATEMENT SHALL BE DETERMINED IN ACCORDANCE WITH
THE FOLLOWING RULES:
* LESS THAN THREE PERCENT RULE. IF THE BASE CONTRIBUTION
PERCENTAGE IS LESS THAN THREE PERCENT (3%), THE EXCESS
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<PAGE>
CONTRIBUTION PERCENTAGE SHALL NOT EXCEED THE BASE
CONTRIBUTION PERCENTAGE.
* THREE PERCENT RULE. IF THE BASE CONTRIBUTION
PERCENTAGE IS THREE PERCENT (3%), THE EXCESS
CONTRIBUTION PERCENTAGE MAY BE A PERCENTAGE BETWEEN
THREE PERCENT (3%) AND SIX PERCENT (6%).
* TWO TIMES RULE. IF THE BASE CONTRIBUTION PERCENTAGE IS
GREATER THAN THREE PERCENT (3%) BUT NOT GREATER THAN
THE INTEGRATION RATE (AS DETERMINED IN THE ADOPTION
AGREEMENT), THE EXCESS CONTRIBUTION PERCENTAGE SHALL
NOT EXCEED THE PRODUCT OF THE BASE CONTRIBUTION
PERCENTAGE MULTIPLIED BY TWO (2).
* INTEGRATION LIMITATION. IF THE BASE CONTRIBUTION
PERCENTAGE IS GREATER THAN THE INTEGRATION RATE (AS
DETERMINED IN THE ADOPTION AGREEMENT), THE EXCESS
CONTRIBUTION PERCENTAGE SHALL NOT EXCEED THE SUM OF
THE BASE CONTRIBUTION PERCENTAGE PLUS THE
INTEGRATION RATE.
THE EMPLOYER DISCRETIONARY PROFIT SHARING CONTRIBUTION WHICH IS MADE WITH
RESPECT TO AN ELIGIBLE PARTICIPANT SHALL BE ALLOCATED TO THAT PARTICIPANT'S
EMPLOYER CONTRIBUTIONS ACCOUNT FOR THE PLAN YEAR WITH RESPECT TO WHICH IT IS
MADE AND, FOR THE PURPOSES OF SECTION 4, SHALL BE CREDITED AS OF THE VALUATION
DATE COINCIDENT WITH OR IMMEDIATELY FOLLOWING THE DATE SUCH CONTRIBUTION IS
RECEIVED BY THE TRUSTEE OR, IF THE EMPLOYER HAS SELECTED DAILY VALUATION DATES
FOR ACCOUNTING PURPOSES IN THE ADOPTION AGREEMENT, AS SOON AS PRACTICABLE AFTER
SUCH CONTRIBUTION IS RECEIVED BY THE TRUSTEE.
- --------------------------------------------------------------------------------
3.5. ELIGIBLE PARTICIPANTS. A Participant shall be considered eligible to share
in the allocation of Employer matching or discretionary contributions pursuant
to Section 3.3, Section 3.4.3 and Section 3.4.5, if any, and forfeited Suspense
Accounts to be reallocated with such contributions as of the Annual Valuation
Date in such Plan Year, if any, only if such Participant satisfies all of the
following requirements:
(a) PARTICIPANT. The Participant was a Participant at some time during
the Plan Year.
(b) COMPENSATION. The Participant has Recognized Compensation for such
Plan Year.
(c) LAST DAY RULE. If the Adoption Agreement so provides, the Participant
was an Employee on the last day of the Plan Year (including, for this
purpose, individuals temporarily absent due to illness, vacation or
layoff and individuals inducted into the Armed Forces of the United
States during such Plan Year) or the Participant died, became Disabled
or retired at or after his Normal Retirement Age during such Plan
Year.
(d) HOURS OF SERVICE RULE. If the Adoption Agreement so provides, the
Participant has that number of Hours of Service in the Plan Year
required by the Adoption Agreement, or the Participant died, became
Disabled or retired at or after his Normal Retirement Age during such
Plan Year.
No other Participant shall be considered an eligible Participant for such Plan
Year.
3.6. MAKE-UP CONTRIBUTIONS FOR OMITTED PARTICIPANTS. If, after the Employer's
annual contribution for a Plan Year has been made and allocated, it should
appear that, through oversight or a mistake of fact or law, a Participant (or an
Employee who should have been considered a Participant) who should have been
entitled to share in such contribution,
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<PAGE>
received no allocation or received an allocation which was less than he
should have received, the Employer may, at its election, and in lieu of
reallocating such contribution, make a special make-up contribution for the
Account of such Participant in an amount adequate to provide for him the same
addition to his Account for such Plan Year as he should have received.
3.7. ROLLOVER CONTRIBUTIONS.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
3.7.1. ELIGIBLE CONTRIBUTIONS. UNLESS THE ADOPTION AGREEMENT PRECLUDES
IT, EMPLOYEES (WHETHER OR NOT THEY ARE PARTICIPANTS) IN RECOGNIZED EMPLOYMENT
MAY CONTRIBUTE TO THIS PLAN, WITHIN SUCH TIME AND IN SUCH FORM AND MANNER AS MAY
BE PRESCRIBED BY THE ADMINISTRATOR'S REPRESENTATIVE IN ACCORDANCE WITH THOSE
PROVISIONS OF FEDERAL LAW RELATING TO ROLLOVER CONTRIBUTIONS, PROPERTY
ACCEPTABLE TO THE TRUSTEE (OR CASH PROCEEDS THEREOF) RECEIVED BY THEM IN
ELIGIBLE ROLLOVER DISTRIBUTIONS FROM CERTAIN TYPES OF QUALIFIED PLAN OR TRUSTS,
EMPLOYEE ANNUITIES AND INDIVIDUAL RETIREMENT ACCOUNTS OR ANNUITIES. THE
PROVISIONS OF THIS SECTION SHALL BE SUBJECT TO SUCH CONDITIONS AND LIMITATIONS
AS THE ADMINISTRATOR'S REPRESENTATIVE MAY PRESCRIBE FROM TIME TO TIME FOR
ADMINISTRATIVE CONVENIENCE AND TO PRESERVE THE TAX-QUALIFIED STATUS OF THIS
PLAN. ALSO, THE ADMINISTRATOR'S REPRESENTATIVE MAY ESTABLISH RULES AND
CONDITIONS REGARDING THE ACCEPTANCE OF DIRECT ROLLOVERS UNDER SECTION 401(a)(31)
OF THE INTERNAL REVENUE CODE FROM TRUSTEES OR CUSTODIANS OF OTHER QUALIFIED
PENSION, PROFIT SHARING OR STOCK BONUS PLANS.
- --------------------------------------------------------------------------------
3.7.2. SPECIFIC REVIEW. The Administrator's Representative shall have
the right to reject or return any such rollover contribution if, in its opinion,
the acceptance thereof might jeopardize the tax-qualified status of this Plan or
unduly complicate its administration, but the acceptance of any such rollover
contribution shall not be regarded as an opinion or guarantee on the part of the
Employer, the Trustee, the Administrator's Representative or the Plan as to the
tax consequences which may result to the contributing Participant thereby.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
3.7.3. ALLOCATION. ALL ROLLOVER CONTRIBUTIONS MADE BY AN EMPLOYEE TO
THIS PLAN SHALL BE ALLOCATED TO A ROLLOVER ACCOUNT ESTABLISHED FOR SUCH EMPLOYEE
EXCEPT THAT ANY PORTION THEREOF WHICH REPRESENTS DEDUCTIBLE VOLUNTARY EMPLOYEE
CONTRIBUTIONS SHALL BE ALLOCATED TO A DEDUCTIBLE VOLUNTARY ACCOUNT FOR SUCH
EMPLOYEE. FOR THE PURPOSES OF SECTION 4, ROLLOVER CONTRIBUTIONS SHALL BE
CREDITED TO SUCH EMPLOYEE'S ROLLOVER ACCOUNT OR DEDUCTIBLE VOLUNTARY ACCOUNT AS
OF THE VALUATION DATE COINCIDENT WITH OR IMMEDIATELY FOLLOWING THE DATE SUCH
CONTRIBUTION IS RECEIVED BY THE TRUSTEE OR, IF THE EMPLOYER HAS SELECTED DAILY
VALUATION DATES FOR ACCOUNTING PURPOSES IN THE ADOPTION AGREEMENT, AS SOON AS
PRACTICABLE AFTER SUCH CONTRIBUTION IS RECEIVED BY THE TRUSTEE.
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3.8. NONDEDUCTIBLE VOLUNTARY CONTRIBUTIONS.
3.8.1. METHOD OF CONTRIBUTION. If the Adoption Agreement so provides,
each Participant may make a nondeductible voluntary contribution to this Plan
that is included in the Participant's gross income. Such contribution shall be
either a direct contribution in cash or pursuant to a payroll withholding
arrangement agreed to by the Employer. The provisions of this section shall be
subject to the provisions of Section 3.10 and shall also be subject to such
uniform and nondiscriminatory conditions and limitations as the Administrator's
Representative may prescribe from time to time for administrative convenience
and to preserve the tax-qualified status of this Plan.
3.8.2. PAYMENT TO TRUSTEE. The nondeductible voluntary contributions of
Participants shall be collected by the Employer by such means as the
Administrator's
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<PAGE>
Representative shall specify. Within the time required by regulations of the
United States Department of Labor, the Employer shall remit all such
nondeductible voluntary contributions to the Trustee for deposit in the Fund.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
3.8.3. ALLOCATION. A NONDEDUCTIBLE VOLUNTARY CONTRIBUTION MADE BY A
PARTICIPANT TO THIS PLAN SHALL BE ALLOCATED TO THAT PARTICIPANT'S NONDEDUCTIBLE
VOLUNTARY ACCOUNT FOR THE PLAN YEAR WITH RESPECT TO WHICH IT IS MADE AND, FOR
THE PURPOSES OF SECTION 4, SHALL BE CREDITED AS OF THE VALUATION DATE COINCIDENT
WITH OR IMMEDIATELY FOLLOWING THE DATE SUCH CONTRIBUTION IS RECEIVED BY THE
TRUSTEE OR, IF THE EMPLOYER HAS SELECTED DAILY VALUATION DATES FOR ACCOUNTING
PURPOSES IN THE ADOPTION AGREEMENT, AS SOON AS PRACTICABLE AFTER SUCH
CONTRIBUTION IS RECEIVED BY THE TRUSTEE.
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3.9. DEDUCTIBLE VOLUNTARY CONTRIBUTIONS. Prior to January 1, 1987, the Plan
accepted deductible voluntary contributions made in accordance with Section 3.6
of the Prior Plan Statement. All such contributions held in the Deductible
Voluntary Account shall continue to share in any trust earnings or losses, and
be distributed in accordance with the provisions of Section 7. Effective
January 1, 1987, however, the Plan shall not accept deductible voluntary
contributions for a taxable year of the Participant beginning after December 31,
1986.
3.10. SECTION 401(m) COMPLIANCE.(3)
3.10.1. SPECIAL DEFINITIONS. For purposes of this Section 3.10, the
following special definitions shall apply:
(a) "ELIGIBLE EMPLOYEE" means an individual who is eligible to make
nondeductible voluntary contributions to this Plan for any portion of
the Plan Year (whether or not he does so) or an individual who is
eligible to receive an Employer matching contribution for any portion
of the Plan Year (whether or not he does so).
(b) "HIGHLY COMPENSATED ELIGIBLE EMPLOYEES" means those eligible employees
defined as highly compensated employees in Appendix D to this Plan
Statement.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
(c) "CONTRIBUTION PERCENTAGE" MEANS, THE RATIO (CALCULATED SEPARATELY FOR
EACH ELIGIBLE EMPLOYEE IN SUCH GROUP) OF:
(i) THE TOTAL AMOUNT, FOR THE PLAN YEAR, OF NONDEDUCTIBLE VOLUNTARY
CONTRIBUTIONS CREDITED TO THE ELIGIBLE EMPLOYEE'S NONDEDUCTIBLE
VOLUNTARY ACCOUNT AND THE TOTAL AMOUNT, FOR THE PLAN YEAR, OF
EMPLOYER MATCHING CONTRIBUTIONS CREDITED TO THE ELIGIBLE
EMPLOYEE'S EMPLOYER MATCHING ACCOUNT (BUT IF THE ADMINISTRATOR'S
REPRESENTATIVE ELECTS TO INCLUDE THE EMPLOYER MATCHING
CONTRIBUTIONS IN THE SECTION 401(k) TEST IN SECTION 2, THE
ADMINISTRATOR'S REPRESENTATIVE MAY ELECT TO NOT INCLUDE THE
EMPLOYER MATCHING CONTRIBUTIONS IN THIS SECTION 401(m) TEST), AND
IF THE ADMINISTRATOR'S REPRESENTATIVE ELECTS ALL OR A PORTION OF
THE AMOUNT, FOR THE PLAN YEAR, OF EMPLOYER CONTRIBUTIONS CREDITED
TO
- ---------------
(3)Except as otherwise specifically provided in this Section, the provisions of
this Section apply for Plan Years beginning after December 31, 1986.
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<PAGE>
THE ELIGIBLE EMPLOYEE'S RETIREMENT SAVINGS ACCOUNT OR EMPLOYER
PROFIT SHARING ACCOUNT, OR BOTH, TO
(ii) THE ELIGIBLE EMPLOYEE'S COMPENSATION, AS DEFINED BELOW, FOR THE
PORTION OF SUCH PLAN YEAR THAT THE EMPLOYEE IS AN ELIGIBLE
EMPLOYEE.
FOR THIS PURPOSE, NONDEDUCTIBLE VOLUNTARY CONTRIBUTIONS ARE CONSIDERED
TO HAVE BEEN MADE IN THE PLAN YEAR IN WHICH CONTRIBUTED TO THE FUND.
ALSO, FOR THIS PURPOSE, EMPLOYER CONTRIBUTIONS WILL BE CONSIDERED MADE
IN THE PLAN YEAR IF THEY ARE ALLOCATED AS OF A DATE DURING SUCH PLAN
YEAR AND ARE DELIVERED TO THE TRUSTEE WITHIN TWELVE (12) MONTHS AFTER
THE END OF SUCH PLAN YEAR. SUCH "CONTRIBUTION PERCENTAGE" SHALL NOT
INCLUDE EMPLOYER MATCHING CONTRIBUTIONS THAT ARE FORFEITED EITHER TO
CORRECT EXCESS AGGREGATE CONTRIBUTIONS OR BECAUSE THE CONTRIBUTIONS TO
WHICH THEY RELATE ARE EXCESS DEFERRALS, EXCESS CONTRIBUTIONS OR EXCESS
AGGREGATE CONTRIBUTIONS PURSUANT TO SECTION 7.12.
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SECOND AMENDMENT-EFFECTIVE JANUARY 1, 1994
(d) "COMPENSATION" MEANS COMPENSATION FOR SERVICES PERFORMED FOR THE
EMPLOYER DEFINED AS "SECTION 415 COMPENSATION" IN APPENDIX A TO THIS
PLAN STATEMENT. THE ADMINISTRATOR'S REPRESENTATIVE MAY ELECT TO
INCLUDE AS COMPENSATION ANY ELECTIVE CONTRIBUTIONS MADE BY THE
EMPLOYER ON BEHALF OF THE ELIGIBLE EMPLOYEE THAT ARE NOT INCLUDIBLE IN
GROSS INCOME UNDER SECTIONS 125, 402(a)(8), 402(h), 403(b), 414(h)(2)
AND 457 OF THE INTERNAL REVENUE CODE. NOTWITHSTANDING THE DEFINITION
OF "SECTION 415 COMPENSATION" IN APPENDIX A TO THIS PLAN STATEMENT
COMPENSATION SHALL ALWAYS BE DETERMINED ON A CASH (AND NOT ON AN
ACCRUAL) BASIS AND COMPENSATION SHALL BE DETERMINED ON A PLAN YEAR
BASIS (WHICH IS NOT NECESSARILY THE SAME AS THE LIMITATION YEAR). AN
ELIGIBLE EMPLOYEE'S COMPENSATION FOR A PLAN YEAR SHALL NOT EXCEED THE
ANNUAL COMPENSATION LIMIT UNDER SECTION 401(a)(17) OF THE INTERNAL
REVENUE CODE. FOR PURPOSES OF THE FOREGOING, THE ANNUAL COMPENSATION
LIMIT UNDER SECTION 401(a)(17) OF THE INTERNAL REVENUE CODE SHALL BE
TWO HUNDRED THOUSAND DOLLARS ($200,000) (AS ADJUSTED UNDER THE
INTERNAL REVENUE CODE FOR COST OF LIVING INCREASES) FOR PLAN YEARS
BEGINNING BEFORE JANUARY 1, 1994, AND SHALL BE ONE HUNDRED AND FIFTY
THOUSAND DOLLARS ($150,000) (AS SO ADJUSTED) FOR PLAN YEARS BEGINNING
ON OR AFTER JANUARY 1, 1994.
- --------------------------------------------------------------------------------
(e) "AVERAGE CONTRIBUTION PERCENTAGE" means, for a specified group of
eligible employees for the Plan Year, the average of the contribution
percentage for all eligible employees in such group.
3.10.2. SPECIAL RULES. For purposes of this Section 3.10, the following
special rules apply:
(a) ROUNDING. Effective for Plan Years beginning after December 31, 1988,
the contribution percentages and average contribution percentage for
each group of eligible employees shall be calculated to the nearest
one-hundredth of one percent of the eligible employee's compensation.
- --------------------------------------------------------------------------------
SECOND AMENDMENT-EFFECTIVE JANUARY 1, 1994
(b) FAMILY MEMBER. IF A HIGHLY COMPENSATED ELIGIBLE EMPLOYEE IS SUBJECT
TO THE FAMILY AGGREGATION RULES OF SECTION 414(q)(6) OF THE INTERNAL
REVENUE CODE
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<PAGE>
BECAUSE SUCH EMPLOYEE IS EITHER A FIVE PERCENT (5%) OWNER OR ONE
OF THE TEN (10) MOST HIGHLY COMPENSATED EMPLOYEES (AS DEFINED
IN APPENDIX D), THE COMBINED CONTRIBUTION PERCENTAGE FOR THE FAMILY
GROUP (WHICH IS TREATED AS ONE HIGHLY COMPENSATED ELIGIBLE EMPLOYEE)
SHALL BE DETERMINED BY COMBINING THE AMOUNTS DESCRIBED IN SECTION
3.10.1(c)(i) AND BY COMBINING THE COMPENSATION DESCRIBED IN SECTION
3.10.1(d) OF ALL FAMILY MEMBERS WHO ARE ELIGIBLE EMPLOYEES. THE
FAMILY MEMBERS WHO ARE AGGREGATED WITH RESPECT TO A HIGHLY COMPENSATED
ELIGIBLE EMPLOYEE SHALL BE DISREGARDED AS SEPARATE ELIGIBLE EMPLOYEES
IN DETERMINING THE AVERAGE CONTRIBUTION PERCENTAGE OF HIGHLY
COMPENSATED ELIGIBLE EMPLOYEES AND THE AVERAGE CONTRIBUTION PERCENTAGE
OF ALL OTHER ELIGIBLE EMPLOYEES. IF AN ELIGIBLE EMPLOYEE IS REQUIRED
TO BE AGGREGATED AS A MEMBER OF MORE THAN ONE FAMILY GROUP IN THE
PLAN, ALL ELIGIBLE EMPLOYEES WHO ARE MEMBERS OF THOSE FAMILY GROUPS
THAT INCLUDE THAT ELIGIBLE EMPLOYEE ARE AGGREGATED AS ONE FAMILY
GROUP. WITH RESPECT TO ANY HIGHLY COMPENSATED ELIGIBLE EMPLOYEE,
"FAMILY" SHALL MEAN THE EMPLOYEE'S SPOUSE AND LINEAL ASCENDANTS AND
DESCENDANTS AND THE SPOUSES OF SUCH LINEAL ASCENDANTS AND DESCENDANTS.
THE LIMIT ON ANNUAL COMPENSATION UNDER SECTION 401(a)(17) OF THE
INTERNAL REVENUE CODE APPLIES TO THE ABOVE CONTRIBUTION PERCENTAGE
DETERMINATION EXCEPT THAT FOR PURPOSES OF THAT LIMIT, THE TERM
"FAMILY" SHALL INCLUDE ONLY THE SPOUSE OF THE ELIGIBLE EMPLOYEE AND
LINEAL DESCENDANTS OF THE ELIGIBLE EMPLOYEE WHO HAVE NOT ATTAINED AGE
NINETEEN (19) YEARS BEFORE THE CLOSE OF THAT PLAN YEAR. FOR PURPOSES
OF THE FOREGOING, THE ANNUAL COMPENSATION LIMIT UNDER SECTION
401(a)(17) OF THE INTERNAL REVENUE CODE SHALL BE TWO HUNDRED THOUSAND
DOLLARS ($200,000) (AS ADJUSTED UNDER THE INTERNAL REVENUE CODE FOR
COST OF LIVING INCREASES) FOR PLAN YEARS BEGINNING BEFORE JANUARY 1,
1994, AND SHALL BE ONE HUNDRED AND FIFTY THOUSAND DOLLARS ($150,000)
(AS SO ADJUSTED) FOR PLAN YEARS BEGINNING ON OR AFTER JANUARY 1, 1994.
- --------------------------------------------------------------------------------
(c) MULTIPLE USE. Effective for Plan Years beginning after December 31,
1988, if one or more highly compensated employees (as defined in
Appendix D) are subject to the 401(k) test described in Section 2.7
and to the 401(m) test described in this Section 3.10 and the sum of
the average deferral percentage and the average contribution
percentage of those highly compensated employees subject to either or
both tests exceeds the aggregate limit (as defined in this Section
3.10), then the average contribution percentage of those highly
compensated eligible employees who are also subject to the 401(k) test
described in Section 2.7 will be reduced (beginning with such highly
compensated eligible employee whose contribution percentage is the
highest) so that the aggregate limit is not exceeded. The amount by
which each highly compensated eligible employee's contribution
percentage is reduced shall be treated as an Excess Aggregate
Contribution (as defined in Section 7). The average deferral
percentage and the average contribution percentage of the highly
compensated eligible employees are determined after any corrections
required to meet the tests described in Section 2.7 and in Section
3.10. Multiple use does not occur if both the average deferral
percentage and the average contribution percentage of the highly
compensated employees does not exceed one and twenty-five hundredths
(1.25) multiplied by the average deferral percentage and average
contribution percentage of the other eligible employees. For purposes
of this Section 3.10, the "aggregate limit" shall mean the sum of (i)
one hundred twenty-five percent (125%) of the GREATER of (A) the
average deferral percentage of employees other than the highly
compensated covered employees for the Plan Year, or (B) the average
contribution percentage of employees other than the highly compensated
eligible employees subject to the 401(m) test in this Section 3.10 for
the Plan Year and (ii) the lesser of two hundred percent (200%) or two
(2) plus
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the lesser of such average deferral percentage or average contribution
percentage.
(d) MULTIPLE PLANS. For purposes of this Section 3.10, the contribution
percentage for any highly compensated eligible employee who
participates in two or more arrangements described in section 401(k)
of the Internal Revenue Code that are maintained by the Employer,
shall be determined as if the total of the amounts described in
Section 3.10.1(c)(i) above was made under each such plan. If a highly
compensated eligible employee participates in two or more such
arrangements that have different plan years, all arrangements ending
with or within the same calendar year shall be treated as a single
arrangement. In the event that this Plan satisfies the requirements
of section 401(m), 401(a)(4) or 410(b) of the Internal Revenue Code
only if aggregated with one or more other plans, or if one or more
other plans satisfy the requirements of such sections of the Internal
Revenue Code only if aggregated with this Plan, then this Section 3.10
shall be applied by determining the contribution percentage of
eligible employees as if all such plans were a single plan. For plan
years beginning after December 31, 1989, plans may be aggregated in
order to satisfy section 401(m) of the Internal Revenue Code only if
they have the same Plan Year.
(e) RECORDS. The Employer shall maintain records sufficient to
demonstrate satisfaction of one of the tests described in Section
3.10.3 and the amount of matching contributions (as defined in section
401(m)(4)(A) of the Internal Revenue Code which meet the requirements
of section 401(k)(2)(B) and (C) of the Internal Revenue Code) or
qualified nonelective contributions (within the meaning of section
401(m)(4)(C) of the Internal Revenue Code). The determination and
treatment of the contribution percentage of any Participant shall
satisfy such other requirements as may be prescribed by the Secretary
of the Treasury.
3.10.3. THE TESTS. Notwithstanding the provisions of Section 3.3 or
Section 3.4.4 and Section 3.8, the nondeductible voluntary contributions and
Employer matching contributions made for each Plan Year shall be limited and
modified under uniform and nondiscriminatory rules established by the
Administrator's Representative and by the rules hereinafter provided in order
that one of the following two (2) tests is satisfied for that Plan Year:
TEST 1: The average contribution percentage for the group of highly
compensated eligible employees is not more than the average
contribution percentage of all other eligible employees
multiplied by one and twenty-five hundredths (1.25).
TEST 2: The excess of the average contribution percentage for the group
of highly compensated eligible employees over that of all other
eligible employees is not more than two (2) percentage points,
and the average contribution percentage for the group of highly
compensated eligible employees is not more than the average
contribution percentage of all other eligible employees
multiplied by two (2).
The Administrator's Representative shall maintain records to demonstrate
compliance with one of the two (2) tests described above, including the extent
to which Employer contributions credited to Retirement Savings Accounts and
qualified nonelective contributions (as defined in Section 3.10.1(c)) are used
in determining the contribution percentage.
3.10.4. REMEDIAL ACTION. If the Administrator's Representative
determines that neither of the tests will be satisfied (or may not be satisfied)
for a Plan Year, then during such
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Plan Year, the following actions may be taken so that one of the tests will
be satisfied for such Plan Year:
(a) The nondeductible voluntary contributions of the highly compensated
eligible employees who have the highest contribution percentage shall
be reduced to the extent necessary to reduce their contribution
percentage to the next lower percentage.
(b) If neither of the tests is satisfied after such adjustment, the
nondeductible voluntary contributions of the highly compensated
eligible employees who then have the highest contribution percentage
(including those reduced under (a) above) shall be reduced to the
extent necessary to reduce their contribution percentage to the next
lower percentage.
(c) If neither of the tests is satisfied after such adjustment, this
method of adjustment shall be repeated one or more additional times
until one of the tests is satisfied or until no further adjustments
can be made in the nondeductible voluntary contributions of the highly
compensated eligible employees.
(d) If neither of the tests is satisfied after adjusting the nondeductible
voluntary contributions of the highly compensated eligible employees,
then the Employer matching contributions for the highly compensated
eligible employees who have the highest contribution percentage
(including those reduced under (a) through (c) above) shall be reduced
to the extent necessary to reduce their contribution percentage to the
next lower percentage.
(e) If neither of the tests is satisfied after such adjustment, the
Employer matching contributions for the highly compensated eligible
employees who then have the highest contribution percentage (including
those reduced under (d) above) shall be reduced to the extent
necessary to reduce their contribution percentage to the next lower
percentage.
(f) If neither of the tests is satisfied after such adjustment, this
method of adjustment shall be repeated one or more additional times
until one of the tests is satisfied.
The Administrator's Representative shall prescribe rules concerning such
adjustments, including the frequency of applying the tests and the commencement
and termination dates for any adjustments. Any amounts required to be
distributed as provided above which are distributed more than 2-1/2 months after
the close of the Plan Year being tested, will result in a ten percent (10%)
penalty tax on the Employer as provided in section 4979 of the Internal Revenue
Code.
3.11. LIMITATION ON ALLOCATIONS. In no event shall any amount be allocated
to the Account of any Participant if, or to the extent, such amounts would
exceed the limitations set forth in the Appendix A to this Plan Statement.(4)
- ---------------
(4)The provisions of Appendix A apply to Plan Years beginning after
December 31, 1986.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
3.12. EFFECT OF DISALLOWANCE OF DEDUCTION OR MISTAKE OF FACT ALL EMPLOYER
CONTRIBUTIONS TO THE PLAN ARE CONDITIONED ON THEIR QUALIFICATION FOR DEDUCTION
FOR FEDERAL INCOME TAX PURPOSES UNDER SECTION 404 OF THE INTERNAL REVENUE CODE.
If the deduction for federal income tax purposes under section 404 of the
Internal Revenue Code should be disallowed, in whole or in part, for any
Employer contribution to this Plan for any year, or if any Employer contribution
to this Plan is made by reason of a mistake of fact, then there shall be
calculated the excess of the amount contributed over the amount that would have
been contributed had there not occurred a mistake in determining the deduction
or a mistake of fact. The Employer, at its election, may direct the Trustee to
return such excess, adjusted for its pro rata share of any net loss (but not any
net gain) in the value of the Fund which accrued while such excess was held
therein, to the Employer within one (1) year of the disallowance of the
deduction or the mistaken payment of the contribution, as the case may be. If
the return of such amount would cause the balance of any Account of any
Participant to be reduced to less than the balance which would have been in such
Account had the mistaken amount not been contributed, however, the amount to be
returned to the Employer shall be limited so as to avoid such reduction.
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<PAGE>
SECTION 4
INVESTMENT AND ADJUSTMENT OF ACCOUNTS
4.1. ESTABLISHMENT OF SUBFUNDS.
4.1.1. ESTABLISHING COMMINGLED SUBFUNDS. The Administrator's
Representative may (but is not required to) direct the Trustee in writing to
divide the Fund into two (2) or more investment Subfunds, which shall serve as
vehicles for the investment of Participants' Accounts and which shall be managed
either by the Trustee or by one or more Investment Managers, as the
Administrator's Representative shall determine. The Administrator's
Representative shall determine the general investment characteristics and
objectives of each investment Subfund. The Trustee or Investment Manager, as
the case may be, shall have complete investment discretion over each investment
Subfund assigned to it, subject only to the general investment characteristics
and objectives established for the particular investment Subfund. The Account
of each investing Participant shall have a ratable interest in the Subfund.
4.1.2. INDIVIDUAL SUBFUNDS. The Administrator's Representative may (but
is not required to) direct the Trustee in writing to establish investment
Subfunds that consist solely of all or a part of the assets of a single
Participant's Total Account, whose assets the Participant controls by investment
directives to the Trustee and which may not be commingled with the assets of any
other Participant's Accounts. If any Participant is permitted to direct the
Trustee with regard to the investment of his individual investment Subfund, then
all Participants shall be permitted to direct the Trustee with respect to their
individual investment Subfunds. In no event, however, shall the Participant be
allowed to direct the investment of assets in such individual investment Subfund
in any work of art, rug or antique, metal or gem, stamp or coin, alcoholic
beverage or other similar tangible personal property if the investment in such
property shall have been prohibited by the Secretary of the Treasury.
Notwithstanding anything apparently to the contrary in Section 10.6, all voting
or similar rights exercisable with respect to assets held in an individually
directed subfund shall be exercisable solely by the Participant or Beneficiary
whose Account is invested in such individually directed subfund.
4.1.3. OPERATIONAL RULES. In accordance with uniform rules, the
Administrator's Representative shall determine the circumstances under which a
particular investment Subfund may be elected, or shall be automatically
utilized, the minimum or maximum amount or percentage of an Account which may be
invested in a particular investment Subfund, the procedures for making or
changing investment elections and the effect of a Participant's or Beneficiary's
failure to make an effective election with respect to all or any portion of an
Account.
4.1.4. REVISING SUBFUNDS. The Administrator's Representative shall have
the power, from time to time, to dissolve investment Subfunds, to direct that
additional investment Subfunds be established, to change Investment Managers for
any one or more of the investment Subfunds, and, under uniform rules, to
withdraw or limit participation in a particular investment Subfund. In
connection with the power to commingle reserved to the Trustee under Section
10.6, the Administrator's Representative shall also have the power to direct the
Trustee to consolidate any separate investment Subfunds hereunder with any other
separate investment Subfunds having the same investment objectives which are
established under any other retirement plan trust fund of the Employer or any
corporation affiliated in ownership or management with the Employer of which the
Trustee is trustee and which are managed by the Trustee or the same Investment
Manager.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
4.1.5. ERISA SECTION 404(c) COMPLIANCE. IF THE ADMINISTRATOR'S
REPRESENTATIVE AND THE TRUSTEE AGREE, THE ADMINISTRATOR'S REPRESENTATIVE MAY
ESTABLISH INVESTMENT SUBFUNDS AND OPERATIONAL RULES WHICH ARE INTENDED TO
SATISFY SECTION 404(c) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974
AND THE REGULATIONS THEREUNDER. SUCH INVESTMENT SUBFUNDS SHALL PERMIT
PARTICIPANTS AND BENEFICIARIES THE OPPORTUNITY TO CHOOSE FROM AT LEAST THREE
INVESTMENT ALTERNATIVES, EACH OF WHICH IS DIVERSIFIED, EACH OF WHICH PRESENT
MATERIALLY DIFFERENT RISK AND RETURN CHARACTERISTICS, AND WHICH, IN THE
AGGREGATE, ENABLE PARTICIPANTS AND BENEFICIARIES TO ACHIEVE A PORTFOLIO WITH
APPROPRIATE RISK AND RETURN CHARACTERISTICS CONSISTENT WITH MINIMIZING RISK
THROUGH DIVERSIFICATION. SUCH OPERATIONAL RULES SHALL PROVIDE THE FOLLOWING,
AND SHALL OTHERWISE COMPLY WITH SECTION 404(c) OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974 AND THE REGULATIONS AND RULES PROMULGATED THEREUNDER FROM
TIME TO TIME:
(a) PARTICIPANTS AND BENEFICIARIES MAY GIVE INVESTMENT INSTRUCTIONS TO THE
TRUSTEE AT LEAST ONCE EVERY THREE MONTHS;
(b) THE TRUSTEE MUST FOLLOW THE INVESTMENT INSTRUCTIONS OF PARTICIPANTS
AND BENEFICIARIES THAT COMPLY WITH THE PLAN'S OPERATIONAL RULES,
PROVIDED THAT THE TRUSTEE MAY IN ANY EVENT DECLINE TO FOLLOW ANY
INVESTMENT INSTRUCTIONS THAT:
(i) WOULD RESULT IN A PROHIBITED TRANSACTION DESCRIBED IN
SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
OF 1974 OR SECTION 4975 OF THE INTERNAL REVENUE CODE;
(ii) WOULD RESULT IN THE ACQUISITION OF AN ASSET THAT MIGHT
GENERATE INCOME WHICH IS TAXABLE TO THE PLAN;
(iii) WOULD NOT BE IN ACCORDANCE WITH THE DOCUMENTS AND
INSTRUMENTS GOVERNING THE PLAN INSOFAR AS THEY ARE
CONSISTENT WITH TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974;
(iv) WOULD CAUSE A FIDUCIARY TO MAINTAIN INDICIA OF OWNERSHIP
OF ANY ASSETS OF THE PLAN OUTSIDE OF THE JURISDICTION OF THE
DISTRICT COURTS OF THE UNITED STATES OTHER THAN AS PERMITTED
BY SECTION 404(b) OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974 AND DEPARTMENT OF LABOR REGULATION
SECTION 2050.404B-1;
(v) WOULD JEOPARDIZE THE PLAN'S TAX STATUS UNDER THE INTERNAL
REVENUE CODE;
(vi) COULD RESULT IN A LOSS IN EXCESS OF A PARTICIPANT'S OR
BENEFICIARY'S ACCOUNT BALANCE;
(vii) WOULD RESULT IN THE ACQUISITION OR SALE OF ANY EMPLOYER REAL
PROPERTY OR ANY EMPLOYER SECURITY UNLESS SUCH EMPLOYER
SECURITY ACQUISITION SATISFIES THE CONDITIONS OF
SECTION 408(e) OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974 AND DEPARTMENT OF LABOR REGULATION SECTION
2550.404c-1.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
(c) PARTICIPANTS AND BENEFICIARIES SHALL BE PERIODICALLY INFORMED OF
TRANSACTIONAL FEES AND EXPENSES (E.G., COMMISSIONS, SALES LOADS,
DEFERRED SALES CHARGES,
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<PAGE>
REDEMPTION OR EXCHANGE FEES) THAT AFFECT THEIR ACCOUNTS AND ARE
RELATED TO THEIR PLAN INVESTMENT DECISIONS;
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
(d) WITH RESPECT TO ANY SUBFUND CONSISTING OF EMPLOYER SECURITIES AND
INTENDED TO SATISFY THE REQUIREMENTS OF SECTION 404(c) OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, (i) PARTICIPANTS AND
BENEFICIARIES SHALL BE ENTITLED TO ALL VOTING, TENDER AND OTHER RIGHTS
APPURTENANT TO THE OWNERSHIP OF SUCH SECURITIES, (ii) PROCEDURES SHALL
BE ESTABLISHED TO ENSURE THE CONFIDENTIAL EXERCISE OF SUCH RIGHTS,
EXCEPT TO THE EXTENT NECESSARY TO COMPLY WITH FEDERAL AND STATE LAWS
NOT PREEMPTED BY THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974,
AND (iii) THE TRUSTEE SHALL ENSURE THE SUFFICIENCY OF AND COMPLIANCE
WITH SUCH CONFIDENTIALITY PROCEDURES.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
4.2. VALUATION AND ADJUSTMENT OF ACCOUNTS. THE TRUSTEE SHALL VALUE EACH
INVESTMENT SUBFUND AS OF EACH VALUATION DATE (WHICH FOR PURPOSES OF THIS SECTION
4.2 SHALL INCLUDE ANY VALUATION DATE WHICH A DISTRIBUTION IS TO BE MADE PURSUANT
TO SECTION 7), WHICH VALUATION SHALL REFLECT, AS NEARLY AS POSSIBLE, THE THEN
FAIR MARKET VALUE OF THE ASSETS COMPRISING SUCH SUBFUND (INCLUDING INCOME
ACCUMULATIONS THEREIN). IN MAKING SUCH VALUATIONS, THE TRUSTEE MAY RELY UPON
INFORMATION SUPPLIED BY AN INVESTMENT MANAGER HAVING INVESTMENT RESPONSIBILITY
OVER THE PARTICULAR SUBFUND.
- --------------------------------------------------------------------------------
As of each Valuation Date (the "current Valuation Date"), the value of each
Account or portion of an Account invested in a particular investment Subfund,
including Suspense Accounts, determined as of the last preceding Valuation Date
(the "initial Account value") shall be increased (or decreased) by the following
adjustments made in the following sequence:
(a) INTERMEDIATE DISTRIBUTIONS ADJUSTMENT. The initial Account value
shall be adjusted by the total amount:
(i) distributed in fact to (or with respect to) the Participant
from such Account, and
(ii) loaned to the Participant, whether the loan was made before
or after the date on which the initial Account value is
determined, if the Adoption Agreement provides that loans
shall be made from the individual Account of the Participant
who received the loan, and
(iii) transferred from such Account to another Account of that
Participant (or any other Participant) within this Plan
(including amounts transferred to other investment Subfunds)
or to the trustee of another plan pursuant to an arrangement
contemplated under Section 9.3, and
(iv) transferred into such Account from another Account of that
Participant (or any other Participant) within this Plan
(including amounts transferred from other investment
Subfunds), or from the trustee of another plan pursuant to
an arrangement contemplated under Section 9.3, and
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<PAGE>
(v) paid as expenses incurred by the Plan which were charged
specifically against that Account (as distinguished from
being a general charge against the assets of the Fund),
as of a date subsequent to the last preceding Valuation Date but prior
to the current Valuation Date.
(b) INVESTMENT ADJUSTMENT. The initial Account value (as adjusted above)
shall be increased (or decreased), in the ratio that such Account
value bears to all Account Values, for the:
(i) realized and unrealized gains and losses on the assets of
the Fund, and
(ii) income earned by the Fund (excluding income, if any,
allocated as provided in item (iii) and the last sentence of
this Section 4.2(b)), and
(iii) if the Adoption Agreement so provides, income earned on
contributions made to the Account in advance of the
Valuation Date as of which such contributions are allocated
to the Account, and
(iv) expenses incurred by the Plan and paid generally from the
Fund (rather than charged specifically against a particular
Account),
as of a date subsequent to the last preceding Valuation Date but not
later than the current Valuation Date. In addition, the initial value
of each Retirement Savings Account shall also be increased (or
decreased) for its proportionate share of income earned on retirement
savings contributions, as described in Section 3.2, deposited to the
Account as of any date subsequent to the last preceding Valuation Date
but before the current Valuation Date.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
(c) CONTRIBUTION ADJUSTMENT. THE INITIAL ACCOUNT VALUE (AS ADJUSTED
ABOVE) SHALL BE INCREASED BY THE TOTAL AMOUNT CREDITED TO SUCH ACCOUNT
UNDER SECTION 3 AS OF A DATE SUBSEQUENT TO THE LAST PRECEDING
VALUATION DATE BUT NOT LATER THAN THE CURRENT VALUATION DATE.
- --------------------------------------------------------------------------------
(d) FINAL DISTRIBUTIONS ADJUSTMENT. The initial Account value (as
adjusted above) shall be adjusted by the total amount:
(i) distributed in fact to (or with respect to) the Participant
from such Account, and
(ii) transferred from such Account to another Account of that
Participant (or any other Participant) within this Plan
(including amounts transferred to other investment
Subfunds), or to the trustee of another plan pursuant to an
arrangement contemplated under Section 9.3, and
(iii) paid as expenses incurred by the Plan which were charged
specifically against that Account (as distinguished from
being a general charge against the assets of the Fund),
as of the current Valuation Date.
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<PAGE>
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
(e) OTHER RULES. NOTWITHSTANDING THE FOREGOING, THE ADMINISTRATOR'S
REPRESENTATIVE AND THE TRUSTEE MAY AGREE IN WRITING TO REVISED RULES
OR ADDITIONAL RULES FOR THE ADJUSTMENT OF ACCOUNTS INCLUDING, WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, THE TIMES WHEN CONTRIBUTIONS
SHALL BE CREDITED UNDER SECTION 3 FOR THE PURPOSES OF ALLOCATING GAINS
OR LOSSES UNDER THIS SECTION 4.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
(f) DAILY VALUATION RULES. NOTWITHSTANDING THE FOREGOING, IF THE EMPLOYER
HAS SELECTED DAILY VALUATION DATES IN THE ADOPTION AGREEMENT, THE
FOLLOWING ACCOUNTING RULES WILL APPLY:
(i) VALUATION OF THE FUND. THE TRUSTEE SHALL VALUE EACH SUBFUND FROM
TIME TO TIME (BUT NOT LESS FREQUENTLY THAN EACH ANNUAL VALUATION
DATE), WHICH VALUATION SHALL REFLECT, AS NEARLY AS POSSIBLE, THE
THEN FAIR MARKET VALUE OF THE ASSETS COMPRISING SUCH SUBFUND
(INCLUDING INCOME ACCUMULATIONS THEREIN). IN MAKING SUCH
VALUATIONS, THE TRUSTEE MAY RELY UPON INFORMATION SUPPLIED BY ANY
INVESTMENT MANAGER HAVING INVESTMENT RESPONSIBILITY OVER THE
PARTICULAR SUBFUND.
(ii) ADJUSTMENT OF ACCOUNTS. THE EMPLOYER SHALL CAUSE THE VALUE OF
EACH ACCOUNT OR PORTION OF AN ACCOUNT INVESTED IN A PARTICULAR
SUBFUND (INCLUDING UNDISTRIBUTED TOTAL ACCOUNTS) TO BE INCREASED
(OR DECREASED) FROM TIME TO TIME FOR DISTRIBUTIONS,
CONTRIBUTIONS, INVESTMENT GAINS (OR LOSSES) AND EXPENSES CHARGED
TO THE ACCOUNT.
4.3. MANAGEMENT AND INVESTMENT OF FUND. THE FUND IN THE HANDS OF THE TRUSTEE,
TOGETHER WITH ALL ADDITIONAL CONTRIBUTIONS MADE THERETO AND TOGETHER WITH ALL
NET INCOME THEREOF, SHALL BE CONTROLLED, MANAGED, INVESTED, REINVESTED AND
ULTIMATELY PAID AND DISTRIBUTED TO PARTICIPANTS AND BENEFICIARIES BY THE TRUSTEE
WITH ALL THE POWERS, RIGHTS AND DISCRETIONS GENERALLY POSSESSED BY TRUSTEES, AND
WITH ALL THE ADDITIONAL POWERS, RIGHTS AND DISCRETIONS CONFERRED UPON THE
TRUSTEE UNDER THE PLAN STATEMENT, EXCEPT TO THE EXTENT THAT THE TRUSTEE IS
SUBJECT TO THE AUTHORIZED AND PROPERLY GIVEN INVESTMENT DIRECTIONS OF THE
EMPLOYER, PARTICIPANTS, BENEFICIARIES OR INVESTMENT MANAGER. EXCEPT TO THE
EXTENT THAT THE TRUSTEE IS SUBJECT TO THE AUTHORIZED AND PROPERLY GIVEN
INVESTMENT DIRECTIONS OF THE EMPLOYER, PARTICIPANTS, BENEFICIARIES OR INVESTMENT
MANAGER, AND SUBJECT TO THE DIRECTIONS OF THE ADMINISTRATOR'S REPRESENTATIVE
WITH RESPECT TO THE PAYMENT OF BENEFITS HEREUNDER, THE TRUSTEE SHALL HAVE THE
EXCLUSIVE AUTHORITY TO MANAGE AND CONTROL THE ASSETS OF THE FUND IN ITS CUSTODY
AND SHALL NOT BE SUBJECT TO THE DIRECTION OF ANY PERSON IN THE DISCHARGE OF ITS
DUTIES, NOR SHALL ITS AUTHORITY BE SUBJECT TO DELEGATION OR MODIFICATION EXCEPT
BY FORMAL AMENDMENT OF THE PLAN STATEMENT.
IF THE TRUSTEE IS SUBJECT TO THE INVESTMENT DIRECTIONS OF THE EMPLOYER,
PARTICIPANTS, BENEFICIARIES OR INVESTMENT MANAGER, THE TRUSTEE SHALL NOT MAKE
ANY INVESTMENT OR DISPOSE OF ANY INVESTMENT IN THE FUND EXCEPT UPON THE EXPRESS
VERBAL OR WRITTEN DIRECTION OF THE EMPLOYER, PARTICIPANTS, BENEFICIARIES OR
INVESTMENT MANAGER. ALSO, THE TRUSTEE SHALL BE UNDER NO DUTY TO QUESTION ANY
INVESTMENT DIRECTIONS OF THE EMPLOYER, PARTICIPANTS, BENEFICIARIES OR INVESTMENT
MANAGER, TO REVIEW OR MONITOR ANY SECURITIES OR PROPERTY HELD IN THE FUND OR THE
PARTICIPANT'S ACCOUNTS, OR TO GIVE ANY ADVICE TO THE EMPLOYER, PARTICIPANTS,
BENEFICIARIES OR INVESTMENT MANAGER WITH RESPECT TO THE INVESTMENT, RETENTION OR
DISPOSITION OF ANY ASSETS HELD IN THE FUND OR THE PARTICIPANTS' ACCOUNTS.
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<PAGE>
SECTION 5
VESTING
5.1. EMPLOYER MATCHING ACCOUNT AND EMPLOYER CONTRIBUTIONS ACCOUNT.
5.1.1. PROGRESSIVE VESTING.(5) The Employer Matching Account and
Employer Contributions Account of each Participant shall become Vested in him
in accordance with the schedule set forth in the Adoption Agreement;
provided, however, that the Vested percentage of a Participant's Employer
Matching Account and Employer Contributions Account determined as of the
Effective Date (or the date of the execution of the Adoption Agreement by the
Employer, if later) shall be not less than such Vested percentage computed
under the Prior Plan Statement, if any, as of that date.
5.1.2. FULL VESTING. Notwithstanding the foregoing, the entire
Employer Matching Account and Employer Contributions Account of each
Participant shall be fully Vested in him upon the earliest occurrence of any
of the following events while in the employment of the Employer or an
Affiliate:
(a) his death,
(b) his attainment of age sixty-five (65) years or, if earlier, his
attainment of his Normal Retirement Age or his attainment of any
earlier age specified in the Adoption Agreement,
(c) the occurrence of his Disability,
(d) a partial termination of the Plan which is effective as to him, or
(e) a complete termination of the Plan or a complete discontinuance of
Employer contributions hereto.
In addition, a Participant who is not in the employment of the Employer or an
Affiliate upon a complete termination of the Plan or a complete
discontinuance of Employer contributions hereto, shall be so fully Vested if,
on the date of such termination or discontinuance, such Participant has not
had a "forfeiture date" as described in Section 6.2.3.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
5.1.3. SPECIAL RULE FOR PARTIAL DISTRIBUTIONS. IF A DISTRIBUTION IS
MADE OF LESS THAN THE ENTIRE EMPLOYER CONTRIBUTIONS ACCOUNT OF A PARTICIPANT
WHO IS NOT THEN FULLY (100%) VESTED, THEN UNTIL THE PARTICIPANT BECOMES FULLY
VESTED IN HIS EMPLOYER CONTRIBUTIONS ACCOUNT OR UNTIL HE INCURS FIVE (5) OR
MORE CONSECUTIVE ONE-YEAR BREAKS IN SERVICE, WHICHEVER FIRST OCCURS, HIS
VESTED INTEREST IN SUCH ACCOUNT AT ANY RELEVANT TIME SHALL NOT BE LESS THAN
AN AMOUNT ("X") DETERMINED BY THE FORMULA: X=P (B + D) - D. FOR THE PURPOSE
OF APPLYING THE FORMULA, "P" IS THE VESTED PERCENTAGE AT THE RELEVANT TIME
(DETERMINED PURSUANT TO SECTION 5); "B" IS THE ACCOUNT BALANCE AT THE
RELEVANT TIME; AND "D" IS THE AMOUNT OF THE DISTRIBUTION.
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5.1.4. EFFECT OF BREAK ON VESTING. If a Participant who is not fully
(100%) Vested incurs five (5) or more consecutive One-Year Breaks in Service,
returns to Recognized Employment and is thereafter eligible for any
additional allocation of Employer contributions,
- ------------------------
(5)/The vesting schedule in the Adoption Agreement may be superseded
for a Plan Year if the Plan becomes top heavy for that Plan Year. (See Appendix
B, Section 3.2.1.) The effect of this may continue for several years after the
Plan ceases to be top heavy. (See Appendix B, Section 3.2.2.)
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<PAGE>
his undistributed Employer Matching Account or Employer Contributions
Account, if any, attributable to Employer contributions allocated as of a
date before such five (5) consecutive One-Year Breaks in Service, and in
which he has a Vested interest by reason of such prior service, and his new
Employer Matching Account or Employer Contributions Account, in which he may
become Vested by reason of future service, shall be separately maintained for
vesting purposes until he is fully (100%) Vested in each such Account under
the rules of Section 1.1.32 and this Section 5.
5.2. OPTIONAL VESTING SCHEDULE.
5.2.1. ELECTION. If an amendment of this Plan's vesting schedule
should be adopted or the Plan is amended in any way that directly or
indirectly affects the computation of the Participant's Vested percentage, a
qualifying Participant may elect to have the Vested portion of his Employer
Matching Account or Employer Contributions Account determined under the
vesting schedule as it existed immediately before the adoption of such
amendment. (In no event shall an amendment of this Plan's vesting schedule
reduce a Participant's Vested percentage as of the date such amendment is
adopted or, if later, the date such amendment is effective.)
5.2.2. QUALIFYING PARTICIPANT. A Participant in this Plan qualifies
for the election described in this Section 5.2 only if, as of the expiration
of the period described in Section 5.2.3, he has five (5) or more years of
Vesting Service; provided, however, effective for Plan Years beginning after
December 31, 1988, a Participant who has one (1) or more Hours of Service in
any Plan Year beginning after December 31, 1988, qualifies for the election
described in this Section 5.2, only if, as of the expiration of the period
described in Section 5.2.3, he has three (3) or more years of Vesting Service.
5.2.3. PROCEDURE FOR ELECTION. The election described in Section
5.2.1 shall be effective only if it is executed in writing upon forms to be
prepared by the Administrator's Representative and delivered to the
Administrator's Representative after the date upon which the amendment is
formally adopted and before the latest of:
(a) the date sixty (60) days after such formal adoption,
(b) the date sixty (60) days after the date such amendment becomes
effective, or
(c) the date sixty (60) days after the date the Participant is issued
written notice of the adoption of the amendment.
5.2.4. CONCLUSIVE ELECTION. Failure to file an election will be
deemed an irrevocable waiver of the election. An election filed in
accordance with this provision will be irrevocable from the date it is filed.
5.3. OTHER ACCOUNTS. The Retirement Savings Account, Rollover Account,
Nondeductible Voluntary Account, Deductible Voluntary Account, and Transfer
Account of each Participant shall be fully (100%) Vested in him at all times.
Each Account will be credited with applicable contributions, forfeitures,
earnings and losses as provided in Section 4.
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SECTION 6
MATURITY
6.1. EVENTS OF MATURITY. A Participant's Total Account shall mature and the
Vested portion shall become distributable in accordance with Section 7 upon
the earliest occurrence of any of the following events while in the
employment of the Employer or an Affiliate:
(a) his death,
(b) his separation from service, whether voluntary or involuntary,
(c) his attainment of age seventy and one-half (70-1/2) years,
(d) crediting of any amount to his Account after his attainment of age
seventy and one-half (70-1/2) years,
(e) his Disability,
(f) termination of the Plan without the establishment or maintenance of
another defined contribution plan (other than an employee stock
ownership plan as defined in section 4975(e)(7) of the Internal
Revenue Code),
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
(g) THE DISPOSITION BY THE EMPLOYER TO AN UNRELATED ORGANIZATION OF
SUBSTANTIALLY ALL THE ASSETS (WITHIN THE MEANING OF SECTION 409(d)(2)
OF THE INTERNAL REVENUE CODE) USED BY THE EMPLOYER IN A TRADE OR
BUSINESS OF THE EMPLOYER, BUT ONLY WITH RESPECT TO EMPLOYEES WHO
CONTINUE EMPLOYMENT WITH THE ORGANIZATION ACQUIRING SUCH ASSETS AND
ONLY IF THE PURCHASE AND SALE AGREEMENT SPECIFICALLY AUTHORIZES
DISTRIBUTION OF THIS PLAN'S ASSETS IN CONNECTION WITH SUCH DISPOSITION
AND THE EMPLOYER CONTINUES TO MAINTAIN THE PLAN AFTER THE DISPOSITION,
(h) THE DISPOSITION BY THE EMPLOYER TO AN UNRELATED ORGANIZATION OF THE
EMPLOYER'S INTEREST IN A SUBSIDIARY (WITHIN THE MEANING OF SECTION
409(d)(3) OF THE INTERNAL REVENUE CODE), BUT ONLY WITH RESPECT TO
EMPLOYEES WHO CONTINUE EMPLOYMENT WITH SUCH SUBSIDIARY AND ONLY IF THE
PURCHASE AND SALE AGREEMENT SPECIFICALLY AUTHORIZES DISTRIBUTION OF
THIS PLAN'S ASSETS IN CONNECTION WITH SUCH DISPOSITION AND THE
EMPLOYER CONTINUES TO MAINTAIN THE PLAN AFTER THE DISPOSITION, OR
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(i) if the Adoption Agreement so provides, his attainment of age fifty-
nine and one-half (59-1/2) years.
provided, however, that a transfer from Recognized Employment to employment
with the Employer that is other than Recognized Employment or a transfer from
the employment of one Employer participating in this Plan to another such
Employer or to any Affiliate shall not constitute an Event of Maturity.
6.2. DISPOSITION OF NON-VESTED PORTION OF ACCOUNT. Upon the occurrence of a
Participant's Event of Maturity, if any portion of his Employer Matching
Account or his Employer Contributions Account is not Vested in him, such
portion shall be transferred to his Suspense Account as of the Valuation Date
coincident with or next following such Event of Maturity.
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6.2.1. NO BREAK. If such former Participant is reemployed by the
Employer or an Affiliate on or before the Annual Valuation Date coincident
with or immediately following his "forfeiture date" (as defined in Section
6.2.3), the portion of his Employer Matching Account or his Employer
Contributions Account which was not Vested in him upon his Event of Maturity
(and therefore became his Suspense Account) shall be transferred back to and
held in his Employer Matching Account or his Employer Contributions Account
under the Plan as of the Valuation Date coincident with or next following the
reemployment date and it shall be held there pending the occurrence of
another Event of Maturity effective as to him, during which period of
subsequent employment he may earn a Vested interest in some or all of such
portion in accordance with the provisions of Section 5.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
6.2.2. A BREAK. IF, HOWEVER, SUCH FORMER PARTICIPANT IS NOT
REEMPLOYED BY THE EMPLOYER OR AN AFFILIATE ON OR BEFORE THE ANNUAL VALUATION
DATE COINCIDENT WITH OR IMMEDIATELY FOLLOWING HIS FORFEITURE DATE, THE ENTIRE
PORTION OF HIS EMPLOYER MATCHING ACCOUNT OR HIS EMPLOYER CONTRIBUTIONS
ACCOUNT WHICH WAS NOT VESTED IN HIM UPON HIS EVENT OF MATURITY (AND THEREFORE
BECAME HIS SUSPENSE ACCOUNT) SHALL BE FORFEITED AS OF SUCH ANNUAL VALUATION
DATE AND SHALL BE USED TO RESTORE ANY FORFEITED SUSPENSE ACCOUNTS AS REQUIRED
IN SECTION 6.3, TO REDUCE ADMINISTRATIVE EXPENSES DUE ON THAT ANNUAL
VALUATION DATE AND NOT PAID BY THE EMPLOYER AND TO REDUCE ANY EMPLOYER
CONTRIBUTION TO BE MADE AS OF THAT ANNUAL VALUATION DATE. ANY REMAINING
PORTION OF THE FORFEITURE SHALL BE USED TO REDUCE ADMINISTRATIVE EXPENSES OR
ANY EMPLOYER CONTRIBUTION TO BE MADE AS OF ANY VALUATION DATE IN THE
SUCCEEDING PLAN YEAR UNTIL DISPOSED OF. IN ALL EVENTS, ANY FORFEITURES
OTHERWISE NOT DISPOSED OF IN THE PRECEDING SENTENCES, SHALL BE ALLOCATED AS
OF THE ANNUAL VALUATION DATE OF THE SUCCEEDING PLAN YEAR AS PROVIDED IN
SECTION 3.4.
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6.2.3. FORFEITURE DATE. For the purpose of the foregoing, a
Participant's forfeiture date shall be the date (following his Event of
Maturity) as of which occurred the earliest of:
(i) his fifth (5th) consecutive One-Year Break in Service
following his Event of Maturity,
(ii) the distribution of his entire Vested Total Account, or
(iii) his Event of Maturity if he has no Vested interest in his
Total Account (that is, his Vested interest, consisting of
zero, will be deemed to be distributed).
6.3. RESTORATION OF FORFEITED ACCOUNTS. If a Participant:
(a) incurs an Event of Maturity at a time when he was not fully (100%)
Vested in his Employer Matching Account or Employer Contributions
Account, and
(b) has had his Suspense Account (which was established on account of that
Event of Maturity) forfeited and disposed of as provided in Section
6.2, and
(c) becomes an employee of the Employer or an Affiliate before he has five
(5) consecutive One-Year Breaks in Service following the Event of
Maturity,
then there shall be restored to his Employer Matching Account or his Employer
Contributions Account an amount equal to the amount which was forfeited from
his Suspense Account (without any adjustment for income, gains or losses).
This restoration shall occur as of the Annual Valuation Date next following
his return to participation in the Plan and shall be conditioned upon his
remaining in employment with the Employer or Affiliate until that Annual
Valuation Date. The amount so restored shall be held in a separate account
and shall
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become Vested in accordance with the rules of Section 5.1.3. The amount
necessary to make the restoration shall come first from Suspense Accounts to
be forfeited on the Annual Valuation Date on which the restoration is to
occur. If Suspense Accounts to be forfeited as of that Annual Valuation Date
are not adequate for this purpose, the Employer shall make a contribution
adequate to make the restoration as of that Annual Valuation Date (in
addition to any contributions required to be made under Section 3).
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SECTION 7
DISTRIBUTION
7.l. APPLICATION FOR DISTRIBUTION.
7.1.1. APPLICATION REQUIRED. No distribution shall be made from the
Plan until the Administrator's Representative has received a written
application for distribution from the Participant or the Beneficiary entitled
to receive distribution (the "Distributee"). The Administrator's
Representative may prescribe rules regarding the form of such application,
the manner of filing such application and the information required to be
furnished in connection with such application.
Unless the Participant elects otherwise, distribution of the Participant's
Vested Total Account will begin no later than the 60th day after the latest
of the close of the Plan Year in which:
(a) The Participant attains age 65 (or Normal Retirement Age, if earlier);
(b) occurs the tenth anniversary of the year in which the Participant
commenced participation in the Plan; or
(c) the Participant separates from service with the Employer.
Notwithstanding the foregoing, the failure of the Participant (and, if
necessary, the Participant's spouse) to apply for a distribution after the
Participant has had an Event of Maturity shall be an election to defer
payment in satisfaction of the previous sentence.
Subject to Section 7.3.4, the requirements of Section 7.1 and 7.2 shall apply
to any distribution of a Participant's interest and will take precedence over
any inconsistent provisions of the Plan Statement. Unless otherwise
specified, these provisions apply to calendar years beginning after December
31, 1984. All distributions required under the plan shall be made in
accordance with the provisions of this Section 7 and the regulations under
section 401(a)(9) of the Internal Revenue Code, including the minimum
distribution incidental benefit requirement of Treas. Reg. 1.401(a)(9)-2
(proposed).
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
7.1.2. EXCEPTION FOR SMALL AMOUNTS. A VESTED TOTAL ACCOUNT WHICH
DOES NOT EXCEED (AND HAS NEVER EXCEEDED) THREE THOUSAND FIVE HUNDRED DOLLARS
($3,500) AS OF THE VALUATION DATE PERMITTED IN ARTICLE X OF THE ADOPTION
AGREEMENT THAT IS COINCIDENT WITH OR NEXT FOLLOWING THE OCCURRENCE OF AN
EVENT OF MATURITY EFFECTIVE AS TO A PARTICIPANT, SHALL BE DISTRIBUTED
AUTOMATICALLY IN A SINGLE LUMP SUM AS SOON AS ADMINISTRATIVELY PRACTICABLE
AFTER THAT VALUATION DATE WITHOUT A WRITTEN APPLICATION FOR DISTRIBUTION. A
PARTICIPANT WHO HAS NO VESTED INTEREST IN THE PARTICIPANT'S TOTAL ACCOUNT AS
OF THE PARTICIPANT'S EVENT OF MATURITY SHALL BE DEEMED TO HAVE RECEIVED AN
IMMEDIATE DISTRIBUTION OF THE PARTICIPANT'S ENTIRE INTEREST IN THE PLAN AS OF
SUCH EVENT OF MATURITY.
7.1.3. EXCEPTION FOR REQUIRED DISTRIBUTIONS. ANY VESTED TOTAL
ACCOUNT FOR WHICH NO APPLICATION FOR DISTRIBUTION HAS BEEN RECEIVED PRIOR TO
THE REQUIRED BEGINNING DATE EFFECTIVE AS TO THE DISTRIBUTEE UNDER SECTION
7.2.2, OR, SUBJECT TO SECTION 9.2, FOLLOWING TERMINATION OF THE PLAN, SHALL
BE DISTRIBUTED AUTOMATICALLY IN A LUMP SUM (IF THE PLAN IS NOT AN EXEMPT
PROFIT SHARING PLAN, HOWEVER, THE VESTED TOTAL ACCOUNT SHALL BE DISTRIBUTED
IN A FORM PROVIDED UNDER SECTION 7.3.4) ON THE REQUIRED BEGINNING DATE
WITHOUT A WRITTEN APPLICATION FOR DISTRIBUTION.
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7.1.4. DIRECT ROLLOVER. Effective for distributions made on or after
January 1, 1993, a Distributee who is eligible to elect a direct rollover may
elect, at the time and in the manner
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prescribed by the Administrator's Representative, to have all or any portion
of an eligible rollover distribution paid directly to an eligible retirement
plan specified by the Distributee in a direct rollover. A Distributee who is
eligible to elect a direct rollover includes only a Participant, a
Beneficiary who is the surviving spouse of a Participant and a Participant's
spouse or former spouse who is the alternate payee under a qualified domestic
relations order, as defined in Appendix C.
(a) ELIGIBLE ROLLOVER DISTRIBUTION means any distribution of all or any
portion of a Total Account to a Distributee who is eligible to elect a
direct rollover except (i) any distribution that is one of a series of
substantially equal installments payable not less frequently than
annually over the life expectancy of such Distributee or the joint and
last survivor life expectancy of such Distributee and such
Distributee's designated Beneficiary, and (ii) any distribution that
is one of a series of substantially equal installments payable not
less frequently than annually over a specified period of ten (10)
years or more, and (iii) any distribution to the extent such
distribution is required under section 401(a)(9) of the Code, and (iv)
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 means (i) an individual retirement account
described in section 408(a) of the Code, or (ii) an individual
retirement annuity described in section 408(b) of the Code, or (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 eligible rollover distribution. However, in the case of an
eligible rollover distribution to a Beneficiary who is the surviving
spouse of a Participant, an eligible retirement plan is only an
individual retirement account or individual retirement annuity as
described in section 408 of the Code.
(c) DIRECT ROLLOVER means the payment of an eligible rollover distribution
by the Plan to the eligible retirement plan specified by the
Distributee who is eligible to elect a direct rollover.
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SECOND AMENDMENT-EFFECTIVE JANUARY 1, 1993
7.1.5. NOTICES. THE ADMINISTRATOR'S REPRESENTATIVE WILL ISSUE SUCH
NOTICES AS MAY BE REQUIRED UNDER SECTIONS 402(f), 411(a)(11), 417(a)(3) AND
OTHER SECTIONS OF THE INTERNAL REVENUE CODE IN CONNECTION WITH DISTRIBUTIONS
FROM THE PLAN. NO DISTRIBUTION WILL BE MADE UNLESS IT IS CONSISTENT WITH
SUCH NOTICE REQUIREMENTS. IF THE PLAN IS AN EXEMPT PROFIT SHARING PLAN AS
DEFINED IN SECTION 7.3.4 (d), DISTRIBUTION MAY COMMENCE LESS THAN THIRTY (30)
DAYS AFTER THE NOTICE REQUIRED UNDER SECTION 1.411(a)-11(c) OF THE INCOME TAX
REGULATIONS OR THE NOTICE REQUIRED UNDER SECTION 1.402(f)-2T OF THE INCOME
TAX REGULATIONS IS GIVEN, PROVIDED THAT:
(a) THE ADMINISTRATOR'S REPRESENTATIVE INFORMS THE DISTRIBUTEE THAT THE
DISTRIBUTEE HAS A RIGHT TO A PERIOD OF AT LEAST THIRTY (30) DAYS AFTER
RECEIVING THE NOTICE TO CONSIDER THE DECISION OF WHETHER OR NOT TO
ELECT DISTRIBUTION (AND, IF APPLICABLE, A PARTICULAR DISTRIBUTION
OPTION); AND
(b) THE DISTRIBUTEE, AFTER RECEIVING THE NOTICE, AFFIRMATIVELY ELECTS IN
THE MANNER PRESCRIBED BY THE ADMINISTRATOR'S REPRESENTATIVE A
DISTRIBUTION.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
7.1.6. LOST DISTRIBUTEES. IN THE EVENT OF PLAN TERMINATION OR A
DISTRIBUTION PERMITTED UNDER SECTION 7.1.2, IF A DISTRIBUTEE CANNOT BE FOUND
AFTER TWO (2) FIRST CLASS RETURN RECEIPT MAILINGS TO THE DISTRIBUTEE'S LAST
KNOWN ADDRESS, THEN SUCH DISTRIBUTEE'S VESTED TOTAL ACCOUNT SHALL BE EITHER
DEPOSITED INTO AN INTEREST-BEARING SAVINGS ACCOUNT IN THE NAME OF THE
DISTRIBUTEE WITH A BANK OR SIMILAR FINANCIAL INSTITUTION, INCLUDING THE
TRUSTEE OR AN AFFILIATE OF THE TRUSTEE OR SHALL BE TREATED AS UNCLAIMED
PROPERTY PURSUANT TO THE LAWS OF THE STATE IN WHICH THE TRUSTEE IS DOMICILED
AND SHALL BE TURNED OVER TO SUCH STATE IN ACCORDANCE WITH THAT STATE'S
UNCLAIMED PROPERTY LAWS. AFTER A LOST DISTRIBUTEE'S VESTED TOTAL ACCOUNT HAS
BEEN DEPOSITED INTO EITHER A SAVINGS ACCOUNT OR TURNED OVER TO THE STATE, THE
DISTRIBUTEE IS NO LONGER A PARTICIPANT IN THE PLAN AND HAS NO RIGHT TO A
CLAIM OF BENEFITS AGAINST THE PLAN AND HAS NO CLAIM WHATSOEVER AGAINST THE
TRUSTEE WITH RESPECT TO THE PLAN. A DISTRIBUTEE WHOSE VESTED TOTAL ACCOUNT
HAS BEEN TURNED OVER TO A STATE BECAUSE THE DISTRIBUTEE COULD NOT BE FOUND
MAY REQUEST DISTRIBUTION FROM THE STATE IN ACCORDANCE WITH THE STATE'S
UNCLAIMED PROPERTY LAWS. A DISTRIBUTEE WHOSE VESTED TOTAL ACCOUNT HAS BEEN
DEPOSITED WITH A BANK OR FINANCIAL INSTITUTION BECAUSE THE DISTRIBUTEE COULD
NOT BE FOUND MAY REQUEST DISTRIBUTION FROM SUCH BANK OR FINANCIAL INSTITUTION.
7.2. TIME OF DISTRIBUTION. UPON THE RECEIPT OF A PROPER APPLICATION FOR
DISTRIBUTION FROM THE DISTRIBUTEE, AND AFTER THE OCCURRENCE OF AN EVENT OF
MATURITY EFFECTIVE AS TO A PARTICIPANT, AND AFTER THE PARTICIPANT'S VESTED
TOTAL ACCOUNT HAS BEEN DETERMINED AND THE RIGHT OF THE DISTRIBUTEE TO RECEIVE
A DISTRIBUTION HAS BEEN ESTABLISHED, THE ADMINISTRATOR'S REPRESENTATIVE SHALL
CAUSE THE TRUSTEE TO MAKE OR COMMENCE DISTRIBUTION OF SUCH VESTED TOTAL
ACCOUNT AS SOON AS ADMINISTRATIVELY FEASIBLE AFTER THE VALUATION DATE
SPECIFIED BY THE DISTRIBUTEE WHICH IS PERMITTED IN ARTICLE X OF THE ADOPTION
AGREEMENT AND WHICH IS NOT EARLIER THAN NOR LATER THAN THE DATES SPECIFIED
BELOW.
7.2.1. EARLIEST BEGINNING DATE. DISTRIBUTION TO A DISTRIBUTEE SHALL
NOT BE MADE OR COMMENCED EARLIER THAN THE EARLIEST BEGINNING DATE.
(a) PARTICIPANT. IF THE DISTRIBUTEE IS A PARTICIPANT, THE EARLIEST
BEGINNING DATE IS THE VALUATION DATE PERMITTED IN ARTICLE X OF THE
ADOPTION AGREEMENT THAT IS COINCIDENT WITH OR NEXT FOLLOWING THE DATE
OF THE PARTICIPANT'S EVENT OF MATURITY; PROVIDED, HOWEVER, THAT IF
DAILY VALUATION DATES HAVE BEEN SELECTED IN ARTICLE X OF THE ADOPTION
AGREEMENT, THE EARLIEST BEGINNING DATE IS THE PARTICIPANT'S EVENT OF
MATURITY.
(b) BENEFICIARY. IF THE DISTRIBUTEE IS A BENEFICIARY OF A PARTICIPANT,
THE EARLIEST BEGINNING DATE IS THE VALUATION DATE PERMITTED IN ARTICLE
X OF THE ADOPTION AGREEMENT THAT IS COINCIDENT WITH OR NEXT FOLLOWING
THE DATE OF SUCH PARTICIPANT'S DEATH; PROVIDED, HOWEVER, THAT IF DAILY
VALUATION DATES HAVE BEEN SELECTED IN ARTICLE X OF THE ADOPTION
AGREEMENT, THE EARLIEST BEGINNING DATE IS THE DATE OF SUCH
PARTICIPANT'S DEATH.
IN NO EVENT, HOWEVER, SHALL DISTRIBUTION BE MADE OR COMMENCED TO A
DISTRIBUTEE EARLIER THAN THE DATE THE ADMINISTRATOR'S REPRESENTATIVE RECEIVES
ANY REQUIRED APPLICATION FOR DISTRIBUTION AND THE NOTICE REQUIREMENTS
IDENTIFIED IN SECTION 7.1.5 HAVE BEEN SATISFIED.
7.2.2. REQUIRED BEGINNING DATE. DISTRIBUTION SHALL BE MADE OR
COMMENCED AS SOON AS ADMINISTRATIVELY FEASIBLE AFTER THE LAST VALUATION DATE
PERMITTED IN ARTICLE X OF THE ADOPTION AGREEMENT OCCURRING IN THE CALENDAR
YEAR IMMEDIATELY PRECEDING THE REQUIRED BEGINNING DATE
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EFFECTIVE AS TO THE DISTRIBUTEE. IN ALL EVENTS, HOWEVER, DISTRIBUTION SHALL
BE MADE OR COMMENCED NOT LATER THAN THE REQUIRED BEGINNING DATE.
(a) PARTICIPANT. IF THE DISTRIBUTEE IS A PARTICIPANT, THE REQUIRED
BEGINNING DATE IS THE APRIL 1 FOLLOWING THE CALENDAR YEAR IN WHICH THE
PARTICIPANT ATTAINS AGE SEVENTY AND ONE-HALF (70-1/2) YEARS.
(b) BENEFICIARY. IF THE DISTRIBUTEE IS THE BENEFICIARY OF A PARTICIPANT
WHO DIED ON OR AFTER THE APRIL 1 FOLLOWING THE CALENDAR YEAR IN WHICH
THE PARTICIPANT ATTAINED AGE SEVENTY AND ONE-HALF (70-1/2) YEARS, THE
REQUIRED BEGINNING DATE IS THE DATE OR DATES WHICH PROVIDE FOR
DISTRIBUTION TO SUCH BENEFICIARY AT A RATE (CONSIDERING BOTH TIME AND
AMOUNT) THAT IS CUMULATIVELY AT LEAST AS RAPID AS THE RATE OF
DISTRIBUTION SCHEDULED AND COMMENCED PRIOR TO THE DEATH OF THE
PARTICIPANT.
(c) BENEFICIARY. IF THE DISTRIBUTEE IS A BENEFICIARY OF A PARTICIPANT WHO
DIED BEFORE THE APRIL 1 FOLLOWING THE CALENDAR YEAR IN WHICH THE
PARTICIPANT ATTAINED AGE SEVENTY AND ONE-HALF (70-1/2) YEARS, THE
REQUIRED BEGINNING DATE IS THE DATE OR DATES THAT ALLOW DISTRIBUTION
OF THE ENTIRE AMOUNT TO BE COMPLETED NOT LATER THAN DECEMBER 31 OF THE
CALENDAR YEAR IN WHICH OCCURS THE FIFTH (5TH) ANNIVERSARY OF THE
PARTICIPANT'S DEATH; PROVIDED, HOWEVER, THAT:
(I) IF THE BENEFICIARY IS AN INDIVIDUAL WHO IS NOT THE SURVIVING
SPOUSE OF THE PARTICIPANT (OR A TRUST FOR SUCH INDIVIDUAL'S
BENEFIT WHICH SATISFIES THE REQUIREMENTS OF TREAS. REG.
1.401(a)(9)-1(b), Q & A D-5) AND IF DISTRIBUTIONS WILL BE MADE TO
SUCH INDIVIDUAL BENEFICIARY (OR SUCH TRUST) IN SUBSTANTIALLY
EQUAL ANNUAL AMOUNTS OVER A PERIOD OF TIME NOT EXTENDING BEYOND
THE LIFE EXPECTANCY OF SUCH BENEFICIARY, DISTRIBUTIONS MUST
COMMENCE NOT LATER THAN DECEMBER 31 OF THE YEAR FOLLOWING THE
YEAR OF THE PARTICIPANT'S DEATH, OR
(II) IF THE BENEFICIARY IS THE SURVIVING SPOUSE OF THE PARTICIPANT (OR
A TRUST FOR SUCH SPOUSE'S BENEFIT WHICH SATISFIES THE
REQUIREMENTS OF TREAS. REG. 1.401(a)(9)-1(b), Q & A D-5)AND IF
DISTRIBUTIONS WILL BE MADE TO SUCH SURVIVING SPOUSE IN
SUBSTANTIALLY EQUAL ANNUAL AMOUNTS OVER A PERIOD OF TIME NOT
EXTENDING BEYOND THE LIFE EXPECTANCY OF THE SURVIVING SPOUSE (OR
SUCH TRUST), DISTRIBUTIONS MUST COMMENCE NOT LATER THAN THE DATE
SPECIFIED IN PARAGRAPH (I) ABOVE OR, IF LATER, THE DECEMBER 31 OF
THE CALENDAR YEAR IN WHICH THE PARTICIPANT WOULD HAVE ATTAINED
AGE SEVENTY AND ONE-HALF (70-1/2) YEARS.
IF DISTRIBUTIONS ARE MADE TO A BENEFICIARY IN INSTALLMENTS, THE SECOND
AND ALL SUBSEQUENT DISTRIBUTIONS MUST BE MADE ON OR BEFORE DECEMBER 31
OF THE YEAR FOR WHICH THE DISTRIBUTION IS MADE. A BENEFICIARY MUST
ELECT THE METHOD OF DISTRIBUTION NO LATER THAN THE EARLIER OF (a)
DECEMBER 31 OF THE CALENDAR YEAR IN WHICH DISTRIBUTIONS WOULD BE
REQUIRED TO BEGIN UNDER THIS SECTION 7.2.2, OR (b) DECEMBER 31 OF THE
CALENDAR YEAR IN WHICH OCCURS THE FIFTH (5TH) ANNIVERSARY OF THE
PARTICIPANT'S DEATH. IF A BENEFICIARY MAKES NO ELECTION, DISTRIBUTION
OF THE BENEFICIARY'S ENTIRE INTEREST MUST BE COMPLETED BY DECEMBER 31
OF THE CALENDAR YEAR CONTAINING THE FIFTH (5TH) ANNIVERSARY OF THE
PARTICIPANT'S DEATH.
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7.3. FORMS OF DISTRIBUTION.
7.3.1. FORMS AVAILABLE. At the direction of the Administrator's
Representative (subject to Section 7.3.4), the Trustee shall make
distribution of the Participant's Vested
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Total Account to the Distributee in one of the following optional forms of
benefit as permitted in the Adoption Agreement and as designated by the
Distributee in writing:
(a) LUMP SUM. If the Distributee is either a Participant or a
Beneficiary, in a lump sum as described in the Adoption Agreement.
(b) FIXED INSTALLMENTS TO PARTICIPANT. If the Distributee is a
Participant, in a series of substantially equal installments payable
annually over a fixed period selected by the Participant before the
first payment which does not exceed the life expectancy of the
Participant. The election to recalculate life expectancy described in
Section 7.3.3 does not apply to this form of distribution.
(c) MINIMUM INSTALLMENTS TO PARTICIPANTS. If the Distributee is a
Participant, in a series of substantially equal installments payable
annually over the life expectancy of the Participant or the joint and
last survivor life expectancy of the Participant and his Beneficiary
determined as of the date of the first such installment payment;
provided, however, that the amount of such installments shall
automatically be increased if the series of substantially equal
installments payable annually over the life expectancy of the
Participant or the joint and last survivor life expectancy of the
Participant and his Beneficiary determined again as of the
Participant's required beginning date (see Section 7.2.2(a)) and based
on the facts then in existence is greater than the amount determined
as of the first such installment payment. For calendar years
beginning before January 1, 1989, if the Participant's spouse is not
the Beneficiary, then the method of distribution selected must assure
that at least fifty percent (50%) of the Vested Total Account is paid
within the life expectancy of the Participant.
(d) INSTALLMENTS TO BENEFICIARY. If the Distributee is an individual who
is a Beneficiary of a deceased Participant who died before the April 1
following the calendar year in which the Participant would have
attained age seventy and one-half (70-1/2) years, in a series of
substantially equal installments payable annually over a period
selected by the Beneficiary which does not exceed the period permitted
by the Adoption Agreement. If the Distributee is an individual who is
a Beneficiary of a deceased Participant who died on or after the April
1 following the calendar year in which the Participant attained age
seventy and one-half (70-1/2) years, in a series of substantially
equal installments which are a continuation of the payments commenced
(or scheduled) prior to the date of the Participant's death (or in a
lump sum if the Adoption Agreement permits such a payment to the
Beneficiary).
7.3.2. SUBSTANTIALLY EQUAL. Distributions shall be considered to be
substantially equal if the distributions are determined in whichever of the
following manners is applicable:
(a) FIXED INSTALLMENTS. If distributions are in the form of installments
payable over a fixed period, the amount of the distribution required
to be made for each calendar year (the "distribution year") shall be
determined by dividing the amount of the Vested Total Account as of
the last Valuation Date in the calendar year immediately preceding the
distribution year (such preceding calendar year being the "valuation
year") by the number of remaining installment payments to be made
(including the distribution being determined). The amount of the
Vested Total Account as of such Valuation Date shall be increased by
the amount of any contributions and forfeitures allocated to the
Vested Total Account during the valuation year and after such
Valuation Date (including contributions and forfeitures, if any, made
after the end of the valuation year which are allocated as of dates in
the valuation year). The amount of the Vested Total Account shall be
decreased
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by the amount of any distributions made in the valuation year and
after such Valuation Date.
(b) LIFETIME INSTALLMENTS. If distributions are in the form of
installments over the life expectancy of the recipient or the joint
and last survivor life expectancy of the Participant and his
Beneficiary, the amount of the distribution required to be made for
each calendar year (the "distribution year") shall be determined by
dividing the amount of the Vested Total Account as of the last
Valuation Date in the calendar year immediately preceding the
distribution year (such preceding calendar year being the "valuation
year") by the remaining life expectancy as of the distribution year.
The amount of the Vested Total Account as of the last Valuation Date
in the valuation year shall be increased by the amount of any
contributions and forfeitures allocated to the Vested Total Account
during the valuation year and after such Valuation Date (including
contributions and forfeitures, if any, made after the end of the
valuation year which are allocated as of dates in the valuation
year). The amount of the Vested Total Account shall be decreased by
distributions made in the valuation year and after such Valuation
Date.
7.3.3. LIFE EXPECTANCY. Life expectancy and joint and last survivor
expectancy shall be determined by use of the expected return multiples in
Tables V and VI of Treas. Reg. 1.72-9. An individual's life expectancy shall
be based upon the individual's attained age on his birthday in the calendar
year for which life expectancy is first being determined and, in the absence
of an election as provided below, shall be reduced by one (1) year in each
succeeding calendar year.
(a) ELECTION TO RECALCULATE LIFE EXPECTANCY. In the case of a Participant
or a Beneficiary who is the surviving spouse of a Participant (but not
in the case of any other individual), the Participant or such
Beneficiary may elect to have life expectancy redetermined for each
succeeding calendar year that a distribution is required to be made.
The election must be made no later than the time of the first required
distribution. The election is irrevocable and must apply to all
subsequent years.
(b) JOINT AND LAST SURVIVOR. Joint and last survivor life expectancy
shall be determined for the Participant and the individual who is the
Participant's Beneficiary in accordance with the rules of section
401(a)(9) of the Internal Revenue Code and the regulations thereunder.
(c) MINIMUM DISTRIBUTION INCIDENTAL BENEFIT REQUIREMENT. In the case of a
Participant and a Beneficiary who is not a spouse of the Participant,
the life expectancy factor used to compute the amount of the
substantially equal payment during the Participant's lifetime shall
not be greater than the factor determined under Treas. Reg.
1.401(a)(9)-2 (the minimum distribution incidental benefit
requirement).
7.3.4. PRESUMPTIVE FORMS. The selection of a form of distribution
shall be subject, however, to the following rules:
(a) REQUIRED LUMP SUM. As provided in Section 7.1.2, if the value of the
Participant's Vested Total Account is not greater than Three Thousand
Five Hundred Dollars ($3,500) when distributed, the distribution shall
be made in a single lump sum.
(b) QJ&SA CONTRACT. A QJ&SA contract is an immediate, nontransferable
annuity contract issued as an individual policy or under a master or
group contract which provides for an annual or more frequent annuity
payable to
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and for the lifetime of the Participant beginning as of a date
designated by the Participant which is not later than the dates
specified in Section 7.2.2, with a survivor annuity payable on an
annual or more frequent basis after the death of the Participant to
and for the lifetime of the surviving spouse of the Participant (to
whom the Participant was married on the Valuation Date as of which
such contract is issued) in an amount equal to fifty percent (50%)
of the amount payable during the joint lives of the Participant and
the surviving spouse. If payments had started to the Participant
prior to his death, payments of the survivor annuity shall commence
immediately after death. If payments had not started prior to the
Participant's death, the surviving spouse shall designate the
commencement date which shall not be later than the date the
Participant would have attained age seventy and one-half (70-1/2)
years. The contract shall be a QJ&SA contract only if it is issued
on a premium basis which does not discriminate on the basis of the
sex of the Participant or the surviving spouse and if it complies
with the requirements of this Plan and section 401(a)(9) of the
Internal Revenue Code and the regulations thereunder.
(c) LIFE ANNUITY CONTRACT. A Life Annuity contract is an immediate,
nontransferable annuity contract issued as an individual policy or
under a group or master contract which provides for an annual or more
frequent annuity payable to and for (i) the lifetime of an unmarried
Participant beginning as of a date designated by the Participant which
is not later than the dates specified in Section 7.2.2, or (ii) the
lifetime of the surviving spouse of a Participant beginning as of the
first day of the month following the Participant's death or any later
date designated by the surviving spouse which is not later than the
date the Participant would have attained age seventy and one-half
(70-1/2) years. The contract shall be a Life Annuity contract only if
it is issued on a premium basis which does not discriminate on the
basis of the sex of the Participant or the surviving spouse and if it
complies with the requirements of this Plan and section 401(a)(9) of
the Internal Revenue Code and the regulations thereunder.
(d) EXEMPT PROFIT SHARING PLAN. This Plan is an exempt profit sharing
plan if the following conditions are satisfied:
(i)
(ii) no Participant under this Plan can elect to receive payments
in the form of a lifetime annuity, and
(iii) this Plan is not a direct or indirect transferee of assets
from a defined benefit pension plan, money purchase pension
plan or target benefit money purchase pension plan, and
(iv) this Plan is not a direct or indirect transferee from a
stock bonus plan or a profit sharing plan which was
otherwise required to make available to Participants with
respect to whom assets and liabilities were transferred
distribution in the form of a lifetime annuity.
(e) MARRIED PARTICIPANT. In the case of any distribution which is to be
made:
(i) if this Plan is not an exempt profit sharing plan, and
(ii) when paragraph (a) above is not applicable, and
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(iii) to a Participant who is married on the Valuation Date as of
which such distribution is to be made or commenced to him,
and
(iv) to a Participant who has not rejected distribution in the
form of a QJ&SA contract,
distribution shall be effected for such Participant by applying the
entire Vested Total Account to purchase and distribute to such
Participant a QJ&SA contract. A Participant may reject distribution
in the form of a QJ&SA contract by filing with the Administrator's
Representative an affirmative written rejection of distribution in
that form not more than ninety (90) days before the Valuation Date as
of which the distribution is made or commenced. Such a rejection may
be made or revoked at any time and any number of times until the
Valuation Date as of which the distribution to the Participant is made
or commenced. A rejection shall not be effective unless the
Participant's spouse consents. To be valid, the consent of the spouse
must be in writing, must acknowledge the effect of the distribution,
must be witnessed by a notary public, must be given during the ninety
(90) day period before the Valuation Date as of which the distribution
is made or commenced and must relate to that specific distribution.
The consent of the spouse must be to a specific form of distribution
(other than the QJ&SA contract) which may not be changed without
further spousal consent unless the Participant elects a QJ&SA
contract, or alternatively, the consent of the spouse must expressly
permit the Participant to elect and to change the form of distribution
(other than the QJ&SA contract) without any requirement of further
spousal consent. The consent of the spouse shall be irrevocable and
shall be effective only with respect to that spouse. No less than
thirty (30) days and no more than ninety (90) days prior to the date
distribution is to be made or commenced to the Participant, there
shall be furnished to the Participant a written explanation of the
terms and conditions of the QJ&SA contract, the Participant's right to
reject, and the effect of a rejection of distribution in the form of
the QJ&SA contract, the requirement for the consent of the
Participant's spouse, the right to revoke a prior rejection of
distribution in the form of a QJ&SA contract, and the right to make
any number of further revocations or rejections until the Valuation
Date as of which the distribution actually is made or commenced.
Notwithstanding the consent requirement described above, if the
Participant establishes to the satisfaction of the Administrator's
Representative that such written consent cannot be obtained because
there is no spouse, or the spouse cannot be located, a Participant's
rejection shall be deemed a valid rejection.
(f) UNMARRIED PARTICIPANT. In the case of any distribution which is to be
made:
(i) if this Plan is not an exempt profit sharing plan, and
(ii) when paragraph (a) above is not applicable, and
(iii) to a Participant who is not married on the Valuation Date as
of which such distribution is to be made or commenced to
him, and
(iv) to a Participant who has not rejected distribution in the
form of a Life Annuity contract,
distribution shall be effected for such Participant by applying the
entire Vested Total Account to purchase and distribute to such
Participant a Life Annuity contract. A Participant may reject
distribution in the form of a Life Annuity contract by filing with the
Administrator's Representative an
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affirmative written rejection of distribution in that form not more
than ninety (90) days before the Valuation Date as of which the
distribution is made or commenced. Such a rejection may be made or
revoked at any time and any number of times until the Valuation
Date as of which the distribution to the Participant is made or
commenced. No less than thirty (30) days and no more than ninety
(90) days prior to the date distribution is to be made or commenced
to the Participant, there shall be furnished to the Participant a
written explanation of the terms and conditions of the Life Annuity
contract, the Participant's right to reject and the effect of a
rejection of, distribution in the form of the Life Annuity
contract, the right to revoke a prior rejection of distribution in
the form of a Life Annuity contract, and the right to make any
number of further revocations or rejections until the Valuation
Date as of which distribution actually is made or commenced.
(g) SURVIVING SPOUSE. In the case of a distribution which is made:
(i) if this Plan is not an exempt profit sharing plan, and
(ii) when paragraph (a) above is not applicable, and
(iii) to the surviving spouse of a deceased Participant, and
(iv) when such surviving spouse has not rejected distribution in
the form of a Life Annuity contract,
distribution shall be effected for such surviving spouse by applying
the entire Vested Total Account to purchase and distribute to such
surviving spouse a Life Annuity contract as soon as administratively
feasible after the Participant's death; but in no event earlier than
the date upon which the surviving spouse makes application for the
distribution, or, if earlier, the date upon which the Participant (if
he continued to live) would have attained age seventy and one half
(70-1/2) years. A surviving spouse may reject distribution in the
form of a Life Annuity contract by filing with the Administrator's
Representative an affirmative written rejection of distribution in
that form not more than ninety (90) days before the Valuation Date as
of which the distribution is made or commenced. Any number of
rejections and revocations of rejections may be made at any time until
the Valuation Date as of which the distributions are made or commence
to such surviving spouse. No less than thirty (30) days and no more
than ninety (90) days prior to the date distribution is to be made or
commenced to the surviving spouse, there shall be furnished to the
surviving spouse a written explanation of the terms and conditions of
the contract, the surviving spouse's right to reject, and the effect
of a rejection of distribution in the form of the Life Annuity
contract, the right to revoke a prior rejection of distribution in the
form of the Life Annuity contract, and the right to make any number of
further revocations or rejections until the Valuation Date as of which
distribution actually is made or commenced.
7.3.5. EFFECT OF REEMPLOYMENT. If a Participant is reemployed by the
Employer or an Affiliate after distribution has been made or commenced to him
but before his Normal Retirement Age, further distribution of his Vested
Total Account shall be suspended and the undistributed remainder of his
Vested Total Account shall continue to be held in the Fund until another
Event of Maturity effective as to him shall occur after his reemployment. It
is the general intent of this Plan that no distribution shall be made while a
Participant is maintaining an employment relationship with the Employer or an
Affiliate.
7.3.6. TEFRA Section 242(b) TRANSITIONAL RULES. Notwithstanding
the other provisions of this Section 7, distributions to or with respect to
each individual eligible to make a
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designation (before January 1, 1984) of a method of distribution pursuant to
section 242(b) of the Tax Equity and Fiscal Responsibility Act of 1982 shall
be made on and after the first day of the Plan Year beginning in 1984 in
accordance with the provisions set forth in the Appendix E to this Plan
Statement; provided, however, that if the Plan is not an exempt profit
sharing plan, the QJ&SA contract or Life Annuity contract has been rejected
as described in Section 7.3.4.
7.4. DESIGNATION OF BENEFICIARIES.
7.4.1. RIGHT TO DESIGNATE. Each Participant may designate, upon
forms to be furnished by and filed with the Administrator's Representative,
one or more primary Beneficiaries or alternative Beneficiaries to receive all
or a specified part of his Vested Total Account in the event of his death and
may change or revoke any such designation from time to time. No such
designation, change or revocation shall be effective unless executed by the
Participant and accepted by the Administrator's Representative during the
Participant's lifetime. If, however, the Plan is not an exempt profit
sharing plan and such designation is made to a nonspouse Beneficiary before
the first day of the Plan Year in which the Participant attains age
thirty-five (35) years and the Participant dies on or after that date while
married, the beneficiary designation is void.
7.4.2. SPOUSAL CONSENT. Notwithstanding the foregoing, a designation
will not be valid for the purpose of paying benefits from the Plan to anyone
other than a surviving spouse of the Participant (if there is a surviving
spouse) unless that surviving spouse consents in writing to the designation
of another person as Beneficiary. To be valid, the consent of such spouse
must be in writing, must acknowledge the effect of the designation of the
Beneficiary and must be witnessed by a notary public. The consent of the
spouse must be to the designation of a specific named Beneficiary which may
not be changed without further spousal consent, or alternatively, the consent
of the spouse must expressly permit the Participant to make and to change the
designation of Beneficiaries without any requirement of further spousal
consent. The consent of the spouse to a nonspouse Beneficiary is a waiver of
the spouse's rights to benefits under the Plan. In a plan that is not an
exempt profit sharing plan, these benefits are known as a qualified
preretirement survivor annuity. The consent of the surviving spouse need not
be given at the time the designation is made. The consent of the surviving
spouse need not be given before the death of the Participant. The consent of
the surviving spouse will be required, however, before benefits can be paid
to any person other than the surviving spouse. The consent of a spouse shall
be irrevocable and shall be effective only with respect to that spouse.
In the case of a distribution to which Section 7.3.4(g) applies, the
Administrator's Representative shall provide each Participant within the
applicable period for such Participant a written explanation of the Life
Annuity Contract in such terms and in such manner as would be comparable to
the explanation provided for meeting the requirements of Section 7.3.4(e)
applicable to a QJ & SA contract.
The applicable period for a Participant is whichever of the following
periods ends last: (i) the period beginning with the first day of the Plan
Year in which the Participant attains age 32 and ending with the close of the
Plan Year preceding the Plan Year in which the Participant attains age 35;
(ii) a reasonable period ending after the individual becomes a Participant;
and (iii) a reasonable period ending after this paragraph first applies to
the Participant. Notwithstanding the foregoing, notice must be provided
within a reasonable period ending after separation from service in the case
of a Participant who separates from service before attaining age 35.
For the purposes of applying the preceding paragraph, a reasonable
period ending after the enumerated events described in (ii) and (iii) is the
end of the two-year period beginning one year prior to the date the
applicable event occurs, and ending one year after that date. In the case of
a Participant who separates from service before the Plan Year in which age 35
is attained, notice shall be provided within the two-year period beginning
one year prior to
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separation and ending one year after separation. If such a Participant
thereafter returns to employment with the employer, the applicable period for
such Participant shall be redetermined.
7.4.3. FAILURE OF DESIGNATION. If a Participant:
(a) fails to designate a Beneficiary,
(b) designates a Beneficiary and thereafter revokes such designation
without naming another Beneficiary, or
(c) designates one or more Beneficiaries and all such Beneficiaries so
designated fail to survive the Participant,
such Participant's Vested Total Account, or the part thereof as to which such
Participant's designation fails, as the case may be, shall be payable to the
first class of the following classes of automatic Beneficiaries with a member
surviving the Participant and (except in the case of his surviving issue) in
equal shares if there is more than one member in such class surviving the
Participant:
Participant's surviving spouse
Participant's surviving issue per stirpes and not per capita
Participant's surviving parents
Participant's surviving brothers and sisters
Representative of Participant's estate.
7.4.4. DEFINITIONS. When used herein and, unless the Participant has
otherwise specified in his Beneficiary designation, when used in a
Beneficiary designation, "issue" means all persons who are lineal descendants
of the person whose issue are referred to, including legally adopted
descendants and their descendants but not including illegitimate descendants
and their descendants; "child" means an issue of the first generation; "per
stirpes" means in equal shares among living children of the person whose
issue are referred to and the issue (taken collectively) of each deceased
child of such person, with such issue taking by right of representation of
such deceased child; and "survive" and "surviving" mean living after the
death of the Participant.
7.4.5. SPECIAL RULES. Unless the Participant has otherwise specified
in his Beneficiary designation, the following rules shall apply:
(a) if there is not sufficient evidence that a Beneficiary was living
after the death of the Participant, it shall be deemed that the
Beneficiary was not living after the death of the Participant.
(b) The automatic Beneficiaries specified in Section 7.4.3 and the
Beneficiaries designated by the Participant shall become fixed as of
the Participant's death so that, if a Beneficiary survives the
Participant but dies before the receipt of all payments due such
Beneficiary hereunder, such remaining payments shall be payable to the
representative of such Beneficiary's estate.
(c) If the Participant designates as a Beneficiary the person who is the
Participant's spouse on the date of the designation, either by name or
by relationship, or both, the dissolution, annulment or other legal
termination of the marriage between the Participant and such person
shall automatically revoke such designation. (The foregoing shall not
prevent the Participant from designating a former spouse as a
Beneficiary on a form executed by the Participant and received by the
Committee after the date of the legal termination of the marriage
between the Participant and such former spouse, and during the
Participant's lifetime.)
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(d) Any designation of a nonspouse Beneficiary by name that is accompanied
by a description of relationship to the Participant shall be given
effect without regard to whether the relationship to the Participant
exists either then or at the Participant's death.
(e) Any designation of a Beneficiary only by statement of relationship to
the Participant shall be effective only to designate the person or
persons standing in such relationship to the Participant at the
Participant's death.
A Beneficiary designation is permanently void if it either is executed or is
filed by a Participant who, at the time of such execution or filing, is then
a minor under the law of the state of his legal residence. The Committee
(and not the Trustee) shall be the sole judge of the content, interpretation
and validity of a purported Beneficiary designation.
7.5. DEATH PRIOR TO FULL DISTRIBUTION. If a Participant dies after his Event
of Maturity but before distribution of his Vested Total Account has been
completed, the remainder of his undistributed Vested Total Account shall be
distributed in the same manner as hereinbefore provided in the Event of
Maturity by reason of death. If, at the death of the Participant, any
payment to the Participant was due or otherwise pending but not actually
paid, the amount of such payment shall be included in the Vested Total
Account which is payable to the Beneficiary (and shall not be paid to the
Participant's estate).
7.6. DISTRIBUTION IN CASH. Subject to the requirements of Section 7.3 for a
Plan that is not an exempt profit sharing plan, distribution of a
Participant's Vested Total Account shall be made in cash. If, however, (i)
the Vested Total Account to be distributed consists in whole or in part of a
Participant's unpaid promissory note, the Trustee shall cause distribution of
that portion of the Vested Total Account to be made in the form of that
unpaid promissory note, or (ii) the Vested Total Account to be distributed
consists in whole or in part of a life insurance contract acquired pursuant
to the Participant's direction under Section 10.11, the Trustee shall cause
distribution of that portion of the Vested Total Account to be made in the
form of the life insurance contract so acquired, or (iii) the Vested Total
Account to be distributed consists in whole or in part of a Participant's
individually directed Subfund established pursuant to Section 4.1.2, the
Trustee shall cause distribution of that portion of the Vested Total Account
to be made in the form of the assets held in the individually directed
Subfund.
7.7. DELETED BY THE FIRST AMENDMENT.
7.8. WITHDRAWALS FROM VOLUNTARY ACCOUNTS.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
7.8.1. WHEN AVAILABLE. IF THE ADOPTION AGREEMENT SO PROVIDES, A
PARTICIPANT (WHETHER OR NOT THEN EMPLOYED BY THE EMPLOYER) MAY MAKE
WITHDRAWALS FROM TIME TO TIME FROM THE PARTICIPANT'S NONDEDUCTIBLE VOLUNTARY
ACCOUNT (IF ANY) AND THE PARTICIPANT'S DEDUCTIBLE VOLUNTARY ACCOUNT (IF ANY).
TO RECEIVE SUCH A WITHDRAWAL, THE PARTICIPANT MUST FILE A WRITTEN
APPLICATION SPECIFYING THE DOLLAR AMOUNT TO BE WITHDRAWN. SUCH WITHDRAWAL
APPLICATION SHALL BE APPROVED BY THE ADMINISTRATOR'S REPRESENTATIVE TO BE
MADE IN A LUMP SUM CASH PAYMENT AS SOON AS ADMINISTRATIVELY PRACTICABLE AFTER
THE VALUATION DATE PERMITTED IN ARTICLE X OF THE ADOPTION AGREEMENT THAT IS
COINCIDENT WITH OR NEXT FOLLOWING APPROVAL OF THE COMPLETED APPLICATION BY
THE ADMINISTRATOR'S REPRESENTATIVE.
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7.8.2. SEQUENCE OF ACCOUNTS. The amount of such withdrawals by a
Participant shall be deemed to first come from the aggregate amount of
voluntary contributions theretofore made by him and only thereafter from the
earnings or gains in, or attributable to, either Voluntary Account.
Notwithstanding the foregoing, any such withdrawal shall be
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deemed to have been first taken from the Participant's nondeductible
voluntary contributions made prior to January 1, 1987, to the extent of the
aggregate amount not previously withdrawn. Thereafter, the withdrawal shall
be deemed to have been taken from a combination of (i) the Participant's
nondeductible voluntary contributions made after December 31, 1986, to the
extent of the aggregate amount thereof not previously withdrawn, and (ii) a
portion of the earnings in the Nondeductible Voluntary Account. The portion
of each such withdrawal that is deemed to be earnings will be in the same
ratio as the total earnings of the Nondeductible Voluntary Account bear to
the total Nondeductible Voluntary Account. All withdrawals shall be deemed
to come first from the Nondeductible Voluntary Account, and only after the
amount which may be withdrawn from the Nondeductible Voluntary Account is
exhausted will a withdrawal come from the Deductible Voluntary Account.
7.8.3. LIMITATIONS. Notwithstanding the foregoing, no distribution
shall be made pursuant to this Section 7.8 unless this Plan is an exempt
profit sharing plan (as defined in Section 7.3.4) or the spouse of the
Participant, if any, consents in writing to the distribution. To be valid,
the consent of such spouse must be in writing, must acknowledge the effect of
the withdrawal and must be witnessed by a notary public. The consent of the
spouse must be given within ninety (90) days prior to the Valuation Date as
of which the withdrawal is made and must relate to that specific withdrawal.
The consent given by one spouse shall be effective only with respect to that
spouse.
7.8.4. COORDINATION WITH SECTION 4.1. If a withdrawal is made from
an Account which is invested in more than one (1) investment Subfund
authorized and established under Section 4.1, the amount withdrawn shall be
charged to each such investment Subfund in the same proportions as the
Account is invested in such investment Subfunds, unless otherwise directed by
the Administrator's Representative.
7.9. IN-SERVICE DISTRIBUTIONS.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
7.9.1. WHEN AVAILABLE. IF THE ADOPTION AGREEMENT SO PROVIDES, A
PARTICIPANT (WHETHER OR NOT THEN EMPLOYED BY THE EMPLOYER) MAY RECEIVE AN
IN-SERVICE DISTRIBUTION FROM THE VESTED PORTION OF THE PARTICIPANT'S TOTAL
ACCOUNT (UNLESS THE ADOPTION AGREEMENT SPECIFICALLY PROHIBITS IN-SERVICE
DISTRIBUTIONS FROM A PARTICULAR ACCOUNT) IF THE ADMINISTRATOR'S
REPRESENTATIVE DETERMINES THAT SUCH IN-SERVICE DISTRIBUTION IS FOR ONE OF THE
PURPOSES DESCRIBED IN SECTION 7.9.2 AND THE CONDITIONS IN SECTIONS 7.9.3 AND
7.9.4 HAVE BEEN FULFILLED. TO RECEIVE AN IN-SERVICE DISTRIBUTION, THE
PARTICIPANT MUST FILE AN IN-SERVICE DISTRIBUTION APPLICATION WITH THE
ADMINISTRATOR'S REPRESENTATIVE. IN THE APPLICATION, THE PARTICIPANT SHALL
SPECIFY THE DOLLAR AMOUNT TO BE DISTRIBUTED. SUCH IN-SERVICE DISTRIBUTION
APPLICATION SHALL BE APPROVED BY THE ADMINISTRATOR'S REPRESENTATIVE TO BE
MADE IN A LUMP SUM CASH PAYMENT AS SOON AS ADMINISTRATIVELY PRACTICABLE AFTER
THE VALUATION DATE PERMITTED IN ARTICLE X OF THE ADOPTION AGREEMENT THAT IS
COINCIDENT WITH OR NEXT FOLLOWING APPROVAL OF THE COMPLETED APPLICATION BY
THE ADMINISTRATOR'S REPRESENTATIVE.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
7.9.2. PURPOSES. IN-SERVICE DISTRIBUTIONS SHALL BE ALLOWED UNDER
SECTION 7.9.1 FOR ONLY SUCH OF THE FOLLOWING PURPOSES AS ARE PERMITTED IN THE
ADOPTION AGREEMENT AND ONLY IF THE PARTICIPANT ESTABLISHES THAT THE
IN-SERVICE DISTRIBUTION IS TO BE MADE FOR ONE OF THE FOLLOWING PERMITTED
PURPOSES:
(a) EXPENSES FOR MEDICAL CARE DESCRIBED IN SECTION 213(d) OF THE INTERNAL
REVENUE CODE PREVIOUSLY INCURRED BY THE PARTICIPANT, THE PARTICIPANT'S
SPOUSE OR ANY DEPENDENTS OF THE PARTICIPANT (AS DEFINED IN SECTION 152
OF
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THE INTERNAL REVENUE CODE) OR NECESSARY FOR THESE PERSONS TO OBTAIN
MEDICAL CARE DESCRIBED IN SECTION 213(d) OF THE INTERNAL REVENUE CODE,
(b) COSTS DIRECTLY RELATED TO THE PURCHASE OF A PRINCIPAL RESIDENCE FOR
THE PARTICIPANT (EXCLUDING MORTGAGE PAYMENTS),
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1995
(c) PAYMENT OF TUITION, ROOM AND BOARD AND RELATED EDUCATIONAL FEES FOR
THE NEXT TWELVE (12) MONTHS OF POST-SECONDARY EDUCATION FOR THE
PARTICIPANT, OR THE PARTICIPANT'S SPOUSE, CHILDREN OR DEPENDENTS (AS
DEFINED IN SECTION 152 OF THE INTERNAL REVENUE CODE), OR
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
(d) PAYMENTS NECESSARY TO PREVENT THE EVICTION OF THE PARTICIPANT FROM THE
PARTICIPANT'S PRINCIPAL RESIDENCE OR FORECLOSURE ON THE MORTGAGE OF
THAT PRINCIPAL RESIDENCE.
SUCH PURPOSES SHALL BE CONSIDERED TO BE AN IMMEDIATE AND HEAVY FINANCIAL NEED OF
THE PARTICIPANT.
7.9.3. LIMITATIONS. IN NO EVENT SHALL THE CUMULATIVE AMOUNT OF
IN-SERVICE DISTRIBUTIONS WITHDRAWN FROM A PARTICIPANT'S RETIREMENT SAVINGS
ACCOUNT EXCEED THE AMOUNT OF CONTRIBUTIONS TO THAT ACCOUNT MADE PURSUANT TO
SECTION 3.2 (I.E., IN-SERVICE DISTRIBUTIONS FROM THAT ACCOUNT SHALL NOT
INCLUDE ANY EARNINGS ON SUCH CONTRIBUTIONS OR ANY CURATIVE ALLOCATIONS OR
EARNINGS ON CURATIVE ALLOCATIONS MADE PURSUANT TO SECTION 3.4.2). THE AMOUNT
OF THE IN-SERVICE DISTRIBUTION SHALL NOT EXCEED THE AMOUNT OF THE
PARTICIPANT'S IMMEDIATE AND HEAVY FINANCIAL NEED; PROVIDED, HOWEVER, THAT THE
AMOUNT OF THE IMMEDIATE AND HEAVY FINANCIAL NEED MAY INCLUDE AMOUNTS
NECESSARY TO PAY ANY FEDERAL, STATE, OR LOCAL INCOME TAXES OR PENALTIES
REASONABLY ANTICIPATED TO RESULT FROM THE DISTRIBUTION. IN ADDITION, A
HARDSHIP DISTRIBUTION WHICH INCLUDES A PORTION OF THE PARTICIPANT'S
RETIREMENT SAVINGS ACCOUNT SHALL NOT BE ALLOWED UNLESS THE PARTICIPANT HAS
OBTAINED ALL DISTRIBUTIONS, OTHER THAN HARDSHIP DISTRIBUTIONS, AND ALL
NONTAXABLE LOANS (AT THE TIME OF THE LOAN) CURRENTLY AVAILABLE UNDER ALL
PLANS MAINTAINED BY THE EMPLOYER AND AFFILIATES. OTHER FUNDS ARE NOT
CURRENTLY AVAILABLE UNLESS THE FUNDS ARE AVAILABLE PRIOR TO OR COINCIDENTLY
WITH THE DATE THE HARDSHIP DISTRIBUTION IS AVAILABLE.
NOTWITHSTANDING THE FOREGOING, NO DISTRIBUTION SHALL BE MADE PURSUANT TO THIS
SECTION 7.9 UNLESS THE PLAN IS AN EXEMPT PROFIT SHARING PLAN (AS DEFINED IN
SECTION 7.3.4) OR THE SPOUSE OF THE PARTICIPANT, IF ANY, CONSENTS IN WRITING
TO THE DISTRIBUTION. TO BE VALID, THE CONSENT OF THE SPOUSE MUST BE IN
WRITING, MUST ACKNOWLEDGE THE EFFECT OF THE DISTRIBUTION AND MUST BE
WITNESSED BY A NOTARY PUBLIC. THE CONSENT OF THE SPOUSE MUST BE GIVEN WITHIN
NINETY (90) DAYS PRIOR TO THE DATE AS OF WHICH THE DISTRIBUTION IS MADE AND
MUST RELATE TO THE SPECIFIC DISTRIBUTION. THE CONSENT OF THE SPOUSE SHALL BE
IRREVOCABLE AND SHALL BE EFFECTIVE ONLY WITH RESPECT TO THAT SPOUSE.
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7.9.4. COORDINATION WITH RETIREMENT SAVINGS AGREEMENT. The
Participant's Retirement Savings Agreement shall be cancelled for twelve (12)
months after receipt of an in-service distribution and shall not be
automatically reinstated. Thereafter, such Participant may, upon giving
fifteen (15) days' prior written notice to the Plan Administrator, enter into
a new Retirement Savings Agreement effective as of the payday on or after any
subsequent Enrollment Date following such twelve (12) month period, provided
he is in Recognized Employment on that date. Also, a Participant shall not
be allowed to make nondeductible
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voluntary contributions to this Plan for such twelve (12) month period. In
addition, such a Participant shall not be allowed to make retirement savings
contributions for the Participant's taxable year immediately following the
taxable year of the in-service distribution which exceeds the adjusted Seven
Thousand Dollar ($7,000) limit (as described in Section 2.5) for such next
taxable year less the amount of such Participant's retirement savings
contributions for the taxable year of the in-service distribution. The rules
described in this Section 7.9.4 only apply if the hardship distribution
includes a portion of the Participant's Retirement Savings Account.
7.9.5. SEQUENCE OF ACCOUNTS. Each and every accelerated distribution
made pursuant to this Section 7.9 shall first be taken from and charged to
the Participant's Accounts (if the Adoption Agreement permits distribution
from such Account) in the following sequence:
(i) Nondeductible Voluntary Account
(ii) Rollover Account
(iii) Transfer Account
(iv) Employer Contributions Account
(v) Employer Matching Account
(vi) Deductible Voluntary Account
(vii) Retirement Savings Account.
Distributions from the Participant's Nondeductible Voluntary Account shall be
distributed in the sequence described in Section 7.8.
7.9.6. COORDINATION WITH SECTION 4.1. If a withdrawal is made from
an Account which is invested in more than one (1) investment Subfund
authorized and established under Section 4.1, the amount withdrawn shall be
charged to each such investment Subfund in the same proportions as the
Account is invested in such investment Subfunds, unless otherwise directed by
the Administrator's Representative.
7.10. TRANSITIONAL RULES. Participants or Beneficiaries who have
actually started receiving installment payments before January 1, 1989, shall
continue to receive such payments under the rules specified in the Plan
Statement prior to the adoption of the rules described in Appendix F to this
Plan Statement to the extent such rules are not inconsistent with the current
Plan Statement and current laws and regulations including, specifically,
section 401(a)(9) and section 411(d)(6) of the Internal Revenue Code. The
rules in Section 7.1, through and including, Section 7.9 to this Plan
Statement are effective for Plan Years beginning after December 31, 1988.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
7.11. LOANS. UNLESS THE ADOPTION AGREEMENT PRECLUDES IT, LOANS MAY BE
MADE TO PARTICIPANTS FROM THIS PLAN WHO ARE NOT OWNER-EMPLOYEES OR
SHAREHOLDER-EMPLOYEES SUBJECT TO THIS SECTION 7.11.
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7.11.1. GENERAL RULES. The Trustee shall, at the direction of the
Administrator's Representative, make a loan or loans to a Participant or
Beneficiary (other than an Owner-Employee or a Shareholder-Employee). To
receive a loan from the Plan, a Participant or Beneficiary must submit a
written request to the Administrator's Representative. The
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written request must specify the amount of the loan, term of loan and, if
required, include spousal consent. The amount of such loan to any Participant
or Beneficiary, when added to the outstanding balance of the other loans to
the borrower from the Plan, shall not exceed the lesser of: (i) fifty percent
(50%) of the Vested amount of the Participant's Total Account, or (ii) Fifty
Thousand Dollars ($50,000). The Fifty Thousand Dollar ($50,000) limitation
shall be reduced by the excess (if any) of: (i) the highest outstanding
balance of loans from the Plan during the one-year period ending on the day
before the new loan is made, OVER (ii) the outstanding balance of all loans
from the Plan on the day the new loan is made (but not including the new
loan).
By acceptance of such loan, the Participant or Beneficiary automatically
(by operation of the rules of this Plan Statement) grants a lien upon such of
his Accounts from which monies were withdrawn to make up the loan in an
amount not less than the amount of such loans (including unpaid interest).
The borrower may grant a security interest in his or her "qualified
residence" as defined in section 163(h) of the Code if the borrower's
unrestricted equity interest is adequate to do so. No other security shall
be required or permitted as a condition of granting any such loans. Any such
loan shall provide that it shall be repaid within a definite period of time,
which period shall not exceed five (5) years unless such loan is used to
acquire any dwelling unit which within a reasonable time (determined at the
time the loan is made) is to be used as a principal residence of the
Participant in which event such period shall not exceed fifteen (15) years.
Any such loan must be repaid in substantially level amounts including
principal and interest, over the term of the loan; provided, however, that a
loan may be prepaid or accelerated prior to the end of the term of the loan.
Loan payments must be made at least once each Plan Year quarter.
Notwithstanding the foregoing, no loan shall be made pursuant to this
Section 7.11 unless this Plan is an exempt profit sharing plan (as defined in
Section 7.3.4) or the spouse of the Participant, if any, consents to the
loan. To be valid, the consent of such spouse must be in writing, must
acknowledge the effect of the loan and the use of the Account as security for
the loan and must be witnessed by a notary public. The consent of the spouse
must be given within ninety (90) days prior to the date the loan is made and
must relate to a specific loan. The consent given by the spouse to whom the
Participant was married at the time the loan was made shall be effective with
respect to that spouse and each subsequent spouse of the Participant. A new
consent shall be required if the Account is used for renegotiation,
extension, renewal or other revision of the loan. If a valid spousal consent
has been obtained as described above or such consent is not required, then,
notwithstanding any other provisions of this Plan Statement, the portion of
the Participant's Vested Total Account used as a security interest held by
the Plan by reason of a loan outstanding to the Participant shall be taken
into account for purposes of determining the amount of the Vested Total
Account payable at the time of death or distribution, but only if the
reduction is used as repayment of the loan. If less than one hundred percent
(100%) of the Participant's Vested Total Account (determined without regard
to the preceding sentence) is payable to the surviving spouse of the
Participant, then the Vested Total Account shall be adjusted by first
reducing the Vested Total Account by the amount of the security used as
repayment of the loan, and then determining the benefit payable to the
surviving spouse.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1995
7.11.2. INTEREST RATE. THE INTEREST RATE ON EACH LOAN MUST BE A
REASONABLE INTEREST RATE DETERMINED ON THE FIRST BUSINESS DAY OF THE CALENDAR
MONTH IMMEDIATELY PRECEDING THE DATE AS OF WHICH THE LOAN IS ISSUED.
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7.11.3. LOANS MADE FROM PARTICIPANT'S ACCOUNTS. If the Adoption
Agreement so provides, each loan will be made from the individual Accounts of
the Participant who receives the loan and the following rules will apply:
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(a) ACCOUNTING FOR LOAN. For the purpose of determining the extent to
which such Participant's Total Account is entitled to share in income,
gains or losses of the Fund under Section 4, the same shall be deemed
to be reduced by the unpaid balance of any outstanding loans to the
Participant, and the interest payments on such loans shall be credited
to his Total Account.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
(b) COORDINATION WITH SECTION 4.1. IF A LOAN IS MADE FROM AN ACCOUNT
WHICH IS INVESTED IN MORE THAN ONE INVESTMENT SUBFUND AUTHORIZED AND
ESTABLISHED UNDER SECTION 4.1, THE AMOUNT WITHDRAWN IN ORDER TO MAKE
THE LOAN SHALL BE CHARGED PRO RATA TO EACH INVESTMENT SUBFUND. ALL
REPAYMENTS OF PRINCIPAL AND INTEREST SHALL BE ALLOCATED AMONG THE
INVESTMENT SUBFUNDS THAT THE BORROWER HAS ELECTED FOR INVESTMENT AT
THE TIME REPAYMENT IS RECEIVED.
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(c) SEQUENCE OF ACCOUNTS. If a loan is made to a Participant who has
assets in more than one Account, such loan shall be deemed to have
been made from the Participant's Accounts in the following sequence:
(i) Rollover Account
(ii) Transfer Account
(iii) Employer Contributions Account
(iv) Employer Matching Account
(v) Deductible Voluntary Account
(vi) Nondeductible Voluntary Account
(vii) Retirement Savings Account (but see the last sentence of
this subsection (c)).
Repayments of principal and payments of interest shall be apportioned
among the Accounts from which the loan was made in proportion to the
amounts by which the Accounts were initially reduced in order to make
the loan. If the borrower's "qualified residence" as defined in
section 163(h) of the Code is given as security for the loan, then no
portion of the borrowed amount may come from the Participant's
Retirement Savings Account.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
7.11.4. LOAN RULES. ALL LOANS MUST COMPLY WITH THE LOAN RULES
ESTABLISHED BY THE TRUSTEE FROM TIME TO TIME. IF THE EMPLOYER ADOPTS OTHER
LOAN RULES INCONSISTENT WITH THE RULES ESTABLISHED BY THE TRUSTEE, THE
EMPLOYER WILL HAVE MADE AN UNAUTHORIZED AMENDMENT TO THE PLAN AND WILL BE
GOVERNED BY THE PROVISIONS OF SECTION 9.1.1.
7.12. CORRECTIVE DISTRIBUTIONS.
7.12.1. EXCESS DEFERRALS ($7,000 LIMIT).
(a) IN GENERAL. A PARTICIPANT MAY ASSIGN TO THIS PLAN ANY EXCESS
DEFERRALS MADE DURING A TAXABLE YEAR OF THE PARTICIPANT BY NOTIFYING
THE ADMINISTRATOR'S REPRESENTATIVE IN WRITING NOT LATER THAN THE
MARCH 1 FOLLOWING SUCH TAXABLE YEAR OF THE AMOUNT OF THE EXCESS
DEFERRAL TO BE ASSIGNED TO THE PLAN.
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A PARTICIPANT SHALL BE DEEMED TO HAVE NOTIFIED THE PLAN OF EXCESS
DEFERRALS TO THE EXTENT THE PARTICIPANT HAS EXCESS DEFERRALS FOR
THE TAXABLE YEAR CALCULATED BY TAKING INTO ACCOUNT ONLY THE AMOUNT
OF ELECTIVE CONTRIBUTIONS ALLOCATED TO THE PARTICIPANT'S RETIREMENT
SAVINGS ACCOUNT AND TO ANY OTHER PLAN OF THE EMPLOYER AND
AFFILIATES. NOTWITHSTANDING ANY OTHER PROVISION OF THE PLAN
STATEMENT, A PARTICIPANT'S EXCESS DEFERRALS, PLUS ANY INCOME AND
MINUS ANY LOSS ALLOCABLE THERETO, SHALL BE DISTRIBUTED TO THE
PARTICIPANT NO LATER THAN THE FIRST APRIL 15 FOLLOWING THE CLOSE OF
THE PARTICIPANT'S TAXABLE YEAR.
(b) DEFINITIONS. FOR PURPOSES OF THIS SECTION, "EXCESS DEFERRALS" SHALL
MEAN THE AMOUNT OF ELECTIVE CONTRIBUTIONS ALLOCATED TO THE
PARTICIPANT'S RETIREMENT SAVINGS ACCOUNT FOR A PARTICIPANT'S TAXABLE
YEAR AND WHICH THE PARTICIPANT OR THE EMPLOYER, WHERE APPLICABLE,
ALLOCATES TO THIS PLAN PURSUANT TO THE CLAIM PROCEDURE DESCRIBED
BELOW.
(c) CLAIMS. THE PARTICIPANT'S CLAIM SHALL BE IN WRITING; SHALL BE
SUBMITTED TO THE ADMINISTRATOR'S REPRESENTATIVE NOT LATER THAN MARCH 1
WITH RESPECT TO THE IMMEDIATELY PRECEDING TAXABLE YEAR; SHALL SPECIFY
THE AMOUNT OF THE PARTICIPANT'S EXCESS DEFERRALS FOR THE PRECEDING
TAXABLE YEAR; AND SHALL BE ACCOMPANIED BY THE PARTICIPANT'S WRITTEN
STATEMENT THAT IF SUCH AMOUNTS ARE NOT DISTRIBUTED, SUCH EXCESS
DEFERRALS, WHEN ADDED TO AMOUNTS DEFERRED UNDER OTHER PLANS OR
ARRANGEMENTS DESCRIBED IN SECTIONS 401(k), 408(k), 457, 501(c)(18) OR
403(b) OF THE INTERNAL REVENUE CODE, WILL EXCEED THE LIMIT IMPOSED ON
THE PARTICIPANT BY SECTION 402(g) OF THE INTERNAL REVENUE CODE FOR THE
TAXABLE YEAR IN WHICH THE DEFERRAL OCCURRED. THE EMPLOYER SHALL
NOTIFY THE PLAN ON BEHALF OF THE PARTICIPANT WHERE THE EXCESS
DEFERRALS OCCUR IN THE PLAN OR THE COMBINED PLANS OF THE EMPLOYER AND
AFFILIATES.
(d) DETERMINATION OF INCOME OR LOSS. THE EXCESS DEFERRALS SHALL BE
ADJUSTED FOR INCOME OR LOSS. UNLESS THE ADMINISTRATOR'S
REPRESENTATIVE AND THE TRUSTEE AGREE OTHERWISE IN WRITING, THE INCOME
OR LOSS ALLOCABLE TO EXCESS DEFERRALS SHALL BE DETERMINED BY
MULTIPLYING THE INCOME OR LOSS ALLOCABLE TO THE PARTICIPANT'S ELECTIVE
CONTRIBUTIONS FOR THE PLAN YEAR ENDING WITHIN SUCH PRECEDING TAXABLE
YEAR BY A FRACTION, THE NUMERATOR OF WHICH IS THE EXCESS DEFERRALS ON
BEHALF OF THE PARTICIPANT FOR SUCH PRECEDING TAXABLE YEAR AND THE
DENOMINATOR OF WHICH IS THE PARTICIPANT'S RETIREMENT SAVINGS ACCOUNT
BALANCE ATTRIBUTABLE TO ELECTIVE CONTRIBUTIONS ON THE VALUATION DATE
COINCIDENT WITH OR IMMEDIATELY BEFORE THE LAST DAY OF SUCH PRECEDING
TAXABLE YEAR WITHOUT REGARD TO ANY INCOME OR LOSS OCCURRING DURING
SUCH TAXABLE YEAR. ALSO, UNLESS THE ADMINISTRATOR'S REPRESENTATIVE
AND THE TRUSTEE AGREE OTHERWISE IN WRITING, THE EXCESS DEFERRAL SHALL
NOT BE ADJUSTED FOR INCOME OR LOSS FOR THE PERIOD BETWEEN THE
VALUATION DATE COINCIDENT WITH OR IMMEDIATELY BEFORE THE LAST DAY OF
SUCH PRECEDING TAXABLE YEAR AND THE DATE OF DISTRIBUTION OF THE EXCESS
DEFERRAL. IF THE ADMINISTRATOR'S REPRESENTATIVE AND THE TRUSTEE AGREE
IN WRITING TO ADJUST FOR INCOME OR LOSS FOR THE PERIOD BETWEEN THE
VALUATION DATE COINCIDENT WITH OR IMMEDIATELY BEFORE THE LAST DAY OF
SUCH PRECEDING TAXABLE YEAR, THE INCOME OR LOSS ALLOCABLE FOR SUCH
PERIOD SHALL BE EQUAL TO TEN PERCENT (10%) OF THE INCOME OR LOSS
ALLOCABLE TO THE DISTRIBUTABLE EXCESS DEFERRAL FOR THE APPLICABLE
TAXABLE YEAR MULTIPLIED BY THE NUMBER OF WHOLE CALENDAR MONTHS THAT
HAVE ELAPSED SINCE THE VALUATION DATE COINCIDENT WITH OR IMMEDIATELY
BEFORE THE LAST DAY OF SUCH TAXABLE YEAR, INCLUDING THE MONTH OF
DISTRIBUTION IF DISTRIBUTION OCCURS AFTER THE FIFTEENTH (15TH) OF SUCH
MONTH.
(e) ACCOUNTING FOR EXCESS DEFERRALS. EXCESS DEFERRALS SHALL BE
DISTRIBUTED FROM THE PARTICIPANT'S RETIREMENT SAVINGS ACCOUNT.
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7.12.2. EXCESS CONTRIBUTIONS (SECTION 401(k) TEST).
(a) IN GENERAL. NOTWITHSTANDING ANY OTHER PROVISION OF THE PLAN
STATEMENT, EXCESS CONTRIBUTIONS FOR A PLAN YEAR, PLUS ANY INCOME AND
MINUS ANY LOSS ALLOCABLE THERETO, SHALL BE DISTRIBUTED NO LATER THAN
THE LAST DAY OF THE FOLLOWING PLAN YEAR, TO PARTICIPANTS TO WHOSE
ACCOUNTS ELECTIVE CONTRIBUTIONS, AND IF USED TO DETERMINE THE DEFERRAL
PERCENTAGE UNDER SECTION 2, MATCHING CONTRIBUTIONS (AS DEFINED IN
SECTION 401(m)(4)(a) OF THE INTERNAL REVENUE CODE WHICH MEET THE
REQUIREMENTS OF SECTIONS 401(k)(2)(b) AND 401(k)(2)(c) OF THE INTERNAL
REVENUE CODE) OR QUALIFIED NONELECTIVE CONTRIBUTIONS (WITHIN THE
MEANING OF SECTION 401(m)(4)(c) OF THE INTERNAL REVENUE CODE), OR
BOTH, WERE ALLOCATED. IF SUCH EXCESS CONTRIBUTIONS ARE DISTRIBUTED
MORE THAN TWO AND ONE HALF (2 1/2) MONTHS AFTER THE LAST DAY OF THE
PLAN YEAR IN WHICH SUCH EXCESS CONTRIBUTIONS AROSE, A TEN PERCENT
(10%) EXCISE TAX WILL BE IMPOSED ON THE EMPLOYER MAINTAINING THE PLAN
WITH RESPECT TO SUCH EXCESS CONTRIBUTIONS. SUCH DISTRIBUTIONS SHALL
BE MADE TO HIGHLY COMPENSATED ELIGIBLE EMPLOYEES (AS DEFINED IN
SECTION 2) ON THE BASIS OF THE RESPECTIVE PORTIONS OF THE EXCESS
CONTRIBUTIONS ATTRIBUTABLE TO EACH OF SUCH EMPLOYEES.
(b) EXCESS CONTRIBUTIONS. FOR PURPOSES OF THIS SECTION, "EXCESS
CONTRIBUTIONS" SHALL MEAN, WITH RESPECT TO ANY PLAN YEAR, THE EXCESS
OF:
(I) THE AGGREGATE AMOUNT OF EMPLOYER CONTRIBUTIONS TAKEN INTO ACCOUNT
IN COMPUTING THE AVERAGE DEFERRAL PERCENTAGE (AS DEFINED IN
SECTION 2) OF HIGHLY COMPENSATED COVERED EMPLOYEES (AS DEFINED IN
SECTION 2) FOR SUCH PLAN YEAR, OVER
(II) THE MAXIMUM AMOUNT OF SUCH CONTRIBUTIONS PERMITTED BY THE
SECTION 401(k) TEST DESCRIBED IN SECTION 2 (DETERMINED BY
REDUCING CONTRIBUTIONS MADE ON BEHALF OF THE HIGHLY COMPENSATED
COVERED EMPLOYEES IN ORDER OF THE DEFERRAL PERCENTAGE, AS DEFINED
IN SECTION 2, BEGINNING WITH THE HIGHEST SUCH PERCENTAGE).
(c) DETERMINATION OF INCOME OR LOSS. THE EXCESS CONTRIBUTIONS SHALL BE
ADJUSTED FOR INCOME OR LOSS. UNLESS THE ADMINISTRATOR'S
REPRESENTATIVE AND THE TRUSTEE AGREE OTHERWISE IN WRITING, THE INCOME
OR LOSS ALLOCABLE TO EXCESS CONTRIBUTIONS SHALL BE DETERMINED BY
MULTIPLYING INCOME OR LOSS ALLOCABLE TO THE PARTICIPANT'S ELECTIVE
CONTRIBUTIONS, AND IF USED TO DETERMINE AN ELIGIBLE EMPLOYEE'S
DEFERRAL PERCENTAGE UNDER SECTION 2, MATCHING CONTRIBUTIONS (AS
DEFINED IN SECTION 401(m)(4) OF THE INTERNAL REVENUE CODE WHICH MEET
THE REQUIREMENTS OF SECTIONS 401(k)(2)(b) AND 401(k)(2)(c) OF THE
INTERNAL REVENUE CODE) OR QUALIFIED NONELECTIVE CONTRIBUTIONS (WITHIN
THE MEANING OF SECTION 401(m)(4)(c) OF THE INTERNAL REVENUE CODE), OR
BOTH, FOR THE PLAN YEAR BY A FRACTION, THE NUMERATOR OF WHICH IS THE
EXCESS CONTRIBUTIONS ON BEHALF OF THE PARTICIPANT FOR THE PLAN YEAR
AND THE DENOMINATOR OF WHICH IS THE SUM OF THE PARTICIPANT'S ACCOUNT
BALANCES ATTRIBUTABLE TO ELECTIVE CONTRIBUTIONS AND SUCH MATCHING
CONTRIBUTIONS OR QUALIFIED NONELECTIVE CONTRIBUTIONS, OR BOTH, ON THE
LAST DAY OF THE PLAN YEAR, WITHOUT REGARD TO ANY INCOME OR LOSS
OCCURRING DURING SUCH PLAN YEAR. ALSO, UNLESS THE ADMINISTRATOR'S
REPRESENTATIVE AND THE TRUSTEE AGREE OTHERWISE IN WRITING, EXCESS
CONTRIBUTIONS SHALL NOT BE ADJUSTED FOR INCOME OR LOSS FOR THE PERIOD
BETWEEN THE VALUATION DATE COINCIDENT WITH OR IMMEDIATELY BEFORE THE
LAST DAY OF SUCH
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PRECEDING TAXABLE YEAR AND THE DATE OF DISTRIBUTION OF THE EXCESS
CONTRIBUTIONS. IF THE ADMINISTRATOR'S REPRESENTATIVE AND THE
TRUSTEE AGREE IN WRITING TO ADJUST FOR INCOME OR LOSS FOR THE
PERIOD BETWEEN THE VALUATION DATE COINCIDENT WITH OR IMMEDIATELY
BEFORE THE LAST DAY OF SUCH PRECEDING TAXABLE YEAR, THE INCOME OR
LOSS ALLOCABLE FOR SUCH PERIOD SHALL BE EQUAL TO TEN PERCENT (10%)
OF THE INCOME OR LOSS ALLOCABLE TO THE DISTRIBUTABLE EXCESS
CONTRIBUTIONS FOR THE APPLICABLE TAXABLE YEAR MULTIPLIED BY THE
NUMBER OF WHOLE CALENDAR MONTHS THAT HAVE ELAPSED SINCE THE
VALUATION DATE COINCIDENT WITH OR IMMEDIATELY BEFORE THE LAST DAY
OF SUCH TAXABLE YEAR, INCLUDING THE MONTH OF DISTRIBUTION IF
DISTRIBUTION OCCURS AFTER THE FIFTEENTH (15TH) OF SUCH MONTH.
(d) ACCOUNTING FOR EXCESS CONTRIBUTIONS. EXCESS CONTRIBUTIONS SHALL BE
DISTRIBUTED FROM THE PARTICIPANT'S RETIREMENT SAVINGS ACCOUNT AND
EMPLOYER MATCHING ACCOUNT, IF APPLICABLE, IN PROPORTION TO THE
PARTICIPANT'S ELECTIVE CONTRIBUTIONS AND MATCHING CONTRIBUTIONS, IF
APPLICABLE, (AS DEFINED IN SECTION 401(m)(4)(A) OF THE INTERNAL
REVENUE CODE WHICH MEET THE REQUIREMENTS OF SECTIONS 401(k)(2)(B) AND
401(k)(2)(C) OF THE INTERNAL REVENUE CODE) FOR THE PLAN YEAR. EXCESS
CONTRIBUTIONS SHALL BE DISTRIBUTED FROM THE PARTICIPANT'S EMPLOYER
CONTRIBUTIONS ACCOUNT, IF APPLICABLE (BUT ONLY APPLICABLE IF QUALIFIED
NONELECTIVE CONTRIBUTIONS WITHIN THE MEANING OF SECTION 401(m)(4)(C)
OF THE INTERNAL REVENUE CODE ARE HELD IN THE EMPLOYER CONTRIBUTIONS
ACCOUNT), ONLY TO THE EXTENT SUCH EXCESS CONTRIBUTIONS EXCEED THE
BALANCE IN THE PARTICIPANT'S RETIREMENT SAVINGS ACCOUNT AND EMPLOYER
MATCHING ACCOUNT.
(e) SPECIAL FAMILY MEMBER RULE. IF THE DEFERRAL PERCENTAGE OF A HIGHLY
COMPENSATED COVERED EMPLOYEE IS DETERMINED UNDER SECTION 2.7.2(b),
THEN THE DEFERRAL PERCENTAGE IS REDUCED AS REQUIRED UNDER THIS SECTION
AND THE EXCESS CONTRIBUTIONS FOR THE FAMILY GROUP SHALL BE ALLOCATED
AMONG THE FAMILY MEMBERS IN PROPORTION TO THE ELECTIVE CONTRIBUTIONS
OF EACH FAMILY MEMBER THAT ARE COMBINED TO DETERMINE THE DEFERRAL
PERCENTAGE.
7.12.3. EXCESS AGGREGATE CONTRIBUTIONS (SECTION 401(m) TEST).
(a) IN GENERAL. SUBJECT TO SECTION 7.12.3(f), BUT OTHERWISE
NOTWITHSTANDING ANY OTHER PROVISION OF THE PLAN STATEMENT, EXCESS
AGGREGATE CONTRIBUTIONS, PLUS ANY INCOME AND MINUS ANY LOSS ALLOCABLE
THERETO, SHALL BE DISTRIBUTED NO LATER THAN THE LAST DAY OF THE
FOLLOWING PLAN YEAR TO PARTICIPANTS TO WHOSE ACCOUNTS NONDEDUCTIBLE
VOLUNTARY CONTRIBUTIONS OR EMPLOYER MATCHING CONTRIBUTIONS, AND IF
USED TO DETERMINE THE CONTRIBUTION PERCENTAGE UNDER SECTION 3,
ELECTIVE CONTRIBUTIONS OR QUALIFIED NONELECTIVE CONTRIBUTIONS (WITHIN
THE MEANING OF SECTION 401(m)(4)(C) OF THE INTERNAL REVENUE CODE), OR
BOTH, WERE ALLOCATED. SUCH DISTRIBUTIONS SHALL BE MADE TO HIGHLY
COMPENSATED ELIGIBLE EMPLOYEES (AS DEFINED IN SECTION 3) ON THE BASIS
OF THE RESPECTIVE PORTIONS OF THE EXCESS AGGREGATE CONTRIBUTIONS
ATTRIBUTABLE TO EACH OF SUCH EMPLOYEES.
(b) EXCESS AGGREGATE CONTRIBUTIONS. FOR PURPOSES OF THIS SECTION, "EXCESS
AGGREGATE CONTRIBUTIONS" SHALL MEAN, WITH RESPECT TO ANY PLAN YEAR,
THE EXCESS OF:
(i) THE AGGREGATE AMOUNT OF CONTRIBUTIONS TAKEN INTO ACCOUNT IN
COMPUTING THE AVERAGE CONTRIBUTION PERCENTAGE (AS DEFINED IN
SECTION 3) OF HIGHLY COMPENSATED ELIGIBLE EMPLOYEES (AS DEFINED
IN SECTION 3) FOR SUCH PLAN YEAR, OVER
(ii) THE MAXIMUM AMOUNT OF SUCH CONTRIBUTIONS PERMITTED BY THE
SECTION 401(m) TEST DESCRIBED IN SECTION 3 (DETERMINED BY
REDUCING CONTRIBUTIONS MADE ON BEHALF OF THE HIGHLY COMPENSATED
ELIGIBLE
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EMPLOYEES IN ORDER OF THE CONTRIBUTION PERCENTAGE, AS DEFINED IN
SECTION 3, BEGINNING WITH THE HIGHEST SUCH PERCENTAGE).
(c) DETERMINATION OF INCOME. THE EXCESS AGGREGATE CONTRIBUTIONS SHALL BE
ADJUSTED FOR INCOME OR LOSS. UNLESS THE ADMINISTRATOR'S
REPRESENTATIVE AND THE TRUSTEE AGREE OTHERWISE IN WRITING, THE INCOME
OR LOSS ALLOCABLE TO EXCESS AGGREGATE CONTRIBUTIONS SHALL BE
DETERMINED BY MULTIPLYING THE INCOME OR LOSS ALLOCABLE TO THE
PARTICIPANT'S NONDEDUCTIBLE VOLUNTARY CONTRIBUTIONS AND EMPLOYER
MATCHING CONTRIBUTIONS (TO THE EXTENT USED TO DETERMINE THE ELIGIBLE
EMPLOYEE'S CONTRIBUTION PERCENTAGE UNDER SECTION 3), AND IF USED TO
DETERMINE AN ELIGIBLE EMPLOYEE'S CONTRIBUTION PERCENTAGE UNDER
SECTION 3, ELECTIVE CONTRIBUTIONS OR QUALIFIED NONELECTIVE
CONTRIBUTIONS (WITHIN THE MEANING OF SECTION 401(m)(4)(C) OF THE
INTERNAL REVENUE CODE), OR BOTH, FOR THE PLAN YEAR BY A FRACTION, THE
NUMERATOR OF WHICH IS THE EXCESS AGGREGATE CONTRIBUTIONS ON BEHALF OF
THE PARTICIPANT FOR THE PLAN YEAR AND THE DENOMINATOR OF WHICH IS THE
SUM OF THE ACCOUNT BALANCES ATTRIBUTABLE TO NONDEDUCTIBLE VOLUNTARY
CONTRIBUTIONS, EMPLOYER MATCHING CONTRIBUTIONS AND SUCH ELECTIVE
CONTRIBUTIONS OR QUALIFIED NONELECTIVE CONTRIBUTIONS, OR BOTH, ON THE
LAST DAY OF THE PLAN YEAR WITHOUT REGARD TO ANY INCOME OR LOSS
OCCURRING DURING SUCH PLAN YEAR. ALSO, UNLESS THE ADMINISTRATOR'S
REPRESENTATIVE AND THE TRUSTEE AGREE OTHERWISE IN WRITING, EXCESS
AGGREGATE CONTRIBUTIONS SHALL NOT BE ADJUSTED FOR INCOME OR LOSS FOR
THE PERIOD BETWEEN THE VALUATION DATE COINCIDENT WITH OR IMMEDIATELY
BEFORE THE LAST DAY OF SUCH PRECEDING TAXABLE YEAR AND THE DATE OF
DISTRIBUTION OF THE EXCESS CONTRIBUTIONS. IF THE ADMINISTRATOR'S
REPRESENTATIVE AND THE TRUSTEE AGREE IN WRITING TO ADJUST FOR INCOME
OR LOSS FOR THE PERIOD BETWEEN THE VALUATION DATE COINCIDENT WITH OR
IMMEDIATELY BEFORE THE LAST DAY OF SUCH PRECEDING TAXABLE YEAR, THE
INCOME OR LOSS ALLOCABLE FOR SUCH PERIOD SHALL BE EQUAL TO TEN PERCENT
(10%) OF THE INCOME OR LOSS ALLOCABLE TO THE DISTRIBUTABLE EXCESS
AGGREGATE CONTRIBUTIONS FOR THE APPLICABLE TAXABLE YEAR MULTIPLIED BY
THE NUMBER OF WHOLE CALENDAR MONTHS THAT HAVE ELAPSED SINCE THE
VALUATION DATE COINCIDENT WITH OR IMMEDIATELY BEFORE THE LAST DAY OF
SUCH TAXABLE YEAR, INCLUDING THE MONTH OF DISTRIBUTION IF DISTRIBUTION
OCCURS AFTER THE FIFTEENTH (15TH) OF SUCH MONTH.
(d) ACCOUNTING FOR EXCESS AGGREGATE CONTRIBUTIONS. EXCESS AGGREGATE
CONTRIBUTIONS SHALL BE DISTRIBUTED FROM THE PARTICIPANT'S VOLUNTARY
ACCOUNT, THE PARTICIPANT'S EMPLOYER MATCHING ACCOUNT (AND, IF
APPLICABLE, THE PARTICIPANT'S RETIREMENT SAVINGS ACCOUNT OR EMPLOYER
CONTRIBUTIONS ACCOUNT, OR BOTH) IN PROPORTION TO THE PARTICIPANT'S
NONDEDUCTIBLE VOLUNTARY CONTRIBUTIONS, EMPLOYER MATCHING
CONTRIBUTIONS, AND IF USED TO DETERMINE THE CONTRIBUTION PERCENTAGE
UNDER SECTION 3, ELECTIVE CONTRIBUTIONS OR QUALIFIED NONELECTIVE
CONTRIBUTIONS (WITHIN THE MEANING OF SECTION 401(m)(4)(C) OF THE
INTERNAL REVENUE CODE), OR BOTH, FOR THE PLAN YEAR.
(e) SPECIAL FAMILY MEMBER RULE. IF THE CONTRIBUTION PERCENTAGE OF A
HIGHLY COMPENSATED ELIGIBLE EMPLOYEE IS DETERMINED UNDER SECTION
3.10.2(b), THEN THE CONTRIBUTION PERCENTAGE IS REDUCED AS REQUIRED
UNDER THIS SECTION AND THE EXCESS AGGREGATE CONTRIBUTIONS FOR THE
FAMILY GROUP SHALL BE ALLOCATED AMONG THE FAMILY MEMBERS IN PROPORTION
TO THE NONDEDUCTIBLE VOLUNTARY CONTRIBUTIONS AND EMPLOYER MATCHING
CONTRIBUTIONS OF EACH FAMILY MEMBER THAT ARE COMBINED TO DETERMINE THE
CONTRIBUTION PERCENTAGE.
(f) SPECIAL RULE FOR PARTIAL VESTING. IF THE PARTICIPANT IS NOT FULLY
(100%) VESTED IN THE EMPLOYER MATCHING ACCOUNT AS OF THE LAST DAY OF
THE PLAN YEAR TO WHICH THE EXCESS AGGREGATE CONTRIBUTIONS RELATE, THEN
THE DISTRIBUTION OF THE PARTICIPANT'S EXCESS AGGREGATE CONTRIBUTIONS
UNDER THIS SECTION SHALL BE DEEMED TO HAVE BEEN DISTRIBUTED FROM THE
FULLY (100%) VESTED PORTION OF THE EMPLOYER MATCHING ACCOUNT AND SUCH
ACCOUNT SHALL BECOME VESTED IN ACCORDANCE WITH THE SPECIAL RULE FOR
PARTIAL DISTRIBUTIONS IN SECTION 5.1.3. TO THE EXTENT THE EXCESS
AGGREGATE CONTRIBUTIONS EXCEED THE FULLY (100%) VESTED PORTION OF
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THE PARTICIPANT'S EMPLOYER MATCHING ACCOUNT, THE EXCESS AGGREGATE
CONTRIBUTIONS SHALL BE FORFEITED AND REALLOCATED AS PROVIDED IN
SECTION 6.2.
7.12.4. PRIORITY. THE DETERMINATION OF THE EXCESS AGGREGATE
CONTRIBUTIONS SHALL BE MADE AFTER FIRST DETERMINING THE EXCESS DEFERRALS, AND
THEN DETERMINING THE EXCESS CONTRIBUTIONS. THE AMOUNT OF EXCESS
CONTRIBUTIONS SHALL BE REDUCED BY EXCESS DEFERRALS PREVIOUSLY DISTRIBUTED TO
SUCH PARTICIPANT FOR THE PARTICIPANT'S TAXABLE YEAR ENDING WITH OR WITHIN
SUCH PLAN YEAR.
7.12.5. MATCHING CONTRIBUTIONS. IF EXCESS DEFERRALS, EXCESS
CONTRIBUTIONS OR ELECTIVE CONTRIBUTIONS TREATED AS EXCESS AGGREGATE
CONTRIBUTIONS ARE DISTRIBUTED PURSUANT TO THIS SECTION 7.12, APPLICABLE
MATCHING CONTRIBUTIONS UNDER SECTION 3.3 OR 3.4 SHALL BE TREATED AS
FORFEITURES AND REALLOCATED AS PROVIDED IN SECTION 6.2.
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SECTION 8
SPENDTHRIFT PROVISIONS
No Participant or Beneficiary shall have any transmissible interest in any
Account nor shall any Participant or Beneficiary have any power to anticipate,
alienate, dispose of, pledge or encumber the same while in the possession or
control of the Trustee, nor shall the Trustee, the Administrator's
Representative or the Employer recognize any assignment thereof, either in whole
or in part, nor shall any Account herein be subject to attachment, garnishment,
execution following judgment or other legal process while in the possession or
control of the Trustee.
The power to designate Beneficiaries to receive the Vested Total Account of a
Participant in the event of his death shall not permit or be construed to permit
such power or right to be exercised by the Participant so as thereby to
anticipate, pledge, mortgage or encumber his Account or any part thereof, and
any attempt of a Participant so to exercise said power in violation of this
provision shall be of no force and effect and shall be disregarded by the
Trustee, the Administrator's Representative and the Employer.
This section shall not prevent the Trustee, the Administrator's Representative
or the Employer from exercising, in their discretion, any of the applicable
powers and options granted to them upon the occurrence of an Event of Maturity,
as such powers may be conferred upon them by any applicable provision hereof,
nor prevent the Plan from foreclosing on the lien granted to secure any and all
loans made to him as a Participant from the Fund. (In the event of a default on
a Participant loan, foreclosure on the promissory note and the attachment of the
security interest in the Account will not occur until an Event of Maturity
occurs with respect to such Participant.) This section does not prevent the
Administrator's Representative or Trustee from observing the forms of a
qualified domestic relations order as provided in the Appendix C to this Plan
Statement.
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SECTION 9
AMENDMENT AND TERMINATION
9.1. AMENDMENT.
9.1.1. AMENDMENT BY EMPLOYER. The Employer reserves the right to amend
the designations and elections made by it under the Adoption Agreement from time
to time by making and delivering a new Adoption Agreement to the Trustee, to add
overriding language in the Adoption Agreement when such language is necessary to
satisfy the requirements of section 415 of the Internal Revenue Code or to avoid
duplication of minimum benefits under section 416 of the Internal Revenue Code
because of the required aggregation of multiple plans, which amendment shall
become effective only if expressly accepted in writing by the Trustee, and to
add certain model amendments published by the Internal Revenue Service, which
specifically provide that their adoption will not cause the plan to be treated
as individually designed. An Employer that amends the Plan for any other
reason, will no longer participate in these Prototype Documents and will be
considered to have an individually designed plan. The Employer further reserves
the right to amend its plan in its entirety by the adoption of another master,
prototype or individually designed successor retirement plan document in place
of this Plan Statement, and by entering into such agreement with the Trustee or
with a successor trustee, or other successor funding medium selected by the
Employer as may be required for the purpose of carrying such successor
retirement plan document into effect. The Employer may not amend the Prototype
Documents (as distinguished from amending its elections in the Adoption
Agreement). If an Employer should take action to:
(i) remove and replace the Trustee originally designated in this
Plan Statement, or name a Trustee who is not the Prototype
Sponsor (or a Trustee approved by the Prototype Sponsor), or
(ii) amend this Plan Statement by the adoption of another
document in lieu of this Plan Statement, or
(iii) attempt to amend the Prototype Documents, or
(iv) attempt to complete the Adoption Agreement in a manner not
permitted by the Adoption Agreement, or
(v) affirmatively refuse to consent to an amendment effected
by the Prototype Sponsor under Section 9.1.2,
such action shall not be considered a termination of the Plan adopted or
continued under this Plan Statement. Upon the occurrence of such action, the
Employer shall no longer be considered to be maintaining a Plan under these
Prototype Documents but rather under an individually designed document. No
amendment shall be effective so as to increase the duties of the Trustee without
its consent and provided, further, that the right of the Employer to designate a
successor retirement plan or funding medium shall be subject to the notice
requirements affecting the removal of the Trustee set forth in Section 10.3.
9.1.2. AMENDMENT BY PROTOTYPE SPONSOR. The Employer has delegated to
the Prototype Sponsor the right to amend this Plan Statement (either as to its
form or the elections specified in the Adoption Agreement). Although it is
intended that this power of amendment will be used principally to assure
compliance with applicable provisions of the Employee Retirement Income Security
Act of 1974 and the Internal Revenue Code as they may be now or hereafter
amended, this power of amendment may be exercised for any purpose deemed
appropriate by the Prototype Sponsor. Any such amendment shall be effective
only upon notice in writing to the Employer. The Employer shall be deemed to
have
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consented to such amendment unless prior to the expiration of thirty (30)
days after notice is sent to the Employer, the Employer exercises its reserved
power of amendment by adopting a successor retirement plan and funding medium,
as provided in Section 9.1.
9.1.3. LIMITATION ON AMENDMENTS. No amendment shall be effective to
reduce or divest the Account of any Participant unless the same shall have been
adopted with the consent of the Secretary of Labor pursuant to section 412(c)(8)
of the Internal Revenue Code. No amendment shall eliminate an optional form of
distribution with respect to benefits attributable to service before the
amendment was adopted, unless such amendment is adopted pursuant to regulations
issued by the Secretary of the Treasury.
9.1.4. RESIGNATION OF PROTOTYPE SPONSOR. By giving the Employer thirty
(30) days' written notice of its intention to do so, the Prototype Sponsor may
withdraw its consent to the Employer's use of the Prototype Documents. Upon the
occurrence of such action, the Employer shall no longer be considered to be
maintaining a Plan under these Prototype Documents but rather under an
individually designed document.
9.2. DISCONTINUANCE OF CONTRIBUTIONS AND TERMINATION OF PLAN. The Employer also
reserves the right to reduce, suspend or discontinue its contributions to this
Plan and to terminate the Plan herein embodied in its entirety. If the Plan is
terminated, the assets will be distributed as soon as administratively feasible.
9.3. MERGER, ETC., WITH ANOTHER PLAN. The Employer may cause all or a part of
this Plan to be merged with all or a part of any other plan and may cause all or
a part of the assets and liabilities to be transferred from this Plan to another
plan. In the case of merger or consolidation of this Plan with, or transfer of
assets and liabilities of this Plan to, any other plan, each Participant shall
(if such other plan were then terminated) receive a benefit immediately after
the merger, consolidation or transfer which is not less than the benefit he
would have been entitled to receive immediately before the merger, consolidation
or transfer (if this Plan had then terminated). If the Employer agrees to a
transfer of assets and liabilities to or from another plan, the agreement under
which such transfer is concluded shall specify the Accounts to which the
transferred amounts are to be credited.
In no event shall assets be transferred from any other plan to this Plan unless
this Plan complies (or has been amended to comply) with the optional form of
benefit requirements of section 411(d)(6)(B)(ii) of the Internal Revenue Code
(or, where applicable, the distribution rules of section 401(k) of the Internal
Revenue Code) with respect to such transferred assets.
In no event shall assets be transferred from this Plan to any other plan unless
such other plan complies (or has been amended to comply) with the optional form
of benefit requirements of section 411(d)(6)(B)(ii) of the Internal Revenue Code
and the distribution rules of section 401(k) of the Internal Revenue Code with
respect to such transferred assets.
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FOURTH AMENDMENT-EFFECTIVE DECEMBER 12, 1994 OR, IF LATER, MARCH 12, 1995
NOTWITHSTANDING ANY PROVISION OF THE PLAN TO THE CONTRARY, TO THE EXTENT THAT
ANY OPTIONAL FORM OF BENEFIT UNDER THIS PLAN PERMITS A DISTRIBUTION PRIOR TO THE
EMPLOYEE'S RETIREMENT, DEATH DISABILITY OR SEVERANCE FROM EMPLOYMENT, AND PRIOR
TO PLAN TERMINATION, THE OPTIONAL FORM OF BENEFIT IS NOT AVAILABLE WITH RESPECT
TO BENEFITS ATTRIBUTABLE TO ASSETS (INCLUDING POST-TRANSFER EARNING THEREON) AND
LIABILITIES THAT ARE TRANSFERRED WITHIN THE MEANING OF SECTION 414(l) OF THE
INTERNAL REVENUE CODE, TO THIS PLAN FROM A MONEY PURCHASE PENSION PLAN QUALIFIED
UNDER SECTION 401(a) OF THE INTERNAL REVENUE CODE (OTHER THAN ANY PORTION OF
THOSE ASSETS AND LIABILITIES ATTRIBUTABLE TO VOLUNTARY EMPLOYEE CONTRIBUTIONS).
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9.4. ADOPTION BY AFFILIATES.
9.4.1. ADOPTION WITH CONSENT. The Employer executing the Adoption
Agreement (herein called the "principal employer") may consent to the adoption
of this Plan by any business entity affiliated in ownership with the principal
employer (subject to such conditions as the principal employer may impose).
9.4.2. PROCEDURE FOR ADOPTION. Any such adopting business entity shall
initiate its adoption of this Plan by delivery of a certified copy of the action
of its directors (if a corporation), general partner (if a partnership) or
proprietor (if a sole proprietorship), adopting this Plan Statement to the
principal employer. Upon the consent by said principal employer of the adoption
by the adopting business entity, and the delivery to the Trustee of written
evidence of the principal employer's consent, the adoption of this Plan by the
adopting business entity shall be effective as of the date specified by the
principal employer.
9.4.3. EFFECT OF ADOPTION. Upon the adoption of this Plan by an
adopting business entity as heretofore provided, the adopting business entity
shall be an Employer hereunder in all respects. Each adopting business entity
(and each other business entity joining the principal employer in the execution
of the Adoption Agreement), as a condition of continued participation in this
Plan, delegates to the principal employer the sole power and authority:
(a) to terminate the Plan (except that each adopting business entity shall
have the power to terminate this Plan as applied to it); to amend the
Plan Statement (except that each adopting business entity shall have
the power to amend the Plan Statement as applied to it by establishing
a successor plan to which assets and liabilities may be transferred as
provided in Section 9.3),
(b) to appoint, remove and accept the resignation of a Trustee; to appoint
or remove the Administrator's Representative; to appoint or remove an
Investment Manager; to act as the plan administrator,
(c) to direct the Trustee to return an Employer contribution that was made
by mistake or which is not deductible,
(d) to consent to the adoption of this Plan by affiliated employers; to
establish conditions and limitations upon such adoption of this Plan
by affiliated employers, and
(e) to cause this Plan to be merged with another plan and to transfer
assets and liabilities between this Plan and another.
Each reference herein to the Employer shall include the principal employer
and all adopting business entities unless the context clearly requires
otherwise. Employment with the principal employer and all adopting business
entities shall be credited with each other and all Affiliates of any of them
for the purposes of determining Eligibility Service, Vesting Service,
One-Year Breaks in Service and the minimum annual service requirement for
allocation of contributions and forfeited Suspense Accounts. Contributions
of the principal employer and each adopting business entity shall be
identical, as a percentage of each Participant's Recognized Compensation, as
determined by the principal employer, but shall be allocated only among those
persons who were the Employees during the Plan Year of the particular
business entity making the contribution. Notwithstanding Section 6.2 to the
contrary, forfeited Suspense Accounts shall only be used, first, to restore
prior forfeitures for an Employee of the particular business entity for which
a current forfeiture occurs, second, to reduce the required matching
contribution, if any, for such business entity, and, finally, to reduce the
discretionary contributions of such business entity. If necessary, the
foregoing steps shall be followed in Plan Years subsequent to the Plan Year
in which the forfeiture occurs until such Suspense Accounts are exhausted.
Any unallocated Suspense Accounts remaining at the termination of the Plan
shall be allocated to the Employer Contributions
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Accounts of all Participants then employed by the principal employer and all
adopting business entities, in proportion to the relative value of each such
Account.
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SECTION 10
CONCERNING THE TRUSTEE
10.1. DEALINGS WITH TRUSTEE.
10.1.1. NO DUTY TO INQUIRE. No person, firm or corporation dealing with
the Trustee shall be required to take cognizance of the provisions of this Plan
Statement or be required to make inquiry as to the authority of the Trustee to
do any act which the Trustee shall do hereunder. No person, firm or corporation
dealing with the Trustee shall be required to see either to the administration
of the Plan or Fund or to the faithful performance by the Trustee of its duties
hereunder (except to the extent otherwise provided by the Employee Retirement
Income Security Act of 1974). Any such person, firm or corporation shall be
entitled to assume conclusively that the Trustee is properly authorized to do
any act which it shall do hereunder. Any such person, firm or corporation shall
be under no liability to anyone whomsoever for any act done hereunder pursuant
to the written direction of the Trustee.
10.1.2. ASSUMED AUTHORITY. Any such person, firm or corporation may
conclusively assume that the Trustee has full power and authority to receive and
receipt for any money or property becoming due and payable to the Trustee. No
such person shall be bound to inquire as to the disposition or application of
any money or property paid to the Trustee or paid in accordance with the written
directions of the Trustee.
10.2. COMPENSATION OF TRUSTEE. The corporate Trustee shall be entitled to
receive compensation for its services as Trustee hereunder as may be agreed upon
from time to time by the Administrator's Representative and the Trustee. The
Trustee shall be entitled to receive reimbursement for reasonable expenses,
fees, costs and other charges incurred by it or payable by it on account of the
administration of the Plan and the Fund to the extent approved by the
Administrator's Representative, except to the extent that the Employer, in its
discretion, directly pays the Trustee, such items of expense and compensation
shall be payable out of:
(i) the annual Employer contribution to the Fund, or
(ii) the income of the Fund, or
(iii) the principal of the Fund, including any accumulations of
income that have been added thereto, or
(iv) to or out of any combination of the foregoing sources in the
event the service in question has been for the benefit,
protection or administration of more than one such source of
payment.
The Trustee's determination in such respect made in good faith of the amount
so to be allocated and charged to each such source of payment shall be
binding and conclusive upon all persons interested or becoming interested in
the Plan or the Fund. Each such charge of the Trustee shall be a lien upon
the Fund, and, ratably, in accordance with the method of allocation used as
aforesaid, shall be a lien upon the interest of Participants in the source of
payment to which the same is charged until the same is paid and discharged in
full.
10.3. RESIGNATION AND REMOVAL OF TRUSTEE.
10.3.1. RESIGNATION, REMOVAL AND APPOINTMENT. The Trustee may resign
by giving the Employer thirty (30) days' written notice of its intention so
to do. The Employer may agree in writing to a lesser period of notice. The
notice period shall begin on the date such notice is mailed. The Employer
may remove any Trustee or successor Trustee hereunder by giving such Trustee
thirty (30) days' written notice of removal. The Trustee may agree in
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writing to a lesser period of notice. The notice period shall begin on the
date such notice is mailed. The Employer shall have the power to appoint one
or more individual or corporate Trustees, or both, as additional or successor
Trustees. Such appointments shall not be effective until a written
acceptance of trusteeship is filed with the then acting Trustee.
10.3.2. SURVIVING TRUSTEES. When any person or corporation appointed,
qualified and serving as a Trustee hereunder shall cease to be a Trustee of
the Fund, the remaining Trustee or Trustees then serving hereunder, or the
successor Trustee or Trustees appointed hereunder, as the case may be, shall
thereupon be and become vested with full title and right to possession of all
assets and records of the Plan and Fund in the possession or control of such
prior Trustee, and the prior Trustee shall forthwith account for and deliver
the same to such remaining or successor Trustee or Trustees.
10.3.3. SUCCESSOR ORGANIZATIONS. By designating a corporate Trustee,
original or successor, hereunder, there is included in such designation and
as a part thereof any other corporation possessing trust powers and
authorized by law to accept the Plan and Fund into which or with which the
designated corporate Trustee, original or successor, shall be converted,
consolidated or merged, and the corporation into which or with which any
corporate Trustee hereunder shall be so converted, consolidated or merged
shall continue to be the corporate Trustee of the Plan and Fund.
10.3.4. CO-TRUSTEE RESPONSIBILITY. No Trustee shall be or become
liable for any act or omission of a co-trustee serving hereunder with him or
it (except to the extent that liability is imposed under the Employee
Retirement Income Security Act of 1974) or of a prior Trustee hereunder, it
being the purpose and intent that each Trustee shall be liable only for his
or its own acts or omissions during his or its term of service as Trustee
hereunder.
10.4. ACCOUNTINGS BY TRUSTEE.
10.4.1. PERIODIC REPORTS. The Trustee shall render to the Employer
and to the Administrator's Representative an account and report as soon as
practicable after the Annual Valuation Date in each year (and as soon as may
be practicable after each other Valuation Date) showing all transactions
affecting the administration of the Plan and the Fund, including, but not
necessarily limited to, such information concerning the Plan and the Fund and
the administration thereof by the Trustee as shall be requested in writing by
the Employer.
10.4.2. SPECIAL REPORTS. The Trustee shall also render such further
reports from time to time as may be requested by the Employer and shall
submit its final report and account to the Employer when it shall cease to be
Trustee hereunder, whether by resignation or other cause.
10.4.3. REVIEW OF REPORTS. After giving Participants and other
persons interested therein a reasonable opportunity to examine the annual
account of the Trustee to the Employer as provided in Section 10.4.1,
provided that no exceptions are asserted thereto by any person (including the
Employer) interested therein, the Employer may settle and allow such accounts
by agreement with the Trustee. Except as may be otherwise required by the
Employee Retirement Income Security Act of 1974 the Trustee shall upon such
settlement and allowance be released and relieved of all liability for all
matters set forth therein.
10.5. TRUSTEE'S POWER TO PROTECT ITSELF ON ACCOUNT OF TAXES. The
Trustee, as a condition to the making of distribution of a Participant's
Vested Total Account during his lifetime, may require the Participant, or in
the event of his death may require the person or persons entitled to receive
his Vested Total Account in such event, to furnish the Trustee with proof of
payment of all income, inheritance, estate, transfer, legacy and/or
succession taxes and all other taxes of any different type or kind that may
be imposed under or by virtue of any state or federal statute or law upon the
payment, transfer, descent or distribution of such Vested Total Account and
for the payment of which the Trustee may, in its judgment, be directly or
indirectly liable. In lieu of the foregoing, the Trustee may deduct,
withhold and transmit to
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the proper taxing authorities any such tax which it may be permitted or
required to deduct and withhold and the Vested Total Account to be
distributed in such case shall be correspondingly reduced.
10.6. OTHER TRUST POWERS. Except to the extent that the Trustee is
subject to the authorized and properly given investment directions of a
Participant, Beneficiary or Investment Manager (and in extension, but not in
limitation, of the rights, powers and discretions conferred upon the Trustee
herein), the Trustee shall have and may exercise from time to time in the
administration of the Plan and the Fund, for the purpose of distribution
after the termination thereof, and for the purpose of distribution of Vested
Total Accounts, without order or license of any court, any one or more or all
of the following rights, powers and discretions:
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
(a) TO INVEST AND REINVEST ANY INVESTMENT SUBFUNDS ESTABLISHED
PURSUANT TO SECTION 4.1 IN ACCORDANCE WITH THE INVESTMENT
CHARACTERISTICS AND OBJECTIVES DETERMINED THEREFOR AND TO
INVEST AND REINVEST THE ASSETS OF THE FUND IN ANY SECURITIES
OR PROPERTIES IN WHICH AN INDIVIDUAL COULD INVEST HIS OWN
FUNDS AND WHICH IT DEEMS FOR THE BEST INTEREST OF THE FUND,
WITHOUT LIMITATION BY ANY STATUTE, RULE OF LAW OR REGULATION
OF ANY GOVERNMENTAL BODY PRESCRIBING OR LIMITING THE
INVESTMENT OF TRUST ASSETS BY CORPORATE OR INDIVIDUAL
TRUSTEES, IN OR TO CERTAIN KINDS, TYPES OR CLASSES OF
INVESTMENTS OR PRESCRIBING OR LIMITING THE PORTION OF THE FUND
WHICH MAY BE INVESTED IN ANY ONE PROPERTY OR KIND, TYPE OR
CLASS OF INVESTMENT. SPECIFICALLY AND WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, THE TRUSTEE MAY INVEST AND
REINVEST PRINCIPAL AND ACCUMULATED INCOME OF THE FUND IN ANY
REAL OR PERSONAL PROPERTY; PREFERRED OR COMMON STOCKS OF ANY
KIND OR CLASS OF ANY CORPORATION, INCLUDING BUT NOT LIMITED TO
INVESTMENT AND SMALL BUSINESS INVESTMENT COMPANIES OF ALL
TYPES; VOTING TRUST CERTIFICATES; INTERESTS IN INVESTMENT
TRUSTS; INTERESTS IN ANY LIMITED OR GENERAL PARTNERSHIP OR
OTHER BUSINESS ENTERPRISE, HOWEVER ORGANIZED AND FOR WHATEVER
PURPOSE; GROUP OR INDIVIDUAL ANNUITY CONTRACTS (WHICH MAY
INVOLVE INVESTMENT IN THE ISSUER'S GENERAL ACCOUNT OR ANY OF
ITS SEPARATE ACCOUNTS); INTERESTS IN COMMON OR COLLECTIVE
TRUSTS, VARIABLE INTEREST NOTES OR ANY OTHER TYPE OF
COLLECTIVE FUND MAINTAINED BY A BANK OR SIMILAR INSTITUTION
(WHETHER OR NOT THE TRUSTEE HEREUNDER); SHARES OF ANY
REGULATED INVESTMENT COMPANY (MUTUAL FUND) PROVIDED, HOWEVER,
IF THE TRUSTEE OR ANY OF ITS AFFILIATES ACTS AS INVESTMENT
ADVISOR OR OTHER SERVICE PROVIDER FOR SUCH MUTUAL FUND
(INCLUDING THE FIRST AMERICAN FUNDS, INC. AND THE FIRST
AMERICAN INVESTMENT FUNDS, INC.), THEN THE EMPLOYER (OR OTHER
FIDUCIARY INDEPENDENT OF THE TRUSTEE) MUST FIRST ACKNOWLEDGE
THAT IT HAS RECEIVED THE CURRENT PROSPECTUS FOR THE MUTUAL
FUND AND A DETAILED WRITTEN DISCLOSURE OF THE INVESTMENT
ADVISORY AND OTHER FEES CHARGED OR TO BE PAID BY THE PLAN OR
THE MUTUAL FUND AND THE EMPLOYER (OR SUCH OTHER FIDUCIARY)
MUST APPROVE THE INVESTMENT ADVISORY FEE AND OTHER FEES PAID
BY THE PLAN DIRECTLY OR THROUGH THE MUTUAL FUND AND THE
INVESTMENT OF PLAN ASSETS IN THE MUTUAL FUNDS; ANY
INTEREST-BEARING CERTIFICATES, ACCOUNTS OR SIMILAR
INTEREST-BEARING INSTRUMENTS IN A BANK OR SIMILAR FINANCIAL
INSTITUTION, INCLUDING THE TRUSTEE OR AN AFFILIATE OF THE
TRUSTEE, PROVIDED SUCH CERTIFICATES, ACCOUNTS OR INSTRUMENTS
BEAR A REASONABLE RATE OF INTEREST; BONDS, NOTES AND
DEBENTURES, SECURED OR UNSECURED; MORTGAGES, LEASES OR OTHER
INTERESTS IN REAL OR PERSONAL PROPERTY; INTERESTS IN MINERAL,
GAS, OIL OR TIMBER PROPERTIES OR OTHER WASTING ASSETS;
OPTIONS; COMMODITY OR FINANCIAL FUTURES CONTRACTS; FOREIGN
CURRENCY; INSURANCE CONTRACTS ON THE LIFE OF ANY "KEYMAN" OR
SHAREHOLDER OF THE EMPLOYER; OR CONDITIONAL SALES CONTRACTS.
THE PLAN MAY NOT ACQUIRE OR HOLD ANY SECURITIES ISSUED BY AN
EMPLOYER OR REAL ESTATE LEASED TO AN EMPLOYER EXCEPT THAT THE
TRUSTEE ACTING PURSUANT TO THE EXPRESS WRITTEN DIRECTIONS OF
THE EMPLOYER AS PROVIDED IN SECTION 10.12
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MAY ACQUIRE AND HOLD EMPLOYER SECURITIES WHICH ARE "QUALIFYING
EMPLOYER SECURITIES" (WITHIN THE MEANING OF SECTION 407(D)(5)
OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974) AND
EMPLOYER REAL PROPERTY WHICH IS "QUALIFYING EMPLOYER REAL
PROPERTY" (WITHIN THE MEANING OF SECTION 407(D)(4) OF THE
AFORESAID ACT); AND, PROVIDED FURTHER, THAT THE PLAN MAY
ACQUIRE ANY SUCH EMPLOYER SECURITIES OR EMPLOYER REAL PROPERTY
ONLY IF IMMEDIATELY AFTER SUCH ACQUISITION THE AGGREGATE FAIR
MARKET VALUE OF EMPLOYER SECURITIES AND EMPLOYER REAL PROPERTY
HELD BY THE PLAN DOES NOT EXCEED THE LESSER OF (I) THE
PERCENTAGE INDICATED IN THE ADOPTION AGREEMENT OF THE FAIR
MARKET VALUE OF THE ASSETS OF THE PLAN, OR (II) THE THEN VALUE
OF ALL EMPLOYER MATCHING ACCOUNTS AND EMPLOYER CONTRIBUTIONS
ACCOUNTS. IF THE TRUSTEE DETERMINES TO INVEST IN ANY
"QUALIFYING EMPLOYER SECURITY," SUCH SECURITIES SHALL BE HELD
ONLY IN THE EMPLOYER MATCHING ACCOUNTS OR EMPLOYER
CONTRIBUTIONS ACCOUNTS OR IN THE SUSPENSE ACCOUNTS ATTRIBUTABLE
TO SUCH ACCOUNTS. INVESTMENT OF THE ENTIRE FUND IN COMMON
STOCKS SHALL BE DEEMED APPROPRIATE AT ANY PHASE OF THE ECONOMIC
BUSINESS CYCLE, BUT IT IS NOT, HOWEVER, THE PURPOSE HEREOF TO
DIRECT THAT THE FUND SHALL BE INVESTED EITHER ENTIRELY OR TO
ANY EXTENT WHATSOEVER IN SUCH COMMON STOCKS. PRIOR TO MATURITY
AND DISTRIBUTION OF THE VESTED TOTAL ACCOUNTS OF PARTICIPANTS,
THE TRUSTEE SHALL COMMINGLE THE ACCOUNTS OF PARTICIPANTS AND
FORMER PARTICIPANTS IN EACH INVESTMENT SUBFUND AND INVEST,
REINVEST, CONTROL AND MANAGE EACH OF THE SAME AS A COMMON TRUST
FUND.
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(b) To sell, exchange or otherwise dispose of any asset of whatsoever
character at any time held by the Trustee in trust hereunder.
(c) To segregate any part or portion of the Fund for the purpose of
administration or distribution thereof and, in its sole discretion, to
hold the Fund uninvested whenever and for so long as, in the Trustee's
discretion, the same is likely to be required for the payment in cash
of Accounts normally expected to mature in the near future, or
whenever, and for as long as, market conditions are uncertain, or for
any other reason which, in the Trustee's discretion, requires such
action or makes such action advisable.
(d) In connection with the Trustee's power to hold uninvested reasonable
amounts of cash whenever it is deemed advisable to do so, to deposit
the same, with or without interest, in the commercial or savings
departments of any corporate Trustee serving hereunder or of any other
bank, trust company or other financial institution including those
affiliated in ownership with the Trustee named in the Adoption
Agreement.
(e) To register any investment held in the Fund in the name of the
Trustee, without trust designation, or in the name of a nominee or
nominees, and to hold any investment in bearer form, but the records
of the Trustee shall at all times show that all such investments are
part of the Fund, and the Trustee shall be as responsible for any act
or default of any such nominee as for its own.
(f) To retain and employ such attorneys, agents and servants as may be
necessary or desirable, in the opinion of the Trustee, in the
administration of the Fund, and to pay them such reasonable
compensation for their services as may be agreed upon as an expense of
administration of the Fund, including power to employ and retain
counsel upon any matter of doubt as to the meaning of or
interpretation to be placed upon this Plan Statement or any provisions
thereof with reference to any question arising in the administration
of the Fund or pertaining to the rights and liabilities of the Trustee
hereunder. The Trustee, in any such event, may act in reliance
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upon the advice, opinions, records, statements and
computations of any attorneys and agents and on the records,
statements and computations of any servants so selected by it
in good faith and shall be released and exonerated of and from
all liability to anyone in so doing (except to the extent that
liability is imposed under the Employee Retirement Income
Security Act of 1974).
(g) To institute, prosecute and maintain, or to defend, any proceeding at
law or in equity concerning the Plan or Fund or the assets thereof or
any claims thereto, or the interests of Participants and Beneficiaries
hereunder at the sole cost and expense of the Fund or at the sole cost
and expense of the Total Account of the Participant that may be
concerned therein or that may be affected thereby as, in the Trustee's
opinion, shall be fair and equitable in each case, and to compromise,
settle and adjust all claims and liabilities asserted by or against
the Plan or Fund or asserted by or against the Trustee, on such terms
as the Trustee, in each such case, shall deem reasonable and proper.
The Trustee shall be under no duty or obligation to institute,
prosecute, maintain or defend any suit, action or other legal
proceeding unless it shall be indemnified to its satisfaction against
all expenses and liabilities which it may sustain or anticipate by
reason thereof.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
(h) To institute, participate and join in any plan of reorganization,
readjustment, merger or consolidation with respect to the issuer of
any securities held by the Trustee hereunder, and to use any other
means of protecting and dealing with any of the assets of the Fund
which it believes reasonably necessary or proper and, in general, to
exercise each and every other power or right with respect to each
asset or investment held by it hereunder as individuals generally have
and enjoy with respect to their own assets and investment, including
power to vote upon any securities or other assets having voting power
which it may hold from time to time, and to give proxies with respect
thereto, with or without power of substitution or revocation, and to
deposit assets or investments with any protective committee, or with
trustees or depositaries designated by any such committee or by any
such trustees or any court. NOTWITHSTANDING THE FOREGOING, AN
INVESTMENT MANAGER SHALL HAVE ANY OR ALL OF SUCH POWERS AND RIGHTS
WITH RESPECT TO PLAN ASSETS FOR WHICH IT HAS INVESTMENT RESPONSIBILITY
BUT ONLY IF (AND ONLY TO THE EXTENT THAT) SUCH POWERS AND RIGHTS ARE
EXPRESSLY GIVEN TO SUCH INVESTMENT MANAGER IN A WRITTEN AGREEMENT
SIGNED BY IT WITH A COPY DELIVERED TO THE TRUSTEE.
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(i) In any matter of doubt affecting the meaning, purpose or intent of any
provision of this Plan Statement which directly affects its duties, to
determine such meaning, purpose or intent; and the determination of
the Trustee in any such respect shall be binding and conclusive upon
all persons interested or who may become interested in the Plan or the
Fund.
(j) To require, as a condition to distribution of any Vested Total
Account, proof of identity or of authority of the person entitled to
receive the same, including power to require reasonable
indemnification on that account as a condition precedent to its
obligation to make distribution hereunder.
(k) To collect, receive, receipt and give quittance for all payments that
may be or become due and payable on account of any asset in trust
hereunder which has not, by act of the Trustee taken pursuant thereto,
been made payable to
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others; and payment thereof by the company issuing the same, or
by the party obligated thereon, as the case may be, when made
to the Trustee hereunder or to any person or persons designated
by the Trustee, shall acquit, release and discharge such
company or obligated party from any and all liability on
account thereof.
(l) To determine from time to time, as required for the purpose of
distribution or for the purpose of allocating trust income or for any
other purpose of the Plan, the then value of the Fund and the Accounts
in the Fund, the Trustee, in each such case, using and employing for
that purpose the fair market value of each of the assets constituting
the Fund. Each such determination so made by the Trustee in good
faith shall be binding and conclusive upon all persons interested or
becoming interested in the Plan or the Fund.
(m) To receive and retain contributions made in a form other than cash in
the form in which the same are received until such time as the
Trustee, in its sole discretion, deems it advisable to sell or
otherwise dispose of such assets.
(n) To commingle, for investment purposes, the assets of the Fund with the
assets of any other qualified retirement plan trust fund of the
Employer, provided that the records of the Trustee shall reflect the
relative interests of the separate trusts in such commingled fund.
(o) To grant an option or options for the sale or other disposition of a
trust asset, including the issuance of options for purchase of common
stock held by the Trust in return for the receipt of a premium from
the optionee (it being expressly intended that said options may be in
such form and terms as to permit their being freely traded on an
option exchange) and including the repurchase of any such option
granted, or in lieu thereof, the repurchase of an option identical in
terms to the one issued.
(p) To have and to exercise such other and additional powers as may be
advisable or proper in its opinion for the effective and economical
administration of the Fund.
(q) If so provided in the Adoption Agreement, one (1) or more declarations
of trust executed by the Trustee (or by banks or trust companies
affiliated in ownership with the Trustee) shall be incorporated by
reference into this Agreement and not withstanding any other provision
of the Agreement to the contrary, the Trustee may cause all or any
part of the Fund, without limitation as to amount, to be commingled
with the money of trusts created by others by causing such money to be
invested as a part of any or all of the funds created by said
declarations of trust and the Fund so added to any of said funds shall
be subject to all of the provisions of said declarations of trust as
the same may be amended from time to time.
10.7. INVESTMENT MANAGERS.
10.7.1. APPOINTMENT AND QUALIFICATIONS. The Employer shall have the
power to appoint from time to time one or more Investment Managers to direct the
Trustee in the investment of, or to assume complete investment responsibility
over, all or any portion of the Fund. An Investment Manager may be any person
or firm (a) which is either (1) registered as an investment adviser under the
Investment Advisers Act of 1940, (2) a bank, or (3) an insurance company which
is qualified to perform the services of an Investment Manager under the laws of
more than one state; and (b) which acknowledges in writing that it is a
fiduciary with respect to the Plan because it has been appointed as an
Investment Manager with respect to the Plan. The conditions prescribed in the
preceding sentence shall apply to
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the issuer of any group annuity contract hereunder only if, and to the extent
that, such issuer would otherwise be considered a "fiduciary" with respect to
the Plan, within the meaning of the Employee Retirement Income Security Act
of 1974.
10.7.2. REMOVAL. The Employer may remove any such Investment Manager and
shall have the power to appoint a successor or successors from time to time in
succession to any Investment Manager who shall be removed, shall resign or shall
otherwise cease to serve hereunder. The Employer shall furnish the Trustee with
such written evidence as the Trustee may require of the appointment, removal and
scope of the authority of the Investment Manager.
10.7.3. RELATION TO OTHER FIDUCIARIES. The Trustee shall comply with
all investment directions given to the Trustee with respect to the designated
portion of the Fund, and the Trustee shall be released and exonerated of and
from all liability for or on account of any action taken or not taken by it
pursuant to the directions of such Investment Manager, except to the extent
that liability is imposed under the Employee Retirement Income Security Act
of 1974. Neither the Employer, nor any officer, director or Employee thereof,
nor any member of the Administrator's Representative shall be liable for the
acts or omissions of the Trustee or of any Investment Manager appointed
hereunder. The fees and expenses of any Investment Manager, as agreed upon
from time to time between the Investment Manager and the Employer, shall be
charged to and paid from the Fund in a fair and equitable manner, except to
the extent that the Employer, in its discretion, may pay such directly to the
Investment Manager.
10.8. FIDUCIARY PRINCIPLES. The Trustee and each other fiduciary
hereunder, in the exercise of each and every power or discretion vested in
them by the provisions of this Plan Statement shall (subject to the
provisions of the Employee Retirement Income Security Act of 1974) discharge
their duties with respect to the Plan solely in the interest of the
Participants and Beneficiaries and:
(a) for the exclusive purpose of:
(i) providing benefits to Participants and Beneficiaries, and
(ii) defraying reasonable expenses of administering the Plan,
(b) 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 a like character and with like aims,
(c) by diversifying the investments of the Plan so as to minimize the risk
of large losses, unless under the circumstances it is clearly prudent
not to do so, and
(d) in accordance with the documents and instruments governing the Plan,
insofar as they are consistent with the provisions of the Employee
Retirement Income Security Act of 1974.
Notwithstanding anything in this Plan Statement to the contrary, any
provision hereof which purports to relieve a fiduciary from responsibility or
liability for any responsibility, obligation or duty under Part 4 of Subtitle
B of Title I of the Employee Retirement Income Security Act of 1974 shall, to
the extent the same is inconsistent with said Part 4, be deemed void.
10.9. PROHIBITED TRANSACTIONS. Except as may be permitted by law, no
Trustee or other fiduciary hereunder shall permit the Plan to engage,
directly or indirectly, in any of the following transactions with a person
who is a "disqualified person" (as defined in section 4975 of the Internal
Revenue Code) or a "party in interest" (as defined in section 3(14) of the
Employee Retirement Income Security Act of 1974):
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(a) sale, exchange or leasing of any property between the Plan and such
person,
(b) lending of money or other extension of credit between the Plan and
such person,
(c) furnishing of goods, services or facilities between the Plan and such
person,
(d) transfer to, or use by or for the benefit of, such person of the
income or assets of the Plan,
(e) act by such person who is a fiduciary hereunder whereby he deals with
the income or assets of the Plan in his own interest or for his own
account, or
(f) receipt of any consideration for his own personal account by such
person who is a fiduciary from any party dealing with the Plan in
connection with a transaction involving the income or assets of the
Plan.
10.10. INDEMNITY. The Trustee, and directors, officers and employees of the
Employer shall, except as prohibited by law, be indemnified and held harmless by
the Employer from any and all liabilities, costs and expenses (including legal
fees), to the extent not covered by liability insurance, arising out of any
action taken by such Trustee or individuals as Trustee, fiduciary or in any
other capacity with respect to this Plan, whether imposed under the Employee
Retirement Income Security Act of 1974 or otherwise unless such liability arises
from the proven gross negligence, the bad faith or, if such Trustee or
individuals have reasonable cause to believe their conduct was unlawful, the
criminal misconduct of such Trustee, director, officer or employee. This
indemnification shall continue as to a Trustee, director, officer or employee
after such Trustee or individual ceases to be a Trustee, director, officer or
employee.
10.11. INVESTMENT IN INSURANCE. If the Employer shall so designate in the
Adoption Agreement, a Participant may, with the consent of the Administrator's
Representative and subject to such conditions as the Administrator's
Representative may impose, elect to have a portion of his Vested Total Account
(excluding any Deductible Voluntary Account) invested in life insurance
contracts issued by any insurance company licensed to do business in the State
of where the Trustee has its principal place of business (any such insurance
contract held for a Participant hereunder being herein referred to as a
"contract").
10.11.1. LIMITATION ON PAYMENT OF PREMIUMS. No more than fifty percent
(50%) of the aggregate Employer contributions allocated to a Participant's
Employer Matching Account and Employer Contributions Account may be used to
purchase ordinary life insurance contracts. Ordinary life insurance
contracts are contracts with both nondecreasing death benefits and
nonincreasing premiums. No more than twenty-five percent (25%) of the
aggregate Employer contributions allocated to the Participant's Employer
Matching Account and Employer Contributions Account may be used to purchase
term life insurance contracts, universal life insurance contracts and all
other life insurance contracts which are not ordinary life insurance
contracts. If both ordinary life insurance contracts and other insurance
contracts are required, the sum of one-half (1/2) of the premiums paid to
acquire ordinary life insurance contracts plus one hundred percent (100%) of
all premiums paid to acquire other forms of life insurance contracts shall
not be permitted to exceed twenty-five percent (25%) of the aggregate
Employer contributions allocated to the Participant's Employer Matching
Account and Employer Contributions Account. All amounts used to purchase
term life insurance, to fund "P.S. 58" costs or to acquire any other non-cash
value benefits under this section shall be deemed to come from the Employer
Matching Account and then from the Employer Contributions Accounts subject to
the limits specified above. If the Participant's Employer Matching Account
and Employer Contributions Account are insufficient within the limitations
herein contained to pay any premium on a contract when the same becomes due,
the Trustee shall, unless the Participant directs the Trustee to use his
Nondeductible
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Voluntary Account, Rollover Account or Transfer Account for this purpose or
pays to the Trustee a sum sufficient to pay such premium (any such payment
being deemed a nondeductible voluntary contribution hereunder), cause such
contract to be rewritten for its then paid-up value, if any, and retain the
same for the Participant, in which event no further premium payments shall
thereafter be made thereon. All dividends on a contract shall be used to
reduce premiums.
10.11.2. MISCELLANEOUS RULES FOR PURCHASE OF CONTRACT. The Participant
shall take such physical examinations and furnish such information as may be
necessary to procure a contract. To the extent possible, all contracts shall
have a uniform premium due date. The Trustee shall be the owner of all
contracts, with full power to execute all insurance applications and to exercise
all available options, and shall be the death beneficiary thereunder.
10.11.3. PAYMENT OF EXPENSES. Any charge or expense of the Trustee in
handling a Participant's contract shall be paid from that Participant's Total
Account; provided, that the Employer may, in its discretion, directly pay such
charge or expense.
10.11.4. AUTHORITY FOR CONTRACT. Any insurance company issuing contracts
may deal with the Trustee alone and without the consent of any Participant or
Beneficiary and shall not be required to examine the provisions of this Plan
Statement or any amendment thereto, nor shall it be responsible for the failure
of the Trustee to perform its duties, nor shall it be obliged to see to the
application or disposition of any money paid by it to the Trustee, and any such
payment shall fully discharge such insurance company for the amount so paid.
10.11.5. PAYMENT OF CONTRACT UPON DEATH. Upon the death of the
Participant, the proceeds of the contracts held for him hereunder shall be
deemed a death benefit under this Plan and shall be added to the Vested Total
Account and distributed to his Beneficiary or Beneficiaries in the manner
prescribed in Section 7.
10.11.6. PAYMENT OF CONTRACT -- NOT UPON DEATH. Upon the occurrence of an
Event of Maturity other than the death of the Participant, the Trustee shall, as
directed by the Administrator's Representative, either: (i) surrender the
contracts held for him hereunder for cash and distribute the proceeds in the
manner described in Section 7, (ii) distribute the contracts to the Participant
(provided, however, that the optional modes of settlement under any such
contract shall be limited to those available under this Plan), or (iii) convert
the contracts into an annuity contract or contracts of the type described in
Section 7.3 and distribute the same to the Participant, or (iv) any combination
of the foregoing. In no event, however, shall any such contract be distributed
in a manner which is inconsistent with the requirements in Section 7.3.
10.11.7. VALUE OF CONTRACT. For the purpose of determining the value of a
contract hereunder, such contract shall be valued at the greater of the premiums
theretofore paid thereon or its then cash value, but such contract shall not be
considered a part of the Fund for the purpose of allocating income, market gains
and losses of the Fund in accordance with Section 4.
10.11.8. INTERPRETATION. If any provision of any contract is inconsistent
with any provision of the Plan Statement, the provision of the Plan Statement
shall control.
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THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1994
10.12. EMPLOYER DIRECTED INVESTMENTS. IF SO INDICATED IN THE ADOPTION
AGREEMENT, THE TRUSTEE SHALL BE SUBJECT IN THE INVESTMENT, MANAGEMENT AND
CONTROL OF THE FUND TO THE PROPERLY GIVEN DIRECTIONS OF THE PERSON, PERSONS
OR COMMITTEE IDENTIFIED IN THE ADOPTION AGREEMENT OR CERTIFIED TO THE TRUSTEE
BY AN OFFICER OF THE EMPLOYER. THE TRUSTEE SHALL NOT MAKE ANY INVESTMENT OR
DISPOSE OF ANY INVESTMENTS IN THE FUND EXCEPT UPON THE EXPRESS
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VERBAL OR WRITTEN DIRECTION OF THE EMPLOYER. THE TRUSTEE SHALL BE UNDER NO
DUTY TO QUESTION ANY INVESTMENT DIRECTION OF THE EMPLOYER, TO REVIEW OR
MONITOR ANY SECURITIES OR PROPERTY HELD IN THE FUND, OR TO ADVICE THE
EMPLOYER WITH RESPECT TO THE INVESTMENT, RETENTION OR DISPOSITION OF ANY
ASSETS IN THE FUND. THE TRUSTEE IS ACTING PURSUANT TO AND IN RELIANCE ON
SUCH DIRECTIONS SHALL BE FULLY AND COMPLETELY INDEMNIFIED AND HELD HARMLESS
BY THE EMPLOYER FROM ANY LIABILITY, LOSS OR EXPENSE (INCLUDING LEGAL FEES)
ARISING OUT OF ITS ACTIONS SO DIRECTED NOTWITHSTANDING THAT SUCH DIRECTIONS,
AND THE TRUSTEE'S CONDUCT PURSUANT THERETO, MAY CONSTITUTE A BREACH OF
FIDUCIARY OBLIGATIONS TO THE PLAN, THE PARTICIPANTS AND BENEFICIARIES. THE
EMPLOYER MAY DIRECT THE TRUSTEE TO PURCHASE SHARES OF ANY REGULATED
INVESTMENT COMPANY (MUTUAL FUND) FOR WHICH THE TRUSTEE OR ANY OF ITS
AFFILIATES ACTS AS INVESTMENT ADVISOR OR OTHER SERVICE PROVIDER, PROVIDED,
HOWEVER, THAT THE EMPLOYER (OR OTHER FIDUCIARY INDEPENDENT OF THE TRUSTEE)
MUST FIRST ACKNOWLEDGE IT HAS RECEIVED THE CURRENT PROSPECTUS FOR THE MUTUAL
FUND (INCLUDING THE FIRST AMERICAN FUNDS, INC. AND THE FIRST AMERICAN
INVESTMENT FUNDS, INC.) AND A DETAILED DISCLOSURE OF THE INVESTMENT ADVISORY
AND OTHER FEES CHARGED OR TO BE PAID BY THE PLAN AND THE EMPLOYER MUST
APPROVE THE INVESTMENT ADVISORY FEE AND OTHER FEES PAID BY THE PLAN DIRECTLY
OR THROUGH THE MUTUAL FUNDS AND THE INVESTMENT OF PLAN ASSETS IN THE MUTUAL
FUND.
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SECTION 11
DETERMINATIONS -- RULES AND REGULATIONS
11.1. DETERMINATIONS. The Administrator's Representative shall make such
determinations as may be required from time to time in the administration of
this Plan. The Trustee and other interested parties may act and rely upon all
information reported to them hereunder and need not inquire into the accuracy
thereof, nor be charged with any notice to the contrary.
11.2. RULES AND REGULATIONS. Any rule not in conflict or at variance with
the provisions hereof may be adopted by the Administrator's Representative.
11.3. METHOD OF EXECUTING INSTRUMENTS.
11.3.1. EMPLOYER OR ADMINISTRATOR'S REPRESENTATIVE. Information to be
supplied or written notices to be made or consents to be given by the Employer
or the Administrator's Representative pursuant to any provision of this Plan
Statement may be signed in the name of the Employer by any officer thereof who
has been authorized to make such certification or to give such notices or
consents or by the Administrator's Representative.
11.3.2. TRUSTEE. Any instrument or written notice required, necessary or
advisable to be made or given by the Trustee may be signed by any Trustee, if
all Trustees serving hereunder are individuals, or by any authorized officer or
Employee of the Trustee, if a corporate Trustee shall be acting hereunder as
sole Trustee, or by any such officer or Employee of the corporate Trustee or by
an individual Trustee acting hereunder, if corporate and individual Trustees
shall be serving as co-trustees hereunder.
11.4. CLAIMS PROCEDURE. The Administrator's Representative shall establish
procedures for the resolution of disputes and disposition of claims arising
under this Plan. An application for a distribution under Section 7 shall be
considered as a claim for the purposes of this Section 11.4. Until modified by
the Administrator's Representative, this claims procedure is as described below.
11.4.1. ORIGINAL CLAIM. Any Employee, former Employee or Beneficiary of
such Employee or former Employee may, if he so desires, file with the
Administrator's Representative a written claim for benefits under this Plan.
Within ninety (90) days after the filing of such a claim, the Administrator's
Representative shall notify the claimant in writing whether his claim is upheld
or denied in whole or in part or shall furnish the claimant a written notice
describing specific special circumstances requiring a specified amount of
additional time (but not more than one hundred eighty days from the date the
claim was filed) to reach a decision on the claim. If the claim is denied in
whole or in part, the Administrator's Representative shall state in writing:
(a) the specific reasons for the denial,
(b) the specific references to the pertinent provisions of the Plan
Statement on which the denial is based,
(c) a description of any additional material or information necessary for
the claimant to perfect the claim and an explanation of why such
material or information is necessary, and
(d) an explanation of the claims review procedure set forth in this
section.
11.4.2. CLAIMS REVIEW PROCEDURE. Within sixty (60) days after receipt of
notice that his claim has been denied in whole or in part, the claimant may file
with the Administrator's
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Representative a written request for a review and may, in conjunction
therewith, submit written issues and comments. Within sixty (60) days after
the filing of such a request for review, the Administrator's Representative
shall notify the claimant in writing whether, upon review, the claim was
upheld or denied in whole or in part or shall furnish the claimant a written
notice describing specific special circumstances requiring a specified amount
of additional time (but not more than one hundred twenty days from the date
the request for review was filed) to reach a decision on the request for
review.
11.4.3. GENERAL RULES.
(a) No inquiry or question shall be deemed to be a claim or a request for
a review of a denied claim unless made in accordance with the claims
procedure. The Administrator's Representative may require that any
claim for benefits and any request for a review of a denied claim be
filed on forms to be furnished by the Administrator's Representative
upon request.
(b) All decisions on claims and on requests for a review of denied claims
shall be made by the Administrator's Representative.
(c) The Administrator's Representative may, in its discretion, hold one or
more hearings on a claim or a request for a review of a denied claim.
(d) Claimants may be represented by a lawyer or other representative (at
their own expense), but the Administrator's Representative reserves
the right to require the claimant to furnish written authorization. A
claimant's representative shall be entitled to copies of all notices
given to the claimant.
(e) The decision of the Administrator's Representative on a claim and on a
request for a review of a denied claim shall be served on the claimant
in writing. If a decision or notice is not received by a claimant
within the time specified, the claim or request for a review of a
denied claim shall be deemed to have been denied.
(f) Prior to filing a claim or a request for a review of a denied claim,
the claimant or his representative shall have a reasonable opportunity
to review a copy of the Plan Statement and all other pertinent
documents in the possession of the Employer, the Administrator's
Representative and the Trustee.
11.5. INFORMATION FURNISHED BY PARTICIPANTS. Neither the Employer nor the
Administrator's Representative nor the Trustee shall be liable or responsible
for any error in the computation of the Account of a Participant resulting from
any misstatement of fact made by the Participant, directly or indirectly, to the
Employer, the Administrator's Representative or the Trustee and used by them in
determining his Account. Neither the Employer nor the Administrator's
Representative nor the Trustee shall be obligated or required to increase the
Account of such Participant which, on discovery of the misstatement, is found to
be understated as a result of such misstatement of the Participant. However,
the Account of any Participant which is overstated by reason of any such
misstatement shall be reduced to the amount appropriate for him in view of the
truth. Any refund received upon reduction of an Account so made shall be used
to reduce the next succeeding contribution of the Employer to the Plan.
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SECTION 12
OTHER ADMINISTRATIVE MATTERS
12.1. EMPLOYER.
12.1.1. OFFICERS. Except as hereinafter provided, functions generally
assigned to the Employer shall be discharged by its officers or delegated and
allocated as provided herein.
12.1.2. DELEGATION. Except as hereinafter provided, the Board of
Directors may delegate or redelegate and allocate and reallocate to one or more
persons or to a committee of persons jointly or severally, and whether or not
such persons are directors, officers or Employees, such fiduciary and other
functions assigned to it or to the Employer hereunder as it may from time to
time deem advisable.
12.1.3. BOARD OF DIRECTORS. The Board of Directors shall have the
exclusive authority, which authority may not be delegated, to act for the
Employer:
(a) to adopt the Plan, to terminate the Plan, and
(b) to appoint or remove a Trustee, to appoint or remove an Investment
Manager, to appoint or remove the Administrator's Representative.
12.2. ADMINISTRATOR'S REPRESENTATIVE. The Employer shall designate an
Administrator's Representative to act for the Employer. The Administrator's
Representative may be one person or a committee of such members as may be
determined and appointed from time to time by the Employer and shall serve at
the pleasure of the Employer. The Administrator's Representative shall serve
without compensation, but its reasonable expenses shall be an expense of the
administration of the Fund and shall be paid by the Trustee from and out of the
Fund except to the extent the Employer, in its discretion, directly pays such
expenses. If it is a committee, the Administrator's Representative may elect
such officers as the Administrator's Representative may decide upon. The
Administrator's Representative shall:
(a) if a committee, establish rules for the functioning of the
Administrator's Representative, including the times and places for
holding meetings, the notices to be given in respect of such meetings
and the number of members who shall constitute a quorum for the
transaction of business,
(b) if a committee, organize and delegate to such of its members as it
shall select authority to execute or authenticate rules, advisory
opinions or instructions, and other instruments adopted or authorized
by the Administrator's Representative; adopt such bylaws or
regulations as it deems desirable for the conduct of its affairs;
appoint a secretary, who need not be a member of the Administrator's
Representative, to keep its records and otherwise assist the
Administrator's Representative in the performance of its duties,
(c) keep a record of all its proceedings and acts and keep all books of
account, records and other data as may be necessary for the proper
administration of the Plan; notify the Trustee and the Employer of any
action taken by the Administrator's Representative and, when required,
notify any other interested person or persons,
(d) determine from the records of the Employer the compensation, service
records, status and other facts regarding Participants and other
Employees,
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(e) cause to be compiled at least annually, from the records of the
Administrator's Representative and the reports and accountings of the
Trustee, a report and accounting of the status of the Plan and the
Accounts of the Participants, and make it available to each
Participant who shall have the right to examine that part or portion
of such report and accounting (or a true and correct copy of such
part) which sets forth his benefits and his ratable interest in the
Fund,
(f) prescribe forms to be used for applications for participation,
distributions, withdrawals, notifications, etc., as may be required in
the administration of the Plan,
(g) set up such rules, applicable to all Participants similarly situated,
as are deemed necessary to carry out the terms of the Plan Statement,
(h) perform all other acts reasonably necessary for administering the Plan
and carrying out the provisions of the Plan Statement and performing
the duties imposed on it by the Employer,
(i) interpret and construe the Plan Statement,
(j) resolve questions of eligibility and status under the Plan, and the
rights of Employees, Participants and Beneficiaries and the amounts of
their interests,
(k) resolve all questions of administration of the Plan not specifically
referred to in this section, and
(l) delegate or redelegate to one or more persons, jointly or severally,
and whether or not such persons are members of a committee which is
the Administrator's Representative or Employees of the Employer, such
functions assigned to the Administrator's Representative hereunder as
it may from time to time deem advisable.
If the Administrator's Representative is a committee and there shall at any time
be three (3) or more members serving hereunder who are qualified to perform a
particular act, the same may be performed, on behalf of all, by a majority of
those qualified, with or without the concurrence of the minority. No person who
failed to join or concur in such act shall be held liable for the consequences
thereof, except to the extent that liability is imposed under the Employee
Retirement Income Security Act of 1974.
If the Employer does not designate an Administrator's Representative, the
President (or other chief executive officer) of the Employer shall be the
Administrator's Representative.
12.3. LIMITATION ON AUTHORITY. No action taken by any fiduciary, if
authority to take such action has been delegated or redelegated to it
hereunder, shall be the responsibility of any other fiduciary except as may
be required by the provisions of the Employee Retirement Income Security Act
of 1974. Except to the extent imposed by the Employee Retirement Income
Security Act of 1974, no fiduciary shall have the duty to question whether
any other fiduciary is fulfilling all of the responsibility imposed upon such
other fiduciary by this Plan Statement or by the Act or by any regulations or
rulings issued thereunder. The Trustee shall have no authority or duty to
determine or enforce payment of any Employer contribution under this Plan or
to determine the existence, nature or extent of any individual's rights in
the Fund or under the Plan or question any determination made by the Employer
or the Administrator's Representative regarding the same. The
responsibilities and obligations of the Trustee shall be strictly limited to
those set forth in this Plan Statement.
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12.4. CONFLICT OF INTEREST. If any Trustee, any Administrator's
Representative, any member of the Board of Directors or any officer or Employee
of the Employer to whom authority has been delegated or redelegated hereunder
shall also be a Participant in this Plan, he shall have no authority as such
Trustee, member, officer or Employee with respect to any matter specially
affecting his individual interest hereunder (as distinguished from the interests
of all Participants and Beneficiaries or a broad class of Participants and
Beneficiaries), all such authority being reserved exclusively to the other
Trustees, members, officers or Employees, as the case may be, to the exclusion
of such Participant, and such Participant shall act only in his individual
capacity in connection with any such matter.
12.5. DUAL CAPACITY. Individuals, firms, corporations or partnerships
identified herein or delegated or allocated authority or responsibility
hereunder may serve in more than one fiduciary capacity.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
12.6. ADMINISTRATOR. The PRINCIPAL EMPLOYER shall be the administrator for
purposes of section 3(16)(A) of the Employee Retirement Income Security Act of
1974.
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12.7. NAMED FIDUCIARIES. The Trustee, the Employer, the Board of Directors
and the Administrator's Representative shall be named fiduciaries for the
purpose of section 402(a) of the Employee Retirement Income Security Act of
1974.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
12.8. SERVICE OF PROCESS. In the absence of any designation to the contrary
by the PRINCIPAL EMPLOYER, the President of the PRINCIPAL EMPLOYER is designated
as the appropriate and exclusive agent for the receipt of service of process
directed to the Plan in any legal proceeding, including arbitration, involving
the Plan.
12.9. RESIDUAL AUTHORITY. In the event the PRINCIPAL EMPLOYER,
Administrator's Representative, Board of Directors, or other person designated
as having the authority to act or a duty to act on any matter hereunder, is
prevented by death, dissolution, incapacity or other similar cause from acting
hereunder and there is no other person then empowered to act on such matter, the
Trustee shall be empowered to act in its place.
12.10. ADMINISTRATIVE EXPENSES. The reasonable expenses of administering the
Plan shall be payable out of the Fund except to the extent that the PRINCIPAL
EMPLOYER, in its discretion, directly pays the expenses.
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SECTION 13
IN GENERAL
13.1. DISCLAIMERS.
13.1.1. EFFECT ON EMPLOYMENT. Neither the terms of this Plan Statement
nor the benefits hereunder nor the continuance thereof shall be a term of the
employment of any Employee, and the Employer shall not be obliged to continue
this Plan. The terms of this Plan Statement shall not give any Employee the
right to be retained in the employment of the Employer.
13.1.2. SOLE SOURCE OF BENEFITS. Neither the Trustee nor the
Administrator's Representative nor the Employer or any of its officers or
members of its Board of Directors in any way guarantee the Fund against loss or
depreciation, nor do they guarantee the payment of any benefit or amount which
may become due and payable hereunder to any Participant or to any Beneficiary or
to any creditor of a Participant, a Beneficiary or the Trustee. Each
Participant, Beneficiary or other person entitled at any time to payments
hereunder shall look solely to the assets of the Fund for such payments or to
the Vested Total Account distributed to any Participant or Beneficiary, as the
case may be, for such payments. In each case where a Vested Total Account shall
have been distributed to a former Participant or a Beneficiary or to the person
or any one of a group of persons entitled jointly to the receipt thereof and
which purports to cover in full the benefit hereunder, such former Participant
or Beneficiary, or such person or persons, as the case may be, shall have no
further right or interest in the other assets of the Fund.
13.1.3. CO-FIDUCIARY MATTERS. Neither the Employer nor any of its
officers or members of its Board of Directors nor the Administrator's
Representative shall in any manner be liable to any Participant, Beneficiary
or other person for any act or omission of the Trustee (except to the extent
that liability is imposed under the Employee Retirement Income Security Act
of 1974). Neither the Trustee nor the Administrator's Representative nor the
Employer or any of its officers or members of its Board of Directors shall be
under any liability or responsibility (except to the extent that liability is
imposed under the Employee Retirement Income Security Act of 1974) for
failure to effect any of the objectives or purposes of this Plan by reason of
loss or fluctuation in the value of Fund or for the form, genuineness,
validity, sufficiency or effect of any Fund asset at any time held hereunder,
or for the failure of any person, firm or corporation indebted to the Fund to
pay such indebtedness as and when the same shall become due or for any delay
occasioned by reason of any applicable law, order or regulation or by reason
of any restriction or provision contained in any security or other asset held
by the Fund. Except as is otherwise provided in the Employee Retirement
Income Security Act of 1974, the Employer, its officers and the members of
its Board of Directors, the Trustee, the Administrator's Representative and
other fiduciaries shall not be liable for an act or omission of another
person with regard to a fiduciary responsibility that has been allocated to
or delegated to such other person pursuant to the terms of this Plan
Statement or pursuant to procedures set forth in this Plan Statement.
13.2. REVERSION OF FUND PROHIBITED. The Fund from time to time hereunder
shall at all times be a trust fund separate and apart from the assets of the
Employer, and no part thereof shall be or become available to the Employer or to
creditors of the Employer under any circumstances other than those specified in
Section 1.3, Section 3.12, Section 11.5 and Appendix A hereof. It shall be
impossible for any part of the corpus or income of the Fund to be used for, or
diverted to, purposes other than for the exclusive benefit of Participants and
Beneficiaries (except as provided in Section 1.3, Section 3.12, Section 11.5 and
Appendix A).
13.3. EXECUTION IN COUNTERPARTS. This Plan Statement may be executed in any
number of counterparts, each of which, without production of the others, shall
be deemed to be an original.
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13.4. CONTINUITY. If this Plan Statement is adopted as an amendment of a
Prior Plan Statement, the tenure and membership of the any committee previously
appointed, the rules of administration adopted and the Beneficiary designations
in effect under the Prior Plan Statement immediately before the Effective Date
shall, to the extent not inconsistent with this Plan Statement, continue in full
force and effect until altered as provided herein.
13.5. CONTINGENT TOP HEAVY PLAN RULES. The rules set forth in the
Appendix B to this Plan Statement (concerning additional provisions that
apply if the Plan becomes top heavy) are incorporated herein.(6)
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(6)Except as otherwise specifically provided in Appendix B, the provisions
of Appendix B apply for Plan Years beginning after December 31, 1986.
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APPENDIX A
SECTION 415 LIMITATIONS ON ALLOCATIONS
SECTION 1
INTRODUCTION
Terms defined in the Plan Statement shall have the same meanings when
used in this Appendix. References to the "Code" shall mean the Internal
Revenue Code, as amended from time to time. In addition, when used in this
Appendix, the following terms shall have the following meanings:
1.1. ANNUAL ADDITION. Annual addition means, with respect to any Participant
for a limitation year, the sum of:
(i) all employer contributions (including employer
contributions of the Participant's earnings reductions
under section 401(k), section 403(b) and section
408(k) of the Code) allocable as of a date during such
limitation year to the Participant under all defined
contribution plans,
(ii) all forfeitures allocable as of a date during such
limitation year to the Participant under all defined
contribution plans,
(iii) all Participant contributions made as of a date during
such limitation year to all defined contribution plans,
(iv) all amounts allocated after March 31, 1984, to an
individual medical account which is part of a pension or
annuity plan maintained by the employer,
(v) all amounts derived from contributions paid or accrued
after December 31, 1985, in taxable years ending after
such date, under a welfare benefit fund, and
(vi) all amounts allocable as of a date during such limitation
year to the Participant under Section 2.4, Section 3.6,
Section 4 or Section 5 of this Appendix A.
1.1.1. SPECIFIC INCLUSIONS. With regard to a plan which contains a
qualified cash or deferred arrangement or matching contributions or employee
contributions, excess deferrals and excess contributions and excess aggregate
contributions (whether or not distributed during or after the limitation
year) shall be considered annual additions in the year contributed.
1.1.2. SPECIFIC EXCLUSIONS. The annual addition shall not, however,
include any portion of a Participant's rollover contributions or any
additions to accounts attributable to a plan merger or a transfer of plan
assets or liabilities or any other amounts excludible under law.
1.1.3. ESOP RULE. In the case of an employee stock ownership plan
within the meaning of section 4975(e)(7) of the Code under which no more than
one-third (1/3rd) of the Employer contributions for a limitation year which
are deductible under section 404(a)(9) of the Code are allocated to highly
compensated employees (as defined in section 414(q) of the Code), annual
additions shall not include forfeitures of employer securities under the
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employee stock ownership plan if such securities were acquired with the
proceeds of an exempt loan or employer contributions to the employee stock
ownership plan which are deductible by the Employer under section
404(a)(9)(B) of the Code and charged against the Participant's account (i.e.,
interest payments).
1.2. CONTROLLED GROUP MEMBER. Controlled group member means the Employer and
each member of a controlled group of corporations (as defined in section
414(b) and as modified by Code section 415(h) of the Code), all commonly
controlled trades or businesses (as defined in section 414(c) and as modified
by Code section 415(h) of the Code) and affiliated service groups (as defined
in section 414(m) of the Code) of which the Employer is a part.
1.3. DEFINED BENEFIT AND DEFINED CONTRIBUTION PLANS. Defined benefit plan
and defined contribution plan have the meanings assigned to those terms by
section 415(k)(1) of the Code. Whenever reference is made to defined benefit
plans and defined contribution plans in this Appendix, it shall include all
such plans maintained by the Employer and all controlled group members.
1.4. DEFINED BENEFIT FRACTION.
1.4.1. GENERAL RULE. Defined benefit fraction means a fraction the
numerator of which is the sum of the Participant's projected annual benefits
under all defined benefit plans (whether or not terminated) determined as of
the close of the limitation year, and the denominator of which is the lesser
of:
(i) one hundred twenty-five percent (125%)(7) of the dollar
limitation in effect under sections 415(b) and (d) of
the Code as of the close of such limitation year (i.e., 125%
of $90,000 as adjusted for cost of living, commencement
dates, length of service and other factors), or
(ii) one hundred forty percent (140%) of the dollar amount which
may be taken into account under section 415(b)(l)(B) of the
Code with respect to such Participant as of the close of such
limitation year (i.e., 140% of the Participant's highest
average compensation as adjusted for cost of living, length
of service and other factors).
1.4.2. TRANSITION RULE. Notwithstanding the above, if the
Participant was a participant as of the first day of the first limitation
year beginning after December 31, 1986, in one or more defined benefit plans
which were in existence on May 6, 1986, the denominator of this fraction will
not be less than one hundred twenty-five percent (125%) of the sum of the
annual benefits under such plans which the Participant had accrued as of the
close of the last limitation year beginning before January 1, 1987,
disregarding any changes in the terms and conditions of the Plan after May 5,
1986. The preceding sentence applies only if the defined benefit plans
individually and in the aggregate satisfied the requirements of Code section
415 for all limitation years beginning before January 1, 1987.
1.5. DEFINED CONTRIBUTION FRACTION.
1.5.1. GENERAL RULE. Defined contribution fraction means a fraction,
the numerator of which is the sum of the Participant's annual additions
(including Employer contributions which are allocated to a separate account
established for the purpose of providing medical benefits or life insurance
benefits with respect to a key employee (as defined in Appendix B) under a
welfare benefit fund or individual medical account) as of the close of the
limitation year and for all prior limitation years, and the denominator of
which is the sum of the amounts determined under paragraph (i) or (ii) below,
whichever is the lesser, for such limitation year and for each prior
limitation year in which the Participant had any service with the employer
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(7) Lower limitations may apply in any Plan Year that this Plan is super top
heavy. (See Appendix B, Section 3.5.)
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<PAGE>
(regardless of whether that or any other defined contribution plan was in
existence during those years or continues in existence):
(i) one hundred twenty-five percent (125%)(8) of the
dollar limitation determined under sections 415(b) and (d)
of the Code and in effect under section 415(c)(l)(A) of the
Code for such limitation year determined without regard to
section 415(c)(6) of the Code (i.e., 125% of $30,000 as
adjusted for cost of living), or
(ii) one hundred forty percent (140%) of the dollar amount which
may be taken into account under section 415(c)(l)(B) of the
Code with respect to such individual under the Plan for such
limitation year (i.e., 140% of 25% of the Participant's
Section 415 compensation for such limitation year).
1.5.2. TEFRA TRANSITION RULE. The Employer may elect that the amount
taken into account for each Participant for all limitation years ending
before January 1, 1983 under paragraphs (i) and (ii) above shall be
determined pursuant to the special transition rule provided in section
415(e)(6) of the Code.
1.5.3. EMPLOYEE CONTRIBUTIONS. Notwithstanding the definition of
"annual additions," for the purpose of determining the defined contribution
fraction in limitation years beginning before January 1, 1987, employee
contributions shall not be taken into account to the extent that they were
not required to be taken into account under section 415 of the Code prior to
the Tax Reform Act of 1986.
1.5.4. ANNUAL DENOMINATOR. The amounts to be determined under
paragraphs (i) or (ii) above for the limitation year and for all prior
limitation years in which the Participant had any service with the employer
shall be determined separately for each such limitation year on the basis of
which amount is the lesser for each such limitation year.
1.5.5. RELEVANT LAW. For all limitation years ending before January
1, 1976, the dollar limitation under section 415(c)(1)(A) of the Code is
Twenty-five Thousand Dollars ($25,000). For limitation years ending after
December 31, 1975 and before January 1, 1990, the amount shall be:
For limitation years The Section 415(c)(1)(A)
ending during: dollar amount is:
-------------------- ----------------------------
1976 $ 26,825
1977 $ 28,175
1978 $ 30,050
1979 $ 32,700
1980 $ 36,875
1981 $ 41,500
1982 $ 45,475
1983 - 1989 $ 30,000
1.5.6. RELIEF RULE. If the Participant was a participant as of the
end of the first day of the first limitation year beginning after December
31, 1986, in one or more defined contribution plans which were in existence
on May 6, 1986, the numerator of this fraction will be adjusted if the sum of
this fraction and the defined benefit fraction would otherwise exceed one
(1.0) under the terms of this Plan Statement. Under the adjustment, an
amount equal to the product of the excess of the sum of the fractions over
one (10), times the denominator of this
- ----------------------
(8) Lower limitations may apply in any Plan Year that this Plan is
super top heavy. (See Appendix B, Section 3.5.)
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<PAGE>
fraction, will be permanently subtracted from the numerator of this fraction.
The adjustment is calculated using the fractions as they would be computed
as of the end of the last limitation year beginning before January 1, 1987,
and disregarding any changes in the terms and conditions of the plan made
after May 5, 1986, but using the section 415 limitations applicable to the
first limitation year beginning on or after January 1, 1987.
1.6. HIGHEST AVERAGE COMPENSATION. Highest average compensation means the
average Section 415 compensation for the three (3) consecutive years of
service with the controlled group members that produce the highest average.
A year of service with the controlled group members is the Plan Year.
1.7. INDIVIDUAL MEDICAL ACCOUNT. Individual medical account means an
account, as defined in section 415(l)(2) of the Code, maintained by the
Employer or an Affiliate which provides an annual addition.
1.8. LIMITATION YEAR. The limitation year shall be the Plan Year, unless the
Adoption Agreement specifies a different limitation year. All qualified
plans maintained by the Employer must use the same limitation year. If the
limitation year is amended to a different 12-consecutive month period, the
new limitation year must begin on a date within the limitation year in which
the amendment is made.
1.9. MASTER OR PROTOTYPE PLAN. A plan the form of which is the subject of a
favorable opinion letter from the Internal Revenue Service.
1.10. MAXIMUM PERMISSIBLE ADDITION.
1.10.1. GENERAL RULE. The maximum permissible addition (to defined
contribution plans) for any one (1) limitation year shall be the lesser of:
(i) Thirty Thousand Dollars ($30,000), or if greater, one-
fourth (1/4) of the defined benefit limitation set forth
in section 415(b)(1) of the Code as in effect for the
limitation year, or
(ii) Twenty-five percent (25%) of the Participant's Section
415 compensation for such limitation year.
The compensation limitation referred to in (ii) shall not apply to any
contribution for medical benefits (within the meaning of section 401(h) or
section 419A(f)(2) of the Code) which is otherwise treated as an annual
addition under section 415(l)(1) or 419A(d)(2) of the Code.
1.10.2. ESOP RULE. In the case of an employee stock ownership plan
within the meaning of section 4975(e)(7) of the Code under which no more than
one third (1/3rd) of the Employer contributions for a limitation year are
allocated to highly compensated employees (as defined in section 414(q) of
the Code), the dollar limitation in (i) above (after adjustment for cost of
living) shall be increased to be equal to the sum of:
(i) the dollar limitation in (i) above (after adjustment for
cost of living), and
(ii) the lesser of the dollar limitation in (i) above (after
adjustment for cost of living) or the amount of employer
securities contributed or purchased with cash
contributed to the employee stock ownership plan.
1.10.3. MEDICAL BENEFITS. The dollar limitation in (i) above (after
adjustment for cost of living) shall be reduced by the amount of Employer
contributions which are allocated to a separate account established for the
purpose of providing medical benefits or life insurance benefits with respect
to a key employee (as defined in Appendix B) under a welfare benefit fund or
an individual medical account.
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1.10.4. SHORT YEAR. If a short limitation year is created because of an
amendment changing the limitation year to a different 12-consecutive month
period, the maximum permissible amount will not exceed the amount described in
Section 1.10.1(i) multiplied by the following fraction:
Number of months in the short limitation year
---------------------------------------------
12
1.11. PROJECTED ANNUAL BENEFIT. Projected annual benefit means the annual
annuity benefit payable to the Participant at his normal retirement age (as
defined in the defined benefit plan) adjusted to an actuarially equivalent
straight life annuity form (or, if it would be a lesser amount, to any
actuarially equivalent qualified joint and survivor annuity form that is
available under the defined benefit plan) assuming that:
(i) the Participant continues employment and participation under
the defined benefit plan until his normal retirement age (as
defined in the defined benefit plan) or until the current
age if later, and
(ii) the Participant's Section 415 compensation and all other
factors used to determine benefits under the defined benefit
plan remain unchanged for all future limitation years.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
1.12. SECTION 415 COMPENSATION.
1.12.1. SECTION 415 COMPENSATION. SECTION 415 COMPENSATION
(SOMETIMES, "SECTION 415 COMPENSATION") SHALL MEAN, WITH RESPECT TO ANY
LIMITATION YEAR, THE WAGES, TIPS AND OTHER COMPENSATION PAID TO THE
PARTICIPANT BY THE EMPLOYER AND REPORTABLE IN THE BOX DESIGNATED "WAGES,
TIPS, OTHER COMPENSATION" ON TREASURY FORM W-2 (OR ANY COMPARABLE SUCCESSOR
BOX OR FORM) FOR THE LIMITATION YEAR BUT DETERMINED WITHOUT REGARD TO ANY
RULES THAT LIMIT THE REMUNERATION INCLUDED IN WAGES BASED ON THE NATURE OR
LOCATION OF THE EMPLOYMENT OR THE SERVICES PERFORMED (SUCH AS THE EXCEPTION
FOR AGRICULTURAL LABOR IN SECTION 3401(a)(2) OF THE INTERNAL REVENUE CODE).
FOR LIMITATION YEARS BEGINNING AFTER DECEMBER 31, 1991, SECTION 415
COMPENSATION SHALL BE DETERMINED ON A CASH BASIS.
1.12.2. EARNED INCOME. SECTION 415 COMPENSATION FOR A SELF-EMPLOYED
PERSON SHALL BE SUCH SELF-EMPLOYED PERSON'S EARNED INCOME. EARNED INCOME IS
A SELF-EMPLOYED PERSON'S NET EARNINGS FROM SELF-EMPLOYMENT IN THE TRADE OR
BUSINESS INDICATED IN THE ADOPTION AGREEMENT AS THE TRADE OR BUSINESS OF THE
EMPLOYER WITH REGARD TO WHICH THIS PLAN IS ESTABLISHED (BUT ONLY IF SUCH
TRADE OR BUSINESS IS ONE IN WHICH PERSONAL SERVICES OF THE SELF-EMPLOYED
PERSON IS A MATERIAL INCOME-PRODUCING FACTOR) FOR A PLAN YEAR DURING WHICH
THE SELF-EMPLOYED PERSON IS A PARTICIPANT, REDUCED BY THE AMOUNT OF THE
EMPLOYER CONTRIBUTIONS MADE UNDER THE TERMS OF THIS PLAN FOR COMMON LAW
EMPLOYEES. EARNED INCOME SHALL INCLUDE GAINS (OTHER THAN ANY GAIN WHICH IS
TREATED AS GAIN FROM THE SALE OR EXCHANGE OF A CAPITAL ASSET FOR THE PURPOSE
OF DETERMINING THE SELF-EMPLOYED INDIVIDUAL'S FEDERAL INCOME TAX) AND NET
EARNINGS DERIVED FROM THE SALE OR OTHER DISPOSITION OF, THE TRANSFER OF ANY
INTEREST IN, OR THE LICENSING OF THE USE OF PROPERTY (OTHER THAN GOOD WILL)
BY AN INDIVIDUAL WHOSE PERSONAL EFFORTS CREATED SUCH PROPERTY. EARNED INCOME
SHALL BE DETERMINE WITHOUT REGARD TO ITEMS NOT INCLUDED IN GROSS INCOME AND
THE DEDUCTIONS ALLOCABLE TO SUCH ITEMS. NET EARNINGS SHALL BE DETERMINED
WITH REGARD TO THE DEDUCTION ALLOWED TO THE SELF-EMPLOYED PERSON BY SECTION
164(f) OF THE CODE FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 1989.
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1.13. WELFARE BENEFIT FUND. Welfare benefit fund means a fund as defined
in section 419(e) of the Code which provides post-retirement medical benefits
allocated to separate accounts for key employees as defined in section
419A(d)(3).
SECTION 2
THIS PLAN ALONE
This Section 2 applies only if the Participant does not participate in
and has never participated in another qualified plan or a welfare benefit
fund or an individual medical account maintained by any controlled group
member.
2.1. GENERAL RULE. The amount of annual additions which may be credited to
the Participant's Account under this Plan for any limitation year will not
exceed the maximum permissible amount. If the Employer contribution that
would otherwise be contributed or allocated to the Participant's Account
would cause the annual additions for the limitation year to exceed the
maximum permissible amount, the amount contributed or allocated will be
reduced so that the annual additions for the limitation year will equal the
maximum permissible amount.
2.2. ESTIMATION. Prior to determining the Participant's actual total
compensation for the limitation year, the Employer may determine the maximum
permissible amount for a Participant on the basis of a reasonable estimation
of the Participant's total compensation for the limitation year, uniformly
determined for all Participants similarly situated.
2.3. FINAL DETERMINATION. As soon as is administratively feasible after the
end of the limitation year, the maximum permissible amount for the limitation
year will be determined by the Employer on the basis of the Participant's
actual total compensation for the limitation year.
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FIRST AMENDMENT-EFFECTIVE JANUARY 1, 1993
2.4. REMEDIAL ACTION. IF THE PARTICIPANT'S ANNUAL ADDITIONS FOR A
LIMITATION YEAR WOULD EXCEED THE MAXIMUM PERMISSIBLE ADDITIONS APPLICABLE TO
DEFINED CONTRIBUTION PLANS ALONE, THE EMPLOYER SHALL, TO THE EXTENT THEY
CAUSE SUCH EXCESS TO OCCUR, CAUSE THE FOLLOWING TO OCCUR UNTIL SUCH EXCESS IS
ELIMINATED:
(i) RETURN ANY UNMATCHED EMPLOYEE CONTRIBUTIONS MADE BY THE
PARTICIPANT FOR THE LIMITATION YEAR TO THE PARTICIPANT
(ADJUSTED FOR THEIR PROPORTIONATE SHARE OF GAINS BUT NOT
LOSSES WHILE HELD IN THE PLAN), AND
(ii) DISTRIBUTE UNMATCHED ELECTIVE DEFERRALS (WITHIN THE MEANING
OF SECTION 402(g)(3) OF THE CODE) MADE FOR THE LIMITATION
YEAR TO THE PARTICIPANT (ADJUSTED FOR THEIR PROPORTIONATE
SHARE OF GAINS BUT NOT LOSSES WHILE HELD IN THE PLAN), AND
(iii) RETURN ANY MATCHED EMPLOYEE CONTRIBUTIONS MADE BY THE
PARTICIPANT FOR THE LIMITATION YEAR TO THE PARTICIPANT
(ADJUSTED FOR THEIR PROPORTIONATE SHARE OF GAINS BUT NOT
LOSSES WHILE HELD IN THE PLAN), AND
(iv) DISTRIBUTE MATCHED ELECTIVE DEFERRALS (WITHIN THE MEANING OF
SECTION 402(g)(3) OF THE CODE) MADE FOR THE LIMITATION YEAR
TO THE PARTICIPANT (ADJUSTED FOR THEIR PROPORTIONATE SHARE
OF GAINS BUT NOT LOSSES WHILE HELD IN THE PLAN).
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TO THE EXTENT EITHER MATCHED EMPLOYEE CONTRIBUTIONS ARE RETURNED OR MATCHED
ELECTIVE DEFERRALS ARE DISTRIBUTED, ANY MATCHING CONTRIBUTION MADE WITH
RESPECT THERETO SHALL BE FORFEITED AND REALLOCATED TO PARTICIPANTS AS
PROVIDED IN THE PLAN STATEMENT.
IF, AFTER RETURNING SUCH EMPLOYEE CONTRIBUTIONS TO THE PARTICIPANT AND
DISTRIBUTING ELECTIVE DEFERRALS TO THE PARTICIPANT, AN EXCESS STILL EXISTS,
THE EMPLOYER SHALL CAUSE SUCH EXCESS TO BE USED TO REDUCE EMPLOYER
CONTRIBUTIONS FOR THE NEXT LIMITATION YEAR ("SECOND LIMITATION YEAR") (AND
SUCCEEDING LIMITATION YEARS, AS NECESSARY) FOR THAT PARTICIPANT IF THAT
PARTICIPANT IS COVERED BY THE PLAN AT THE END OF THE SECOND LIMITATION YEAR
(OR SUCCEEDING LIMITATION YEARS). IF THE PARTICIPANT IS NOT COVERED BY THE
PLAN AT THE END OF THE SECOND LIMITATION YEAR (OR SUCCEEDING LIMITATION
YEARS), HOWEVER, THEN THE EXCESS AMOUNTS MUST BE HELD UNALLOCATED IN AN
"EXCESS ACCOUNT" FOR THE SECOND LIMITATION YEAR (OR SUCCEEDING LIMITATION
YEARS) AND ALLOCATED AND REALLOCATED IN THE SECOND LIMITATION YEAR (OR
SUCCEEDING LIMITATION YEAR) TO ALL THE REMAINING PARTICIPANTS IN THE PLAN AS
IF AN EMPLOYER CONTRIBUTION FOR THE SECOND LIMITATION YEAR (OR SUCCEEDING
LIMITATION YEAR). HOWEVER, IF THE ALLOCATION OR REALLOCATION OF THE EXCESS
AMOUNTS PURSUANT TO THE PROVISIONS OF THE PLAN CAUSES THE LIMITATIONS OF THIS
APPENDIX TO BE EXCEEDED WITH RESPECT TO EACH PARTICIPANT FOR THE SECOND
LIMITATION YEAR (OR SUCCEEDING LIMITATION YEARS), THEN THESE AMOUNTS MUST BE
HELD UNALLOCATED IN AN EXCESS ACCOUNT. IF AN EXCESS ACCOUNT IS IN EXISTENCE
AT ANY TIME DURING THE SECOND LIMITATION YEAR (OR ANY SUCCEEDING LIMITATION
YEAR), ALL AMOUNTS IN THE EXCESS ACCOUNT MUST BE ALLOCATED AND REALLOCATED TO
PARTICIPANTS' ACCOUNTS (SUBJECT TO THE LIMITATIONS OF THIS APPENDIX) AS IF
THEY WERE ADDITIONAL EMPLOYER CONTRIBUTIONS BEFORE ANY EMPLOYER CONTRIBUTION
AND ANY PARTICIPANT CONTRIBUTIONS WHICH WOULD CONSTITUTE ANNUAL ADDITIONS MAY
BE MADE TO THE PLAN FOR THAT LIMITATION YEAR. FURTHERMORE, THE EXCESS
AMOUNTS MUST BE USED TO REDUCE EMPLOYER CONTRIBUTIONS FOR THE SECOND
LIMITATION YEAR (AND SUCCEEDING LIMITATION YEARS, AS NECESSARY) FOR ALL OF
THE REMAINING PARTICIPANTS. EXCESS AMOUNTS MAY NOT BE DISTRIBUTED FROM THE
PLAN TO PARTICIPANTS OR FORMER PARTICIPANTS. IF AN EXCESS ACCOUNT IS IN
EXISTENCE AT ANY TIME DURING A LIMITATION YEAR, THE GAINS AND LOSSES AND
OTHER INCOME ATTRIBUTABLE TO THE EXCESS ACCOUNT SHALL BE ALLOCATED TO SUCH
EXCESS ACCOUNT. TO THE EXTENT THAT INVESTMENT GAINS OR OTHER INCOME OR
INVESTMENT LOSSES ARE ALLOCATED TO THE EXCESS ACCOUNT, THE ENTIRE AMOUNT
ALLOCATED TO PARTICIPANTS FROM THE EXCESS ACCOUNT, INCLUDING ANY SUCH GAINS
OR OTHER INCOME OR LESS ANY LOSSES, SHALL BE CONSIDERED AS AN ANNUAL
ADDITION. IF THE PLAN SHOULD BE TERMINATED PRIOR TO THE DATE ANY SUCH
TEMPORARILY HELD, UNALLOCATED EXCESS CAN BE ALLOCATED TO THE ACCOUNTS OF
PARTICIPANTS, THE DATE OF TERMINATION SHALL BE DEEMED TO BE AN ANNUAL
VALUATION DATE FOR THE PURPOSE OF ALLOCATING SUCH EXCESS AND, IF ANY PORTION
OF SUCH EXCESS CANNOT BE ALLOCATED AS OF SUCH DEEMED ANNUAL VALUATION DATE BY
REASON OF THE LIMITATIONS OF THIS APPENDIX, SUCH REMAINING EXCESS SHALL BE
RETURNED TO THE EMPLOYER.
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SECTION 3
THIS PLAN AND ANOTHER PROTOTYPE DEFINED CONTRIBUTION PLAN
This Section 3 applies only if, in addition to this Plan, the
Participant is covered under another master or prototype qualified defined
contribution plan, a welfare benefit fund or an individual medical account
maintained by any controlled group member.
3.1. GENERAL RULE. The annual additions which may be credited to a
Participant's Account under this Plan for any limitation year will not exceed
the maximum permissible amount reduced by the annual additions credited to a
Participant's account under the other plans and welfare benefit funds for the
same limitation year. If the annual additions with respect to the
Participant under other defined contribution plans and welfare benefit funds
maintained by any controlled group member are less than the maximum
permissible amount and the Employer contribution that would otherwise be
contributed or allocated to the Participant's Account under this Plan would
cause the annual additions for the limitation year to exceed this limitation,
the amount contributed or allocated will be reduced so that the annual
additions under all such plans and funds for the limitation year will equal
the maximum
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permissible amount. If the annual additions with respect to the Participant
under such other defined contribution plans and welfare benefit funds in the
aggregate are equal to or greater than the maximum permissible amount, no
amount will be contributed or allocated to the Participant's Account under
this Plan for the limitation year.
3.2. ESTIMATION. Prior to determining the Participant's actual total
compensation for the limitation year, the Employer may determine the maximum
permissible amount for a Participant on the basis of a reasonable estimation
of the Participant's compensation for the limitation year, uniformly
determined for all Participants similarly situated.
3.3. FINAL DETERMINATION. As soon as is administratively feasible after the
end of the limitation year, the maximum permissible amount for the limitation
year will be determined by the Employer on the basis of the Participant's
actual total compensation for the limitation year.
3.4. PRIORITY. If, pursuant to Section 3.3 of this Appendix or as a result
of the allocation of forfeitures, a Participant's annual additions under this
Plan and such other plans would result in an excess amount for a limitation
year and the allocations to accounts under such plans are made as of more
than one (1) date during the limitation year, the excess amount will be
deemed to consist of the annual additions last allocated during the
limitation year, except that the annual additions attributable to a welfare
benefit fund or individual medial account will be deemed to have been
allocated first regardless of the actual allocation date.
3.5. APPORTIONMENT. If an excess amount was allocated to a Participant on an
allocation date of this Plan which coincides with an allocation date of
another plan, the excess amount attributed to this Plan will be the product
of,
(a) the total excess amount allocated as of such date, multiplied by
(b) the ratio of (i) the annual additions allocated to the Participant for
the limitation year as of such date under this Plan to (ii) the total
annual additions allocated to the Participant for the limitation year
as of such date under this Plan and all the other master or prototype
qualified defined contribution plans.
3.6. REMEDIAL ACTION. Any excess amount attributed to this Plan will be
disposed in the manner described in Section 2.4 of this Appendix.
SECTION 4
THIS PLAN AND A NON-PROTOTYPE DEFINED CONTRIBUTION PLAN
If the Participant is covered under another qualified defined
contribution plan maintained by any controlled group member which is not a
master or prototype plan, annual additions which may be credited to the
Participant's Account under this Plan for any limitation year will be limited
in accordance with Section 3.1 through 3.6 of this Appendix as though the
other plan was a master or prototype qualified defined contribution plan
unless the Employer provides other limitations in the Adoption Agreement.
SECTION 5
THIS PLAN AND A DEFINED BENEFIT PLAN
If any controlled group member maintains, or at any time maintained, a
qualified defined benefit plan covering any Participant in this Plan, the sum
of a Participant's defined
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benefit plan fraction and defined contribution plan fraction will not exceed
one (1.0) at the close of any limitation year. The annual additions which
may be credited to the Participant's Account under this Plan for any
limitation year will be limited in accordance with the Adoption Agreement.
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APPENDIX B
CONTINGENT TOP HEAVY PLAN RULES
Notwithstanding any of the foregoing provisions of the Plan Statement,
if, after applying the special definitions set forth in Section 1 of this
Appendix, this Plan is determined under Section 2 of this Appendix to be a
Top Heavy Plan for a Plan Year, then the special rules set forth in Section 3
of this Appendix shall apply. For so long as this Plan is not determined to
be a Top Heavy Plan, the special rules in Section 3 of this Appendix shall be
inapplicable to this Plan.
SECTION 1
SPECIAL DEFINITIONS
Terms defined in the Plan Statement shall have the same meanings when used in
this Appendix. References to the "Code" shall mean the Internal Revenue
Code, as amended from time to time. In addition, when used in this Appendix,
the following terms shall have the following meanings:
1.1. AGGREGATED EMPLOYERS -- the Employer and each other corporation,
partnership or proprietorship which is a "predecessor" to the Employer, or is
under "common control" with the Employer, or is a member of an "affiliated
service group" that includes the Employer, as those terms are defined in
section 414(b), (c), (m) or (o) of the Code.
1.2. AGGREGATION GROUP -- a grouping of this Plan and:
(a) if any Participant in the Plan is a Key Employee, each other qualified
pension, profit sharing or stock bonus plan of the Aggregated
Employers in which a Key Employee is a Participant (and for this
purpose, a Key Employee shall be considered a Participant only during
periods when he is actually accruing benefits and not during periods
when he has preserved accrued benefits attributable to periods of
participation when he was not a Key Employee); and
(b) each other qualified pension, profit sharing or stock bonus plan of
the Aggregated Employers which is required to be taken into account
for this Plan or any plan described in paragraph (a) above to satisfy
the qualification requirement that this Plan cover a nondiscriminatory
group of employees (i.e., either the so-called "70% test," the
"70%/80% test" or the "nondiscriminatory classification test") or the
requirement that benefits be nondiscriminatory under section 401(a)(4)
of the Code; and
(c) each other qualified pension, profit sharing or stock bonus plan of
the Aggregated Employers which is not included in paragraph (a) or (b)
above, but which the Employer elects to include in the Aggregation
Group and which, when included, would not cause the Aggregation Group
to fail to satisfy the qualification requirement that the Aggregation
Group of plans cover a nondiscriminatory group of employees (I.E.,
either the so-called "70% test," the "70%/80% test" or the
"nondiscriminatory classification test") and the requirement that
benefits be nondiscriminatory under section 401(a)(4) of the Code.
1.3. DETERMINATION DATE -- for the first (1st) plan year of a plan, the last
day of such first (1st) plan year, and for each subsequent plan year, the
last day of the immediately preceding plan year.
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1.4. FIVE PERCENT OWNER -- for each Aggregated Employer that is a
corporation, any person who owns (or is considered to own within the meaning
of the Shareholder Attribution Rules) more than five percent (5%) of the
value of the outstanding stock of the corporation or stock possessing more
than five percent (5%) of the total combined voting power of the corporation,
and, for each Aggregated Employer that is not a corporation, any person who
owns more than five percent (5%) of the capital interest or the profits
interest in such Aggregated Employer. For the purposes of determining
ownership percentages, each corporation, partnership and proprietorship
otherwise required to be aggregated shall be viewed as a separate entity.
1.5. KEY EMPLOYEE -- each Participant (whether or not then an employee) who
at any time during a plan year (or any of the four preceding plan years) is:
(a) an officer of any Aggregated Employer (excluding persons who have the
title of an officer but not the authority and including persons who
have the authority of an officer but not the title) having an annual
compensation from all Aggregated Employers for any such plan year in
excess of fifty percent (50%) of the amount in effect under section
415(b)(1)(A) of the Internal Revenue Code for any such plan year, or
(b) one (l) of the ten (10) employees (not necessarily Participants)
owning (or considered to own within the meaning of the Shareholder
Attribution Rules) both more than one-half of one percent (1/2%)
ownership interest in value and the largest percentage ownership
interests in value of any of the Aggregated Employers (which are owned
by employees) and who has an annual compensation from all the
Aggregated Employers in excess of the limitation in effect under
section 415(c)(1)(A) of the Internal Revenue Code for any such plan
year, or
(c) a Five Percent Owner, or
(d) a One Percent Owner having an annual compensation from the Aggregated
Employers of more than One Hundred Fifty Thousand Dollars ($150,000);
provided, however, that no more than fifty (50) employees (or, if lesser, the
greater of three of all the Aggregated Employers' employees or ten percent of
all the Aggregated Employers' employees) shall be treated as officers. The
determination of whether a Participant is a Key Employee will be made in
accordance with this definition and section 416(i)(l) of the Code and
regulations thereunder. For the purposes of determining ownership
percentages, each corporation, partnership and proprietorship otherwise
required to be aggregated shall be viewed as a separate entity. For purposes
of paragraph (b) above, if two (2) employees have the same interest in any of
the Aggregated Employers, the employee having the greatest annual
compensation from that Aggregated Employer shall be treated as having a
larger interest. For the purpose of determining compensation, however, all
compensation received from all Aggregated Employers shall be taken into
account. The term "Key Employee" shall include the beneficiaries of a
deceased Key Employee. Annual compensation means "Section 415 compensation"
as defined in Appendix A to this Plan Statement but including amounts
contributed by the Employer pursuant to a salary reduction agreement which
are excludible from the Participant's gross income under section 125, section
402(a)(8), section 402(h) or section 403(b) of the Internal Revenue Code.
1.6. ONE PERCENT OWNER -- for each Aggregated Employer that is a corporation,
any person who owns (or is considered to own within the meaning of the
Shareholder Attribution Rules) more than one percent (l%) of the value of the
outstanding stock of the corporation or stock possessing more than one
percent (l%) of the total combined voting power of the corporation, and, for
each Aggregated Employer that is not a corporation, any person who owns more
than one percent (l%) of the capital or the profits interest in such
Aggregated Employer. For the
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purposes of determining ownership percentages, each corporation, partnership
and proprietorship otherwise required to be aggregated shall be viewed as a
separate entity.
1.7. SHAREHOLDER ATTRIBUTION RULES -- the rules of section 318 of the Code,
(except that subparagraph (C) of section 318(a)(2) of the Code shall be
applied by substituting "5 percent" for "50 percent") or, if the Employer is
not a corporation, the rules determining ownership in such Employer which
shall be set forth in regulations prescribed by the Secretary of the Treasury.
1.8. TOP HEAVY AGGREGATION GROUP -- any Aggregation Group for which, as of
the Determination Date, the sum of:
(i) the present value of the cumulative accrued benefits for Key
Employees under all defined benefit plans included in such
Aggregation Group; and
(ii) the aggregate of the accounts of Key Employees under all defined
contribution plans included in such Aggregation Group,
exceed sixty percent (60%) of a similar sum determined for all employees. In
applying the foregoing, the following rules shall be observed:
(a) For the purpose of determining the present value of the cumulative
accrued benefit for any employee under a defined benefit plan, or the
amount of the account of any employee under a defined contribution
plan, such present value or amount shall be increased by the aggregate
distributions made with respect to such employee under the plan during
the five (5) year period ending on the Determination Date.
(b) Any rollover contribution (or similar transfer) initiated by the
employee, made from a plan maintained by one employer to a plan
maintained by another employer and made after December 31, 1983 to a
plan shall not be taken into account with respect to the transferee
plan for the purpose of determining whether such transferee plan is a
Top Heavy Plan (or whether any Aggregation Group which includes such
plan is a Top Heavy Aggregation Group). Any rollover contribution (or
similar transfer) not described in the preceding sentence shall be
taken into account with respect to the transferee plan for the purpose
of determining whether such transferee plan is a Top Heavy Plan (or
whether any Aggregation Group which includes such plan is a Top Heavy
Aggregation Group).
(c) If any individual is not a Key Employee with respect to a plan for any
plan year, and was not a Key Employee for any of the four preceding
plan years, but such individual was a Key Employee with respect to a
plan for any prior plan year, the cumulative accrued benefit of such
employee and the account of such employee shall not be taken into
account.
(d) The determination of whether a plan is a Top Heavy Plan shall be made
once for each plan year of the plan as of the Determination Date for
that plan year.
(e) In determining the present value of the cumulative accrued benefits of
employees under a defined benefit plan, the determination shall be
made as of the actuarial valuation date last occurring during the
twelve (12) months preceding the Determination Date and shall be
determined on the assumption that the employees terminated employment
on the valuation date except as provided in section 416 of the Code
and the regulations thereunder for the first and second plan years of
a defined benefit plan. The accrued benefit of any employee (other
than a Key Employee) shall be
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determined under the method which is used for accrual purposes for
all plans of the employer or if there is no method which is used for
accrual purposes under all plans of the employer, as if such benefit
accrued not more rapidly than the slowest accrual rate permitted
under Code section 411(b)(1)(C). Unless otherwise specified in the
Adoption Agreement, in determining this present value, the mortality
and interest assumptions shall be those which would be used by the
Pension Benefit Guaranty Corporation in valuing the defined benefit
plan if it terminated on such valuation date. The accrued benefit
to be valued shall be the benefit expressed as a single life annuity.
(f) In determining the accounts of employees under a defined contribution
plan, the account values determined as of the most recent asset
valuation occurring within the twelve (12) month period ending on the
Determination Date shall be used. In addition, amounts required to be
contributed under either the minimum funding standards or the plan's
contribution formula shall be included in determining the account. In
the first year of the plan, contributions made or to be made as of the
Determination Date shall be included even if such contributions are
not required.
(g) If any individual has not performed any services for any employer
maintaining the plan at any time during the five (5) year period
ending on the Determination Date, any accrued benefit of the
individual under a defined benefit plan and the account of the
individual under a defined contribution plan shall not be taken into
account.
(h) For this purpose, a terminated plan shall be treated like any other
plan and must be aggregated with other plans of the employer if it was
maintained within the last five (5) years ending on the determination
date for the plan year in question and would, but for the fact that it
terminated, be part of the Aggregation Group for such plan year.
1.9. TOP HEAVY PLAN -- a qualified plan under which (as of the Determination
Date):
(i) if the plan is a defined benefit plan, the present value of the
cumulative accrued benefits for Key Employees exceeds sixty
percent (60%) of the present value of the cumulative accrued
benefits for all employees; and
(ii) if the plan is a defined contribution plan, the aggregate of the
accounts of Key Employees exceeds sixty percent (60%) of the
aggregate of all of the accounts of all employees.
In applying the foregoing, the following rules shall be observed:
(a) Each plan of an Employer REQUIRED to be included in an Aggregation
Group shall be a Top Heavy Plan if such Aggregation Group is a Top
Heavy Aggregation Group.
(b) For the purpose of determining the present value of the cumulative
accrued benefit for any employee under a defined benefit plan, or the
amount of the account of any employee under a defined contribution
plan, such present value or amount shall be increased by the aggregate
distributions made with respect to such employee under the plan during
the five (5) year period ending on the Determination Date.
(c) Any rollover contribution (or similar transfer) initiated by the
employee, made from a plan maintained by one employer to a plan
maintained by
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another employer and made after December 31, 1983 to a plan shall not
be taken into account with respect to the transferee plan for the
purpose of determining whether such transferee plan is a Top Heavy
Plan (or whether any Aggregation Group which includes such plan is a
Top Heavy Aggregation Group). Any rollover contribution (or similar
transfer) not described in the preceding sentence shall be taken into
account with respect to the transferee plan for the purpose of
determining whether such transferee plan is a Top Heavy Plan (or
whether any Aggregation Group which includes such plan is a Top Heavy
Aggregation Group).
(d) If any individual is not a Key Employee with respect to a plan for any
plan year, and was not a Key Employee for any of the four preceding
plan years, but such individual was a Key Employee with respect to the
plan for any prior plan year, the cumulative accrued benefit of such
employee and the account of such employee shall not be taken into
account.
(e) The determination of whether a plan is a Top Heavy Plan shall be made
once for each plan year of the plan as of the Determination Date for
that plan year.
(f) In determining the present value of the cumulative accrued benefits of
employees under a defined benefit plan, the determination shall be
made as of the actuarial valuation date last occurring during the
twelve (12) months preceding the Determination Date and shall be
determined on the assumption that the employees terminated employment
on the valuation date except as provided in section 416 of the Code
and the regulations thereunder for the first and second plan years of
a defined benefit plan. The accrued benefit of any employee (other
than a Key Employee) shall be determined under the method which is
used for accrual purposes for all plans of the employer or if there is
no method which is used for accrual purposes under all plans of the
employer, as if such benefit accrued not more rapidly than the slowest
accrual rate permitted under Code section 411(b)(1)(C). Unless
otherwise specified in the Adoption Agreement, in determining this
present value, the mortality and interest assumptions shall be those
which would be used by the Pension Benefit Guaranty Corporation in
valuing the defined benefit plan if it terminated on such valuation
date. The accrued benefit to be valued shall be the benefit expressed
as a single life annuity.
(g) In determining the accounts of employees under a defined contribution
plan, the account values determined as of the most recent asset
valuation occurring within the twelve (12) month period ending on the
Determination Date shall be used. In addition, amounts required to be
contributed under either the minimum funding standards or the plan's
contribution formula shall be included in determining the account. In
the first year of the plan, contributions made or to be made as of the
Determination Date shall be included even if such contributions are
not required.
(h) If any individual has not performed any services for any employer
maintaining the plan at any time during the five (5) year period
ending on the Determination Date, any accrued benefit of the
individual under a defined benefit plan and the account of the
individual under a defined contribution plan shall not be taken into
account.
(i) For this purpose, a terminated plan shall be treated like any other
plan and must be aggregated with other plans of the employer if it was
maintained within the last five (5) years ending on the determination
date for the plan year in question and would, but for the fact that it
terminated, be part of the Aggregation Group for such plan year.
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SECTION 2
DETERMINATION OF TOP HEAVINESS
Once each Plan Year, as of the Determination Date for that Plan Year, the
administrator of this Plan shall determine if this Plan is a Top Heavy Plan.
SECTION 3
CONTINGENT PROVISIONS
3.1. WHEN APPLICABLE. If this Plan is determined to be a Top Heavy Plan for
any Plan Year, the following provisions shall apply for that Plan Year (and,
to the extent hereinafter specified, for subsequent Plan Years),
notwithstanding any provisions to the contrary in the Plan Statement.
3.2. VESTING REQUIREMENT.
3.2.1. GENERAL RULE. During any Plan Year that the Plan is
determined to be a Top Heavy Plan, then all accounts of all Participants in a
defined contribution plan that is a Top Heavy Plan and the accrued benefits
of all Participants in a defined benefit plan that is a Top Heavy Plan shall
be vested and nonforfeitable in accordance with the following schedule if,
and to the extent, that it is more favorable than other provisions of the
Plan Statement:
If the Participant Has His Vested
Completed the Following Percentage
Years of Vesting Service: Shall Be:
------------------------- ---------
Less than 2 years 0%
2 years but less than 3 years 20%
3 years but less than 4 years 40%
4 years but less than 5 years 60%
5 years but less than 6 years 80%
6 years or more 100%
The above vesting schedule, if applicable, shall apply to all accounts and
benefits within the meaning of section 411(a)(7) of the Code except those
attributable to employee contributions including contributions made and
benefits accrued before the effective date of section 416 of the Code and
before the Plan was a Top Heavy Plan. However, this Section 3.2.1 does not
apply to the accounts of any Participant who does not have an Hour of Service
after the Plan has initially become a Top Heavy Plan, and such Participant's
Vested interests shall be determined without regard to this Section 3.2.1.
The minimum allocation required (to the extent required to be Vested under
section 416(b) of the Code) may not be forfeited under section 411(a)(3)(B)
or 411(a)(3)(D) of the Code, and will be determined without regard to any
contribution by the Employer for the Participant under the Federal Insurance
Contribution Act.
3.2.2. SUBSEQUENT YEAR. In each subsequent Plan Year that the Plan
is determined not to be a Top Heavy Plan, the other nonforfeitability
provisions of the Plan Statement (and not this section) shall apply in
determining the vested and nonforfeitable rights of Participants who do not
have five (5) or more years of Vesting Service (three (3) or more years of
Vesting Service for Participants who have one (1) or more Hours of Service in
any Plan Year beginning after December 31, 1988) as of the beginning of such
subsequent Plan Year; provided, however, that they shall not be applied in a
manner which would reduce the
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vested and nonforfeitable percentage of any Participant. The accounts and
accrued benefits of all other Participants shall be vested and nonforfeitable
in accordance with the more favorable of the schedule in Section 3.2.1 above
or other provisions of the Plan Statement. If the Vesting Schedule under the
Plan shifts in or out of the schedule set forth in Section 3.2.1 for any Plan
Year (because of the Plan's status as a Top Heavy Plan), such shift is an
amendment to the Vesting schedule and the election described in Section 5.2
of the Plan Statement shall apply.
3.3. DEFINED CONTRIBUTION PLAN MINIMUM BENEFIT REQUIREMENT.
3.3.1. GENERAL RULE. If this Plan is a defined contribution plan,
then for any Plan Year that this Plan is determined to be a Top Heavy Plan,
the Employer shall make a contribution for allocation to the account of each
employee who is a Participant for that Plan Year and who is not a Key
Employee in an amount (when combined with other Employer contributions and
forfeited accounts allocated to his account) which is at least equal to three
percent (3%) of such Participant's compensation attributable to Recognized
Employment while a Participant. This contribution shall be made for each
Participant who has not separated from service with the Employer at the end
of the Plan Year (including for this purpose any Participant who is then on
temporary layoff or authorized leave of absence or who, during such Plan
Year, was inducted into the Armed Forces of the United States from employment
with the Employer) including, for this purpose, each employee of the Employer
who would have been a Participant if he had:
(a) completed one thousand (1,000) Hours of Service (or the equivalent)
during the Plan Year, and
(b) made any mandatory contributions to the Plan, and
(c) earned compensation in excess of the stated amount required for
participation in the Plan.
The provision in this Section 3.3.1 shall not apply to any Participant to the
extent the Participant is covered under any other plan or plans of the
Employer and the Employer has provided in Article XIV of the Adoption
Agreement that the minimum allocation or benefit requirement applicable to
top-heavy plans will be met in the other plan or plans.
3.3.2. SPECIAL RULE. Subject to the following rules, the percentage
referred to in Section 3.3.1 of this Appendix shall not exceed the percentage
at which contributions are made (or required to be made) under this Plan for
the Plan Year for that Key Employee for whom that percentage is the highest
for the Plan Year.
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SECOND AMENDMENT-EFFECTIVE JANUARY 1, 1994
(A) THE PERCENTAGE REFERRED TO ABOVE SHALL BE DETERMINED BY DIVIDING THE
EMPLOYER CONTRIBUTIONS FOR SUCH KEY EMPLOYEE FOR SUCH PLAN YEAR BY SO
MUCH OF HIS COMPENSATION FOR SUCH PLAN YEAR AS DOES NOT EXCEED ONE
HUNDRED AND FIFTY THOUSAND DOLLARS ($150,000) (AS ADJUSTED FOR COST OF
LIVING IN ACCORDANCE WITH SECTION 401(a)(17)(B) OF THE INTERNAL
REVENUE CODE).
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(b) For the purposes of this Section 3.3, all defined contribution plans
REQUIRED to be included in an Aggregation Group shall be treated as
one (l) plan.
(c) The exception contained in this Section 3.3.2 shall not apply to (be
available to) this Plan if this Plan is REQUIRED to be included in an
Aggregation Group if including this Plan in an Aggregation Group
enables a defined benefit plan to
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satisfy the qualification requirement that the defined benefit plan
cover a nondiscriminatory group of employees (I.E., either the
so-called "70% test," the "70%/80% test" or the "nondiscriminatory
classification test").
3.3.3. SALARY REDUCTION AND MATCHING CONTRIBUTIONS. For the purpose
of this Section 3.3, all Employer contributions attributable to a salary
reduction or similar arrangement shall be taken into account both for the
purpose of determining the minimum percentage contribution required to be
made for a particular Plan Year for a Participant who is not a Key Employee
and for the purpose of determining whether that minimum contribution
requirement has been satisfied. Effective for Plan Years beginning after
December 31, 1988, for the purpose of this Section 3.3, all Employer
contributions attributable to a salary reduction or similar arrangement and
all Employer matching contributions shall be taken into account for the
purpose of determining the minimum percentage contribution required to be
made for a particular Plan Year for a Participant who is not a Key Employee
but not for the purpose of determining whether that minimum contribution
requirement has been satisfied.
3.4. PRIORITIES AMONG PLANS. In applying the minimum benefit provisions of
this Appendix in any Plan Year that this Plan is determined to be a Top Heavy
Plan, the following rules shall apply:
(a) If an employee participates only in this Plan, the employee shall
receive the minimum benefit applicable to this Plan.
(b) If an employee participates in both a defined benefit plan and a
defined contribution plan and only one (l) of such plans is a Top
Heavy Plan for the Plan Year, the employee shall receive the minimum
benefit applicable to the plan which is a Top Heavy Plan.
(c) If an employee participates in both a defined contribution plan and a
defined benefit plan and both are Top Heavy Plans, then the employee,
for that Plan Year, shall receive the defined benefit plan minimum
benefit unless for that Plan Year the employee has received employer
contributions and forfeitures allocated to his account in the defined
contribution plan in an amount which is at least equal to five percent
(5%) of his compensation.
(d) If an employee participates in this Plan, and other defined
contribution plans that are Top Heavy, the minimum benefit shall be
made in the plan according to chronological order as determined by the
effective date of each plan (using the original effective date of the
plan) beginning with the most recently established plan. Any
contribution required under this Section 3.5 for this Plan is reduced
by any contribution made to any other plan sponsored by the Employer.
3.5. ANNUAL CONTRIBUTION LIMITS.
3.5.l. GENERAL RULE. Notwithstanding anything apparently to the
contrary in the Appendix A to the Plan Statement, for any Plan Year that this
Plan is a Top Heavy Plan, the defined benefit fraction and defined
contribution fraction of the Appendix A to the Plan Statement shall be one
hundred percent (100%) and not one hundred twenty-five percent (125%).
3.5.2. SPECIAL RULE. Section 3.5.l of this Appendix shall not apply
to any Top Heavy Plan if such Top Heavy Plan satisfies the following
requirements:
(a) MINIMUM BENEFIT REQUIREMENT. The Top Heavy Plan (and any plan
required to be included in an Aggregation Group with such plan)
satisfies the requirements of section 416(c)(1)(B) of the Code is
applied by substituting three percent (3%) for two percent (2%) and by
increasing (but by no more
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than ten percentage points) twenty percent (20%) by one percentage
point for each year for which the plan was taken into account under
this Section 3.5. Section 3.3.1 of this Appendix shall be applied
by substituting "four percent (4%)" for "three percent (3%)."
Section 3.4(c) of this Appendix shall be applied by substituting
"seven and one-half percent (7-1/2%)" for "five percent (5%)."
(b) NINETY PERCENT RULE. A Top Heavy Plan would not be a Top Heavy Plan
if "ninety percent (90%)" were substituted for "sixty percent (60%)"
each place that it appears in the definitions of Top Heavy Plan and
Top Heavy Aggregation Group.
3.5.3. TRANSITION RULE. If, but for this Section 3.5.3, Section
3.5.l of this Appendix would begin to apply with respect to this Plan because
it is a Top Heavy Plan, the application of Section 3.5.l of this Appendix
shall be suspended with respect to any individual so long as there are no:
(a) employer contributions, forfeitures or voluntary nondeductible
contributions allocated to such individual (if this Plan is a defined
contribution plan), or
(b) accruals for such individual (if this Plan is a defined benefit plan).
3.5.4. COORDINATING CHANGE. If this Plan is a Top Heavy Plan for any
Plan Year, then for purposes of the Appendix A to the Plan Statement, section
415(e)(6)(i) of the Code shall be applied by substituting "Forty-one Thousand
Five Hundred Dollars ($41,500)" for "Fifty-one Thousand Eight Hundred
Seventy-five Dollars ($51,875)."
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APPENDIX C
QUALIFIED DOMESTIC RELATIONS ORDERS
SECTION 1
GENERAL MATTERS
Terms defined in the Plan Statement shall have the same meanings when used in
this Appendix.
1.1. GENERAL RULE. The Plan shall not honor the creation, assignment or
recognition of any right to any benefit payable with respect to a Participant
pursuant to a domestic relations order unless that domestic relations order
is a qualified domestic relations order.
1.2. ALTERNATE PAYEE DEFINED. The only persons eligible to be considered
alternate payees with respect to a Participant shall be that Participant's
spouse, former spouse, child or other dependent.
1.3. DRO DEFINED. A domestic relations order is any judgment, decree or
order (including an approval of a property settlement agreement) which
relates to the provision of child support, alimony payments, or marital
property rights to a spouse, former spouse, child or other dependent of a
Participant and which is made pursuant to a state domestic relations law
(including a community property law).
1.4. QDRO DEFINED. A qualified domestic relations order is a domestic
relations order which creates or recognizes the existence of an alternate
payee's right to (or assigns to an alternate payee the right to) receive all
or a portion of the Account of a Participant under the Plan and which
satisfies all of the following requirements.
1.4.1. NAMES AND ADDRESSES. The order must clearly specify the name
and the last known mailing address, if any, of the Participant and the name
and mailing address of each alternate payee covered by the order.
1.4.2. AMOUNT. The order must clearly specify the amount or
percentage of the Participant's Account to be paid by the Plan to each such
alternate payee or the manner in which such amount or percentage is to be
determined.
1.4.3. PAYMENT METHOD. The order must clearly specify the number of
payments or period to which the order applies.
1.4.4. PLAN IDENTITY. The order must clearly specify that it applies
to this Plan.
1.4.5. SETTLEMENT OPTIONS. Except as provided in Section 1.4.8 of
this Appendix, the order may not require the Plan to provide any type or form
of benefits or any option not otherwise provided under the Plan.
1.4.6. INCREASED BENEFITS. The order may not require the Plan to
provide increased benefits.
1.4.7. PRIOR AWARDS. The order may not require the payment of
benefits to an alternate payee which are required to be paid to another
alternate payee under another order previously determined to be a qualified
domestic relations order.
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1.4.8. EXCEPTIONS. Notwithstanding Section 1.4.5 of this Appendix:
(a) The order may require payment of benefits be made to an alternate
payee before the Participant has separated from service:
(i) If the order requires payment as of a date that is on or after
the date on which the Participant attains (or would have
attained) the earliest payment date described in Section 1.4.10
of this Appendix, or
(ii) If the order requires (A) that payment of benefits be made to an
alternate payee in a single lump sum as soon as is
administratively feasible after the order is determined to be a
qualified domestic relations order, and (B) does not contain any
of the provisions described in Section 1.4.9 of this Appendix,
and (C) provides that the payment of such single lump sum fully
and permanently discharges all obligations of the Plan to the
alternate payee.
(b) The order may require that payment of benefits be made to an alternate
payee as if the Participant had retired on the date on which payment
is to begin under such order (but taking into account only the present
value of benefits actually accrued).
(c) The order may require payment of benefits to be made to an alternate
payee in any form in which benefits may be paid under the plan to the
Participant (other than in the form of a joint and survivor annuity
with respect to the alternate payee and his or her subsequent spouse).
1.4.9. DEEMED SPOUSE. Notwithstanding the foregoing:
(a) The order may provide that the former spouse of a Participant shall be
treated as a surviving spouse of such Participant for the purposes of
Section 7 of the Plan Statement (and that any subsequent or prior
spouse of the Participant shall not be treated as a spouse of the
Participant for such purposes), and
(b) The order may provide that, if the former spouse has been married to
the Participant for at least one (1) year at any time, the surviving
former spouse shall be deemed to have been married to the Participant
for the one (1) year period ending on the date of the Participant's
death.
1.4.10. PAYMENT DATE DEFINED. For the purpose of Section 1.4.8 of
this Appendix, the earliest payment date means the earlier of:
(a) The date on which the Participant is entitled to a distribution under
the Plan, or
(b) The later of (i) the date the Participant attains age fifty (50)
years, or (ii) the earliest date on which the Participant could begin
receiving benefits under the plan if the Participant separated from
service.
SECTION 2
PROCEDURES
2.1. ACTIONS PENDING REVIEW. During any period when the issue of whether a
domestic relations order is a qualified domestic relations order is being
determined by the
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Administrator's Representative, the Administrator's Representative shall
cause the Plan to separately account for the amounts which would be payable
to the alternate payee during such period if the order were determined to be
a qualified domestic relations order.
2.2. REVIEWING DRO'S. Upon the receipt of a domestic relations order, the
Administrator's Representative shall determine whether such order is a
qualified domestic relations order.
2.2.1. RECEIPT. A domestic relations order shall be considered to
have been received only when the Administrator's Representative shall have
received a copy of a domestic relations order which is complete in all
respects and is originally signed, certified or otherwise officially
authenticated.
2.2.2. NOTICE TO PARTIES. Upon receipt of a domestic relations
order, the Administrator's Representative shall notify the Participant and
all persons claiming to be alternate payees and all prior alternate payees
with respect to the Participant that such domestic relations order has been
received. The Administrator's Representative shall include with such notice
a copy of this Appendix.
2.2.3. COMMENT PERIOD. The Participant and all persons claiming to
be alternate payees and all prior alternate payees with respect to the
Participant shall be afforded a comment period of thirty (30) days from the
date such notice is mailed by the Administrator's Representative in which to
make comments or objections to the Administrator's Representative concerning
whether the domestic relations order is a qualified domestic relations order.
By the unanimous written consent of the Participant and all persons claiming
to be alternate payees and all prior alternate payees with respect to the
Participant, the thirty (30) day comment period may be shortened.
2.2.4. INITIAL DETERMINATION. Within a reasonable period of time
after the termination of the comment period, the Administrator's
Representative shall give written notice to the Participant and all persons
claiming to be alternate payees and all prior alternate payees with respect
to the Participant of its decision that the domestic relations order is or is
not a qualified domestic relations order. If the Administrator's
Representative determines that the order is not a qualified domestic
relations order or if the Administrator's Representative determines that the
written objections of any party to the order being found a qualified domestic
relations order are not valid, the Administrator's Representative shall
include in its written notice:
(i) the specific reasons for its decision,
(ii) the specific reference to the pertinent provisions of this
Plan Statement upon which its decision is based,
(iii) a description of additional material or information, if any,
which would cause the Administrator's Representative to
reach a different conclusion, and
(iv) an explanation of the procedures for reviewing the initial
determination of the Administrator's Representative.
2.2.5. APPEAL PERIOD. The Participant and all persons claiming to be
alternate payees and all prior alternate payees with respect to the
Participant shall be afforded an appeal period of sixty (60) days from the
date such an initial determination and explanation is mailed in which to make
comments or objections concerning whether the original determination of the
Administrator's Representative is correct. By the unanimous written consent
of the Participant and all persons claiming to be alternate payees and all
prior alternate payees with respect to the Participant, the sixty (60) day
appeal period may be shortened.
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2.2.6. FINAL DETERMINATION. In all events, the final determination
of the Administrator's Representative shall be made not later than eighteen
(18) months after the date on which first payment would be required to be
made under the domestic relations order if it were a qualified domestic
relations order. The final determination shall be communicated in writing to
the Participant and all persons claiming to be alternate payees and all prior
alternate payees with respect to the Participant.
2.3. FINAL DISPOSITION. If the domestic relations order is finally
determined to be a qualified domestic relations order and all comment and
appeal periods have expired, the Plan shall pay all amounts required to be
paid pursuant to the domestic relations order to the alternate payee entitled
thereto. If the domestic relations order is finally determined not to be a
qualified domestic relations order and all comment and appeal periods have
expired, benefits under the Plan shall be paid to the person or persons who
would have been entitled to such amounts if there had been no domestic
relations order.
2.4. ORDERS BEING SOUGHT. If the Administrator's Representative has notice
that a domestic relations order is being or may be sought but has not
received the order, the Administrator's Representative shall not (in the
absence of a written request from the Participant) delay payment of benefits
to a Participant or beneficiary which otherwise would be due. If the
Administrator's Representative has determined that a domestic relations order
is not a qualified domestic relations order and all comment and appeal
periods have expired, the Administrator's Representative shall not (in the
absence of a written request from the Participant) delay payment of benefits
to a Participant or beneficiary which otherwise would be due even if the
Administrator's Representative has notice that the party claiming to be an
alternate payee or the Participant or both are attempting to rectify any
deficiencies in the domestic relations order.
SECTION 3
PROCESSING OF AWARD
3.1. GENERAL RULES. If a benefit is awarded to an alternate payee pursuant
to an order which has been finally determined to be a qualified domestic
relations order, the following rules shall apply.
3.1.1. SOURCE OF AWARD. If a Participant shall have a Vested
interest in more than one Account under the Plan, the benefit awarded to an
alternate payee shall be withdrawn from the Participant's Accounts in
proportion to his Vested interest in each of them.
3.1.2. EFFECT ON ACCOUNT. For all purposes of the Plan, the
Participant's Account (and all benefits payable under the Plan which are
derived in whole or in part by reference to the Participant's Account) shall
be permanently diminished by the portion of the Participant's Account which
is awarded to the alternate payee. The benefit awarded to an alternate payee
shall be considered to have been a distribution from the Participant's
Account for the limited purpose of applying the rules of Section 5.1.3 of the
Plan Statement.
3.1.3. AFTER DEATH. After the death of an alternate payee, all
amounts awarded to the alternate payee which have not been distributed to the
alternate payee and which continue to be payable shall be paid in a single
lump sum distribution to the personal representative of the alternate payee's
estate as soon as administratively feasible unless the qualified domestic
relations order clearly provides otherwise. The Participant's beneficiary
designation shall not be effective to dispose of any portion of the benefit
awarded to an alternate payee unless the qualified domestic relations order
clearly provides otherwise.
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3.1.4. IN-SERVICE BENEFITS. The in-service distribution and the loan
provisions of Section 7 of this Plan Statement shall not be applicable to the
benefit awarded to an alternate payee.
3.2. SEGREGATED ACCOUNT. If the Administrator's Representative determines
that it would facilitate the administration or the distribution of the
benefit awarded to the alternate payee or if the qualified domestic relations
order so requires, the benefit awarded to the alternate payee shall be
established on the books and records of the Plan as a separate account
belonging to the alternate payee.
3.3. FORMER ALTERNATE PAYEES. If an alternate payee has received all
benefits to which the alternate payee is entitled under a qualified domestic
relations order, the alternate payee will not at any time thereafter be
deemed to be an alternate payee or prior alternate payee for any substantive
or procedural purpose of this Plan.
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APPENDIX D
HIGHLY COMPENSATED EMPLOYEE
SECTION 1
GENERAL RULE
1.1. HIGHLY COMPENSATED EMPLOYEE. A "highly compensated employee" is any
employee who, during the "determination year" or the "look-back year":
(i) was at any time a five percent (5%) owner;
(ii) received compensation from the Employer in excess of
Seventy-Five Thousand Dollars ($75,000);
(iii) received compensation from the Employer in excess of Fifty
Thousand Dollars ($50,000) and was in the top-paid group of
employees for such year; or
(iv) was at any time an officer and received compensation greater
than 50 percent (50%) of the amount in effect under section
415(b)(1)(A) of the Code for such year.
The group of employees (including former employees) who are highly
compensated employees consists of both highly compensated active employees
and highly compensated former employees. The determination of who is a
highly compensated employee will be made in accordance with this Appendix D
and section 414(q) of the Code and the regulations thereunder.
1.2. DETERMINATION YEAR. The determination year is the current Plan Year
(that is, the Plan Year for which the determination of which employees are
highly compensated employees is being made).
1.3. LOOK-BACK YEAR. The look-back year is the twelve-month period
immediately preceding the determination year (generally, the preceding Plan
Year). The Employer does not elect to make the look-back year calculation on
the basis of the calendar year ending with or within the determination year.
1.4. SPECIAL RULE FOR DETERMINATION YEAR. An employee not described in
Section 1.1 (ii), (iii) or (iv) for the look-back year shall not be treated
as described in Section 1.1 (ii), (iii) or (iv) for the determination year
unless such employee is a member of the group consisting of the one hundred
(100) employees paid the greatest compensation during the determination year.
If there is no difference in compensation between the 100th employee and the
101st employee, then those employees receiving the same compensation as the
100th employee shall be ranked in descending order of seniority, with the
employee with the greatest seniority being ranked first.
1.5. HIGHLY COMPENSATED ACTIVE EMPLOYEE. A highly compensated active
employee is any highly compensated employee who performs services for the
Employer during the determination year.
1.6. HIGHLY COMPENSATED FORMER EMPLOYEE. A highly compensated former
employee is any former employee who had a "separation year" (as defined in
Section 2.9) prior to the determination year and was a highly compensated
active employee for either (1) such employee's separation year or (2) any
determination year ending on or after the employee's
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55th birthday. An employee who performs no services for the Employer during
a determination year is treated as a former employee.
SECTION 2
SPECIAL RULES & DEFINITIONS
2.1. INCORPORATED DEFINITIONS. Terms defined in the Plan Statement shall
have the same meanings when used in this Appendix. References to the "Code"
shall mean the Internal Revenue Code, as amended from time to time.
2.2. FIVE PERCENT OWNER. An employee shall be treated as a five percent (5%)
owner for any determination year or look-back year if at any time during such
year such employee was a five percent (5%) owner (as defined in the Appendix
B to this Plan Statement) of the Employer.
2.3. TOP-PAID GROUP. An employee is in the top-paid group of employees for
any determination year or look-back year if such employee is in the group
consisting of the top twenty percent (20%) of the employees when ranked on
the basis of compensation paid during such year, excluding those employees
described in Section 2.10. For purposes of the preceding sentence, the top
twenty percent (20%) shall be determined by disregarding fractional numbers
(i.e., the top 20% of 118 employees shall be the top 23 employees).
Employees who perform no services for the Employer during the year are not
included in determining the top-paid group of employees for that year.
2.4. SPECIAL RULES FOR OFFICERS.
2.4.1. NOT MORE THAN 50 OFFICERS. For purposes of Section 1.1(iv) of
this Appendix, no more than fifty (50) employees (or, if lesser, the greater
of three employees or ten percent of the employees) shall be treated as
officers. If the actual number of officers exceeds this limit, then the
officers who will be considered as includible officers under Section 1.1(iv)
are those who receive the greatest compensation from the Employer during the
determination year or the look-back year.
2.4.2. AT LEAST 1 OFFICER. If for any determination year or
look-back year no officer of the Employer is described in Section 1.1(iv) of
this Appendix, the highest paid officer of the Employer for such year shall
be treated as described in such Section 1.1(iv). This is true whether or not
such employee is also a highly compensated employee on any other basis.
2.5. FORMER EMPLOYEES EXCLUDED FOR CERTAIN PURPOSES. Former employees are
not included in the top-paid group, the group consisting of the one hundred
(100) employees paid the greatest compensation or the group of includible
officers for purposes of determining who are highly compensated active
employees. In addition, former employees are not counted as employees for
purposes of determining the number of employees in the top-paid group.
2.6. EMPLOYEES DESCRIBED IN SEVERAL GROUPS. An employee who is a highly
compensated active employee for a determination year by reason of being
described in one group under Section 1.1 for either the determination year or
the look-back year, shall not be disregarded in determining whether another
employee is a highly compensated active employee by reason of being described
in another group under Section 1.1.
2.7. CERTAIN FAMILY MEMBERS.
2.7.1. IN GENERAL. If any individual is a member of the family of a
five percent (5%) owner or of a highly compensated employee in the group
consisting of the ten (10) highly
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compensated employees paid the greatest compensation during the determination
year or the look-back year, then:
(i) such individual shall not be considered a separate employee; and
(ii) any compensation paid to such individual (and any applicable
contribution or benefit on behalf of such individual) shall be
treated as if it were paid to (or on behalf of) the five percent
(5%) owner or highly compensated employee.
Family members are subject to this aggregation rule whether or not they may
be excluded under Section 2.10 for purposes of determining the top-paid group
and whether or not they are highly compensated employees when considered
separately.
2.7.2. FAMILY. For purposes of Section 2.7.1 of this Appendix, the
term "family" means, with respect to any employee, such employee's spouse and
lineal ascendants or descendants and the spouses of such lineal ascendants or
descendants.
2.7.3. PRIORITY. The determination of which employees are highly
compensated employees and which highly compensated employees are among the
ten highly compensated employees paid the greatest compensation during the
determination year or the look-back year shall be made prior to the
application of the family aggregation rules. Similarly, the determination of
the number and identity of employees in the top-paid group for a
determination year or a look-back year and the identity of the group of
employees consisting of the 100 employees paid the greatest compensation for
a determination year shall be made prior to the application of the family
aggregation rules. The family aggregation rules apply separately to the
determination year and the look-back year.
2.7.4. CHANGE IN FAMILY RELATIONSHIP. An individual is a family
member with respect to an employee or former employee if such individual is a
family member on any day during the determination year or the look-back year,
even though such relationship changes during such year as a result of death
or divorce.
2.8. COMPENSATION. For purposes of this Appendix the term "compensation"
means "Section 415 compensation" as defined in Appendix A to this Plan
Statement but including amounts contributed by the Employer pursuant to a
salary reduction agreement which are excludible from the Participant's gross
income under section 125, section 402(a)(8), section 402(h) or section 403(b)
of the Code. Compensation for any employee who performed services for only
part of a year is not annualized for purposes of determining such employee's
compensation for the determination year or the look-back year.
2.9. SEPARATION YEAR. Generally the "separation year" is the determination
year during which the employee separates from service with the Employer. An
employee who performs no services for the Employer during a determination
year will be treated as having separated from service in the year in which
that employee last performed services for the Employer.
2.9.1. DEEMED SEPARATION. Solely for the purpose of determining
whether an employee is a highly compensated former employee after the
employee actually separates from service, an employee may be deemed to have
separated from service during a determination year in which the employee
actually performs some services for the Employer. An employee will be deemed
to have a separation year if, in a determination year prior to the employee's
attaining the age of 55, the employee receives compensation in an amount less
than 50% of the employee's average annual compensation for the three
consecutive calendar years preceding such determination year during which the
employee received the greatest amount of compensation from the Employer (or
the total period of the employee's service with the Employer, if less). This
deemed separation from service may occur without regard to whether the
reduction in compensation occurs on account of the employee's leave of
absence from service with the Employer.
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2.9.2. DEEMED RESUMPTION. An employee who is treated as having a
deemed separation year by reason of Section 2.9.1 will not be treated as a
highly compensated former employee after such employee actually separates
from service with the Employer if, after such deemed separation year, and
before the year of actual separation, such employee's compensation from the
Employer for a particular determination year increased significantly so that
such employee is treated as having a deemed resumption of employment. In
order for a deemed resumption of employment to occur, there must be an
increase in compensation from the Employer to the extent that such
compensation would not result in a deemed separation year under Section 2.9.1
using the same three-year period taken into account for purposes of that
Section.
2.10. EXCLUDED EMPLOYEES.
2.10.1. GENERAL EXCLUSIONS. For purposes of determining the number of
employees in the top-paid group for a determination year or a look-back year
under Section 2.3 of this Appendix, the following employees shall be excluded:
(i) employees who have not completed six (6) months of service
by the end of the year;
(ii) employees who normally work less than seventeen and one-half
(17-1/2) hours per week;
(iii) employees who normally work during less than six (6) months
during the year; and
(iv) employees who have not attained age twenty-one (21) by the end
of the year.
For purposes of computing months of service, an employee's service in the
immediately preceding year is added to service in the current year to
determine whether an employee is excluded in the current year.
2.10.2. EMPLOYEES COVERED BY COLLECTIVE BARGAINING AGREEMENTS. In
general, employees who are included in a unit of employees covered by a
collective bargaining agreement are included in determining the number of
employees in the top-paid group. However, if ninety percent (90%) or more of
all employees are covered under collective bargaining agreements and this
Plan covers only employees who are not covered under such agreements, then
the employees who are covered under such collective bargaining agreements
shall not be counted in determining the number of employees who will be
included in the top-paid group. In addition, the employees covered by such
agreements will not be included in the top-paid group.
2.10.3. MINIMUM HOUR RULE. An employee who works at least 17-1/2
hours a week for 50% or more of the total weeks worked by such employee
during a determination year or look-back year is deemed to normally work more
than 17-1/2 hours a week. An employee who works less than 17-1/2 hours a
week for fifty percent (50%) or more of the total weeks worked by such
employee during a determination year or look-back year is deemed to normally
work less than 17-1/2 hours a week. The foregoing determinations may be made
separately with respect to each employee or on the basis of groups of
employees who fall within particular job categories as established by the
Employer on a reasonable basis. In general, eighty percent (80%) of the
positions within a particular job category must be filled by employees who
normally work less than 17-1/2 hours a week before any employees may be
excluded under this rule on the basis of their membership in that job
category. Alternatively, an Employer may exclude employees who are members
of a particular job category if the median number of hours credited to
employees in that category during a determination year or look-back year is
500 or less.
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2.10.4. MINIMUM PERIOD OF TIME RULE. The determination of whether an
employee normally works during less than six months in any determination year
or look-back year is made on the basis of the facts and circumstances of the
Employer as evidenced by the Employer's customary experience in the years
preceding such year. An employee who works on one day during a month is
deemed to have worked during that month.
2.10.5. NONRESIDENT ALIENS. Employees who are nonresident aliens and
who receive no earned income (within the meaning of section 911(d)(2) of the
Code) from the employer which constitutes income from sources within the
United States (within the meaning of section 861(a)(3) of the Code) are
excluded for all purposes of this Appendix.
2.11. ADJUSTMENTS TO DOLLAR AMOUNTS. The dollar amounts described in
Section 1.1 (ii) and (iii) shall be adjusted for cost-of-living increases as
provided by regulations or other rulings by the Secretary of the Treasury.
The applicable dollar amount for a particular determination year shall be the
dollar amount for the calendar year in which the determination year begins.
For determination years beginning before January 1, 1987, the dollar amounts
in Section 1.1 (ii) and (iii) shall be $75,000 and $50,000 respectively.
2.12. ELECTION TO INCLUDE LEASED EMPLOYEES. The term "employee" shall
include all leased employees of the Employer, whether or not such leased
employees are covered by a "safe-harbor plan" as described in section
414(n)(5) of the Code.
2.13. AGGREGATION. Subsections (b), (c), (m), (n), and (o) of section
414 of the Code shall be applied before the application of the rules in this
Appendix.
2.14. ELECTION OF SPECIAL RULE FOR EMPLOYEES WHO SEPARATED FROM SERVICE
BEFORE JANUARY 1, 1987. For purposes of determining who is a highly
compensated former employee for this Plan and for all plans of the Employer
with respect to all situations for which section 414(q) of the Code is
applicable to the Employer, a former employee who separated from service
prior to January 1, 1987, shall be considered a highly compensated former
employee if, during the employee's separation year (or the year preceding
such separation year) or during any year ending on or after such employee's
55th birthday (or the last year ending before such employee's 55th birthday),
the employee was a five percent (5%) owner of the Employer at any time during
such year, or the employee received compensation in excess of $50,000 during
such year. This determination may be made on the basis of the calendar year,
the Plan Year or any other twelve month period selected by the Employer and
applied on a reasonable and consistent basis.
D-5
<PAGE>
APPENDIX E
TEFRA SECTION 242(B) TRANSITIONAL RULES
SECTION 1. IN GENERAL. Prior to January 1, 1984, each individual who was
either:
(a) an actively employed Participant having an Account (or a contribution
accrued to an Account) as of December 31, 1983,
(b) a Participant not actively employed but having an Account (or a
contribution accrued to an Account) as of December 31, 1983, or
(c) a Beneficiary of a deceased Participant having an Account (or a
contribution accrued to an Account) as of December 31, 1983
was given the opportunity to make a designation (before January 1, 1984) of a
method of distribution, that would not have disqualified the Plan under
section 401(a)(9) of the Code as in effect prior to amendment by the Deficit
Reduction Act of 1984, pursuant to Section 242(b) of the Tax Equity and
Fiscal Responsibility Act of 1982 (hereinafter a "Section 242(b)
designation"). Some of those individuals elected to make a Section 242(b)
designation and some did not. The distribution rules set forth in this
Appendix shall, notwithstanding any provisions of Section 7 of the Plan
Statement to the contrary, determine the distributions made with respect to
all individuals entitled to make a Section 242(b) designation, provided that
if the Plan is not an exempt profit sharing plan, the QJ&SA contract or Life
Annuity contract has been rejected as described in Section 7 of the Plan
Statement. Distributions made with respect to individuals not entitled to
make a Section 242(b) designation shall be governed solely by Section 7 of
the Plan Statement.
SECTION 2. NO DESIGNATION. In the case of distributions to an individual
where no Section 242(b) designation was made, distributions after December
31, 1983 shall be made as follows:
(a) If such individual is a Participant whose benefits were in pay status
on December 31, 1983, and the method of distribution in effect for
such Participant was consistent with the provisions of the Plan
Statement at the time such distribution commenced, then distribution
shall continue to be made to such Participant in accordance with the
method of distribution in effect on December 31, 1983, notwithstanding
that distribution could not have commenced under such method after
December 31, 1983.
(b) If such individual is a Beneficiary whose benefits were in pay status
on December 31, 1983, and the method of distribution in effect for
such Beneficiary was consistent with the provisions of the Plan
Statement at the time such distribution commenced, then distribution
shall continue to be made to such Beneficiary in accordance with the
method of distribution in effect on December 31, 1983, notwithstanding
that distribution could not have commenced under such method after
December 31, 1983.
(c) If such individual is a Participant or a Beneficiary whose benefits
were not in pay status on December 31, 1983, distribution shall be
made in accordance with Section 7 of the Plan Statement and, to the
extent distribution cannot then be made upon terms which are
consistent with the provisions of Section 7 of the Plan Statement,
distribution shall be made as soon as practicable after December 31,
1983 in a single lump sum.
(d) For the purpose of the foregoing, benefits shall be considered to have
been in pay status on December 31, 1983 if distribution had commenced
on or prior to that date and was being made under a written instrument
signed by the
E-1
<PAGE>
Participant or Beneficiary which fixed the person to whom such
benefits were payable, the time or times at which distributions
would be made and the amount (or formula pursuant to which the
amount would be determined) of each distribution and was not
subject to variation at the discretion of the Participant or the
Administrator's Representative unless such variation would cause
the acceleration of distributions.
(e) Examples of circumstances in which distribution could not be made upon
terms consistent with the provisions of Section 7 of the Plan
Statement (and therefore would have to be made in a single lump sum)
include, but are not be limited to, distribution to a Participant who
was a key employee in a top heavy plan and who had attained age
seventy and one-half (70-1/2) years before 1984, distribution to a
Beneficiary who was not the surviving spouse of the Participant if the
Participant died prior to 1979, and distribution to a Beneficiary who
is the surviving spouse of a Participant who dies after December 31,
1983 at a time when distributions were being made to such Participant
for a term certain which extended beyond the life expectancy of such
Participant and surviving spouse.
SECTION 3. DESIGNATION MADE. In the case of distributions to an
individual where a Section 242(b) designation was made before January 1,
1984, the Administrator's Representative shall honor such Section 242(b)
designation in making distributions hereunder to all individuals identified
in such Section 242(b) designation. For this purpose:
(a) A Section 242(b) designation shall, to the extent necessary, be
deemed to incorporate by reference either the written beneficiary
designation filed by the Participant prior to or coincident with the
filing of a Section 242(b) designation or, if no such written
beneficiary designation has been filed, the automatic sequence of
Beneficiaries provided under the Plan document in effect on December
31, 1983.
(b) An individual who made a Section 242(b) designation shall have the
right to revoke any Section 242(b) designation filed by him at any
time by a written instrument delivered to the Employer. Upon such
revocation, distribution shall be made in accordance with the
provisions of Section 7 of the Plan Statement. To the extent that
distribution cannot then be made upon terms consistent with the
provisions of Section 7 of the Plan Statement, distribution shall be
made, as soon as practicable after such revocation, in a single lump
sum.
(c) A Beneficiary entitled to distribution under this Plan shall have the
right to revoke the Section 242(b) designation insofar as it applies
to such Beneficiary. Upon such revocation, distribution shall be made
in accordance with the provisions of Section 7 of the Plan Statement.
If a designation is revoked subsequent to the date distributions are
required to begin under Section 7 of the Plan Statement, the trust
must distribute by the end of the calendar year following the calendar
year in which the revocation occurs the total amount not yet
distributed which would have been required to have been distributed to
satisfy Section 7 of the Plan Statement, but for the Section 242(b)
election. For calendar years beginning after December 31, 1988, such
distributions must meet the minimum distribution incidental benefit
requirements in Treas. Reg. 1.401(a)(9)-2 (proposed). Any changes in
the Section 242(b) designation will be considered to be a revocation
of the Section 242(b) designation. However, the mere substitution or
addition of another beneficiary (one not named in the Section 242(b)
designation) under the Section 242(b) designation will not be
considered to be a revocation of the Section 242(b) designation, so
long as such substitution or addition does not alter the period over
which distribution are to be made under the Section 242(b)
designation, directly or indirectly (for example, by altering the
relevant measuring life). In the case in which an amount is
transferred or rolled over from one plan to
E-2
<PAGE>
another plan, the rules in Q&A J-2 and Q&A J-3 of Treas.
Reg. 1.401(a)(9)-1 (proposed) shall apply.
(d) If a Participant shall have filed a Section 242(b) designation and
shall subsequently file (or amend) a written beneficiary designation
under the Plan, the Section 242(b) designation shall not be deemed to
be revoked and the relevant measuring life or lives for purposes of
the Section 242(b) designation shall continue to be determined as
described in paragraph (a) above, without regard to any subsequent
filing (or amendment) of a written beneficiary designation or any
subsequent amendment of the automatic sequence of Beneficiaries under
the Plan Statement.
(e) A distribution to a Beneficiary will be governed by Section 7 of the
Plan Statement, unless the Section 242(b) designation identifies the
Beneficiary, specifies the time at which distribution will commence
and the period over which distribution will be made with respect to
the distribution to be made upon the death of the Participant.
(f) For any distribution which commences before January 1, 1984, but
continues after December 31, 1983, the Participant or the Beneficiary,
to whom such distribution is being made, will be presumed to have
designated the method of distribution under which the distribution is
being made if the method of distribution was specified in writing and
the distribution satisfied the requirements in Section 1 and Section
3(e) of this Appendix.
E-3
<PAGE>
APPENDIX F
TRANSITIONAL DISTRIBUTION RULES
The Prototype Sponsor adopted the following memorandum and amendment:
MEMORANDUM AND AMENDMENT
TO: Sponsoring Employers of 401(k) Prototype
FROM: First Trust National Association ("Prototype Sponsor")
RE: Distributions from Plan
DATE: December 23, 1988
The Internal Revenue Service recently issued regulations which limit the
existence or the use of any Employer, Trustee, Administrator's Representative
or other similar discretion over the benefit forms under qualified plans. In
response to those regulations, the Prototype Sponsor decided to amend the
401(k) Prototype pursuant to its reserved power of amendment. This amendment
is being adopted to protect and preserve the sponsoring Employer's ability to
design its own distribution rules for its Plan. If the Prototype Sponsor did
not take this action, all the options and decisions would be surrendered to
Participants or Beneficiaries. Accordingly, the Prototype Sponsor's decision
to amend the 401(k) Prototype gives sponsoring Employers time to decide how
to respond to these regulations.
Pursuant to Section 9.1.2 of the Basic Plan Document, the Prototype
Sponsor hereby amends the Basic Plan Document (and corresponding Adoption
Agreement) effective as of January 1, 1989, as follows:
SMALL AMOUNT DISTRIBUTIONS. A Vested Total Account which does not exceed
Three Thousand Five Hundred Dollars ($3,500) on the Annual Valuation Date
immediately following a Participant's Event of Maturity shall be
automatically distributed to the Participant in a lump sum as of that Annual
Valuation Date without a written application. The sponsoring Employer may in
a written agreement with the Prototype Sponsor modify this rule to increase
the number of times each year that a small amount distribution can be made
(within limitations established by the Prototype Sponsor).
TIME OF DISTRIBUTION. Distributions from the Plan may only be made as of an
Annual Valuation Date coincident with or following a Participant's Event of
Maturity. Thus, distributions shall only be made once a Plan Year. The
sponsoring Employer may in a written agreement with the Prototype Sponsor
modify this rule to increase the number of times each year that distributions
can be made (within limitations established by the Prototype Sponsor).
FORM OF DISTRIBUTION. Distributions from the Plan shall only be made in a
lump sum payment. This rule shall not apply to Participants and
Beneficiaries currently receiving payments under a specified plan of
installment payments or to Participants who have made a valid designation of
a method of distribution pursuant to section 242(b) of the Tax Equity and
Fiscal Responsibility Act of 1982. The sponsoring Employer may in a written
agreement with the Prototype Sponsor modify this rule to increase the
distribution options (within limitations established by the Prototype
Sponsor).
ELECTION TO DEFER. The election to defer described in Section 7.2.3 of the
Basic Plan Document and all references to that Section are deleted.
F-1
<PAGE>
DISTRIBUTION IN CASH. All distributions from the Plan shall be made in cash.
If, however, the Vested Total Account to be distributed consists in whole or
in part of a Participant's unpaid promissory note, the distribution of that
portion of the Vested Total Account shall be made in the form of that
promissory note. If the Vested Total Account to be distributed consists in
whole or in part of a Participant's individually directed investments, the
distribution of that portion of the Vested Total Account shall be made in the
form of the assets held pursuant to that individual direction.
WITHDRAWALS FROM VOLUNTARY ACCOUNTS. If the Adoption Agreement allows
Participants to withdraw their nondeductible voluntary contributions and
deductible voluntary contributions, a Participant must submit a written
application specifying the amount of the withdrawal. The withdrawal will be
made as of the Annual Valuation Date coincident with or next following the
approval of a completed application and such withdrawal shall be made in a
lump sum cash payment as soon as practicable after such Annual Valuation
Date. The sponsoring Employer may in a written agreement with the Prototype
Sponsor modify this rule to increase the number of times each year that
withdrawals can be made (within limitations established by the Prototype
Sponsor).
WITHDRAWALS FROM RETIREMENT SAVINGS ACCOUNT (401(k)). Notwithstanding the
elections made in the previously completed Adoption Agreement, distributions
from the Retirement Savings Account during employment shall not be allowed.
The sponsoring Employer may in a written agreement with the Prototype Sponsor
modify this rule to allow in-service distributions in limited circumstances
(within limitations established by the Prototype Sponsor).
WITHDRAWALS FROM OTHER ACCOUNTS. Notwithstanding the elections made in the
previously completed Adoption Agreement, distributions from accounts (other
than from the Retirement Savings Account) during employment shall not be
allowed. The sponsoring Employer may in a written agreement with the
Prototype Sponsor modify this rule to allow in-service distributions in
limited circumstances (within limitations established by the Prototype
Sponsor).
Section 9.1.2 of the Basic Plan Document provides that an Employer shall
be deemed to have consented to the amendment described in this memorandum
unless prior to thirty (30) days after the date this memorandum is sent, the
Employer exercises its reserved power of amendment by adopting a successor
retirement plan. You will note that a number of the rules described in this
memorandum allow the sponsoring Employer and the Prototype Sponsor to agree
to modifications. If you want to modify those rules, please contact your
Trust Officer to discuss possible modifications.
F-2
<PAGE>
APPENDIX G
PLAN LOAN RULES
Until the Employer adopts rules for the administration of Plan loans,
this Appendix G shall apply to all loans from the Plan.
(1) All Plan loans shall be administered by the Administrator's
Representative. Applications for loans shall be made to the
Administrator's Representative on forms available from the
Administrator's Representative.
(2) Loans shall be made available to all Participants and Beneficiaries on
a reasonably equivalent basis. Loans may be made for any purpose, and
all applications for loans that comply with Section 7.11 of the Plan
Statement will be granted. For this purpose, Participant shall
include only Participants who are active employees, a person shall be
a Beneficiary only after the death of the Participant who designated
such person as a Beneficiary, and an alternate payee shall be
considered a Beneficiary after the domestic relations order has been
finally determined to be a qualified domestic relations order.
(3) Loans shall not be made available to highly compensated employees (as
defined in Appendix D) in an amount (expressed as a percentage of
Vested Total Account) greater than the amount made available to other
Employees.
(4) No loans will be made to any Shareholder-Employee or Owner-Employee.
(5) All loans shall be secured by that portion of the Participant's Vested
Total Account equal to the lesser of (i) the amount of the loan, or
(ii) 50% of the Vested Total Account determined immediately before the
loan and reduced by the amount of any unpaid principal and interest on
any other loans secured by the Vested Total Account. The borrower may
grant a security interest in his or her "qualified residence" as
defined in section 163(h) of the Code if the borrower's unrestricted
equity interest is adequate to do so. No other security will be
permitted.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
THIRD AMENDMENT-EFFECTIVE JANUARY 1, 1995
(6) ALL LOANS SHALL BEAR A REASONABLE RATE OF INTEREST DETERMINED ON THE
FIRST BUSINESS DAY OF THE CALENDAR MONTH IMMEDIATELY PRECEDING THE
DATE AS OF WHICH THE LOAN IS ISSUED.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(7) Loans shall be for any term not to exceed 5 years except that loans to
acquire a dwelling unit which within a reasonable time (determined at
the time the loan is made) is to be used as the principal residence of
the Participant may be for any term that does not exceed 15 years.
(8) Loans shall be issued effective as of the first business day following
each Valuation Date for the Plan as selected by the Employer in the
Adoption Agreement.
(9) Applications for loans must be received at least fifteen (15) days
before the date as of which the loan is issued.
(10) Loans will be made only in multiples of $100.
(11) All loans must be repaid no less frequently than quarterly. The
Administrator's Representative may establish uniform and
nondiscriminatory rules governing the frequency and method of loan
payments.
G-1
<PAGE>
(12) All loans must be repaid in substantially level amounts including
principal and interest over the term of the loan.
(13) Loans may be prepaid in their entirety (and not otherwise) on any
regular payment date.
(14) No loan shall be made to a married Participant without the consent of
the Participant's spouse, unless the Plan is an exempt profit sharing
plan as defined in Section 7.3.4 of the Plan Statement. To be valid,
the spouse's consent must be in writing, must acknowledge the effect
of the loan and the use of the Account as security, must be witnessed
by a notary public and must be given within ninety (90) days of the
date the loan is made. Spousal consent shall never be required for a
loan to a Beneficiary.
(15) Loans will be in default upon the occurrence of one of the following
"events of default": (a) the death of the borrower, and (b) the
failure to make any payment when it is due.
(16) Upon an event of default, the following procedures shall be followed:
(a) The Administrator's Representative shall notify the borrower of
the event of default as soon as reasonably possible after it has
occurred.
(b) If, but only if, this is the borrower's first default for this
particular loan, the borrower shall have ten (10) days after
receipt of notice or twenty (20) days after notice is mailed,
whichever occurs first, to cure the default.
(c) If this is the second default for the loan, there shall be no
opportunity to cure.
(d) If the default is not or cannot be cured, the entire outstanding
principal and accrued interest shall be immediately due and
payable. If not paid within five (5) days after demand for
payment is made, the loan shall be in actual default.
(17) If the actual default of a loan occurs after an Event of Maturity has
occurred for the Participant, the trustee shall foreclose on the
promissory note and attach the security therefor. If an Event of
Maturity has not then occurred, the trustee shall foreclose on the
promissory note and attach the security therefor as soon as the first
Event of Maturity occurs for the Participant.
(18) While any loan is outstanding, no distribution shall be made from the
Participant's Account which would result in the remaining assets
(exclusive of a borrower's promissory notes) having a value less than
one hundred percent (100%) of the outstanding principal and accrued
but unpaid interest on all outstanding loans.
(19) Loans in default which have not been foreclosed shall continue to
accrue interest until paid or foreclosed.
(20) No loan shall be made to a borrower who has any loan in default.
(21) If required by applicable law, the Trustee shall file reports with the
taxing authorities regarding loans in default, treat such loans as
taxable distributions to the Participant or Beneficiary and withhold
tax payments from the Participant's Accounts.
G-2
<PAGE>
(22) If a loan is made from the individual Account of a Participant and the
Account is invested in more than one investment Subfund authorized and
established under Section 4.1 of the Plan Statement, the borrower may
specify the Subfunds from which the loan shall be taken, and the
amount from each. If the borrower does not specify, the amount
withdrawn to make the loan shall be charged to each investment Subfund
in accordance with the priority rules established by the
Administrator's Representative to be applied in a uniform and
nondiscriminatory manner.
G-3
<PAGE>
EXHIBIT 5.1
January 20, 1998
Western Bancorp
4100 Newport Place, Suite 900
Newport Beach, California 92660
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-8 (the "Registration
Statement") to be filed by you with the Securities and Exchange Commission in
connection with the registration of 31,189 shares of common stock, without par
value (the "Shares"), of Western Bancorp, a California corporation (the
"Company"), and of an indeterminate amount of interests (the "Plan Interests")
to be offered or sold pursuant to the terms of the Western Bancorp 401(K) Plan
(the "Plan"). As your counsel in connection with this transaction, we have
examined the proceedings proposed to be taken in connection with the Plan and
such other matters and documents as we have deemed necessary or relevant as a
basis for this opinion.
Based on these examinations, it is our opinion that upon filing of the
Registration Statement and the completion of the proceedings being taken or
which we, as your counsel, contemplate will be taken prior to the issuance of
the Plan Interests and the Shares, the Plan Interests and the Shares, when
issued in the manner referred to in the Registration Statement and the Plan,
will be duly authorized, validly issued, fully paid and nonnassessable.
For purposes of the foregoing opinion, we have assumed with your
approval and without independent verification that any Shares purchased
through open market purchases, were or will be duly authorized, validly
issued, fully paid and nonassessable when originally issued by the Company.
The foregoing opinion is limited to the Federal laws of the United States
and the laws of the State of California, and we are expressing no opinion as
to the effect of the laws of any other jurisdiction.
We have relied as to certain matters on information obtained from public
officials, officers of the Company and other sources believed by us to be
responsible.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving such consent, we do not thereby admit that we
are in the category of persons whose consent is required under Section 7 of the
Securities Act.
Very truly yours,
/s/ Irell & Manella LLP
---------------------------------------
Irell & Manella LLP
<PAGE>
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Western Bancorp:
We consent to the incorporation by reference in the registration statement on
Form S-8 of Western Bancorp related to its 401(K) Plan of:
(1) Our report dated February 24, 1997 on the consolidated financial
statements of Monarch Bancorp as of and for the year ended December 31, 1996
included in the 1996 annual report on Form 10-KSBA of Monarch Bancorp;
(2) Our report dated June 4, 1997, with respect to the supplemental
consolidated balance sheets of Western Bancorp as of December 31, 1996 and
1995 and the related supplemental consolidated statements of earnings,
shareholders' equity and cash flows for each of the years in the three-year
period ended December 31, 1996 which report appears in Western Bancorp's
Current Report on Form 8-K filed July 17, 1997. Our report, dated June 4,
1997, contains explanatory paragraphs indicating that: (i) We did not audit
the 1996 supplemental consolidated financial statements of California
Commercial Bankshares. Those statements were audited by other auditors whose
report has been furnished to us, and our opinion, insofar as it relates to the
amounts included for California Commercial Bankshares in the 1996
consolidated financial statements of Western Bancorp, is based on the report
of the other auditors; (ii) The consolidated balance sheet of Western Bancorp
(formerly Monarch Bancorp) as of December 31, 1995, and the related
consolidated statements of operations, changes in shareholders' equity and
cash flows for each of the years in the two-year period ended December 31,
1995 were audited by other auditors; (iii) Separate consolidated financial
statements of California Commercial Bankshares also included in the 1995 and
1994 supplemental consolidated financial statements were audited by other
auditors; and (iv) We also audited the combination of the consolidated
balance sheets as of December 31, 1995, and the combination of the related
statements of operations, changes in shareholders' equity and cash flows for
each of the years in the two-year period ended December 31, 1995, after
restatement for the pooling-of-interests; and
(3) Our report, dated October 10, 1997, with respect to the supplemental
consolidated balance sheets of Western Bancorp as of December 31, 1996 and
1995 and the related consolidated statements of earnings, shareholders'
equity and cash flows for each of the years in the three-year period ended
December 31, 1996 which report appears in Western Bancorp's Current Report on
Form 8-K filed October 24, 1997. Our report, dated October 10, 1997, contains
explanatory paragraphs indicating that: (i) We did not audit the 1996
consolidated financial statements of California Commercial Bankshares. Those
statements were audited by other auditors whose report has been furnished to
us, and our opinion, insofar as it relates to the amounts included for
California Commercial Bankshares in the 1996 supplemental consolidated
financial statements of Western Bancorp, is based on the report of the other
auditors; (ii) We did not audit the 1996 consolidated financial statements
<PAGE>
statements of SC Bancorp. Those statements were audited by other auditors
whose report has been furnished to us, and our opinion, insofar as it relates
to the amounts included for SC Bancorp in the 1996 supplemental consolidated
financial statements of Western Bancorp, is based on the report of the other
auditors; (iii) The consolidated balance sheet of Western Bancorp as of
December 31, 1995, and the related consolidated statements of operations,
changes in shareholders' equity and cash flows for each of the years in the
two-year period ended December 31, 1995 were audited by other auditors; (iv)
Separate consolidated financial statements of California Commercial
Bankshares also included in the 1995 and 1994 supplemental consolidated
financial statements were audited by other auditors; (v) Separate
consolidated financial statements of SC Bancorp also included in the 1995 and
1994 supplemental consolidated financial statements were audited by other
auditors; (vi) The supplemental consolidated financial statements give
retroactive effect to the acquisition of SC Bancorp on October 10, 1997,
which has been accounted for as a pooling-of-interests. Generally accepted
accounting principles proscribe giving effect to a consummated business
combination accounted for by the pooling-of-interests method in financial
statements that do not include the date of consummation. The supplemental
consolidated financial statements do not extend through the date of
consummation. However, they will become the historical consolidated financial
statements of Western Bancorp and subsidiaries after financial statements
covering the date of consummation of the business combination with SC Bancorp
are issued; and (vii) We also audited the combination of the consolidated
balance sheet as of December 31, 1995 and the combination of the related
statements of operations, changes in shareholders' equity and cash flows for
each of the years in the two-year period ended December 31, 1995, after
restatement for the pooling-of-interests.
/s/ KPMG Peat Marwick LLP
Los Angeles, California
January 20, 1998
<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement
of Western Bancorp (formerly Monarch Bancorp) on Form S-8 of our report dated
January 24, 1997 (March 17, 1997 as to Notes 7 and 13) on the consolidated
statements of financial condition of California Commercial Bankshares and
subsidiaries as of December 31, 1996 and 1995, and the related consolidated
statements of operations, changes in stockholders' equity, and cash flows for
each of the three years in the period ended December 31, 1996, appearing in
the Current Report on Form 8-K of Western Bancorp dated July 15, 1997 (such
consolidated financial statements are not included herein), and also
appearing in the annual report as amended on Form 10-K/A, of California
Commercial Bankshares, for the year ended December 31, 1996.
/s/ Deloitte & Touche LLP
Los Angeles, California
January 20, 1998
1
<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement
of Western Bancorp (formerly Monarch Bancorp) on Form S-8 of our report dated
January 24, 1997 on the consolidated statements of financial condition of SC
Bancorp and subsidiary as of December 31, 1996 and 1995, and the related
consolidated statements of operations, changes in stockholders' equity, and
cash flows for each of the three years in the period ended December 31, 1996,
appearing in the Current Report on Form 8-K of Western Bancorp dated October
24, 1997 (such consolidated financial statements are not included herein),
and also appearing in the annual report as amended on Form 10-K/A, of
SC Bancorp, for the year ended December 31, 1996.
/s/ Deloitte & Touche LLP
Los Angeles, California
January 20, 1998
2
<PAGE>
[LETTERHEAD]
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent, as successor accountants of Dayton & Associates (said firm
being merged with and into Vavrinek, Trine, Day & Co. on September 1, 1996)
to the incorporation by reference of their Independent Auditor's Report dated
February 29, 1996 regarding the consolidated balance sheets of Monarch
Bancorp and Subsidiaries as of December 31, 1995 and December 31, 1994, and
the related statements of operations, changes in capital, and cash flows for
each of the two years in the period ended December 31, 1995, in the
registration statement on Form S-8 of Western Bancorp related to its 401(k)
Plan filed with the Securities and Exchange Commission.
/s/ Vavrinek, Trine, Day & Co.
January 20, 1998
Laguna Hills, California
