EXHIBIT 4.11
JANUARY 24, 2000
CLEAR CHANNEL COMMUNICATIONS, INC.
401(k) SAVINGS PLAN
Amended and Restated
Effective July 1, 1999
<PAGE>
i
CLEAR CHANNEL COMMUNICATIONS, INC.
401(k) SAVINGS PLAN
TABLE OF CONTENTS
PAGE
PREFACE .....................................................................i
ARTICLE 1 - DEFINITIONS
1.01 Accounts....................................................1
1.02 Actual Deferral Percentage..................................1
1.03 Affiliated Employer.........................................2
1.04 Annual Dollar Limit.........................................2
1.05 Beneficiary.................................................2
1.06 Board of Directors..........................................3
1.07 Break in Service............................................3
1.08 Code........................................................3
1.09 Committee...................................................3
1.10 Compensation................................................3
1.11 Contribution Percentage.....................................4
1.12 Deferral Account............................................4
1.13 Deferral Contributions......................................4
1.14 Disability..................................................5
1.15 Earnings....................................................5
1.16 Effective Date..............................................5
1.17 Employee....................................................5
1.18 Employer....................................................6
1.19 Employer Matching Account...................................7
1.20 Employer Matching Contribution..............................7
1.21 Enrollment Date.............................................7
1.22 ERISA.......................................................7
1.23 Highly-Compensated Employee.................................7
1.24 Hour of Service.............................................8
1.25 Investment Fund............................................10
1.26 Leased Employee............................................10
1.27 Member.....................................................10
1.28 Nonhighly-Compensated Employee.............................10
1.29 Notice.....................................................11
1.30 Parental Leave.............................................11
1.31 Plan.......................................................11
1.32 Plan Year..................................................11
1.33 Rollover Account...........................................11
1.34 Rollover Contributions.....................................11
1.35 Spousal Consent............................................11
1.36 Statutory Compensation.....................................12
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC.
401(k) SAVINGS PLAN
TABLE OF CONTENTS
PAGE
ARTICLE 1 - DEFINITIONS
1.37 Trust Fund.................................................12
1.38 Trustees...................................................13
1.39 Valuation Date.............................................13
1.40 Vested Portion.............................................13
1.41 Vesting Service............................................13
1.42 Year of Eligibility Service................................14
ARTICLE 2 - ELIGIBILITY AND MEMBERSHIP
2.01 Membership.................................................15
2.02 Rehired Member.............................................15
2.03 Transferred Members........................................16
2.04 Termination of Membership..................................16
2.05 Special Provisions for Jacor Communications, Inc...........17
ARTICLE 3 - CONTRIBUTIONS
3.01 Deferral Contributions.....................................18
3.02 Employer Matching Contributions............................21
3.03 Rollover Contributions.....................................22
3.04 Change in Contributions....................................22
3.05 Suspension of Contributions................................22
3.06 Actual Deferral Percentage Test............................23
3.07 Contribution Percentage Test...............................25
3.08 Aggregate Contribution Limitation..........................28
3.09 Additional Discrimination Testing Provisions...............28
3.10 Maximum Annual Additions...................................30
3.11 Return of Contributions....................................33
3.12 Contributions Not Contingent Upon Profits..................34
3.13 Contributions During Period of Military Leave..............35
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC.
401(k) SAVINGS PLAN
TABLE OF CONTENTS
PAGE
ARTICLE 4 - INVESTMENT OF CONTRIBUTIONS
4.01 Investment Funds...........................................37
4.02 Investment of Members' Accounts............................37
4.03 Responsibility for Investments.............................38
4.04 Change of Election.........................................38
4.05 Reallocation of Accounts Among the Funds...................38
4.06 Limitations Imposed by Contract............................38
4.07 ERISA Section 404(c) Compliance............................39
ARTICLE 5 - VALUATION OF UNITS AND CREDITS TO ACCOUNTS
5.01 Units of Participation.....................................40
5.02 Valuation of Units.........................................40
5.03 Crediting the Accounts.....................................40
5.04 Annual Statements..........................................41
ARTICLE 6 - VESTED PORTION OF ACCOUNTS
6.01 Deferral Account and Rollover Account......................42
6.02 Employer Matching Account..................................42
6.03 Disposition of Forfeitures.................................43
ARTICLE 7 - WITHDRAWALS WHILE STILL EMPLOYED
7.01 Withdrawal of Rollover Contributions.......................45
7.02 Withdrawal After Age 59 1/2................................45
7.03 Hardship Withdrawal........................................45
7.04 Procedures and Restrictions................................48
ARTICLE 8 - LOANS TO MEMBERS
8.01 Amount Available...........................................49
8.02 Terms......................................................50
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC.
401(k) SAVINGS PLAN
TABLE OF CONTENTS
PAGE
ARTICLE 9 - DISTRIBUTION OF ACCOUNTS UPON TERMINATION OF EMPLOYMENT
9.01 Eligibility................................................53
9.02 Forms of Distribution......................................53
9.03 Commencement of Payments...................................54
9.04 Age 70 1/2Required Distribution............................54
9.05 Small Benefits.............................................56
9.06 Status of Accounts Pending Distribution....................56
9.07 Proof of Death and Right of Beneficiary or Other Person....57
9.08 Distribution Limitation....................................57
9.09 Direct Rollover of Certain Distributions...................57
9.10 Waiver of Notice Period....................................58
ARTICLE 10 - ADMINISTRATION OF THE PLAN
10.01 Appointment of Committee...................................60
10.02 Duties of Committee........................................60
10.03 Individual Accounts........................................61
10.04 Meetings...................................................61
10.05 Action of Majority.........................................62
10.06 Compensation and Bonding...................................62
10.07 Establishment of Rules.....................................62
10.08 Prudent Conduct............................................62
10.09 Service in More Than One Fiduciary Capacity................63
10.10 Limitation of Liability....................................63
10.11 Indemnification............................................63
10.12 Appointment of Investment Manager..........................64
10.13 Named Fiduciary............................................64
10.14 Expenses of Administration.................................64
10.15 Claims and Review Procedures...............................65
ARTICLE 11 - MANAGEMENT OF FUNDS
11.01 Trust Agreement............................................66
11.02 Exclusive Benefit Rule.....................................66
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC.
401(k) SAVINGS PLAN
TABLE OF CONTENTS
PAGE
ARTICLE 12 - AMENDMENT, MERGER AND TERMINATION
12.01 Amendment of Plan..........................................67
12.02 Merger, Consolidation or Transfer..........................68
12.03 Additional Participating Employers.........................68
12.04 Termination of Plan........................................69
12.05 Distribution of Accounts Upon a Sale of Assets or a
Sale of a Subsidiary.......................................70
ARTICLE 13 - GENERAL PROVISIONS
13.01 Nonalienation..............................................71
13.02 Conditions of Employment Not Affected by Plan..............72
13.03 Facility of Payment........................................72
13.04 Erroneous Allocation.......................................73
13.05 Information................................................74
13.06 Top-Heavy Provisions.......................................74
13.07 Prevention of Escheat......................................77
13.08 Member Notices.............................................78
13.09 Construction...............................................78
APPENDIX A
<PAGE>
PREFACE
The Clear Channel Communications, Inc. 401(k) Plan was initially adopted
effective as of January 1, 1987.
This amendment and restatement is to be effective as of July 1, 1999 for the
benefit of the designated employees of the entities described herein and it is
intended to comply with all statutory and regulatory requirements effective on
or before July 1, 1999.
<PAGE>
CLEAR CHANNEL COMMUNICATIONS, INC.
401(k) SAVINGS PLAN
ARTICLE 1
DEFINITIONS
1.01 "Accounts" means the Employer Matching Account, the Deferral Account and
the Rollover Account.
1.02 "Actual Deferral Percentage" means, with respect to a specified group of
Employees, the average of the ratios, calculated separately for each
Employee in that group, of (a) the amount of Deferral Contributions made
pursuant to Section 3.01 for a Plan Year (including Deferral Contributions
returned to a Highly-Compensated Employee under Section 3.01(c) and
Deferral Contributions returned to any Employee pursuant to Section
3.01(d)), to (b) the Employee's Statutory Compensation for that entire Plan
Year, provided that, upon the direction of the Committee, Statutory
Compensation for a Plan Year shall only be counted if received during the
period an Employee is, or is eligible to become, a Member. The Actual
Deferral Percentage for each group and the ratio determined for each
Employee in the group shall be calculated to the nearest one one-hundredth
of 1%. For purposes of determining the Actual Deferral Percentage for a
Plan Year, Deferral Contributions may be taken into account for a Plan Year
only if they:
(a) relate to compensation that either would have been received by the
Employee in the Plan Year but for the deferral election, or are
attributable to services performed by the Employee in the Plan Year and
would have been received by the Employee within 2 1/2 months after the
close of the Plan Year but for the deferral election,
(b) are allocated to the Employee as of a date within that Plan Year and
the allocation is not contingent on the participation or performance of
service after such date, and
(c) are actually paid to the Trustees no later than 12 months after the end
of the Plan Year to which the contributions relate.
1.03 "Affiliated Employer" means any company which is a member of a controlled
group of corporations (as defined in Section 414(b) of the Code) which also
includes as a member the Employer; any trade or business under common
control (as defined in Section 414(c) of the Code) with the Employer; any
organization (whether or not incorporated) which is a member of an
affiliated service group (as defined in Section 414(m) of the Code) which
includes the Employer; and any other entity required to be aggregated with
the Employer pursuant to regulations under Section 414(o) of the Code.
Notwithstanding the foregoing, for purposes of Sections 1.26 and 3.10, the
definitions in Sections 414(b) and (c) of the Code shall be modified by
substituting the phrase "more than 50%" for the phrase "at least 80%" each
place it appears in Section 1563(a)(1) of the Code.
1.04 "Annual Dollar Limit" means $150,000, as adjusted from time to time for
cost of living in accordance with Section 401(a) (17)(B) of the Code.
1.05 "Beneficiary" means any person, persons or entity designated by a Member to
receive any benefits payable in the event of the Member's death. However, a
married Member's spouse shall be the Member's Beneficiary unless or until
he or she elects another Beneficiary with Spousal Consent. If no
Beneficiary designation is in effect at the Member's death, or if no
person, persons or entity so designated survives the Member, the Member's
surviving spouse, if any, shall be deemed to be the Beneficiary; otherwise
the Beneficiary shall be the personal representative of the estate of the
Member.
<PAGE>
1.06 "Board of Directors" means the Board of Directors of Clear Channel
Communications, Inc.
1.07 "Break in Service" means an event affecting forfeitures, which shall occur
for any Plan Year after the Plan Year in which an employee first becomes
employed by the Employer or an Affiliated Employer during which he or she
does not complete more than 500 Hours of Service. A Break in Service shall
not occur during an approved leave of absence or during a period of
military service which is included in the Employee's Vesting Service
pursuant to Section 1.41.
1.08 "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
1.09 "Committee" means the persons named by the Board of Directors (or its
delegate) to administer and supervise the Plan as provided in Article 10.
1.10 "Compensation" means the total cash remuneration paid to an Employee for
services rendered to the Employer, determined prior to any reduction
pursuant to Section 3.01 or pursuant to a cafeteria plan under Section 125
of the Code. Notwithstanding the foregoing, Compensation shall exclude
severance payments, vacation pay and commissions paid after the termination
of service, amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by an Employee either
becomes freely transferable or is no longer subject to a substantial risk
of forfeiture; amounts realized from the sale, exchange or other
disposition of stock acquired under a stock option described in Part II,
Subchapter D, Chapter I of the Code; or other amounts which receive special
tax benefits, such as premiums for group term life insurance or fringe
benefits excludable from income under Section 132 of the Code. The Annual
Dollar Limit shall apply to Compensation earned after the date an Employee
becomes a Member under Section 2.02.
For Plan Years beginning after December 31, 1996, the Annual Dollar Limit
requirement to aggregate Compensation paid to a Highly-Compensated
Employee, his or her spouse and lineal descendants who have not attained
age 19 before the end of the Plan Year, no longer applies.
1.11 "Contribution Percentage" means, with respect to a specified group of
Employees, the average of the ratios, calculated separately for each
Employee in that group, of (a) the amount of the Employee's Employer
Matching Contributions for that Plan Year (excluding any Employer Matching
Contributions forfeited under the provisions of Sections 3.01 and 3.05), to
(b) his or her Statutory Compensation for that entire Plan Year; provided
that, upon the direction of the Committee, Statutory Compensation for a
Plan Year shall only be counted if received during the period an Employee
is, or is eligible to become, a Member. The Contribution Percentage for
each group and the ratio determined for each Employee in the group shall be
calculated to the nearest one one-hundredth of 1%.
1.12 "Deferral Account" means the account credited with the Deferral
Contributions made on a Member's behalf and earnings on those
contributions.
1.13 "Deferral Contributions" means amounts contributed pursuant to Section
3.01.
<PAGE>
1.14 "Disability" means total and permanent physical or mental disability, as
evidenced by (a) receipt of a Social Security disability pension, (b)
receipt of disability payments under the Employer's long-term disability
program, or (c) certification by a physician or physicians chosen by the
Member and satisfactory to the Committee.
1.15 "Earnings" means the amount of earnings to be returned with any excess
deferrals, excess contributions or excess aggregate contributions under
Section 3.01, 3.06, 3.07 or 3.08 for a Plan Year, determined as of the last
day of such Plan Year under the Plan's method of allocating income to
Members' Accounts pursuant to Article 5.
1.16 "Effective Date" means July 1, 1999. The original effective date of the
Plan is January 1, 1987.
1.17 "Employee" means:
(a) an employee of the Employer who:
(1) receives stated compensation other than a pension, severance pay,
retainer, or fee under contract; and
(2) is paid through the Employer's payroll and such pay is reported to
the Internal Revenue Service on Form W-2 and not on Internal Revenue
Service Form 1099; and
(3) is not specifically excluded as described in the following
paragraph (b).
(b) The term "Employee" specifically excludes the following classes of
individuals and such individuals are ineligible to participate in the
Plan, regardless of any other Plan terms to the contrary, and
regardless of whether the individual is determined to be a "common law
employee" of the Employer by the Internal Revenue Service, Department
of Labor, court or other tribunal of competent jurisdiction or other
government agency:
(1) any Leased Employee;
(2) any individual who has signed an employment agreement,
independent contractor agreement, or other personal services
contract with the Employer stating that he or she is not eligible
to participate in the Plan;
(3) any individual the Employer treats as an independent contractor,
during the period that the individual is so treated. An
individual is treated as an independent contractor if payment for
his or her services is reported to the Internal Revenue Service
on Form 1099, and not on an Internal Revenue Service Form W-2; or
(4) any individual who is included in a unit of employees covered by
a collective bargaining agreement other than those employees
listed in Appendix A, which Appendix may be modified from time to
time.
(c) The term "employee" as used in this Plan means any individual who is
employed by the Employer or an Affiliated Employer and is paid through
the Employer or Affiliated Employer's payroll and such pay is reported
to the Internal Revenue Service on Form W-2 and not on Internal
Revenue Service Form 1099, regardless of whether the individual is an
"Employee," and any Leased Employee.
1.18 "Employer" means Clear Channel Communications, Inc. or any successor by
merger, purchase or otherwise, with respect to its employees, any other
company participating in the Plan as provided in Section 12.03, with
respect to its employees, including specifically as of the Effective Date,
all its subsidiaries, with respect to their employees, except for Universal
Outdoor, Inc. prior to January 1, 2000. Any other entity which becomes an
Affiliated Employer may commence participation in the Plan as provided in
Section 12.03.
1.19 "Employer Matching Account" means the account credited with Employer
Matching Contributions and earnings on those contributions.
1.20 "Employer Matching Contributions" means amounts contributed pursuant to
Section 3.02.
1.21 "Enrollment Date" means the Effective Date and any January 1, April 1, July
1 and October 1 following that date.
1.22 "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
1.23 "Highly-Compensated Employee" means for a Plan Year commencing on or after
January 1, 1997, any employee of the Employer or an Affiliated Employer
(whether or not eligible for membership in the Plan) who
(a) was a 5% owner (as defined in Section 416(i) of the Code) for such
Plan Year or the prior Plan Year, or
(b) for the preceding Plan Year received Statutory Compensation in
excess of $80,000, and was among the highest 20% of employees for the
preceding Plan Year when ranked by Statutory Compensation paid for
that year excluding, for purposes of determining the number of such
employees, such employees as the Committee may determine on a
consistent basis pursuant to Section 414(q) of the Code. The $80,000
dollar amount in the preceding sentence shall be adjusted from time to
time for cost of living in accordance with Section 414(q) of the Code.
Notwithstanding the foregoing, employees who are nonresident aliens
and who receive no earned income from the Employer or an Affiliated
Employer which constitutes income from sources within the United
States shall be disregarded for all purposes of this Section.
The Employer's top-paid group election as described above, shall be
used consistently in determining Highly-Compensated Employees for
determination years of all employee benefit plans of the Employer and
Affiliated Employers for which Section 414(q) of the Code applies
(other than a multiemployer plan) that begin with or within the same
calendar year, until such election is changed by Plan amendment in
accordance with IRS requirements. Notwithstanding the foregoing, the
consistency provision in the preceding sentence shall not apply for
the Plan Year beginning in 1997, and for Plan Years beginning in 1998
and 1999, shall apply only with respect to all qualified retirement
plans (other than a multiemployer plan) of the Employer and Affiliated
Employers.
The provisions of this Section shall be further subject to such
additional requirements as shall be described in Section 414(q) of the
Code and its applicable regulations, which shall override any aspects
of this Section inconsistent therewith.
1.24 "Hour of Service" means, with respect to any applicable computation period,
(a) each hour for which the employee is paid or entitled to payment
for the performance of duties for the Employer or an Affiliated
Employer,
(b) each hour for which an employee is paid or entitled to payment by
the Employer or an Affiliated Employer on account of a period during
which no duties are performed, whether or not the employment
relationship has terminated, due to vacation, holiday, illness,
incapacity (including disability), layoff, jury duty, military duty or
leave of absence, but not more than 501 hours for any single
continuous period, (c) each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to by the Employer
or an Affiliated Employer, excluding any hour credited under (a) or
(b), which shall be credited to the computation period or periods to
which the award, agreement or payment pertains, rather than to the
computation period in which the award, agreement or payment is made,
(d) solely for purposes of determining whether an employee has
incurred a Break in Service under the Plan, each hour for which an
employee would normally be credited under paragraph (a) or (b) above
during a period of Parental Leave but not more than 501 hours for any
single continuous period. However, the number of hours credited to an
employee under this paragraph (d) during the computation period in
which the Parental Leave began, when added to the hours credited to an
employee under paragraphs (a) through (c) above during that
computation period, shall not exceed 501. If the number of hours
credited under this paragraph (d) for the computation period in which
the Parental Leave began is zero, the provisions of this paragraph (d)
shall apply as though the Parental Leave began in the immediately
following computation period, and (e) solely for purposes of
determining whether an employee has incurred a Break in Service under
the Plan, each hour for which an employee would normally be credited
under paragraph (a) or (b) above during a period of leave for the
birth, adoption or placement of a child, to care for a spouse or other
immediate family member with a serious illness or for the employee's
own illness pursuant to the Family and Medical Leave Act of 1993 and
its regulations.
<PAGE>
No hours shall be credited on account of any period during which the
Employee performs no duties and receives payment solely for the purpose
of complying with unemployment compensation, workers' compensation or
disability insurance laws. The Hours of Service credited shall be
determined as required by Title 29 of the Code of Federal Regulations,
Section 2530.200b-2(b) and (c) and may be based on the monthly
equivalency set forth in Section 2530.200b-3 as determined by the
Committee in a reasonable and consistent manner.
1.25 "Investment Fund" means the separate funds in which contributions to the
Plan are invested in accordance with Article 4.
1.26 "Leased Employee" means any person performing services for the Employer or
an Affiliated Employer as a leased employee as defined in Section 414(n) of
the Code. In the case of any person who is a Leased Employee before or
after a period of service as an Employee, the entire period during which he
or she has performed services as a Leased Employee shall be counted as
service as an Employee for all purposes of the Plan, except that he or she
shall not, by reason of that status, become a Member of the Plan.
1.27 "Member" means any person included in the membership of the Plan as
provided in Article 2.
1.28 "Nonhighly-Compensated Employee" means for any Plan Year an employee of the
Employer or an Affiliated Employer who is not a Highly- Compensated
Employee for that Plan Year.
<PAGE>
1.29 "Notice" means the indication by the Employee of his or her wishes through
the means written, electronic or telephonic, provided for the particular
purpose by the Committee.
1.30 "Parental Leave" means a period in which the Employee is absent from work
immediately following his or her active employment because of the
Employee's pregnancy, the birth of the Employee's child, the placement of a
child with the Employee in connection with the adoption of that child by
the Employee, or for purposes of caring for that child for a period
beginning immediately following birth or placement.
1.31 "Plan" means the Clear Channel Communications, Inc. 401(k) Savings Plan as
set forth in this document or as amended from time to time.
1.32 "Plan Year" means the 12-month period beginning on any January 1.
1.33 "Rollover Account" means the account credited with the units attributable
to the Rollover Contributions made by a Member.
1.34 "Rollover Contributions" means amounts contributed pursuant to Section
3.04.
1.35 "Spousal Consent" means the written consent of a Member's spouse to the
Member's designation of a specified Beneficiary. The spouse's consent shall
be witnessed by a Plan representative or notary public. The consent of the
spouse shall also acknowledge the effect on him or her of the Member's
election. The requirement for spousal consent may be waived by the
Committee if it believes there is no spouse, or the spouse cannot be
located, or because of such other circumstances as may be established by
applicable law.
1.36 "Statutory Compensation" means the wages, salaries, and other amounts paid
in respect of an employee for services actually rendered to an Employer or
an Affiliated Employer, including by way of example, overtime, bonuses and
commissions, but excluding deferred compensation, stock options and other
distributions which receive special tax benefits under the Code. For
purposes of determining Highly-Compensated Employees under Section 1.23 and
key employees under Section 13.05(a)(iii), Statutory Compensation shall
include amounts contributed by the Employer pursuant to a salary reduction
agreement which are not includible in the gross income of the employee
under Sections 125, 402(e)(3), 402(h) or 403(b) of the Code. For all other
purposes, Statutory Compensation shall also include the amounts referred to
in the preceding sentence, unless the Committee directs otherwise for a
particular Plan Year. Statutory Compensation for a Plan Year shall not
exceed the Annual Dollar Limit, provided that such Annual Dollar Limit
shall not be applied in determining Highly-Compensated Employees under
Section 1.23.
For Plan Years after December 31, 1996, the Annual Dollar Limit requirement
to aggregate Statutory Compensation paid to a Highly-Compensated Employee,
his or her spouse and lineal descendants who have not attained age 19
before the close of the Plan Year, no longer applies.
1.37 "Trust Fund" means the fund established by the Board of Directors as part
of the Plan into which contributions are to be made and from which benefits
are to be paid in accordance with the terms of the Plan.
<PAGE>
1.38 "Trustees" means the trustees holding the funds of the Plan as provided in
Article 11.
1.39 "Valuation Date" means each trading day of the New York Stock Exchange.
1.40 "Vested Portion" means the portion of the Accounts in which the Member has
a nonforfeitable interest as provided in Article 6, or if applicable,
Section 13.06.
1.41 "Vesting Service" means, with respect to any employee, his or her years of
employment with the Employer or any Affiliated Employer, whether or not as
an Employee, beginning on the date he or she first completes an Hour of
Service, provided that:
(a) a Plan Year in which an employee completes at least 1,000 Hours of
Service counts as a full year of Vesting Service;
(b) if he or she is absent from the service of the Employer or any
Affiliated Employer because of service in the Armed Forces of the United
States and he or she returns to service with the Employer or an Affiliated
Employer having applied to return while his or her reemployment rights were
protected by law, the absence shall be included in his or her Vesting
Service;
(c) if he or she is on a leave of absence approved by the Employer, under
rules uniformly applicable to all Employees similarly situated, the
Employer may authorize the inclusion in his or her Vesting Service of any
portion of that period of leave which is not included in his or her Vesting
Service under (a) or (b) above; and
(d) if he or she incurs a Break in Service (whether prior to or after
termination of employment), his or her Vesting Service after the Break in
Service and after reemployment in the case he or she terminated employment
shall be aggregated with his or her previous period or periods of Vesting
Service if (i) he or she had made Deferral Contributions to the Plan prior
to the Break in Service or he or she was vested in any portion of his or
her Employer Matching Account, or (ii) the number of consecutive one-year
Breaks in Service does not equal or exceed the greater of five years or his
or her total number of years of Vesting Service before his or her Break in
Service, excluding any years of Vesting Service disregarded by reason of
any earlier Break in Service.
For purposes of this Section, an employee's period of employment shall only
include employment from the time an entity becomes an Affiliated Employer,
except as provided in Section 12.03.
1.42 "Year of Eligibility Service" means, with respect to any employee, a
12-month period of employment with the Employer or any Affiliated Employer,
whether or not as an Employee, beginning on the date he or she first
completes an Hour of Service. If an employee's employment is terminated
before completing one Year of Eligibility Service and he or she is later
reemployed, his or her Eligibility Service after reemployment shall be
aggregated with his or her previous period or periods of Eligibility
Service.
<PAGE>
ARTICLE 2
ELIGIBILITY AND MEMBERSHIP
2.01 Membership
Every Employee shall become a Member as of the first Enrollment Date
following the date he or she completes one Year of Eligibility Service and
is age 21, provided he or she is then an Employee.
Notwithstanding the foregoing, an Employee shall become a Member of the
Plan as of the first Enrollment Date which is no earlier than 60 days
following the events described below, without having to complete one Year
of Eligibility Service, provided he or she is then an Employee:
(a) the acquisition of an entity which becomes an Affiliated Employer and
commences participation in the Plan on behalf of its employees
pursuant to Section 12.03;
(b) the acquisition of the Employee's former employer's operating assets;
or
(c) the designation of the Employee as an LMA Employee. For any particular
event, in a uniform manner for all employees affected by such event,
the Committee may permit any such Employee to become a Member at an
Enrollment Date.
2.02 Rehired Member
Any rehired Employee who at the time of his or her termination of
employment was a Member of this Plan will again become a Member as soon as
practicable after such Employee's reemployment date.
Such rehired Employee shall once again become a Member hereunder and shall
be eligible to have Deferral Contributions made on his or her behalf
pursuant to the provisions of Section 3.01 as soon as administratively
practicable following his or her reenrollment date.
2.03 Transferred Members
(a) Notwithstanding any provision of the Plan to the contrary, a Member
who remains in the employ of the Employer or an Affiliated Employer
but ceases to be an Employee shall continue to be a Member of the Plan
but shall not be eligible to receive allocations of Deferral
Contributions or Employer Matching Contributions, while his or her
employment status is other than as an Employee. In the event he or she
becomes an Employee again, he or she will be eligible to make Deferral
Contributions as provided in paragraph (b)(ii) below).
(b) An individual who transfers from the status of an employee ineligible
for Plan membership to an Employee eligible for membership shall
become a Member on the later of (i) on the first Enrollment Date
following the month in which he or she completes the requirements set
forth in Section 2.01, or (ii) as soon as practicable after the date
such individual becomes an Employee.
2.04 Termination of Membership
A Member's membership shall terminate on the date he or she is no longer
employed by the Employer or any Affiliated Employer unless the Member is
entitled to benefits under the Plan, in which event his or her membership
shall terminate when those benefits are distributed to him or her.
<PAGE>
2.05 Special Provisions for Jacor Communications, Inc.
Any employee of Jacor Communications, Inc. and its subsidiaries ("Jacor")
who would have been eligible to participate in Jacor's Code Section 401(k)
plan as of July 1, 1999 will be eligible to become a Member of this Plan as
of July 1, 1999.
<PAGE>
ARTICLE 3
CONTRIBUTIONS
3.01 Deferral Contributions
(a)(i) Effective as of a Member's Enrollment Date or reenrollment date as
defined in Article 2, the Member shall have his or her Compensation
reduced by 2% and that amount shall be contributed on his or her
behalf to the Plan by the Employer as Deferral Contributions until and
unless the Member elects, in accordance with the procedures and within
such time periods as the Committee shall prescribe, to receive such
Compensation directly from the Employer in cash. Such reduction in
Compensation shall commence as soon as administratively practicable
following (A) the Member's Enrollment Date or (B) the Member's
reenrollment date, as defined in Article 2, and shall be applied to
Compensation which could have been subsequently received by the
Member. Such Member may elect, subject to the provisions of paragraphs
(b) through (d) below, to increase the reduction of his or her
subsequent Compensation, in increments of 1%, up to a total of 15% and
have that amount contributed on his or her behalf to the Plan by the
Employer as Deferral Contributions. Such election shall be effective
with the first payroll period on or after the date as of which the
election is to apply or as soon as administratively practicable
thereafter.
Alternatively, a Member who elects to receive the 2% of Compensation
described in the above paragraph directly from the Employer in cash,
may elect at a later date, subject to the provisions of paragraphs (b)
and (d) below, to have his or her subsequent Compensation reduced by
at least 1%, but no more than 15%, in increments of 1%, and have that
amount contributed to the Plan by the Employer. Such election shall be
effective with the first payroll period on or after the date as of
which the election is to apply or as soon as administratively
practicable thereafter.
(ii) Except as otherwise provided in Section 2.03, each other Member,
may elect, subject to the provisions of paragraphs (b) through (d)
below, to have his or her subsequent Compensation reduced by at least
1%, but no more than 15%, in increments of 1%, and have that amount
contributed to the Plan by the Employer. Such election shall be
effective with the first payroll period on or after the date as of
which the election is to apply or as soon as administratively
practicable thereafter.
(iii) Any Deferral Contributions shall be paid to the Trustees as soon
as practicable, but in no event later than the 15th business day of
the month following the month in which the amounts would otherwise
have been payable to the Member in cash.
(b) In no event shall the Member's Deferral Contributions and similar
contributions made on his or her behalf by the Employer or an
Affiliated Employer to all plans, contracts or arrangements subject to
the provisions of Section 401(a)(30) of the Code in any calendar year
exceed $7,000, as adjusted from time to time for cost of living
pursuant to Section 402(g)(5) of the Code. If a Member's Deferral
Contributions in a calendar year reach that dollar limitation, his or
her election of Deferral Contributions for the remainder of the
calendar year will be canceled. As of the first pay period of the
calendar year following such cancellation, the Member's election of
Deferral Contributions shall again become effective in accordance with
his or her previous election, unless the Member elects otherwise in
accordance with Section 3.04.
(c) In the event that the sum of the Deferral Contributions and similar
contributions to any other qualified defined contribution plan
maintained by the Employer or an Affiliated Employer exceeds the
dollar limitation in Section 3.01(b) for any calendar year, the Member
shall be deemed to have elected a return of Deferral Contributions in
excess of such limit ("excess deferrals") from this Plan. The excess
deferrals, together with Earnings, shall be returned to the Member no
later than the April 15 following the end of the calendar year in
which the excess deferrals were made. The amount of excess deferrals
to be returned for any calendar year shall be reduced by any Deferral
Contributions previously returned to the Member under Section 3.06 for
that calendar year. In the event any Deferral Contributions returned
under this paragraph (c) were matched by Employer Matching
Contributions under Section 3.02, those Employer Matching
Contributions, together with Earnings, shall be forfeited and used to
reduce Employer contributions.
(d) If a Member makes tax-deferred contributions under another qualified
defined contribution plan maintained by an employer other than the
Employer or an Affiliated Employer for any calendar year and those
contributions when added to his or her Deferral Contributions exceed
the dollar limitation under Section 3.01(b) for that calendar year,
the Member may allocate all or a portion of such excess deferrals to
this Plan. In that event, such excess deferrals, together with
Earnings, shall be returned to the Member no later than the April 15
following the end of the calendar year in which such excess deferrals
were made. However, the Plan shall not be required to return excess
deferrals unless the Member notifies the Committee, in writing, by
March 1 of that following calendar year of the amount of the excess
deferrals allocated to this Plan. The amount of any such excess
deferrals to be returned for any calendar year shall be reduced by any
Deferral Contributions previously returned to the Member under Section
3.06 for that calendar year. In the event any Deferral Contributions
returned under this paragraph (d) were matched by Employer Matching
Contributions under Section 3.02, those Employer Matching
Contributions, together with Earnings, shall be forfeited and used to
reduce Employer contributions.
3.02 Employer Matching Contributions
The Employer may contribute from time to time on behalf of each of its
Members who elects to make Deferral Contributions an amount equal to a
designated percent of the first 5% of the Deferral Contributions made on
behalf of the Member to the Plan during each payroll period. In no event,
however, shall the Employer Matching Contributions pursuant to this Section
exceed 5% of the Member's Compensation while a Member with respect to a
particular Plan Year. The Employer Matching Contributions are made
expressly conditional on the Plan satisfying the provisions of Sections
3.01, 3.06, 3.07 and 3.08. If any portion of the Deferred Cash Contribution
to which the Employer Matching Contribution relates is returned to the
Member under Section 3.01, 3.06, 3.07 or 3.08, the corresponding Employer
Matching Contribution shall be forfeited and if any amount of the Employer
Matching Contribution is deemed an excess aggregate contribution under
Section 3.07, such amount shall be forfeited in accordance with the
provisions of that Section. The Employer Matching Contributions shall be
paid to the Trustees as soon as practicable.
<PAGE>
3.03 Rollover Contributions
With the permission of the Committee and without regard to any limitations
on contributions set forth in this Article 3, the Plan may receive from an
Employee, whether or not he or she has met the eligibility requirements for
membership, in cash (or, in the case of Employer common stock, in kind),
any amount previously received (or deemed to be received) by him or her
from a qualified plan. The Plan may receive such amount either directly
from the Employee, from an individual retirement account or from a
qualified plan in the form of a direct rollover. Notwithstanding the
foregoing, the Plan shall not accept any amount unless such amount is
eligible to be rolled over to a qualified trust in accordance with
applicable law and the Employee provides evidence satisfactory to the
Committee that such amount qualifies for rollover treatment. Unless
received by the Plan in the form of a direct rollover, the Rollover
Contribution must be paid to the Trustees on or before the 60th day after
the day it was received by the Employee.
3.04 Change in Contributions
The percentages of Compensation designated by a Member under Section 3.01
shall automatically apply to increases and decreases in his or her
Compensation. A Member may change his or her election under Section 3.01 at
any time by giving such advance Notice as the Committee shall prescribe.
The changed percentage shall become effective as soon as practicable
following such Notice.
3.05 Suspension of Contributions
(a) A Member may revoke his or her election under Section 3.01 by giving
such advance Notice as the Committee shall prescribe. The revocation
shall become effective as soon as practicable following such Notice.
(b) A Member who has revoked his or her election under Section 3.01 may
apply to the Committee to resume having his or her Compensation
reduced in accordance with Section 3.01 as soon as practicable
following such Notice.
3.06 Actual Deferral Percentage Test
With respect to each Plan Year commencing on or after January 1, 1997, the
Actual Deferral Percentage for that Plan Year for Highly-Compensated
Employees who are Members or eligible to become Members for that Plan Year
shall not exceed the Actual Deferral Percentage for the preceding Plan Year
for all Nonhighly-Compensated Employees for the preceding Plan Year who
were Members or eligible to become Members during the preceding Plan Year
multiplied by 1.25. If the Actual Deferral Percentage for such
Highly-Compensated Employees does not meet the foregoing test, the Actual
Deferral Percentage for such Highly-Compensated Employees for that Plan
Year may not exceed the Actual Deferral Percentage for the preceding Plan
Year for all Nonhighly-Compensated Employees for the preceding Plan Year
who were Members or eligible to become Members during the preceding Plan
Year by more than two percentage points, and such Actual Deferral
Percentage for such Highly-Compensated Employees for the Plan Year may not
be more than 2.0 times the Actual Deferral Percentage for the preceding
Plan Year for all Nonhighly-Compensated Employees for the preceding Plan
Year who were Members or eligible to become Members during the preceding
Plan Year (or such lesser amount as the Committee shall determine to
satisfy the provisions of Section 3.10). Notwithstanding the foregoing, the
Employer may elect to use the Actual Deferral Percentage for
Nonhighly-Compensated Employees for the Plan Year being tested rather than
the preceding Plan Year provided that such election must be evidenced by a
Plan amendment and once made may not be changed except as provided by the
Secretary of the Treasury.
The Committee may implement rules limiting the Deferral Contributions which
may be made on behalf of some or all Highly-Compensated Employees so that
this limitation is satisfied. If the Committee determines that the
limitation under this Section has been exceeded in any Plan Year, the
following provisions shall apply: (a) The actual deferral ratio of the
Highly-Compensated Employee with the highest actual deferral ratio shall be
reduced to the extent necessary to meet the actual deferral percentage test
or to cause such ratio to equal the actual deferral ratio of the
Highly-Compensated Employee with the next highest ratio. This process will
be repeated until the actual deferral percentage test is passed. Each ratio
shall be rounded to the nearest one one-hundredth of 1% of the Member's
Statutory Compensation. The amount of Deferral Contributions made by each
Highly-Compensated Employee in excess of the amount permitted under his or
her revised deferral ratio shall be added together. This total dollar
amount of excess contributions ("excess contributions") shall then be
allocated to some or all Highly-Compensated Employees in accordance with
the provisions of paragraph (b) below. (b) The Deferral Contributions of
the Highly-Compensated Employee with the highest dollar amount of Deferral
Contributions shall be reduced by the lesser of (i) the amount required to
cause that Employee's Deferral Contributions to equal the dollar amount of
the Deferral Contributions of the Highly-Compensated Employee with the next
highest dollar amount of Deferral Contributions, or (ii) an amount equal to
the total excess contributions. This procedure is repeated until all excess
contributions are allocated. The amount of excess contributions allocated
to a Highly-Compensated Employee, together with Earnings thereon, shall be
distributed to him or her in accordance with the provisions of paragraph
(c).
<PAGE>
(c) The excess contributions, together with Earnings thereon, allocated to
a Member shall be paid to the Member before the close of the Plan Year
following the Plan Year in which the excess contributions were made,
and to the extent practicable, within 2 1/2 months of the close of the
Plan Year in which the excess contributions were made. However, any
excess contributions for any Plan Year shall be reduced by any
Deferral Contributions previously returned to the Member under Section
3.01 for that Plan Year. In the event any Deferral Contributions
returned under this Section were matched by Employer Matching
Contributions, such corresponding Employer Matching Contributions,
with Earnings thereon, shall be forfeited and used to reduce Employer
contributions.
3.07 Contribution Percentage Test
With respect to each Plan Year commencing on or after January 1, 1997, the
Contribution Percentage for that Plan Year for Highly-Compensated Employees
who are Members or eligible to become Members for that Plan Year shall not
exceed the Contribution Percentage for the preceding Plan Year for all
Nonhighly-Compensated Employees for the preceding Plan Year who were
Members or eligible to become Members during the preceding Plan Year
multiplied by 1.25. If the Contribution Percentage for such Plan Year for
such Highly-Compensated Employees does not meet the foregoing test, the
Contribution Percentage for such Highly-Compensated Employees for the Plan
Year may not exceed the Contribution Percentage for the preceding Plan Year
for all Nonhighly-Compensated Employees for the preceding Plan Year who
were Members or eligible to become Members during the preceding Plan Year
by more than two percentage points, and the Contribution Percentage for
such Highly-Compensated Employees for the Plan Year may not be more than
2.0 times the Contribution Percentage for the preceding Plan Year for all
Nonhighly-Compensated Employees for the preceding Plan Year who were
Members or eligible to become Members during the preceding Plan Year (or
such lesser amount as the Committee shall determine to satisfy the
provisions of Section 3.08). Notwithstanding the foregoing, the Employer
may elect to use the Actual Contribution Percentage for
Nonhighly-Compensated Employees for the Plan Year being tested rather than
the preceding Plan Year provided that such election must be evidenced by a
Plan amendment and once made may not be changed except as provided by the
Secretary of the Treasury. If the Committee determines that the limitation
under this Section 3.07 has been exceeded in any Plan Year, the following
provisions shall apply:
(a) The actual contribution ratio of the Highly-Compensated Employee with
the highest actual contribution ratio shall be reduced to the extent
necessary to meet the test or to cause such ratio to equal the actual
contribution ratio of the Highly-Compensated Employee with the next
highest actual contribution ratio. This process will be repeated until
the actual contribution percentage test is passed. Each ratio shall be
rounded to the nearest one one-hundredth of 1% of a Member's Statutory
Compensation. The amount of Employer Matching Contributions made by or
on behalf of each Highly-Compensated Employee in excess of the amount
permitted under his or her revised actual contribution ratio shall be
added together. This total dollar amount of excess contributions
("excess aggregate contributions") shall then be allocated to some or
all Highly-Compensated Employees in accordance with the provisions of
paragraph (b) below.
<PAGE>
(b) The Employer Matching Contributions of the Highly-Compensated Employee
with the highest dollar amount of such contributions shall be reduced
by the lesser of (i) the amount required to cause that Employee's
Employer Matching Contributions to equal the dollar amount of such
contributions of the Highly-Compensated Employee with the next highest
dollar amount of such contributions, or (ii) an amount equal to the
total excess aggregate contributions. This procedure is repeated until
all excess aggregate contributions are allocated. The amount of excess
aggregate contributions allocated to each Highly-Compensated Employee,
together with Earnings thereon, shall be distributed or forfeited in
accordance with the provisions of paragraph (c) below.
(c) Excess aggregate contributions allocated to a Highly-Compensated
Employee under paragraph (b) above shall be distributed or forfeited
as follows: so much of the Employer Matching Contributions, together
with Earnings, as shall be necessary to equal the excess aggregate
contributions shall be reduced, with the vested Employer Matching
Contributions, together with applicable Earnings, being paid to the
Member and the Employer Matching Contributions which are forfeitable
under the Plan, together with applicable Earnings, being forfeited and
applied to reduce Employer contributions.
(d) Any repayment or forfeiture of excess aggregate contributions shall be
made before the close of the Plan Year following the Plan Year for
which the excess aggregate contributions were made, and to the extent
practicable, any repayment or forfeiture shall be made within 2 1/2
months of the close of the Plan Year in which the excess aggregate
contributions were made.
<PAGE>
3.08 Aggregate Contribution Limitation
Notwithstanding the provisions of Sections 3.06 and 3.07, in no event shall
the sum of the Actual Deferral Percentage of the group of eligible
Highly-Compensated Employees and the Contribution Percentage of such group,
after applying the provisions of Sections 3.06 and 3.07, exceed the
"aggregate limit" as provided in Section 401(m)(9) of the Code and the
regulations issued thereunder. In the event the aggregate limit is exceeded
for any Plan Year, the Contribution Percentages of the Highly-Compensated
Employees shall be reduced to the extent necessary to satisfy the aggregate
limit in accordance with the procedure set forth in Section 3.07.
3.09 Additional Discrimination Testing Provisions
(a) If any Highly-Compensated Employee is a member of another qualified
plan of the Employer or an Affiliated Employer, other than an employee
stock ownership plan described in Section 4975(e)(7) of the Code or
any other qualified plan which must be mandatorily disaggregated under
Section 410(b) of the Code, under which deferred cash contributions or
matching contributions are made on behalf of the Highly-Compensated
Employee or under which the Highly-Compensated Employee makes
after-tax contributions, the Committee shall implement rules, which
shall be uniformly applicable to all employees similarly situated, to
take into account all such contributions for the Highly-Compensated
Employee under all such plans in applying the limitations of Sections
3.06, 3.07 and 3.08. If any other such qualified plan has a plan year
other than the Plan Year defined in Section 1.32, the contributions to
be taken into account in applying the limitations of Sections 3.06,
3.07 and 3.08 will be those made in the plan years ending with or
within the same calendar year.
(b) In the event that this Plan is aggregated with one or more other plans
to satisfy the requirements of Sections 401(a)(4) and 410(b) of the
Code (other than for purposes of the average benefit percentage test)
or if one or more other plans is aggregated with this Plan to satisfy
the requirements of such sections of the Code, then the provisions of
Sections 3.06, 3.07 and 3.08 shall be applied by determining the
Actual Deferral Percentage and Contribution Percentage of employees as
if all such plans were a single plan. If this Plan is permissively
aggregated with any other plan or plans for purposes of satisfying the
provisions of Section 401(k)(3) of the Code, the aggregated plans must
also satisfy the provisions of Sections 401(a)(4) and 410(b) of the
Code as though they were a single plan. For Plan Years beginning after
December 31, 1989, plans may be aggregated under this paragraph (b)
only if they have the same plan year.
(c) The Employer may elect to use Deferral Contributions to satisfy the
tests described in Sections 3.07 and 3.08, provided that the test
described in Section 3.06 is met prior to such election, and continues
to be met following the Employer's election to shift the application
of those Deferral Contributions from Section 3.06 to Section 3.07.
(d) The Employer may authorize that special "qualified nonelective
contributions" shall be made for a Plan Year, which shall be allocated
in such amounts and to such Members, who are not Highly-Compensated
Employees, as the Committee shall determine. The Committee shall
establish such separate accounts as may be necessary. Qualified
nonelective contributions shall be 100% nonforfeitable when made. Any
qualified nonelective contributions and any earnings credited on any
qualified nonelective contributions after such date shall only be
available for withdrawal under the provisions of Section 7.02.
Qualified nonelective contributions made for the Plan Year may be used
to satisfy the tests described in Sections 3.06, 3.07 and 3.08, where
necessary.
(e) Notwithstanding any provision of the Plan to the contrary, if
employees included in a unit of employees covered by a collective
bargaining agreement are participating in the Plan and not more than
2% of such employees are Highly-Compensated Employees and
professionals, then such employees shall be disregarded in applying
the provisions of Section 3.06, 3.07 and 3.08. However, a separate
actual deferral percentage test must be performed for the group of
collective bargaining employees on and after January 1, 1993 on the
basis that those employees are included in a separate cash-or-deferred
arrangement.
(f) For Plan Years commencing on and after January 1, 1999, if the
Employer elects to apply the provisions of Section 410(b)(4)(B) to
satisfy the requirements of Section 401(k)(3)(A)(i) of the Code, the
Employer may apply the provisions of Sections 3.06, 3.07 and 3.08 by
excluding from consideration all eligible employees (other than
Highly-Compensated Employees) who have not met the minimum age and
service requirements of Section 410(a)(1)(A) of the Code.
3.10 Maximum Annual Additions
(a) The annual addition to a Member's Accounts for any Plan Year, which
shall be considered the "limitation year" for purposes of Section 415
of the Code, when added to the Member's annual addition for that Plan
Year under any other qualified defined contribution plan of the
Employer or an Affiliated Employer, shall not exceed an amount which
is equal to the lesser of (i) 25% of his or her aggregate remuneration
for that Plan Year or (ii) $30,000, as adjusted pursuant to Section
415(d) of the Code. (b) For purposes of this Section, the "annual
addition" to a Member's Accounts under this Plan or any other
qualified defined contribution plan (including a deemed qualified
defined contribution plan under a qualified defined benefit plan)
maintained by the Employer or an Affiliated Employer shall be the sum
of:
(i) the total contributions, including Deferral Contributions, made
on the Member's behalf by the Employer and all Affiliated
Employers, (ii) all Member contributions, exclusive of any
Rollover Contributions, and (iii)forfeitures, if applicable, that
have been allocated to the Member's Accounts under this Plan or
his or her accounts under any other such qualified defined
contribution plan, and solely for purposes of clause (i) of
paragraph (a) above, (iv) amounts described in Sections 415(1)(1)
and 419A(d)(2) allocated to the Member.
For purposes of this paragraph (b), any Deferral Contributions
distributed under Section 3.06 and any Employer Matching
Contributions distributed or forfeited under the provisions of
Section 3.01, 3.06, 3.07 or 3.08 shall be included in the annual
addition for the year allocated. However, (i) any loan repayments
made under Article 8, (ii) amounts required to be repaid under
Section 6.03 as a condition of the restoration of a Member's
forfeited Employer Matching Account balance and (iii) any excess
deferrals timely distributed from the Plan under Section 3.01(c)
or (d) shall be excluded from the definition of Annual Addition.
<PAGE>
(c) For purposes of this Section, the term "remuneration" with respect to
any Member shall mean the wages, salaries and other amounts paid in
respect of such Member by the Employer or an Affiliated Employer for
personal services actually rendered, and shall include amounts
contributed by the Employer pursuant to a salary reduction agreement
which are not includible in the gross income of the employee under
Section 125, 402(g) or 457 of the Code, but shall exclude deferred
compensation, stock options and other distributions which receive
special tax benefits under the Code. Notwithstanding the foregoing,
for limitation years commencing prior to January 1, 1998, remuneration
shall exclude amounts contributed by the Employer pursuant to a salary
reduction agreement which are not includible in the gross income of
the employee under Section 125, 402(g)(3) or 457 of the Code.
(d) If the annual addition to a Member's Accounts for any Plan Year, prior
to the application of the limitation set forth in paragraph (a) above,
exceeds that limitation due to a reasonable error in estimating a
Member's annual compensation or in determining the amount of Deferral
Contributions that may be made with respect to a Member under Section
415 of the Code, or as the result of the allocation of forfeitures,
the amount of contributions credited to the Member's Accounts in that
Plan Year shall be adjusted to the extent necessary to satisfy that
limitation in accordance with the following order of priority: (i) The
Member's unmatched Deferral Contributions under Section 3.01 shall be
reduced to the extent necessary. The amount of the reduction shall be
returned to the Member together with any earnings on the contributions
to be returned.
<PAGE>
(ii) The Member's matched Deferral Contributions and corresponding
Employer Matching Contributions shall be reduced to the extent
necessary. The amount of the reduction attributable to the
Member's matched Deferral Contributions shall be returned to the
Member together with any earnings on those contributions to be
returned, and the amount attributable to the Employer Matching
Contributions shall be forfeited and used to reduce subsequent
contributions payable by the Employer.
Any Deferral Contributions returned to a Member under this
paragraph (d) shall be disregarded in applying the dollar
limitation on Deferral Contributions under Section 3.01(b), and
in performing the Actual Deferral Percentage Test under Section
3.06.
3.11 Return of Contributions
(a) If all or part of the Employer's deductions for contributions to the
Plan are disallowed by the Internal Revenue Service, the portion of
the contributions to which that disallowance applies shall be returned
to the Employer without interest but reduced by any investment loss
attributable to those contributions, provided that the contribution is
returned within one year after the disallowance of deduction. For this
purpose, all contributions made by the Employer are expressly declared
to be conditioned upon their deductibility under Section 404 of the
Code.
(b) The Employer may recover without interest the amount of its
contributions to the Plan made on account of a mistake of fact,
reduced by any investment loss attributable to those contributions, if
recovery is made within one year after the date of those
contributions.
(c) In the event that Deferral Contributions made under Section 3.01 are
returned to the Employer in accordance with the provisions of this
Section, the elections to reduce Compensation which were made by
Members on whose behalf those contributions were made shall be void
retroactively to the beginning of the period for which those
contributions were made. The Deferral Contributions so returned shall
be distributed in cash to those Members for whom those contributions
were made, provided, however, that if the contributions are returned
under the provisions of paragraph (a) above, the amount of Deferral
Contributions to be distributed to Members shall be adjusted to
reflect any investment gains or losses attributable to those
contributions.
3.12 Contributions Not Contingent Upon Profits
The Employer may make contributions to the Plan without regard to the
existence or the amount of current and accumulated earnings and profits.
Notwithstanding the foregoing, however, this Plan is designed to qualify as
a "profit-sharing plan" for all purposes of the Code.
<PAGE>
3.13 Contributions During Period of Military Leave
(a) Notwithstanding any provision of this Plan to the contrary,
contributions, benefits and service credit with respect to qualified
military service will be provided in accordance with Section 414(u) of
the Code. Without regard to any limitations on contributions set forth
in this Article 3, a Member who is reemployed on or after August 1,
1990 and is credited with Vesting Service under the provisions of
Section 1.41(b) because of a period of service in the uniformed
services of the United States, may elect to contribute to the Plan the
Deferral Contributions that could have been contributed to the Plan in
accordance with the provisions of the Plan had he or she remained
continuously employed by the Employer throughout such period of
absence ("make-up contributions"). The amount of make-up contributions
shall be determined on the basis of the Member's Compensation in
effect immediately prior to the period of absence, and the terms of
the Plan at such time. Any Deferral Contributions so determined shall
be limited as provided in Sections 3.01(b), 3.06, 3.07 and 3.08 with
respect to the Plan Year or Years to which such contributions relate
rather than the Plan Year in which payment is made. Any payment to the
Plan described in this paragraph shall be made during the applicable
repayment period. The repayment period shall equal three times the
period of absence, but not longer than five years and shall begin on
the latest of: (i) the Member's date of reemployment, (ii) October 13,
1996, or (iii) the date the Employer notifies the Employee of his or
her rights under this Section. Earnings (or losses) on make-up
contributions shall be credited commencing with the date the make-up
contribution is made in accordance with the provisions of Article 4.
(b) With respect to a Member who makes the election described in paragraph
(a) above, the Employer shall make Employer Matching Contributions on
the make-up contributions in the amount described in the provisions of
Section 3.02, as in effect for the Plan Year to which such make-up
contributions relate. Employer Matching Contributions under this
paragraph shall be made during the period described in paragraph (a)
above. Earnings (or losses) on Employer Matching Contributions shall
be credited commencing with the date the contributions are made in
accordance with the provisions of Article 4. Any limitations on
Employer Matching Contributions described in Sections 3.02, 3.06, 3.07
and 3.08 shall be applied with respect to the Plan Year or Years to
which such contributions relate rather than the Plan Year or Years in
which payment is made.
(c) All contributions under this Section are considered "annual
additions," as defined in Section 415(c)(2) of the Code, and shall be
limited in accordance with the provisions of Section 3.10 with respect
to the Plan Year or Years to which such contributions relate rather
than the Plan Year in which payment is made. I.
<PAGE>
ARTICLE 4
INVESTMENT OF CONTRIBUTIONS
4.01 Investment Funds
(a) Contributions to the Plan shall be invested in one or more Investment
Funds, as authorized by the Committee, which from time to time may
include such equity funds, international equity funds, fixed income
funds, money market funds, an Employer stock fund and other funds as
the Committee elects to offer.
(b) The Trustees may keep such amounts of cash as it, in its sole
discretion, shall deem necessary or advisable as part of the
Investment Funds, all within the limitations specified in the trust
agreement.
(c) Dividends, interest, and other distributions received on the assets
held by the Trustees in respect to each of the above Investment Funds
shall be reinvested in the respective Investment Fund.
(d) In the event the Committee authorizes an Employer stock fund, that
Investment Fund shall consist primarily of common stock of the
Employer, and shall be purchased by the Trustees regularly in the open
market, by the exercise of stock rights or by private purchase from
anyone, including the Employer. Any such purchase shall be in full
compliance with the fiduciary requirements of ERISA.
4.02 Investment of Members' Accounts
A Member shall make one investment election covering his or her Accounts in
accordance with one of the following options: (a) 100% in one of the
available Investment Funds; (b) in more than one Investment Fund allocated
in multiples of 1%.
If no investment election is made, any contributions made on the Member's
behalf shall be invested as directed by the Committee from time to time.
<PAGE>
4.03 Responsibility for Investments
Each Member is solely responsible for the selection of his or her
investment options. The Trustees, the Committee, the Employer, and the
officers, supervisors and other employees of the Employer are not empowered
to advise a Member as to the manner in which his or her Accounts shall be
invested. The fact that an Investment Fund is available to Members for
investment under the Plan shall not be construed as a recommendation for
investment in the Investment Fund.
4.04 Change of Election
A Member may change his or her investment election under Section 4.02 by
giving such advance Notice as the Committee shall prescribe. Such changed
investment election shall become effective as soon as administratively
practicable following such Notice and shall be effective only with respect
to subsequent contributions.
4.05 Reallocation of Accounts Among the Investment Funds
A Member may elect to reallocate his or her Accounts among the Investment
Funds, in multiples of 1% and in whole dollar multiples, by giving such
advance Notice as the Committee shall prescribe. Such reallocation shall be
effective as soon as administratively practicable following such Notice.
4.06 Limitations Imposed by Contract
Notwithstanding anything in this Article to the contrary, any contributions
invested in a fund of guaranteed investment contracts shall be subject to
any and all terms of such contracts, including any limitations therein
placed on the exercise of any rights otherwise granted to a Member under
any other provisions of this Plan with respect to such contributions.
4.07 ERISA Section 404(c) Compliance
This Plan is intended to constitute a plan described in Section 404(c) of
ERISA. I.
<PAGE>
ARTICLE 5
VALUATION OF UNITS AND CREDITS TO ACCOUNTS
5.01 Units of Participation
A Member's interest in each Investment Fund shall be represented by units
of participation. Prior to the first Valuation Date, each unit in an
Investment Fund shall be valued at $1.00 for each dollar of contribution
made to that Investment Fund during the period from the Effective Date
through the first Valuation Date.
5.02 Valuation of Units
The value of a unit in each Investment Fund shall be determined on each
Valuation Date by dividing the current market value of the assets in that
Investment Fund on that date as determined by the Trustees, after the
payment out of that Investment Fund of all brokerage fees and transfer
taxes applicable to purchases and sales for that Investment Fund made since
the previous Valuation Date and excluding, on each Valuation Date after the
first, the contributions made during the period since the previous
Valuation Date, by the total number of units in that Investment Fund.
5.03 Crediting the Accounts
(a) The Deferral Account of a Member in each Investment Fund shall be
credited on each Valuation Date with the number of units determined by
dividing the Deferral Contributions, if any, made by the Employer to
that Investment Fund on behalf of the Member since the previous
Valuation Date, if applicable, by the unit value for that Investment
Fund as determined on that Valuation Date;
(b) The Employer Matching Account of a Member in each Investment Fund
shall be credited on each Valuation Date with the number of units
determined by dividing the Employer's contributions, if any, made on
the Member's behalf to the Employer Matching Account in that
Investment Fund since the previous Valuation Date, if applicable, by
the unit value for that Investment Fund as determined on that
Valuation Date; and
(c) The Rollover Account of a Member in each Investment Fund shall be
credited on each Valuation Date with the number of units determined by
dividing the Rollover Contributions, if any, made by the Member to
that Investment Fund since the previous Valuation Date, if applicable,
by the unit value for that Investment Fund as determined on that
Valuation Date.
5.04 Annual Statements
At least once a year, each Member shall be furnished with a statement
setting forth the value of his or her Accounts and the Vested Portion of
his or her Accounts.
<PAGE>
ARTICLE 6
VESTED PORTION OF ACCOUNTS
6.01 Deferral Account and Rollover Account
A Member shall at all times be 100% vested in, and have a nonforfeitable
right to, his or her Deferral Account and Rollover Account.
6.02 Employer Matching Account
(a) A Member shall be vested in, and have a nonforfeitable right to, his
or her Employer Matching Account in accordance with the following
schedule:
Years of Vesting Service Percent Vested
------------------------ --------------
less than 3 years 0%
3 years 20
4 years 40
5 years 60
6 years 80
7 or more years 100
(b) Notwithstanding the foregoing, a Member shall be 100% vested in, and
have a nonforfeitable right to, his or her Accounts upon death,
Disability, or the attainment of his or her 65th birthday. Any
employee of Jacor who is eligible to become a Member in accordance
with the provisions of Section 2.05 and whose original date of hire
was on or before December 31, 1996, shall be 100% vested in, and have
a nonforfeitable right to, his or her Accounts.
(c) In addition to the foregoing, any employee of Jacor who is eligible to
become a Member in accordance with the provisions of Section 2.05 and
whose original date of hire is after December 31, 1996 shall be
credited with Years of Vesting Service as of July 1, 1999 equal to the
period of time between his or her original date of hire and July 1,
1999, in whole years rounded to the nearest year.
<PAGE>
6.03 Disposition of Forfeitures
(a) Upon termination of employment of a Member who was not fully vested in
his or her Employer Matching Account, the non-vested portion of his or
her Employer Matching Account shall not be forfeited until the
Member's number of consecutive one-year Breaks in Service equals or
exceeds the greater of five years or the Member's total number of
Years of Vesting Service before his or her Break in Service, or
receives a distribution of the Vested Portion of his or her Accounts,
if earlier. If the former Member is not reemployed by the Employer or
an Affiliated Employer before he or she has a period of Break in
Service described in the preceding sentence or receives such a
distribution, the non-vested portion of his or her Employer Matching
Account shall be forfeited. Any amounts forfeited pursuant to this
paragraph (a) shall be applied to reduce Employer contributions. If
the amount of the Vested Portion of a Member's Employer Matching
Account at the time of his or her termination of employment is zero,
the Member shall be deemed to have received a distribution of such
zero vested benefit.
(b) If an amount of a Member's Employer Matching Account has been
forfeited in accordance with paragraph (a) above, that amount shall be
subsequently restored to the Member's Employer Matching Account
provided (i) he or she is reemployed by the Employer or an Affiliated
Employer before the Member's number of consecutive one-year Breaks in
Service equals or exceeds the greater of five years or the Member's
total number of Years of Vesting Service before his or her Break in
Service and (ii) he or she repays to the Plan during his or her period
of reemployment and within five years of his or her date of
reemployment an amount in cash equal to the full amount distributed to
him or her from the Plan on account of his or her termination of
employment, other than the amount attributable to any Rollover
Contributions made under Section 3.03, provided, however, that he or
she may elect to repay to the Plan all or part of that amount as well.
Repayment shall be made in one lump sum.
(c) In the event that any amounts to be restored by the Employer to a
Member's Employer Matching Account have been forfeited under paragraph
(a) above, those amounts shall be taken first from any forfeitures
which have not as yet been applied against Employer Matching
Contributions and if any amounts remain to be restored, the Employer
shall make a special Employer contribution equal to those amounts.
(d) A repayment shall be invested in the available Investment Funds
according to the Member's election in force at the time of repayment.
<PAGE>
ARTICLE 7
WITHDRAWALS WHILE STILL EMPLOYED
7.01 Withdrawal of Rollover Contributions
A Member may, subject to Section 7.04, elect to withdraw all or part of his
or her Rollover Account attributable to Rollover Contributions.
7.02 Withdrawal After Age 59 1/2
A Member who shall have attained age 59 1/2 as of the effective date of any
withdrawal pursuant to this Section may, subject to Section 7.04, elect to
withdraw all or part of his or her Deferral Account, and all or part of the
Vested Portion of his or her Employer Matching Account attributable to
Employer contributions.
7.03 Hardship Withdrawal
(a) A Member who has withdrawn the total amount available for withdrawal
under the preceding Sections of this Article may, subject to Section
7.04, elect to withdraw all or part of the Deferral Contributions made
on his or her behalf to his or her Deferral Account upon furnishing
proof of hardship satisfactory to the Committee.
(b) A Member shall be considered to have incurred a hardship if, and only
if, he or she meets the requirements of paragraphs (c) and (d) below.
(c) As a condition for hardship there must exist with respect to the
Member an immediate and heavy need to draw upon his or her Deferral
Account.
(i) The Committee shall presume the existence of such immediate and
heavy need if the requested withdrawal is on account of any of
the following:
(A) expenses for medical care described in Section 213(d) of the
Code previously incurred by the Member, his or her spouse or
any of his or her dependents (as defined in Section 152 of
the Code) or necessary for those persons to obtain such
medical care;
(B) costs directly related to the purchase of a principal
residence of the Member (excluding mortgage payments);
(C) payment of tuition and related educational fees, and room
and board expenses, for the next 12 months of post-secondary
education of the Member, his or her spouse, children or
dependents (as defined in Section 152 of the Code);
(D) payment of amounts necessary to prevent eviction of the
Member from his or her principal residence or to avoid
foreclosure on the mortgage of his or her principal
residence; or
(E) the inability of the Member to meet such other expenses,
debts or other obligations recognized by the Internal
Revenue Service as giving rise to immediate and heavy
financial need for purposes of Section 401(k) of the Code.
The amount of the withdrawal may not be in excess of the
amount of the immediate and heavy financial need of the
employee, including any amounts necessary to pay any
federal, state or local income taxes and any amounts
necessary to pay any penalties reasonably anticipated to
result from the distribution.
In evaluating the relevant facts and circumstances, the
Committee shall act in a nondiscriminatory fashion and shall
treat uniformly those Members who are similarly situated.
The Member shall furnish to the Committee such supporting
documents as the Committee may request in accordance with
uniform and nondiscriminatory rules prescribed by the
Committee.
(d) As a condition for hardship, the Member must demonstrate that the
requested withdrawal is necessary to satisfy the financial need
described in paragraph (b). To demonstrate such necessity, the Member
must request, on such form as the Committee shall prescribe, that the
Committee make its determination of the necessity for the withdrawal
solely on the basis of his or her application. In that event, the
Committee shall make such determination, provided all of the following
requirements are met: (i) the Member has obtained all distributions,
other than distributions available only on account of hardship, and
all nontaxable loans currently available under all plans of the
Employer and Affiliated Employers, but any loan which would have the
effect of increasing hardship need not be taken, (ii) the Member is
prohibited from making Deferral Contributions and any after-tax
contributions to the Plan and all other plans of the Employer and
Affiliated Employers under the terms of such plans or by means of an
otherwise legally enforceable agreement for at least 12 months after
receipt of the distribution, and (iii) the limitation described in
Section 3.01(b) under all plans of the Employer and Affiliated
Employers for the calendar year following the year in which the
withdrawal is made must be reduced by the Member's elective deferrals
made in the calendar year of the distribution for hardship. For
purposes of clause (ii), "all other plans of the Employer and
Affiliated Employers" shall include stock option plans, stock purchase
plans, qualified and non-qualified deferred compensation plans and
such other plans as may be designated under regulations issued under
Section 401(k) of the Code, but shall not include health and welfare
benefit plans or the mandatory employee contribution portion of a
defined benefit plan.
<PAGE>
7.04 Procedures and Restrictions
To make a withdrawal, a Member shall give such advance Notice as the
Committee shall prescribe. A withdrawal shall be made as soon as
administratively practicable following such Notice. If a loan and a
hardship withdrawal are processed as of the Valuation Date, the amount
available for the hardship withdrawal will equal the Vested Portion of the
Member's Accounts on such Valuation Date reduced by the amount of the loan.
The amount of the withdrawal shall be allocated between the Investment
Funds in proportion to the value of the Member's Accounts from which the
withdrawal is made in each Investment Fund as of the date of the
withdrawal. Subject to the provisions of Section 9.09, all payments to
Members under this Article shall be made in cash as soon as practicable. In
the event a married Member has elected an annuity under Section 9.02(b)(ii)
at the time the withdrawal is to be made, the withdrawal election shall not
be effective unless Spousal Consent to the election is received by the
Committee. Payments made to Members after December 31, 1998 pursuant to
this Article shall not be considered "eligible rollover distributions"
subject to the provisions of Section 9.09.
<PAGE>
ARTICLE 8
LOANS TO MEMBERS
8.01 Amount Available
(a) A Member who is an employee of the Employer or an Affiliated Employer
may borrow, on written application to the Committee and on approval by
the Committee under such uniform rules as it shall adopt, an amount
which, when added to the outstanding balance of any other loans to the
Member from this Plan or any other qualified plan of the Employer or
Affiliated Employer, including any accrued but unpaid interest on any
deemed loan distribution, does not exceed the lesser of (i) 50% of the
Vested Portion of his or her Accounts, or (ii) $50,000 reduced by the
excess, if any, of (A) the highest outstanding balance of loans to the
Member from such plans during the one year period ending on the day
before the day the loan is made, over (B) the outstanding balance of
loans to the Member from such plans on the date on which the loan is
made.
(b) The interest rate to be charged on loans shall be determined at the
time of the loan application and shall be 1% above the prime rate as
reported in the Wall Street Journal for the last business day of the
quarter preceding the calendar quarter in which the loan is processed.
The interest rate so determined for purposes of the Plan shall be
fixed for the duration of each loan.
(c) The amount of the loan is to be transferred from the Investment Funds
in which the Member's Accounts are invested to a special "loan fund"
for the Member under the Plan. The loan fund consists solely of the
amount transferred to the loan fund and is invested solely in the loan
made to the Member. The amount transferred to the loan fund shall be
pledged as security for the loan. Payments of principal on the loan
will reduce the amount held in the Member's loan fund. Those payments,
together with the attendant interest payment, will be reinvested in
the Investment Funds in accordance with the Member's then effective
investment election.
8.02 Terms
(a) In addition to such rules and regulations as the Committee may adopt,
all loans shall comply with the following terms and conditions:
(i) An application for a loan by a Member shall be made in accordance
with the rules established by the Committee;
(ii) Each loan shall be evidenced by a promissory note payable to the
Plan;
(iii)The period of repayment for any loan shall be determined by the
Member, but that period shall not exceed five years unless the
loan is to be used in conjunction with the purchase of the
principal residence of the Member, in which case the period of
repayment shall not exceed 15 years. Notwithstanding the
foregoing, in the event a Member enters the uniformed services of
the United States and retains reemployment rights under the law,
loan repayments shall be suspended (and interest shall cease to
accrue) during the period of leave, and the period of repayment
shall be extended by the number of months of the period of
service in the uniformed services; provided, however, if the
Member incurs a termination of employment and requests a
distribution pursuant to Article 9, the loan shall be canceled,
and the outstanding loan balance shall be distributed pursuant to
Article 9.
(iv) Payments of principal and interest will be made by
payroll deductions in substantially level amounts,
but no less frequently than quarterly, in an amount
sufficient to amortize the loan over the repayment
period;
(v) A loan may be prepaid in full as of any date without
penalty;
<PAGE>
(vi) Only one loan may be outstanding at any given time
and a new loan may not be made until at least 31 days
after repayment of an outstanding loan is completed.
Notwithstanding the foregoing, a second loan may be
made in conjunction with the purchase of the
principal residence of the Member;
(vii) The minimum loan amount shall be $1,000;
(viii) A loan processing fee and annual maintenance fee
may be charged by the Plan, as determined by
the Committee; and
(ix) Upon termination of employment, full repayment of any
outstanding loan must be made to avoid default; or
the Committee may allow for an alternative method of
repayment upon application.
(b) If a loan is not repaid in accordance with the terms contained
in the promissory note and a default occurs, the Plan may
execute upon its security interest in the Member's Accounts
under the Plan to satisfy the debt; however, the Plan shall
not levy against any portion of the loan fund attributable to
amounts held in the Member's Deferral Account or Employer
Matching Account until such time as a distribution of the
Deferral Account or Employer Matching Account could otherwise
be made under the Plan. A default in any other event may be
deemed a taxable distribution to the Member in accordance with
the Committee's rules.
(c) Any additional rules or restrictions as may be necessary to
implement and administer the loan program shall be in writing
and communicated to employees. Such further documentation is
hereby incorporated into the Plan by reference, and the
Committee is hereby authorized to make such revisions to these
rules as it deems necessary or appropriate, on the advice of
counsel.
(d) To the extent required by law and under such rules as the
Committee shall adopt, loans shall also be made available on a
reasonably equivalent basis to any Beneficiary or former
Employee (i) who maintains an account balance under the Plan
and (ii) who is still a party-in-interest (within the meaning
of Section 3(14) of ERISA).
<PAGE>
(e) For any employee of an entity which is acquired by the
Employer in either an asset or a stock transaction and (i) who
becomes a Member in accordance with the provisions of Section
2.01 or Section 2.05, (ii) who has a nondefaulted loan balance
in the acquired entity's qualified profit sharing or stock
bonus plan on the closing date of the acquisition, and (iii)
who elects to make a direct rollover of his or her account
balance from that plan to this Plan, this Plan will accept as
part of that rollover the promissory note representing such
loan and the Employer, Plan and the Member agree to continue
the repayment in accordance with the terms of such note,
provided such action complies with the requirements of the
Code at the date of rollover.
I.
<PAGE>
ARTICLE 9
DISTRIBUTION OF ACCOUNTS UPON
TERMINATION OF EMPLOYMENT
9.01 Eligibility
Upon a Member's termination of employment the Vested Portion of his or
her Accounts, as determined under Article 6, shall be distributed as
provided in this Article.
9.02 Forms of Distribution
(a) Distribution of the Vested Portion of a Member's Accounts shall
be made to the Member (or to his or her Beneficiary, in the event
of death) in a cash lump sum. In the alternative, to the extent a
Member's Accounts are invested in the Investment fund for
Employer common stock, a Member may elect to receive all or a
portion of the Employer common stock held in such Investment fund
for his or her Accounts, as part of the distribution. The minimum
stock distribution shall be 100 shares or the total number of
shares held for the Employee, if less and any fractional shares
shall be paid in cash. Notwithstanding the foregoing, a Member
may elect to receive that part of the Vested Portion of his or
her Accounts which accrued prior to July 1, 1999, in the optional
form of benefit described under (b) below. (b) Any Employee who
was a Member prior to July 1, 1999 may elect, in such manner as
the Committee shall prescribe, to receive payment of the Vested
Portion of the balance in his or her Accounts in cash payments in
approximately equal quarterly or annual installments over a
period, designated by the Member, not to exceed the life
expectancy of the last survivor of the Member and his or her
Beneficiary. In the event that the Member dies before all
installments have been paid, the remaining balance in his or her
Accounts shall be paid in an immediate cash lump sum to his or
her Beneficiary. (c) Notwithstanding the preceding, if a Member
dies before his or her benefits commence, the Vested Portion of
his or her Accounts shall be paid to his or her Beneficiary in a
cash lump sum.
9.03 Commencement of Payments
(a) Except as otherwise provided in this Article, distribution of
the Vested Portion of a Member's Accounts shall commence as
soon as administratively practicable following the later of
(i) the Member's termination of employment or (ii) the 65th
anniversary of the Member's date of birth (but not more than
60 days after the close of the Plan Year in which the later of
(i) or (ii) occurs).
(b) In lieu of a distribution as described in paragraph (a) above,
a Member may, in accordance with such procedures as the
Committee shall prescribe, elect to have the distribution of
the Vested Portion of his or her Accounts commence as of any
Valuation Date coincident with or following his or her
termination of employment which is before the date described
in paragraph (a) above.
(c) In the case of the death of a Member before his or her
benefits commence, the Vested Portion of his or her Accounts
shall be distributed to his or her Beneficiary as soon as
administratively practicable following the Member's date of
death.
9.04 Age 70 1/2 Required Distribution
(a) Notwithstanding any provision of the Plan to the contrary, if
a Member is a 5% owner (as defined in Section 416(i) of the
Code), distribution of the Member's Accounts shall begin no
later than the April 1 following the calendar year in which he
or she attains age 70 1/2. No minimum distribution payments
will be made to a Member under the provisions of Section
401(a)(9) of the Code on or after January 1, 1997 if the
Member is not a 5% owner as defined above, except that if such
payments had commenced prior to July 1, 1999, they shall
continue to be made unless the Member elects to stop receiving
such payments. Such Member may, however, elect to receive
in-service withdrawals in accordance with the provisions of
Article 7 while he or she remains in service.
(b) In the event a Member is required to begin receiving payments
while in service under the provisions of paragraph (a) above,
the Member may elect to receive payments while in service in
accordance with option (i) or (ii), as follows: (i) A Member
may receive one lump sum payment on or before the Member's
required beginning date equal to his or her entire Account
balance and annual lump sum payments thereafter of amounts
accrued during each calendar year; or
(ii) A Member may receive annual payments of the minimum amount
necessary to satisfy the minimum distribution requirements
of Section 401(a)(9) of the Code. Such minimum amount will
be determined on the basis of the Member's life expectancy
or the joint life expectancy of the Member and his or her
Beneficiary. Such life expectancies will not be recalculated
and the minimum amount will not be determined on joint life
expectancies unless the Member elects in a timely manner
that the life expectancies be recalculated annually or a
joint life expectancy be used. In no event will the life
expectancy of the Beneficiary be recalculated if the
Beneficiary is not the Member's spouse. The amount of the
withdrawal shall be taken pro rata from his or her Accounts.
The amount of the withdrawal shall be allocated between and
among the Investment Funds in proportion to the value of the
Member's Accounts as of the date of each withdrawal from
which amounts are withdrawn.
An election under this Section shall be made by a Member by
giving written notice to the Committee within the 90 day
period prior to his or her required beginning date. The
commencement of payments under this Section shall not
constitute an annuity starting date for purposes of Sections
72, 401(a)(11) and 417 of the Code. Upon the Member's
subsequent termination of employment, payment of the Member's
Accounts shall be made in accordance with the provisions of
Section 9.02. In the event a Member fails to make an election
under this Section, payment shall be made in accordance with
clause (ii) above.
9.05 Small Benefits
Notwithstanding any provision of the Plan to the contrary, a cash lump
sum payment shall be made in lieu of all vested benefits if the value
of the Vested Portion of the Member's Accounts as of his or her
termination of employment amounts to $5,000 or less. The lump sum
payment shall automatically be made as soon as administratively
practicable following the Member's termination of employment, or
following the determination that the amount qualifies for distribution
under this paragraph.
9.06 Status of Accounts Pending Distribution
Until completely distributed under Section 9.03 or 9.04 the Accounts of
a Member who is entitled to a distribution shall continue to be
invested as part of the funds of the Plan and the Member shall retain
investment transfer rights as described in Section 4.05. However, loans
or withdrawals shall not be permitted during the deferral period except
to the extent required by law.
<PAGE>
9.07 Proof of Death and Right of Beneficiary or Other Person
The Committee may require and rely upon such proof of death and such
evidence of the right of any Beneficiary or other person to receive the
value of the Accounts of a deceased Member as the Committee may deem
proper and its determination of the right of that Beneficiary or other
person to receive payment shall be conclusive.
9.08 Distribution Limitation
Notwithstanding any other provision of this Article 9, all
distributions from this Plan shall conform to the regulations issued
under Section 401(a)(9) of the Code, including the incidental death
benefit provisions of Section 401(a)(9)(G) of the Code. Further, such
regulations shall override any Plan provision that is inconsistent with
Section 401(a)(9) of the Code.
9.09 Direct Rollover of Certain Distributions
This Section applies to distributions made on or after January 1, 1993.
Notwithstanding any provision of the Plan to the contrary that would
otherwise limit a distributee's election under this Section, a
distributee may elect, at the time and in the manner prescribed by the
Committee, to have any portion of an eligible rollover distribution
paid directly to an eligible retirement plan specified by the
distributee in a direct rollover. The following definitions apply to
the terms used in this Section:
(a) "Eligible rollover distribution" means any distribution of
all or any portion of the balance to the credit of the
distributee, except that an eligible rollover distribution
does not include any distribution that is one of a series of
substantially equal periodic payments (not less frequently
than annually) made for the life (or life expectancy) of the
distributee or the joint lives (or joint life expectancies)
of the distributee and the distributee's designated
beneficiary, or for a specified period of ten years or more,
any distribution to the extent such distribution is required
under Section 401(a)(9) of the Code, and the portion of any
distribution that is not includible in gross income
(determined without regard to the exclusion for net
unrealized appreciation with respect to employer
securities);
(b) "Eligible retirement plan" means an individual retirement
account described in Section 408(a) of the Code, an
individual retirement annuity described in Section 408(b) of
the Code, an annuity plan described in Section 403(a) of the
Code, or a qualified trust described in Section 401(a) of
the Code, that accepts the distributee's eligible rollover
distribution. However, in the case of an eligible rollover
distribution to the surviving spouse, an eligible retirement
plan is an individual retirement account or individual
retirement annuity;
(c) "Distributee" means an employee or former employee. In
addition, the employee's or former employee's surviving
spouse and the employee's or former employee's spouse or
former spouse who is the alternate payee under a qualified
domestic relations order as defined in Section 414(p) of the
Code, are distributees with regard to the interest of the
spouse or former spouse; and
(d) "Direct rollover" means a payment by the Plan to the
eligible retirement plan specified by the distributee.
9.10 Waiver of Notice Period
Except as provided in the following sentence, if any portion of a
Member's Accounts accrued prior to July 1, 1999, and the value of the
Vested Portion of the Member's accounts exceeds $5,000 on the date of
determination, an election by the Member to receive a distribution
prior to age 65 shall not be valid unless the written election is made
<PAGE>
(a) After the Member has received the notice required under Section
1.411(a)-11(c) of the Income Tax Regulations, and (b) Within a
reasonable time before the effective date of the commencement of the
distribution as prescribed by said
regulations.
If such distribution is one to which Sections 401(a)(11) and 417 of the
Code do not apply, such distribution may commence less than 30 days
after the notice required under Section 1.411(a)-11(c) of the Income
Tax Regulations is given, provided that:
(c) the Committee clearly informs the Member that he or she has a
right to a period of at least 30 days after receiving the
notice to consider the decision of whether or not to elect a
distribution (and, if applicable, a particular distribution
option), and
(d) the Member, after receiving the notice under said Regulation
Section 1.411(a)-11(c), affirmatively elects a distribution.
I.
<PAGE>
ARTICLE 10
ADMINISTRATION OF PLAN
10.01 Appointment of Committee
The general administration of the Plan and the responsibility for
carrying out the provisions of the Plan shall be placed in a Committee
of not less than three persons appointed from time to time by the Board
of Directors to serve at the pleasure of the Board of Directors. The
Board of Directors may delegate to another person the power to appoint
and remove members of the Committee. Any person who is appointed a
member of the Committee shall signify his or her acceptance by filing
written acceptance with the Board of Directors and the Secretary of the
Committee. Any member of the Committee may resign by delivering his or
her written resignation to the Board of Directors and the secretary of
the Committee and shall automatically cease to be a member on the date
he or she ceases to be an employee.
10.02 Duties of Committee
The Committee shall elect a chairperson from their number and a
secretary who may be but need not be one of the members of the
Committee; may appoint from their number such subcommittees with such
powers as they shall determine; may authorize one or more of their
number or any agent to execute or deliver any instrument or make any
payment on their behalf; may retain counsel, recordkeepers, auditors,
consultants, and advisors and provide for such clerical, accounting,
and consulting services as they may require in carrying out the
provisions of the Plan; and may allocate among themselves or delegate
to other persons all or such portion of their duties under the Plan,
other than those granted to the Trustees under the trust agreement
adopted for use in implementing the Plan, as they, in their sole
discretion, shall decide. The Committee's discretionary duties shall
include (but not be limited to) the following:
(a) responsibility for the administration and interpretation of the
Plan as further described in Section 10.07 and accounting for the
Plan;
(b) responsibility for reporting and disclosure as required by ERISA,
and assuring compliance with the reporting and disclosure
requirements of ERISA, including all financial reports and
financial disclosure requirements;
(c) responsibility for and adoption of a program for the
administration of the Plan;
(d) establishment and maintenance of all Plan documents, provided
appropriate legal advice has first been obtained; (e)
implementation of a claims procedure for the Plan subject to
ERISA as outlined in Section 10.15; and (f) correction of any
mistakes and curing of any defects in the administration of the
Plan, including adjustment of erroneous allocations as set forth
in Section 13.04.
10.03 Individual Accounts
The Committee shall maintain, or cause to be maintained, records
showing the individual balances in each Member's Accounts. However,
maintenance of those records and Accounts shall not require any
segregation of the funds of the Plan.
10.04 Meetings
The Committee shall hold meetings upon such notice, at such place or
places, and at such time or times as it may from time to time determine
and act on such matters as its chairperson or other members may deem
appropriate or desirable.
<PAGE>
10.05 Action of Majority
Any act which the Plan authorizes or requires the Committee to do may
be done by a majority of its members. The action of that majority
expressed from time to time by a vote at a meeting or in writing
without a meeting shall constitute the action of the Committee and
shall have the same effect for all purposes as if assented to by all
members of the Committee at the time in office.
10.06 Compensation and Bonding
No member of the Committee shall receive any compensation from the Plan
for his or her services as such. Except as may otherwise be required by
law, no bond or other security need be required of any member in that
capacity in any jurisdiction.
10.07 Establishment of Rules
Subject to the limitations of the Plan, the Committee from time to time
shall establish rules for the administration of the Plan and the
transaction of its business. The Committee shall have discretionary
authority to construe and interpret the Plan (including, but not
limited to, determination of an individual's eligibility for Plan
participation, the right and amount of any benefit payable under the
Plan and the date on which any individual ceases to be a Member). The
determination of the Committee as to the interpretation of the Plan or
any disputed question shall be conclusive and final to the extent
permitted by applicable law.
10.08 Prudent Conduct
The Committee shall use that degree of care, skill, prudence and
diligence that a prudent person acting in a like capacity and familiar
with such matters would use in his or her conduct of a similar
situation.
10.09 Service in More Than One Fiduciary Capacity
Any individual, entity or group of persons may serve in more than one
fiduciary capacity with respect to the Plan and/or the funds of the
Plan.
10.10 Limitation of Liability
The Employer, the Board of Directors, the Committee, and any officer,
employee or agent of the Employer shall not incur any liability
individually or on behalf of any other individuals or on behalf of the
Employer for any act or failure to act, made in good faith in relation
to the Plan or the funds of the Plan. However, this limitation shall
not act to relieve any such individual or the Employer from a
responsibility or liability for any fiduciary responsibility,
obligation or duty under Part 4, Title I of ERISA.
10.11 Indemnification
The Committee, the Board of Directors, and the officers, employees and
agents of the Employer shall be indemnified against any and all
liabilities arising by reason of any act, or failure to act, in
relation to the Plan or the funds of the Plan, including, without
limitation, expenses reasonably incurred in the defense of any claim
relating to the Plan or the funds of the Plan, and amounts paid in any
compromise or settlement relating to the Plan or the funds of the Plan,
except for actions or failures to act made in bad faith. The foregoing
indemnification shall be from the funds of the Plan to the extent of
those funds and to the extent permitted under applicable law; otherwise
from the assets of the Employer.
<PAGE>
10.12 Appointment of Investment Manager
The Board of Directors or the Committee may, in its discretion, appoint
one or more investment managers (within the meaning of Section 3(38) of
ERISA) to manage (including the power to acquire and dispose of) all or
part of the assets of the Plan, as the Board of Directors or the
Committee shall designate. In that event authority over and
responsibility for the management of the assets so designated shall be
the sole responsibility of that investment manager.
10.13 Named Fiduciary
For purposes of ERISA, the Committee shall be the named fiduciary of
the Plan.
10.14 Expenses of Administration
All expenses that arise in connection with the administration of the
Plan, including but not limited to the compensation of the funding
agent, administrative expenses and proper charges and disbursements of
the funding agent and compensation and other expenses and charges of
any counsel, accountant, specialist, consultant, investment manager, or
other person who has been retained by the Employer in connection with
the administration thereof, shall be paid from the funds of the Plan
held by the funding agent under the trust agreement or insurance or
annuity contract adopted for use in implementing the Plan, to the
extent not paid by the Employer.
<PAGE>
10.15 Claims and Review Procedures
(a) Applications for benefits and inquiries concerning the Plan
(or concerning present or future rights to benefits under the
Plan) shall be submitted to the Committee in writing in
accordance with the procedures adopted by the Committee. An
application for benefits shall be submitted on the prescribed
form and shall be signed by the Member or, in the case of a
benefit payable after his or her death, by his or her
Beneficiary. The Committee shall adopt such rules, procedures
and interpretation of the Plan as it deems necessary or
appropriate in carrying out its responsibilities under this
Section 10.15 and communicate such rules, procedures and
interpretations to the Members.
(b) No legal action for benefits under the Plan shall be brought
unless and until the claimant (i) has submitted a written
application for benefits in accordance with such rules and
procedures, (ii) has been notified by the Committee that the
application is denied, (iii) has filed a written request for a
review of the application in accordance with such rules and
procedures, and (iv) has been notified in writing that the
Committee has affirmed the denial of the application;
provided, however, that legal action may be brought after the
Committee has failed to take any action on the claim within
the time prescribed by such rules and procedures.
I.
<PAGE>
ARTICLE 11
MANAGEMENT OF FUNDS
11.01 Trust Agreement
All the funds of the Plan shall be held by Trustees appointed from time
to time by the Board of Directors or the Committee under a trust
agreement adopted, or as amended, by the Board of Directors or the
Committee for use in providing the benefits of the Plan and paying its
expenses not paid directly by the Employer. The Employer shall have no
liability for the payment of benefits under the Plan nor for the
administration of the funds paid over to the Trustees.
11.02 Exclusive Benefit Rule
Except as otherwise provided in the Plan, no part of the corpus or
income of the funds of the Plan shall be used for, or diverted to,
purposes other than for the exclusive benefit of Members and other
persons entitled to benefits under the Plan and paying the expenses of
the Plan not paid directly by the Employer. No person shall have any
interest in, or right to, any part of the earnings of the funds of the
Plan, or any right in, or to, any part of the assets held under the
Plan, except as and to the extent expressly provided in the Plan.
I.
<PAGE>
ARTICLE 12
AMENDMENT, MERGER AND TERMINATION
12.01 Amendment of Plan
The Employer, by action of its Board of Directors, taken at a meeting
held either in person or by telephone or other electronic means, or by
unanimous written consent in lieu of a meeting, reserves the right at
any time and from time to time, and retroactively if deemed necessary
or appropriate, to amend, in whole or in part, any or all of the
provisions of the Plan. Notwithstanding the preceding sentence, the
Committee may approve amendments to the Plan, with or without prior
approval or subsequent ratification by the Board, if the amendment:
does not significantly change the benefits provided under the Plan
(except as required by a change in applicable law); does not
significantly increase the costs of the Plan; and the amendment is
intended either to enable the Plan to remain in compliance with the
requirements of the Code, ERISA or other applicable law, to facilitate
administration of the Plan, or to improve the operation of the Plan.
However, no amendment shall make it possible for any part of the funds
of the Plan to be used for, or diverted to, purposes other than for the
exclusive benefit of persons entitled to benefits under the Plan,
before the satisfaction of all liabilities with respect to them. In
relation to the Accounts on the date on which the amendment is adopted
or, if later, the date on which the amendment becomes effective, no
amendment shall be made which has the effect of decreasing the balance
of the Accounts of any Member, eliminating any right to benefit payment
or any optional form of payment, or of reducing the nonforfeitable
percentage of the balance of the Accounts of a Member below the
nonforfeitable percentage computed under the Plan as in effect prior to
the amendment.
<PAGE>
12.02 Merger, Consolidation or Transfer
The Plan may not be merged or consolidated with, and its assets or
liabilities may not be transferred to, any other plan unless each
person entitled to benefits under the Plan would, if the resulting plan
were then terminated, receive a benefit immediately after the merger,
consolidation, or transfer which is equal to or greater than the
benefit he or she would have been entitled to receive immediately
before the merger, consolidation, or transfer if the Plan had then
terminated.
12.03 Additional Participating Employers
(a) If any company is or becomes a subsidiary of or associated
with an Employer, the Board of Directors may include the
employees of that subsidiary or associated company in the
membership of the Plan upon appropriate action by that
company necessary to adopt the Plan. In the case of a
company acquired by stock purchase, if that company sponsors
a plan described in Code Section 401(k), such plan may be
merged into this Plan upon agreement of the parties, and its
participants shall become Members of the Plan, within the
timeframe set forth in Code Section 410(b)(6). The Board of
Directors shall determine to what extent, if any, previous
service with the subsidiary, associated or other company
shall be recognized under the Plan, but subject to the
continued qualification of the trust for the Plan as
tax-exempt under the Code.
(b) Any subsidiary or associated company may terminate its
participation in the Plan upon appropriate action by it. In
that event the funds of the Plan held on account of Members in
the employ of that company, and any unpaid balances of the
Accounts of all Members who have separated from the employ of
that company, shall be
<PAGE>
determined by the Committee. Those funds shall be distributed
as provided in Section 12.04 if the Plan should be terminated,
or shall be segregated by the Trustees as a separate trust,
pursuant to certification to the Trustees by the Committee,
continuing the Plan as a separate plan for the employees of
that company under which the board of directors of that
company shall succeed to all the powers and duties of the
Board of Directors, including the appointment of the members
of the Committee.
12.04 Termination of Plan
(a) The Board of Directors by action taken in accordance with the
procedures under Section 12.01 may terminate the Plan or
completely discontinue contributions under the Plan for any
reason at any time. In case of termination or partial
termination of the Plan, or complete discontinuance of
Employer contributions to the Plan, the rights of affected
Members to their Accounts under the Plan as of the date of the
termination or discontinuance shall be nonforfeitable. In the
event of the Plan's termination, the total amount in each
Member's Accounts shall be distributed to him or her if
permitted by law or continued in trust for his or her benefit,
as the Committee shall direct.
(b) Upon termination of the Plan, Deferral Contributions, with
earnings thereon, shall only be distributed to Members if
(i) neither the Employer nor an Affiliated Employer
establishes or maintains a successor defined contribution
plan, and (ii) payment is made to the Members in the form of
a lump sum distribution (as defined in Section 402(d)(4) of
the Code, without regard to clauses (i) through (iv) of
subparagraph (A), subparagraph (B), or subparagraph (F)
thereof). For
<PAGE>
purposes of this paragraph, a "successor defined contribution
plan" is a defined contribution plan (other than an employee
stock ownership plan as defined in Section 4975(e)(7) of the
Code ("ESOP") or a simplified employee pension as defined in
Section 408(k) of the Code ("SEP")) which exists at the time
the Plan is terminated or within the 12 month period beginning
on the date all assets are distributed. However, in no event
shall a defined contribution plan be deemed a successor plan
if fewer than 2% of the employees who are eligible to
participate in the Plan at the time of its termination are or
were eligible to participate under another defined
contribution plan of the Employer or an Affiliated Employer
(other than an ESOP or a SEP) at any time during the period
beginning 12 months before and ending 12 months after the date
of the Plan's termination.
12.05 Distribution of Accounts Upon a Sale of Assets or a Sale of a
Subsidiary
Upon the disposition by the Employer of at least 85% of the assets
(within the meaning of Section 409(d)(2) of the Code) used by the
Employer in a trade or business or upon the disposition by the Employer
of its interest in a subsidiary (within the meaning of Section
409(d)(3) of the Code), Deferral Contributions, with earnings thereon,
may be distributed to those Members who continue in employment with the
employer acquiring such assets or with the sold subsidiary, provided
that (a) the Employer maintains the Plan after the disposition, (b) the
buyer does not adopt the Plan or otherwise become a participating
employer in the Plan and does not accept any transfer of assets or
liabilities from the Plan to a plan it maintains in a transaction
subject to Section 414(l)(1) of the Code, (c) payment is made to the
Member in the form of a lump sum distribution (as defined in Section
402(d)(4) of the Code, without regard to clauses (i) through (iv) of
<PAGE>
subparagraph (A), subparagraph (B), or subparagraph (F) thereof), and
(d) payment is made by the end of the second calendar year following
the calendar year in which the disposition occurred. Notwithstanding
the foregoing, if the value of the Vested Portion of the Member's
Accounts is $5,000 or less, the Member's vested Accounts shall be
distributed as soon as administratively practicable after the Valuation
Date following the date the Member's employment with the Employer
terminates due to the disposition referenced above.
I.
<PAGE>
ARTICLE 13
GENERAL PROVISIONS
13.01 Nonalienation
(a) Except as required by any applicable law or by paragraph (c),
no benefit under the Plan shall in any manner be anticipated,
assigned or alienated, and any attempt to do so shall be void.
However, payment shall be made in accordance with the
provisions of any judgment, decree, or order which:
(i) creates for, or assigns to, a spouse, former spouse,
child or other dependent of a Member the right to
receive all or a portion of the Member's benefits
under the Plan for the purpose of providing child
support, alimony payments or marital property rights
to that spouse, child or dependent,
(ii) is made pursuant to a State domestic relations law,
(iii) does not require the Plan to provide any type of
benefit, or any option, not otherwise provided under
the Plan, and
(iv) otherwise meets the requirements of Section 206(d) of
ERISA, as amended, as a "qualified domestic relations
order", as determined by the Committee.
(b) Notwithstanding anything herein to the contrary, if the amount
payable to the alternate payee under the qualified domestic
relations order is less than $5,000, such amount shall be paid
in one lump sum as soon as practicable following the
qualification of the order. If the amount exceeds $5,000, it
may be paid as soon as practicable following the qualification
of the order if the qualified domestic relations order so
provides and the alternate payee consents thereto; otherwise
it may not be payable before the earliest of (i) the Member's
termination of employment, (ii) the time such amount could be
withdrawn under Article 7 or (iii) the Member's attainment of
age 50.
(c) On or after August 5, 1997, a Member's benefit under the Plan
shall be offset or reduced by the amount the Member is
required to pay to the Plan under the circumstances set forth
in Section 401(a)(13)(C) of the Code.
13.02 Conditions of Employment Not Affected by Plan
The establishment of the Plan shall not confer any legal rights upon
any Employee or other person for a continuation of employment, nor
shall it interfere with the rights of the Employer to discharge any
Employee and to treat him or her without regard to the effect which
that treatment might have upon him or her as a Member or potential
Member of the Plan.
13.03 Facility of Payment
If the Committee shall find that a Member or other person entitled to a
benefit is unable to care for his or her affairs because of illness or
accident or because he or she is a minor, the Committee may direct that
any benefit due him or her, unless claim shall have been made for the
benefit by a duly appointed legal representative, be paid to his or her
spouse, a child, a parent or other blood relative, or to a person with
whom he or she resides. Any payment so made shall be a complete
discharge of the liabilities of the Plan for that benefit.
<PAGE>
13.04 Erroneous Allocation
Notwithstanding any provision of the Plan to the contrary, if a
Member's Account is credited with an erroneous amount due to a mistake
in fact or law, the Committee shall adjust such Account in such
equitable manner as it deems appropriate to correct the erroneous
allocation.
<PAGE>
13.05 Information
Each Member, Beneficiary or other person entitled to a benefit, before
any benefit shall be payable to him or her or on his or her account
under the Plan, shall file with the Committee the information that it
shall require to establish his or her rights and benefits under the
Plan.
13.06 Top-Heavy Provisions
(a) The following definitions apply to the terms used in this
Section:
(i) "applicable determination date" means the last day
of the later of the first Plan Year or the preceding
Plan Year;
(ii) "top-heavy ratio" means the ratio of (A) the value of
the aggregate of the Accounts under the Plan for key
employees to (B) the value of the aggregate of the
Accounts under the Plan for all key employees and
non-key employees;
(iii) "key employee" means an employee who is in a category
of employees determined in accordance with the
provisions of Sections 416(i)(1) and (5) of the Code
and any regulations thereunder, and where applicable,
on the basis of the Employee's Statutory Compensation
from the Employer or an Affiliated Employer;
(iv) "non-key employee" means any Employee who is not a
key employee;
(v) "applicable Valuation Date" means the Valuation Date
coincident with or immediately preceding the last day
of the first Plan Year or the preceding Plan Year,
whichever is applicable;
(vi) "required aggregation group" means any other
qualified plan(s) of the Employer or an Affiliated
Employer in which there are members who are key
employees or which enable(s) the Plan to meet the
requirements of Section 401(a)(4) or 410 of the Code;
and
(vii) "permissive aggregation group" means each plan in the
required aggregation group and any other qualified
plan(s) of the Employer or an Affiliated Employer in
which all members are non-key employees, if the
resulting aggregation group continues to meet the
requirements of Sections 401(a)(4) and 410 of the
Code.
(b) For purposes of this Section, the Plan shall be "top-heavy"
with respect to any Plan Year if as of the applicable
determination date the top-heavy ratio exceeds 60%. The
top-heavy ratio shall be determined as of the applicable
Valuation Date in accordance with Sections 416(g)(3) and (4)
of the Code and Article 5 of this Plan. For purposes of
determining whether the Plan is top-heavy, the account
balances under the Plan will be combined with the account
balances or the present value of accrued benefits under each
other plan in the required aggregation group, and in the
Employer's discretion, may be combined with the account
balances or the present value of accrued benefits under any
other qualified plan in the permissive aggregation group.
Distributions made with respect to a Member under the Plan
during the five-year period ending on the applicable
determination date shall be taken into account for purposes
of determining the top-heavy ratio; distributions under
plans that terminated within such five-year period shall
also be taken into account, if any such plan contained key
employees and therefore would have been part of the required
aggregation group.
(c) The following provisions shall be applicable to Members for
any Plan Year with respect to which the Plan is top-heavy:
<PAGE>
(i) In lieu of the vesting requirements specified in Section 6.02, a
Member shall be vested in, and have a nonforfeitable right to,
his or her Employer Matching Account in accordance with the
following schedule:
Nonforfeitable
Years of Vesting Service Percentage
------------------------ ----------
Less than 2 years 0%
2 years 20
3 years 40
4 years 60
5 years 80
6 or more years 100
provided that in no event shall the Vested Portion of
his or her Employer Matching Account be less than the
Vested Portion determined under Section 6.02.
(ii) An additional Employer contribution shall be allocated on
behalf of each Member (and each Employee eligible to become
a Member) who is a non-key employee, and who has not
separated from service as of the last day of the Plan Year,
to the extent that the contributions made on his or her
behalf under Section 3.02 for the Plan Year (and not needed
to meet the contribution percentage test set forth in
Section 3.07) would otherwise be less than 3% of his or her
remuneration. However, if the greatest percentage of
remuneration contributed on behalf of a key employee under
Sections 3.01 and 3.02 for the Plan Year (disregarding any
contributions made under Section 3.13 for the Plan Year)
would be less than 3%, that lesser percentage shall be
substituted for "3%" in the preceding sentence.
Notwithstanding the foregoing provisions of this
subparagraph (ii), no minimum contribution shall be made
under this Plan with respect to a Member (or an Employee
eligible to become a Member) if the required minimum benefit
under Section 416(c)(1) of the Code is provided to him or
her by any other qualified pension plan of the Employer or
an Affiliated Employer. For the purposes of this
subparagraph (ii), remuneration has the same meaning as set
forth in Section 3.12(c).
(d) If the Plan is top-heavy with respect to a Plan Year and
ceases to be top-heavy for a subsequent Plan Year, the
following provisions shall be applicable:
(i) If a Member has completed at least three years of
Vesting Service on or before the last day of the
most recent Plan Year for which the Plan was
top-heavy, the vesting schedule set forth in
paragraph (b)(i) shall continue to be
applicable.
(ii) If a Member has completed at least two, but less than
three, years of Vesting Service on or before the last
day of the most recent Plan Year for which the Plan
was top-heavy, the vesting provisions of Section 6.02
shall again be applicable; provided, however, that in
no event shall the vested percentage of a Member's
Employer Matching Account be less than the percentage
determined under paragraph (b)(i) above as of the
last day of the most recent Plan Year for which the
Plan was top-heavy.
13.07 Prevention of Escheat
If the Committee cannot ascertain the whereabouts of any person to whom
a payment is due under the Plan, the Committee may, no earlier than
three years from the date such payment is due, mail a notice of such
due and owing payment to the last known address of such person, as
shown on the records of the Committee or the Employer. If such person
has not made written claim therefor within three months of the date of
the mailing, the Committee may, if it so elects and upon receiving
advice from counsel to the Plan, direct that such payment and all
remaining payments otherwise due such person be canceled on the records
of the Plan and the amount thereof applied to reduce the contributions
of the Employer. Upon such cancellation, the Plan and the Trust shall
have no further liability therefor except that, in the event such
person or his or her beneficiary later notifies the Committee of his or
her whereabouts and requests the payment or payments due to him or her
under the Plan, the amount so applied shall be paid to him or her in
accordance with the provisions of the Plan.
13.08 Member Notices
Any Notices made by a Member pursuant to the provisions of the Plan
shall be made in a time and manner determined by the Committee under
rules uniformly applicable to all employees similarly situated. The
Committee reserves the right to change from time to time the time and
manner for making such Notice by Members under the Plan if it
determines after due deliberation that such action is justified in that
it improves the administration of the Plan. In the event of a conflict
between the provisions for making a Notice, set forth in the Plan and
such new administrative procedures, those new administrative procedures
shall prevail.
13.09 Construction
(a) The Plan shall be construed, regulated and administered under
ERISA and the laws of the State of Texas, except where ERISA
controls.
(b) The titles and headings of the Articles and Sections in this Plan
are for convenience only. In the case of ambiguity or
inconsistency, the text rather than the titles or headings shall
control.
<PAGE>
AMENDMENT #1 TO THE
CLEAR CHANNEL COMMUNICATIONS, INC. 401(k) SAVINGS PLAN
THIS AMENDMENT to the Clear Channel Communications, Inc. 401(k) Savings
Plan (the "Plan") is made this 2 day of June, 2000 and is made by Clear Channel
Communications, Inc. (the "Company").
W I T N E S S E T H
WHEREAS, the Company has established and maintains the Plan for the benefit
of its employees; and
WHEREAS, the Board of Directors of the Company (the "Board") has the
ability to amend the Plan under Section 12.01, subject to certain conditions not
material hereto; and
WHEREAS, the Board desired to amend the Plan; and
WHEREAS, the Board approved the amendment to the Plan as provided below and
authorized the appropriate officers of the Company to sign and execute this
Amendment.
NOW THEREFORE, effective as of June 2, 2000, Section 3.02 of the Plan is
amended in its entirety by the following:
3.02 Employer Matching Contributions
The Employer may contribute from time to time on behalf of each of its
Members who elect to make Deferral Contributions an amount equal to a
designated percent of the first 5% of the Deferral Contributions made on
behalf of the Member to the Plan during each Plan Year. In no event,
however, shall the Employer Matching Contributions pursuant to this Section
exceed 5% of the Member's Compensation while a Member with respect to a
particular Plan Year. The Employer Matching Contributions are made
expressly conditional on the Plan satisfying the provisions of Sections
3.01, 3.06, 3.07 and 3.08. If any portion of the Deferred Cash Contribution
to which the Employer Matching Contribution relates is returned to the
Member under Section 3.01, 3.06, 3.07 or 3.08, the corresponding Employer
Matching Contribution shall be forfeited and if any amount of the Employer
Matching Contribution is deemed an excess aggregate contribution under
Section 3.07, such amount shall be forfeited in accordance with the
provisions of that Section. The Employer Matching Contributions shall be
paid to the Trustees as soon as practicable. Except as provided herein, the
Plan shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have caused this amendment to be
signed and effective the day first written above.
CLEAR CHANNEL COMMUNICATIONS, INC.
By:______________________________________
Ken Wyker, Secretary
<PAGE>
EXHIBIT 4.12
MASTER TRUST AGREEMENT
Between
-------------------------------------------------------------------------------
CLEAER CHANNEL COMMUNICATIONS, INC.
And
FIDELITY MANAGEMENT TRUST COMPANY
-------------------------------------------------------------------------------
CLEAR CHANNEL COMMUNICATIONS, INC. 401(K) SAVINGS PLAN
MASTER TRUST
Dated as of July 1, 1999
<PAGE>
iv
TABLE OF CONTENTS
Section Page
1 Definitions ................................................ 2
2 Trust ................................................ 3
3 Exclusive Benefit and Reversion of
Sponsor Contributions............................................. 4
4 Disbursements ................................................ 4
(a) Administrator-Directed Disbursements............ 4
(b) Participant Withdrawal Requests................. 4
(c) Limitations..................................... 4
5 Investment of Trust............................................... 4
(a) Selection of Investment Options................. 4
(b) Available Investment Options.................... 4
(c) Participant Direction........................... 5
(d) Mutual Funds.................................... 5
(e) Sponsor Stock................................... 5
(f) Participant Loans for General Purposes.......... 10
(g) Participant Loans for Purchase of Primary
Residence....................................... 11
(h) Reliance of Trustee Directions.................. 11
(i) Trustee Powers.................................. 11
6 Recordkeeping and Administrative Services to Be Performed......... 12
(a) General......................................... 12
(b) Accounts........................................ 13
(c) Inspection and Audit............................ 13
(d) Effect of Plan Amendment........................ 13
(e) Returns, Reports and Information................ 13
(f) Allocation of Plan Interests.................... 13
7 Compensation and Expenses......................................... 14
8 Directions and Indemnification.................................... 14
(a) Identity of Administrator and Named Fiduciaries. 14
(b) Directions from Sponsor or Administrator........ 14
(c) Directions from Named Fiduciary................. 14
(d) Co-Fiduciary Liability.......................... 15
(e) Indemnification................................. 15
(f) Survival........................................ 15
<PAGE>
9 Resignation or Removal of Trustee................................. 15
(a) Resignation..................................... 15
(b) Removal......................................... 15
10 Successor Trustee ................................................ 15
(a) Appointment..................................... 15
(b) Acceptance...................................... 15
(c) Corporate Action................................ 16
11 Termination ................................................ 16
12 Resignation, Removal, and Termination Notices..................... 16
13 Duration ................................................ 16
14 Amendment or Modification......................................... 16
15 Electronic Services............................................... 16
16 General ................................................ 17
(a) Performance by Trustee, its Agents or Affiliates. 17
(b) Delegation by Employer.......................... 17
(c) Entire Agreement................................ 18
(d) Waiver.......................................... 18
(e) Successors and Assigns.......................... 18
(f) Partial Invalidity.............................. 18
(g) Section Headings................................ 18
17 Governing Law ................................................ 18
(a) Massachusetts Law Controls...................... 18
(b) Trust Agreement Controls........................ 18
18 Plan Qualification................................................ 18
<PAGE>
Schedules
A. Administrative Services
B. Fee Schedule
C. Investment Options
D. Administrator's Authorization Letter
E. Named Fiduciary's Authorization Letter
F. IRS Determination Letter or Opinion of Counsel
0. Exchange Guidelines
H. Operational Guidelines for Non-Fidelity Mutual Funds
I. Plan Designation Form
<PAGE>
TRUST AGREEMENT, dated as of the first day of July, 1999, between CLEAR
CHANNEL COMMUNICATION, INC., a Texas corporation, having an office at 347
Sandau, San Antonio, TX 78216 (the "Sponsor"), and FIDELITY MANAGEMENT TRUST
COMPANY, a Massachusetts trust company, having an office at 82 Devonshire
Street, Boston, Massachusetts 02109 (the "Trustee")
WITNESSETH:
WHEREAS, the Sponsor is the sponsor of the Clear Channel Communications,
Inc. 401(k) Savings Plan and the Eller Media Company 401(k) Plan (individually
and collectively, the "Plan"); and
WHEREAS, the Eller Media Company 401(k) Plan is currently frozen to new
exchanges and new contributions, and any new assets shall be directed to Clear
Channel Communications, Inc. 401(k) Savings Plan; and
WHEREAS, certain affiliates and subsidiaries of the Sponsor maintain, or
may in the future maintain, qualified defined contribution plans for the benefit
of their eligible employees; and
WHEREAS, the Sponsor desires to establish a single trust to hold all of
the assets of the Plan and or such other tax-qualified defined contribution
plans maintained by the Sponsor, or any of its subsidiaries or affiliates, as
are designated by the Sponsor as being eligible to participate therein; and
WHEREAS, the Trustee shall maintain a separate account reflecting the
equitable share of each Plan in the Trust and in all investments, receipts,
disbursements and other transactions hereunder, and shall report the value of
such equitable share at such times as may be mutually agreed upon by the Trustee
and the Sponsor. Such equitable share shall be used solely for the payments of
benefits, expenses and other charges properly allocable to each such Plan and
shall not be used for the payment of benefits, expenses or other charges
properly allocable to any other Plan; and
WHEREAS, the Trustee is willing to hold and invest the aforesaid plan
assets in trust pursuant to the provisions of this Trust Agreement and the
provisions of the underlying Plan as communicated in writing to the Trustee,
which trust shall constitute a continuation, by means of an amendment and
restatement, of each of the prior trusts from which plan assets are transferred
to the Trustee; and
WHEREAS, the Trustee is willing to hold and invest the aforesaid plan
assets in trust among several investment options selected by the Named
Fiduciary; and
<PAGE>
WHEREAS, the Trustee is willing to perform recordkeeping and
administrative services for the Plan if the services are ministerial in nature
and are provided within a framework of plan provisions, guidelines and
interpretations conveyed in writing to the Trustee by the Administrator.
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants and agreements set forth below, the Sponsor and the Trustee
agree as follows:
Section 1. Definitions. The following terms as used in this Trust Agreement
have the meaning indicated unless the context clearly requires otherwise:
(a) "Administrator" shall mean, with respect to the Plan, the person or
entity which is the "administrator" of such Plan within the meaning of
section 3(16)(A) of ERISA, namely, the Sponsor.
(b) "Agreement" shall mean this Trust Agreement, as the same may be amended
and in effect from time to time.
(c) "Code" shall mean the Internal Revenue Code of 1986, as it has been or
may be amended from time to time.
(d) "ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as it has been or may be amended from time to time.
(e) "Existing Investment Contracts" shall mean each annuity contract
heretofore entered into by the Sponsor, any other employer or any
predecessor trustee.
(f) "Fidelity Mutual Fund" shall mean any investment company advised by
Fidelity Management & Research Company or any of its affiliates.
(g) "Mutual Fund" shall refer both to Fidelity Mutual Funds and Non-Fidelity
Mutual Funds.
(h) "Named Fiduciary" shall mean, with respect to the application of any
provision of this Agreement to any Plan, the person or entity which is
the relevant fiduciary under such Plan with respect to such matter
(within the meaning of section 402(a) of the Employee Retirement Income
Security Act of 1974, as amended), namely, the Sponsor; and
(i) "Non-Fidelity Mutual Fund" shall mean certain investment companies not
advised by Fidelity Management & Research Company or any of its
affiliates.
(j) "Participant" shall mean, with respect to the Plan, any employee (or
former employee) with an account under the Plan, which has not yet been
fully distributed and/or forfeited, and shall include the designated
beneficiary(ies) with respect to the account of any deceased employee
(or deceased former employee) until such account has been fully
distributed and/or forfeited.
(k) "Participant Recordkeeping Reconciliation Period" shall mean the period
beginning on the date of the initial transfer of assets to the Trust and
ending on the date of the completion of the reconciliation of
Participant records.
(1) "Plan" shall mean the Clear Channel Communications, Inc. 401(k) Savings
Plan, the Eller Media Company 401(k) Plan, and such other tax-qualified,
defined contribution plans which are maintained by the Sponsor or any of
its subsidiaries or affiliates for the benefit of their eligible
employees as may be designated by the Sponsor in writing to the Trustee
as a Plan hereunder, such writing to be in the form of the Plan
Designation Form attached hereto as Schedule "I". Each reference to "a
Plan" or "the Plan" in this Agreement shall mean and include the Plan or
Plans to which the particular provision of this Agreement is being
applied or all Plans, as the context may require.
(m) "Reporting Date" shall mean the last day of each calendar quarter, the
date as of which the Trustee resigns or is removed pursuant to Section 9
hereof and the date as of which this Agreement terminates pursuant to
Section 11 hereof.
(n) "Sponsor" shall mean Clear Channel Communications, Inc., a Texas
corporation, or any successor to all or substantially all of
its businesses which, by agreement, operation of law or otherwise,
assumes the responsibility of the Sponsor under this Agreement.
(o) "Sponsor Stock" shall mean the Common Stock of the Sponsor, or such
other publicly-traded stock of the Sponsor, or such other
publicly-traded stock of the Sponsor's affiliates as meets the
requirements of section 407(d)(5) of ERISA with respect to the Plan.
(p) "Trust" shall mean the Clear Channel Communications, Inc. 401(k)
Savings Plan Master Trust, being the trust established by the
Sponsor and the Trustee pursuant to the provisions of this Agreement.
(q) "Trustee" shall mean Fidelity Management Trust Company, a Massachusetts
trust company and any successor to all or substantially all of its trust
business as described in Section 10(c). The term Trustee shall also
include any successor trustee appointed pursuant to Section 10 to the
extent such successor agrees to serve as Trustee under this Agreement.
Section 2. Trust. The Sponsor hereby establishes the Clear Channel
Communications, Inc. 401(k) Savings Plan Master Trust with the Trustee. The
Trust shall consist of an initial contribution of money or other property
acceptable to the Trustee in its sole discretion, made by the Sponsor or
transferred from a previous trustee under the Plan, such additional sums of
money and Sponsor Stock as shall from time to time be delivered to the Trustee
under a Plan, all investments made therewith and proceeds thereof, and all
earnings and profits thereon, less the payments that are made by the Trustee as
provided herein, without distinction between principal and income. The Trustee
hereby accepts the Trust on the terms and conditions set forth in this
Agreement. In accepting this Trust, the Trustee shall be accountable for the
assets received by it, subject to the terms and conditions of this Agreement.
<PAGE>
Section 3. Exclusive Benefit and Reversion of Sponsor Contributions.
--------------------------------------------------------
Except as provided under applicable law, no part of the Trust allocable to a
Plan may be used for, or diverted to, purposes other than the exclusive benefit
of the Participants in the Plan or their beneficiaries prior to the satisfaction
of all liabilities with respect to the Participants and their beneficiaries. All
expenses of the Trust shall be a charge against and paid from the appropriate
plan participants' accounts, except to the extent such amounts are paid by the
Plan Sponsor in a timely manner.
Section 4. Disbursements.
-------------
(a) Administrator Directed Disbursements. The Trustee shall make
disbursements in the amounts and in the manner that the Administrator directs
from time to time in writing. The Trustee shall have no responsibility to
ascertain such directions compliance with the terms of the Plan (except to the
extent the terms of the Plan have been communicated to the Trustee in writing)
or of any applicable law or the direction's effect for tax purposes or
otherwise; nor shall the Trustee have any responsibility to see to the
application of any disbursement.
(b) Participant Withdrawal Requests. The Sponsor hereby directs that,
pursuant to the Plan, a Participant withdrawal request (in-service or full
withdrawal) may be made by the Participant by telephone, and the Trustee shall
process such request only after the identity of the Participant is verified by
use of a personal identification number ("PIN") and social security number. The
Trustee shall process such withdrawal in accordance with written guidelines
provided by the Sponsor and documented in the Plan Administrative Manual. In the
case of a hardship withdrawal request, the Trustee shall forward the withdrawal
document to the participant for execution and submission for approval to the
Administrator. The Administrator shall have the responsibility for approving the
withdrawal and instructing the Trustee to send the proceeds to the Administrator
or to the participant if so directed by the Administrator.
(c) Limitations. The Trustee shall not be required to make any
disbursement in excess of the net realizable value of the assets of the Trust at
the time of the disbursement. The Trustee shall be required to make all
disbursements in cash in accordance with the hierarchy of investments to be
converted to cash as detailed in the Plan Administrative Manual, or in kind, as
applicable, unless the Administrator has provided written directions to the
contrary.
Section 5. Investment of Trust.
-------------------
(a) Selection of Investment Options. The Trustee shall have no
responsibility for the selection of investment options under the Trust and shall
not render investment advice to any person in connection with the selection of
such options.
(b) Available Investment Options. The Named Fiduciary with respect to a
Plan shall direct the Trustee as to the investment options in which the Trust
shall be invested during the Participant Recordkeeping Reconciliation Period,
and the investment options in which Plan Participants may invest, subject to the
following limitations. The Named Fiduciary may determine to offer as investment
options only (i) Mutual Funds, (ii) Sponsor Stock, and (iii) notes evidencing
loans to Participants in accordance with the terms of the Plan,
The. investment options initially selected by the Named Fiduciary are
identified on Schedules "A" and "C" attached hereto. The Named Fiduciary may add
additional investment options with the consent of the Trustee and upon mutual
amendment of this Trust Agreement and the Schedules thereto to reflect such
additions.
(c) Participant Direction. Each Participant shall direct the Trustee in
which investment option(s) to invest the assets in the Participant's individual
accounts. Such directions may be made by Participants by use of the telephone
exchange system, the internet, or in such other manner as may be agreed upon
from time to time by the Sponsor and the Trustee, maintained for such purposes
by the Trustee or its agent, in accordance with written Exchange Guidelines
attached hereto as Schedule "G". In the event that the Trustee fails to receive
a proper direction, the assets shall be invested in the securities of the Mutual
Fund set forth for such purpose on Schedule "C", until the Trustee receives a
proper direction.
(d) Mutual Funds. The Sponsor hereby acknowledges that it has received
from the Trustee a copy of the prospectus for each Fidelity Mutual Fund selected
by the Named Fiduciary as a Plan investment option. All transactions involving
Non-Fidelity Mutual Funds shall be done in accordance with the Operational
Guidelines for Non-Fidelity Mutual Funds attached hereto as Schedule "H". Trust
investments in Mutual Funds shall be subject to the following limitations:
(i) Execution of Purchases and Sales. Purchases and sales of
Mutual Funds (other than for exchanges) shall he made on the date on which the
Trustee receives from the Sponsor in good order all information and
documentation necessary to accurately effect such purchases and sales (or in the
case of a purchase, the subsequent date on which the Trustee has received a wire
transfer of funds necessary to make such purchase). Exchanges of Mutual Funds
shall be made in accordance with the Exchange Guidelines attached hereto as
Schedule "G".
(ii) Voting. At the time of mailing of notice of each annual
or special stockholders' meeting of any Mutual Fund, the Trustee shall send a
copy of the notice and all proxy solicitation materials to each Participant who
has shares of the Mutual Fund credited to the Participant's accounts, together
with a voting direction form for return to the Trustee or its designee. The
Sponsor shall have the right to direct the Trustee as to the manner in which the
Trustee is to vote the mutual fund shares held in any short-term investment fund
or liquidity reserve. The Participant shall have the right to direct the Trustee
as to the manner in which the Trustee is to vote the shares credited to the
Participant's accounts (both vested and unvested). The Trustee shall vote the
shares as directed by the Participant. The Trustee shall not vote shares for
which it has received no directions from the Participant. During the Participant
Recordkeeping Reconciliation Period, the Sponsor shall have the right to direct
the Trustee as to the manner in which the Trustee is to vote the shares of the
Mutual Funds in the Trust including Mutual Fund shares held in any short-term
investment fund for liquidity reserve. With respect to all rights other than the
right to vote, the Trustee shall follow the directions of the Participant and if
no such directions are received, the directions of the Named Fiduciary. The
Trustee shall have no duty to solicit directions from Participants or the
Sponsor.
(e) Sponsor Stock. Trust investments in Sponsor Stock shall be made via
the CCC Stock Fund (the "Stock Fund"). Investments in the Stock Fund shall
consist primarily of shares of Sponsor Stock. In order to satisfy daily
participant exchange or withdrawal requests for transfers and payments, the
Stock Fund shall also include cash or short-term liquid investments in
accordance with this paragraph. Such holdings will include Fidelity
Institutional Cash Portfolios: Money Market Portfolio: Class I or such other
Mutual Fund or commingled money market pool as agreed to by the Sponsor and
Trustee. The Named Fiduciary shall, after consultation with the Trustee,
establish and communicate to the Trustee in writing a target percentage and
drift allowance for such short-term liquid investments. The Trustee shall be
responsible for ensuring that the actual cash held in the Stock Fund falls
within the agreed upon range over time. Each participant's proportional interest
in the Stock Fund shall be measured in units of participation, rather than
shares of Sponsor Stock. Such units shall represent a proportionate interest in
all of the assets of the Stock Fund, which includes shares of Sponsor Stock,
short-term investments and at times, receivables for dividends and/or Sponsor
Stock sold and payables for Sponsor Stock purchased. The Trustee shall determine
a daily net asset value ("NAV") for each unit outstanding of the Stock Fund.
Valuation of the Stock Fund shall be based upon the New York Stock Exchange
("NYSE") closing price of the Sponsor stock, or if unavailable, the latest
available price as reported by the principal national securities exchange on
which the Sponsor Stock is traded. The NAV may be adjusted by dividends paid on
the shares of Sponsor Stock held by the Stock Fund, gains or losses realized on
sales of Sponsor Stock, appreciation or depreciation in the market price of
those shares owned, and interest on the short-term investments held by the Stock
Fund, expenses that, pursuant to Sponsor direction, the Trustee accrues from the
Stock Fund, and commissions on purchases and sales of Sponsor Stock. Investments
in Sponsor Stock shall be subject to the following limitations:
(i) Acquisition Limit. Pursuant to the Plan, the Trust
may be invested in Sponsor Stock to the extent necessary to comply with
investment directions in accordance with this Agreement.
(ii) Fiduciary Duty of Named Fiduciary. The Named Fiduciary
shall continually monitor the suitability under the fiduciary duty rules of
section 404(a)(1) of ERISA (as modified by section 404(a)(2) of ERISA) of
offering Sponsor Stock as an investment option in the Plan. The Trustee shall
not be liable for any loss or expense which arises from the directions of the
Named Fiduciary with respect to the monitoring and approval of Sponsor Stock as
an investment option in the Plan unless it is clear on their face that the
actions to be taken under those directions would be prohibited by the foregoing
fiduciary duty rules or would be contrary to the terms of this Agreement.
Each participant with an interest in Sponsor Stock (or, in the event of
the participant's death, his beneficiary) is, for the purposes of Section
4(e)(ii), hereby designated as a "named fiduciary" (within the meaning of
Section 403(a)(l) of ERISA), with respect to a pro rata portion of (i) the
shares of Sponsor Stock held which are allocated to other participants' accounts
but as to which directions are not timely received by the Trustee, and (ii) the
shares of Sponsor Stock not allocated to participants' accounts, and (iii)
allocated shares not purchased at the direction of participants, and such
participant (or beneficiary) shall have the right to direct the Trustee in
writing as to the manner in which the Trustee is to vote such shares.
(iii) Purchase and sales of Sponsor Stock shall be made on the
open market as necessary to maintain the target cash percentage and drift
allowance for the Stock Fund, provided that:
(A)......If the Trustee is unable to purchase or sell the total number
of shares required to be purchased or sold on such day as a result of
market conditions; or
(B)......If the Trustee is prohibited by the Securities and Exchange
Commission, the New York Stock Exchange, or any other regulatory body from
purchasing or selling any or all of the shares required to be purchased or
sold on such day, then the Trustee shall purchase or sell such shares as
soon as possible thereafter. The Trustee may follow directions from the
Administrator or Named Fiduciary to deviate from the above purchase and
sale procedures provided that such direction is made in writing by the
Administrator or Named Fiduciary.
(iv) Execution of Purchases and Sales. (A) Purchases and sales
of units in the Stock Fund (other than for exchanges) shall be made on the date
on which the Trustee receives from the Administrator in good order all
information, documentation, and wire transfers of funds (if applicable),
necessary to accurately effect such transactions. Exchanges of units in the
Stock Fund shall be made in accordance with the Exchange Guidelines attached
hereto as Schedule "G". The Trustee may follow directions from the Administrator
or Named Fiduciary to deviate from the above purchase and sale procedures
provided that such direction is made in writing by the Administrator or Named
Fiduciary.
(B)......Purchases and Sales from or to Sponsor. If directed by the
Sponsor in writing prior to the trading
date, the Trustee may purchase or sell Sponsor Stock from or to the Sponsor if
the purchase or sale is for adequate consideration (within the meaning of
section 3(18) of ERISA) and no commission is charged. If Sponsor contributions
(employer) or contributions made by the Sponsor on behalf of the participants
(employee) under the Plan are to be invested in Sponsor Stock, the Sponsor may
transfer Sponsor Stock in lieu of cash to the Trust. In either case, the number
of shares to be transferred will be determined by dividing the total amount of
Sponsor Stock to be purchased or sold by the 4:00 p.m. NYSE closing price of the
Sponsor Stock on the trading date.
(C)......Use of an Affiliated Broker. The Sponsor hereby directs the
Trustee to use Capital Markets. ("Capital Markets") to provide brokerage
services in connection with any purchase or sale of Sponsor Stock in accordance
with directions from Plan participants. Capital Markets shall execute such
directions directly or through its affiliate, National Financial Services
Company ("NFSC"). The provision of brokerage services shall be subject to the
following:
(1) As consideration for such brokerage services, the Sponsor
agrees that Capital Markets shall be entitled to remuneration under
this direction provision in an amount of no more than three and
one-fifth cents ($.032) commission on each share of Sponsor Stock. Any
change in such remuneration may be made only by a signed agreement
between Sponsor and Trustee.
(2) The Trustee will provide the Sponsor with a description of
Capital Markets' brokerage placement practices and a form by which the
Sponsor may terminate this direction to use a broker affiliated with
the Trustee. The Trustee will provide the Sponsor with this
termination form annually, as well as quarterly and annual reports
which summarize all securities transaction-related charges incurred by
the Plan.
(3) Any successor organization of Capital Markets, through
reorganization, consolidation, merger or similar transactions, shall,
upon consummation of such transaction, become the successor broker in
accordance with the terms of this direction provision.
(4) The Trustee and Capital Markets shall continue to rely on
this direction provision until notified to the contrary. The Sponsor
reserves the right to terminate this direction upon written notice to
Capital Markets (or its successor) and the Trustee, in accordance with
Section 11 of this Agreement.
(v) Securities Law Reports. The Named Fiduciary shall be
responsible for filing all reports required under Federal or state securities
laws with respect to the Trust's ownership of Sponsor Stock, including, without
limitation, any reports required under section 13 or 16 of the Securities
Exchange Act of 1934, and shall immediately notify the Trustee in writing of any
requirement to stop purchases or sales of Sponsor Stock pending the filing of
any report. The Trustee shall provide to the Named Fiduciary such information on
the Trust's ownership of Sponsor Stock as the Named Fiduciary may reasonably
request in order to comply with Federal or state securities laws.
(vi) Voting and Tender Offers. Notwithstanding any other
provision of this Agreement the provisions of this Section shall govern the
voting and tendering of Sponsor Stock. The Trustee, after consultation with the
Sponsor, shall prepare the necessary documents associated with the voting of
Sponsor Stock.
(A) Voting.
------
(1) When the issuer of Sponsor Stock prepares for any annual or
special meeting, the Sponsor shall notify the Trustee at least thirty
(30) days in advance of the intended record date and shall cause a
copy of all proxy solicitation materials to be sent to the Trustee. If
requested by the Trustee, the Sponsor shall certify to the Trustee
that the aforementioned materials represents the same information that
is distributed to shareholders of Sponsor Stock. Based on these
materials the Trustee shall prepare a voting instruction form and
shall provide a copy of all proxy solicitation materials to be sent to
each Plan participant with an interest in Sponsor Stock held in the
Trust, together with the foregoing voting instruction form to be
returned to the Trustee or its designee. The form shall show the
proportional interest in the number of full and fractional shares of
Sponsor Stock credited to the participant's accounts held in the Stock
Fund.
(2) Each participant with an interest in the Stock Fund shall
have the right to direct the Trustee as to the manner in which the
Trustee is to vote (including not to vote) that number of shares of
Sponsor Stock reflecting such participant's proportional interest in
the Stock Fund (both vested and unvested). Directions from a
participant to the Trustee concerning the voting of Sponsor Stock
shall be communicated in writing or by such other means as is agreed
upon by the Trustee and the Sponsor. These directions shall be held in
confidence by the Trustee and shall not be divulged to the Sponsor, or
any officer or employee thereof, or any other person except to the
extent that the consequences of such directions are reflected in
reports regularly communicated to any such persons in the ordinary
course of the performance of the Trustee's services hereunder. Upon
its receipt of the directions, the Trustee shall vote the shares of
Sponsor Stock reflecting the participant's proportional interest in
the Stock Fund as directed by the participant. Except as otherwise
required by law, the Trustee shall not vote shares of Sponsor Stock
reflecting a participant's proportional interest in the Stock Fund for
which it has received no direction from the participant.
(B)......Tender Offers.
-------------
(1) Upon commencement of a tender offer for any securities held
in the Trust that are Sponsor Stock, the Sponsor shall timely notify
the Trustee in advance of the intended tender date and shall cause a
copy of all materials to be sent to the Trustee. The Sponsor shall
certify to the Trustee that the aforementioned materials represent the
same information distributed to shareholders of Sponsor Stock. Based
on these materials and after consultation with the Sponsor the Trustee
shall prepare a tender instruction form and shall provide a copy of
all tender materials to be sent to each plan participant with an
interest in the Stock Fund, together with the foregoing tender
instruction form, to be returned to the Trustee or its designee. The
tender instruction form shall show the number of full and fractional
shares of Sponsor Stock that reflect the participants proportional
interest in the Stock Fund (both vested and unvested).
(2) Each participant with an interest in the Stock Fund shall
have the right to direct the Trustee to tender or not to tender some
or all of the shares of Sponsor Stock reflecting such participant's
proportional interest in the Stock Fund (both vested and unvested).
Directions from a participant to the Trustee concerning the tender of
Sponsor Stock shall be communicated in writing, or by mailgram or such
other means as is agreed upon by the Trustee and the Sponsor. These
directions shall be held in confidence by the Trustee and shall not be
divulged to the Sponsor, or any officer or employee thereof, or any
other person except to the extent that the consequences of such
directions are reflected in reports regularly communicated to any such
persons in the ordinary course of the performance of the Trustee's
services hereunder. The Trustee shall tender or not tender shares of
Sponsor Stock as directed by the participant. Except as otherwise
required by law, the Trustee shall not tender shares of Sponsor Stock
reflecting a participant's proportional interest in the Stock Fund for
which it has received no direction from the participant.
(3) Except as otherwise required by law, the Trustee shall tender
that number of shares of Sponsor Stock not credited to participants'
accounts in the same proportion as the total number of shares of
Sponsor Stock credited to participants' accounts for which it has
received instructions from Participants.
(4) A participant who has directed the Trustee to tender some or
all of the shares of Sponsor Stock reflecting the participant's
proportional interest in the Stock Fund may, at any time prior to the
tender offer withdrawal date, direct the Trustee to withdraw some or
all of the tendered shares reflecting the participant's proportional
interest, and the Trustee shall withdraw the directed number of shares
from the tender offer prior to the tender offer withdrawal deadline.
Prior to the withdrawal deadline, if any shares of Sponsor Stock not
credited to participants' accounts have been tendered, the Trustee
shall redetermine the number of shares of Sponsor Stock that would be
tendered under Section 4(e)(v)(B)(3) if the date of the foregoing
withdrawal were the date of determination, and withdraw from the
tender offer the number of shares of Sponsor Stock not credited to
participants' accounts necessary to reduce the amount of tendered
Sponsor Stock not credited to participants' accounts to the amount so
redetermined. A participant shall not be limited as to the number of
directions to tender or withdraw that the participant may give to the
Trustee.
(5) A direction by a participant to the Trustee to tender shares
of Sponsor Stock reflecting the participant's proportional interest in
the Stock Fund shall not be considered a written election under the
Plan by the participant to withdraw, or have distributed, any or all
of his withdrawable shares. The Trustee shall credit to each
proportional interest of the participant from which the tendered
shares were taken the proceeds received by the Trustee in exchange for
the shares of Sponsor Stock tendered from that interest. Pending
receipt of directions (through the Administrator) from the participant
or the Named Fiduciary, as provided in the Plan, as to which of the
remaining investment options the proceeds should be invested in, the
Trustee shall invest the proceeds in the investment option described
in Schedule "C".
(vii) General. With respect to all rights other than the right to
vote, the right to tender, and the right to withdraw shares previously
tendered, in the case of Sponsor Stock credited to a participant's
proportional interest in the Stock Fund, the Trustee shall follow the
directions of the participant and if no such directions are received,
the directions of the Named Fiduciary. The Trustee shall have no duty
to solicit directions from participants. With respect to all rights
other than the right to vote and the right to tender, in the case of
Sponsor Stock not credited to participants' accounts, the Trustee
shall follow the directions of the Named Fiduciary.
(viii) Conversion. All provisions in this Section 4(e) shall also
apply to any securities received as a result of a conversion of
Sponsor Stock.
(f) Participant Loans for General Purposes. The Administrator
shall act as the Trustee's agent for Participant loan notes and as
such shall (i) separately account for repayments of such loans and
clearly identify such assets as Plan assets and (ii) collect and remit
all principal and interest payments to the Trustee. To originate a
Participant loan for General Purposes, the Plan Participant shall
direct the Trustee as to the term and amount of the loan to be made
from the Participant's individual account. Such directions shall be
made by Plan Participants by use of the exchange system maintained for
such purpose by the Trustee or its agent. The Trustee shall determine,
based on the current value of the Participant's account on the date of
the request and any guidelines provided by the Sponsor, the amount
available for the loan. Based on the interest rate supplied by the
Sponsor in accordance with the terms of the Plan, the Trustee shall
advise the Participant of such interest rate, as well as the
installment payment amounts. The Trustee shall distribute the loan
agreement and truth-in-lending disclosure with the proceeds check to
the Participant. To facilitate recordkeeping, the Trustee may destroy
the original of any proceeds check made in connection with a loan to a
Participant under the Plan, provided that the Trustee or its agent
first creates a duplicate by a photographic or optical scanning or
other process yielding a reasonable facsimile of the promissory note
and the Plan Participant's signature thereon, which duplicate may be
reduced or enlarged in size from the actual size of the original
promissory note.
(g) Participant Loans for the Purchase of a Primary Residence.
The Administrator shall act as the Trustee's agent for the purpose of
holding all trust investments in Participant loan notes and related
documentation and as such shall (i) hold physical custody of and keep
safe the notes and other loan documents, (ii) separately account for
repayments of such loans and clearly identify such assets as Plan
assets, (iii) collect and remit all principal and interest payments to
the Trustee, and (iv) cancel and surrender the notes and other loan
documentation when a loan has been paid in full. To originate a
Participant loan for the Purchase of a Primary Residence, the Plan
Participant shall direct the Trustee as to the type of loan to be made
from the Participant's individual account. Such directions shall be
made by Plan Participants by use of the exchange system maintained for
such purpose by the Trustee or its agent. The Trustee shall determine,
based on the current value of the Participant's account, the amount
available for the loan. Based on the interest rate supplied by the
Sponsor in accordance with the terms of the Plan, the Trustee shall
advise the Participant of such interest rate, as well as the
installment payment amounts. The Trustee shall forward the loan
document to the Participant for execution and submission for approval
to the Administrator. The Administrator shall have the responsibility
for approving the loan and instructing the Trustee to send the loan
proceeds to the Administrator or to the Participant if so directed by
the Administrator. In all cases, approval or disapproval by the
Administrator shall be made within thirty (30) days of the
Participant's initial request (the origination date).
(h) Reliance of Trustee on Directions.
---------------------------------
(i) The Trustee shall not be liable for any loss, or expense
which arises from any Participant's exercise or non-exercise
of rights under this Section 5 over the assets in the
Participant's accounts.
(ii) The Trustee shall not be liable for any loss or expense
which arises from the Named Fiduciary's exercise or
non-exercise of rights under this Section 5, unless it was
clear on their face that the actions to be taken under the
Named Fiduciary's directions were prohibited by the
fiduciary duty rules of Section 404(a) of ERISA or were
contrary to the terms of the Plan as communicated in writing
to the Trustee.
(i) Trustee Powers. The Trustee shall have the following powers and
authority:
(i) Subject to paragraphs (b), (c) and (d) of this Section
5, to sell, exchange, convey, transfer, or otherwise
dispose of any property held in the Trust, by private
contract or at public auction. No person dealing with
the Trustee shall be bound to see to the application of
the purchase money or other property delivered to the
Trustee or to inquire into the validity, expediency, or
propriety of any such sale or other disposition.
(ii) To cause any securities or other property held as part
of the Trust to be registered in the Trustee's own
name, in the name of one or more of its nominees, or in
the Trustee's account with the Depository Trust Company
of New York and to hold any investments in bearer form,
but the books and records of the Trustee shall at all
times show that all such investments are part of the
Trust.
(iii)To keep that portion of the Trust in cash or cash
balances as the Named Fiduciary or Sponsor may, from
time to time, deem to be in the best interest of the
Trust.
(iv) To make, execute, acknowledge, and deliver any and all
documents of transfer or conveyance and to carry out
the powers herein granted.
(v) To borrow funds from a bank not affiliated with the
Trustee in order to provide sufficient liquidity to
process Plan transactions in a timely fashion, provided
that the cost of borrowing shall be allocated in a
reasonable fashion to the investment fund(s) in need of
liquidity.
(vi) To settle, compromise, or submit to arbitration any
claims, debts, or damages due to or arising from the
Trust; to commence or defend suits or legal or
administrative proceedings; to represent the Trust in
all suits and legal and administrative hearings; and to
pay all reasonable expenses arising from any such
action, from the Trust if not paid by the Sponsor.
(vii)To employ legal, accounting, clerical, and other
assistance as may be required in carrying out the
provisions of this Agreement and to pay their
reasonable expenses and compensation from the Trust if
not paid by the Sponsor.
(viii) To invest all of any part of the assets of the Trust
in GICs and short-term investments (including interest
bearing accounts with the Trustee of money market
mutual funds advised by affiliates of the Trustee) and
in any collective investment trust or group trust,
including any collective investment trust or group
trust maintained by the Trustee, which then provides
for the pooling of the assets of plans described in
Section 401(a) and exempt from tax under Section 501(a)
of the Code or any comparable provisions of any future
legislation that amends, supplements, or supersedes
those sections, provided that such collective
investment trust or group trust is exempt from tax
under the Code or regulations or rulings issued by the
Internal Revenue Service; the provisions of the
document governing such collective investment trusts or
group trusts, as it may be amended from time to time,
shall govern any investment therein and are hereby made
a part of this Trust Agreement.
(ix) To do all other acts although not specifically
mentioned herein, as the Trustee may deem necessary to
carry out any of the foregoing powers and the purposes
of the Trust.
Section 6. Recordkeeping and Administrative Services to Be Performed.
---------------------------------------------------------
(a) General. The Trustee shall perform those recordkeeping and
administrative functions described in Schedule "A" attached hereto. These
recordkeeping and administrative functions shall be performed within the
framework of the Named Fiduciary's written directions regarding the Plan's
provisions, guidelines and interpretations.
(b) Accounts. The Trustee shall keep accurate accounts of all
investments, receipts, disbursements, and other transactions hereunder, and
shall report the value of the assets held in the Trust as of each Reporting
Date. Within thirty (30) days following each Reporting Date or within sixty (60)
days in the case of a Reporting Date caused by the resignation or removal of the
Trustee, or the termination of this Agreement, the Trustee shall file with the
Sponsor a written account setting forth all investments, receipts,
disbursements, and other transactions effected by the Trustee between the
Reporting Date and the prior Reporting Date, and setting forth the value of the
Trust as of the Reporting Date. Except as otherwise required under ERISA, upon
the timely filing of the IRS Form 5500, the Trustee shall have no liability or
further accountability with respect to the propriety of its acts or transactions
shown in such account, except with respect to such acts or transactions as to
which a written objection shall have been previously filed with the Trustee.
(c) Inspection and Audit. All records generated by the Trustee in
accordance with paragraphs (a) and (b) shall be open to inspection and audit,
during the Trustee's regular business hours prior to the termination of this
Agreement, by the Sponsor or any person designated by the Sponsor. Upon the
resignation or removal of the Trustee or the termination of this Agreement, the
Trustee shall provide to the Sponsor, at no expense to the Sponsor, in the
format regularly provided to the Sponsor; a statement of each Participant's
accounts as of the resignation, removal, or termination, and the Trustee shall
provide to the Sponsor or the Plan's new recordkeeper such further records as
are reasonable, at the Sponsor's expense.
(d) Effect of Plan Amendment. A confirmation of the current qualified
status of each Plan is attached hereto as Schedule "F". The Trustee's provision
of the recordkeeping and administrative services set forth in this Section 6
shall be conditioned on the Sponsor delivering to the Trustee a copy of any
amendment to the Plan as soon as administratively feasible following the
amendment's adoption, with, if requested, an IRS determination letter or an
opinion of counsel substantially in the form of Schedule "F" covering such
amendment, and on the Sponsor providing the Trustee on a timely basis with all
the information the Sponsor deems necessary for the Trustee to perform the
recordkeeping and administrative services and such other information as the
Trustee may reasonably request.
(e) Returns, Reports and Information. Except as set forth on Schedule
"A", the Sponsor shall be responsible for the preparation and filing of all
returns, reports, and information required of the Trust or Plan by law. The
Trustee shall provide the Sponsor with such information as the Sponsor may
reasonably request to make these filings. The Sponsor shall also be responsible
for making any disclosures to Participants including, without limitation, such
disclosures as may be required by law, except such disclosure as may be required
under federal or state truth-in-lending laws with regard to Participant loans,
which shall be provided by the Trustee.
(f) Allocation of Plan Interests. All transfers to, withdrawals from, or
other transactions regarding the Trust shall be conducted in such a way that the
proportionate interest in the Trust of each Plan and the fair market value of
that interest may be determined at any time. Whenever the assets of more than
one Plan are commingled in the Trust or in any investment option, the undivided
interest therein of each such Plan shall be debited or credited (as the case may
be) (i) for the entire amount of every contribution received on behalf of such
Plan, every benefit payment, or other expense attributable solely to such Plan,
and every other transaction relating only to such Plan; and (ii) for its
proportionate share of every item of collected or accrued income, gain or loss,
and general expense, and of any other transactions attributable to the Trust or
that investment option as a whole.
Section 7. Compensation and Expenses. All reasonable expenses of plan
administration as shown on Schedule B attached hereto, as amended from time to
time, shall be a charge against and paid from the appropriate plan participants'
accounts, except to the extent such amounts are paid by the Plan Sponsor in a
timely manner.
All expenses of the Trustee relating directly to the acquisition and
disposition of investments constituting part of the Trust, and all taxes of any
kind whatsoever that may be levied or assessed under existing or future laws
upon or in respect of the Trust or the income thereof, shall be a charge against
and paid from the appropriate Participants' accounts.
Section 8. Directions and Indemnification.
------------------------------
(a) Identity of Sponsor and Named Fiduciaries. The Trustee shall be
fully protected in relying on the fact that the Sponsor and the Named
Fiduciaries under a Plan are the individuals or persons named as such on the
Authorization Letters in the form of Schedules "D" and "E" attached hereto or on
a Plan Designation Form in accordance with Schedule "I" attached hereto or such
other individuals or persons as the Sponsor may notify the Trustee in writing.
(b) Directions from Sponsor or Administrator. Whenever the Sponsor or
Administrator provides a direction to the Trustee, the Trustee shall not be
liable for any loss or expense arising from the direction if the direction is
contained in a writing (or is oral and immediately confirmed in a writing)
signed by any individual whose name and signature have been submitted (and not
withdrawn) in writing to the Trustee by the Sponsor in the form attached hereto
as Schedule "D", provided the Trustee reasonably believes the signature of the
individual to be genuine. Such direction may also be made via Electronic Data
Transfer ("EDT") in accordance with procedures agreed to by the Sponsor and the
Trustee; provided, however, that the Trustee shall be fully protected in relying
on such direction as if it were a direction made in writing by the Sponsor. The
Trustee shall have no responsibility to ascertain any direction's (i) accuracy,
(ii) compliance with the terms of the Plan or any applicable law, or (iii)
effect for tax purposes or otherwise.
(c) Directions from Named Fiduciary. Whenever a Named Fiduciary provides
a direction to the Trustee, the Trustee shall not be liable for any loss or
expense arising from the direction (i) if the direction is contained in a
writing (or is oral and immediately confirmed in a writing) signed by any
individual whose name and signature have been submitted (and not withdrawn) in
writing to the Trustee by the Named Fiduciary in the form attached hereto as
Schedule "E" and (ii) if the Trustee reasonably believes the signature of the
individual to be genuine, unless it is clear on the direction's face that the
actions to be taken under the direction would be prohibited by the fiduciary
duty rules of section 404(a) of ERISA or would be contrary to the terms of the
Plan or this Agreement. For purposes of this Section, such direction may also be
made via electronic data transfer (EDT) or other electronic means in accordance
with procedures agreed to by the Administrator and the Trustee; provided,
however, that the Trustee shall be fully protected in relying on such direction
as if it were a direction made in writing by the Named Fiduciary.
(d) Co-Fiduciary Liability. In any other case, the Trustee shall not be
liable for any loss, or by reason of any breach, arising from any act or
omission of another fiduciary under the Plan except as provided in section
405(a) of ERISA. Without limiting the foregoing, the Trustee shall have no
liability for the acts or omissions of any predecessor or successor trustee.
(e) Indemnification. The Sponsor shall indemnify the Trustee against,
and hold the Trustee harmless from, any and all loss, damage, penalty,
liability, cost, and expense, including without limitation, reasonable
attorneys' fees and disbursements, that may be incurred by, imposed upon, or
asserted against the Trustee by reason of any claim, regulatory proceeding, or
litigation arising from any act done or omitted to be done by any individual or
person with respect to the Plan or Trust, excepting only any and all loss,
damage, penalty, liability, cost, and expense, arising from the Trustee's
negligence or bad faith.
(f) Survival. The provisions of this Section 8 shall survive the
termination of this Agreement.
--------
Section 9. Resignation or Removal of Trustee.
---------------------------------
(a) Resignation. The Trustee may resign at any time upon one hundred and
twenty (120) days' notice in writing to the Sponsor, except in the event of
disqualification of a Plan, the Trustee may resign upon sixty (60) days notice
in writing to the sponsor, unless a shorter period of notice is agreed upon by
the Sponsor. If, by the termination date, the Sponsor has not notified the
Trustee in writing as to whom the assets and cash are to be transferred and
delivered, the Trustee may bring an appropriate action or proceeding for leave
to deposit the assets and cash in a court of competent jurisdiction. The Trustee
shall be reimbursed by the Sponsor for all costs and expenses of the action or
proceeding including, without limitation, reasonable attorneys' fees and
disbursements.
(b) Removal. The Sponsor may remove the Trustee at any time upon sixty
(60) days' notice in writing to the Trustee, unless a shorter period of notice
is agreed upon by the Trustee.
Section 10. Successor Trustee.
-----------------
(a) Appointment. If the office of Trustee becomes vacant for any reason,
the Sponsor may in writing appoint a successor trustee under this Agreement. The
successor trustee shall have all of the rights, powers, privileges, obligations,
duties, liabilities, and immunities granted to the Trustee under this Agreement.
The successor trustee and predecessor trustee shall not be liable for the acts
or omissions of the other with respect to the Trust.
(b) Acceptance. When the successor trustee accepts its appointment under
this Agreement, title to and possession of the Trust assets shall immediately
vest in the successor trustee without any further action on the part of the
predecessor trustee. The predecessor trustee shall execute all instruments and
do all acts that reasonably may be necessary or reasonably may be requested in
writing by the Sponsor or the successor trustee to vest title to all Trust
assets in the successor trustee or to deliver all Trust assets to the successor
trustee.
(c) Corporate Action. Any successor of the Trustee or successor trustee,
through sale or transfer of the business or trust department of the Trustee or
successor trustee, or through reorganization, consolidation, or merger, or any
similar transaction, shall, upon consummation of the transaction, become the
successor trustee under this Agreement.
Section 11. Termination. This Agreement may be terminated at any time by the
Sponsor upon sixty (60) days' notice in writing to the Trustee. On the date of
the termination of this Agreement, the Trustee shall forthwith transfer and
deliver to such individual or entity as the Sponsor shall designate, all cash
and assets then constituting the Trust. If, by the termination date, the Sponsor
has not notified the Trustee in writing as to whom the assets and cash are to be
transferred and delivered, the Trustee may bring an appropriate action or
proceeding for leave to deposit the assets and cash in a court of competent
jurisdiction. The Trustee shall be reimbursed by the Sponsor for all costs and
expenses of the action or proceeding including, without limitation, reasonable
attorneys' fees and disbursements.
Section 12. Resignation, Removal, and Termination Notices. All notices of
resignation, removal, or termination under this Agreement must be in writing and
mailed to the party to which the notice is being given by certified or
registered mail, return receipt requested, to the Sponsor c/o Judy Mesecher,
Clear Channel Communications, Inc., 347 Sandau, San Antonio, TX 78216 and to the
Trustee c/o Legal Department, ERISA Group, Fidelity Investments, 82 Devonshire
Street, Boston, Massachusetts 02109, or to such other addresses as the parties
have notified each other of in the foregoing manner.
Section 13. Duration. This Trust shall continue in effect without limit as to
time, subject, however, to the provisions of this Agreement relating to
amendment, modification, and termination thereof.
Section 14. Amendment or Modification. This Agreement may be amended or modified
at any time and from time to time only by an instrument executed by both the
Sponsor and the Trustee.
Notwithstanding the foregoing, to reflect increased operating costs the Trustee
may once each calendar year amend Schedule "B" without the Sponsor's consent
upon seventy-five (75) days written notice to the Sponsor.
Section 15. Electronic Services.
-------------------
(a) The Trustee may provide communications and services via electronic
medium ("Electronic Services"), including, but not limited to, Fidelity Plan
Sponsor WebStation, Client Intranet, Client e-mail, interactive software
products or any other information provided in an electronic format. The Sponsor,
its agents and employees agree to keep confidential and not publish, copy,
broadcast, retransmit, reproduce, commercially exploit or otherwise
redisseminate the data, information, software or services without the Trustee's
written consent.
(b) The Sponsor shall be responsible for installing and maintaining all
Electronic Services on its computer network and/or Intranet upon receipt in a
manner so that the information provided via the Electronic Service will appear
in the same form and content as it appears on the form of delivery, and for any
programming required to accomplish the installation. The responsibility for such
installing, maintaining and programming shall only apply after the Trustee has
provided written notice to the Sponsor within a reasonable period of time, but
no less than sixty (60) days before the effective date unless the Sponsor and
Trustee agree otherwise, explaining the requirements and generic methods of
installing the Electronic Services. Materials provided for Plan Sponsor's
intranet web sites shall be installed by the Sponsor and shall be clearly
identified as originating from Trustee. With regard to Electronic Services
involving communications materials for the Sponsor or Plan participants, the
Sponsor shall promptly remove Electronic Services from its computer network
and/or Intranet, or replace the Electronic Service with an updated service
provided by the Trustee, upon written notification by the Trustee.
(c) All Electronic Services shall be provided to the Sponsor without any
express or implied legal warranties or acceptance of legal liability by the
Trustee relative to the use of material or Electronic Services by the Sponsor.
No rights are conveyed to any property, intellectual or tangible, associated
with the contents of the Electronic Services and related material.
(d) To the extent that any Electronic Services utilize Internet services
to transport data or communications, the Trustee will take, and Plan Sponsor
agrees to follow, reasonable security precautions; however, the Trustee
disclaims any liability for interception of any such data or communications. The
Trustee shall not be responsible for, and makes no warranties regarding access,
speed or availability of Internet or network services. The Trustee shall not be
responsible for any loss or damage related to or resulting from any changes or
modifications to the electronic material after delivering it to the Plan
Sponsor.
Section 16. General.
-------
(a) Performance by Trustee, its Agents or Affiliates. The Sponsor
acknowledges and authorizes that the services to be provided under this
Agreement shall be provided by the Trustee, its agents or affiliates, including
Fidelity Investments Institutional Operations Company or its successor, and that
certain of such services may be provided pursuant to one or more other
contractual agreements or relationships.
(b) Delegation by Employer. By authorizing the assets of any Plan as to
which it is an Employer to be deposited in the Trust, each Employer, other than
the Sponsor, hereby irrevocably delegates and grants to the Sponsor full and
exclusive power and authority to exercise all of the powers conferred upon the
Sponsor and each Employer by the terms of this Agreement, and to take or refrain
from taking any and all action which such Employer might otherwise take or
refrain from taking with respect to this Agreement, including the sole and
exclusive power to exercise, enforce or waive any rights whatsoever which such
Employer might otherwise have with respect to the Trust, and irrevocably
appoints the Sponsor as its agent for all purposes under this Agreement. The
Trustee shall have no obligation to account to any such Employer or to follow
the instructions of or otherwise deal with any such Employer, the intention
being that the Trustee shall deal solely with the Sponsor.
(c) Entire Agreement. This Agreement contains all of the terms
agreed upon between the parties with respect to the subject matter hereof.
(d) Waiver. No waiver by either party of any failure or refusal to
comply with an obligation hereunder shall be deemed a waiver of any other or
subsequent failure or refusal to so comply.
(e) Successors and Assigns. The stipulations in this Agreement
shall inure to the benefit of, and shall bind, the successors and assigns of the
respective parties.
(f) Partial Invalidity. If any term or provision of this Agreement or
the application thereof to any person or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement, or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby, and each
term and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.
(g) Section Headings. The headings of the various sections and
subsections of this Agreement have been inserted only for the purposes of
convenience and are not part of this Agreement and shall not be deemed in any
manner to modify, explain, expand or restrict any of the provisions of this
Agreement.
Section 17. Governing Law.
-------------
(a) Massachusetts Law Controls. This Agreement is being made in the
Commonwealth of Massachusetts, and the Trust shall be administered as a
Massachusetts trust. The validity, construction, effect, and administration of
this Agreement shall be governed by and interpreted in accordance with the laws
of the Commonwealth of Massachusetts, except to the extent those laws are
superseded under section 514 of ERISA.
(b) Trust Agreement Controls. The Trustee is not a party to the Plan,
and in the event of any conflict between the provisions of the Plan and the
provisions of this Agreement, the provisions of this Agreement shall control
with respect to the duties of the Trustee; otherwise, the provisions of the Plan
shall control.
Section 18. Plan Qualification. The Sponsor shall be responsible for verifying
that while any assets of a particular Plan are held in the Trust, the Plan (i)
is qualified within the meaning of section 401(a) of the Code; (ii) is permitted
by existing or future rulings of the United States Treasury Department to pool
its funds in a group trust; and (iii) permits its assets to be commingled for
investment purposes with the assets of other such plans by investing such assets
in this Trust, If any Plan ceases to be qualified within the meaning of section
401(a) of the Code, the Sponsor shall notify the Trustee as promptly as is
reasonable. Upon receipt of such notice, the Trustee shall promptly segregate
and withdraw from the Trust, the assets which are allocable to such disqualified
Plan, and shall dispose of such assets in the manner directed by the Sponsor.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the day and year first above
written.
CLEAR CHANNEL COMMUNICATIONS, INC.
Attest: _______________________________ By: ___________________________
Director of Retirement Name: ___________________________
Benefits Title: ___________________________
Date: ___________________________
FIDELITY MANAGEMENT TRUST COMPANY
Attest: ________________________________ By: ___________________________
Name: ___________________________
Title: ___________________________
Date: ___________________________
<PAGE>
FIRST AMENDMENT TO TRUST AGREEMENT BETWEEN
FIDELITY MANAGEMENT TRUST COMPANY AND
CLEAR CHANNEL COMMUNICATIONS, INC.
THIS FIRST AMENDMENT, dated as of the 30th of December, 1999, by and
between Fidelity Management Trust Company (the "Trustee") and Clear Channel
Communications, Inc. (the "Sponsor");
WITNESSETH:
WHEREAS, the Trustee and the Sponsor heretofore entered into a Trust
Agreement dated July 1, 1999, with regard to the Clear Channel
Communications, Inc. 401(k) Savings Plan and the Eller Media Company 401(k)
Plan (the "Plan"); and
WHEREAS, the Trustee and the Sponsor now desire to amend said Trust
Agreement as provided for in Section 13 thereof;
NOW THEREFORE, in consideration of the above premises, the Trustee and
the Sponsor hereby amend the Trust Agreement by:
(1) Amending the "money classifications" section of Schedule "A"
to add the following:
- Universal Employer Base
- Universal Employee Pre-Tax
- Universal Employee After-Tax
- Universal Rollover
- Universal Employer Match
IN WITNESS WHEREOF, the Trustee and the Sponsor have caused this First
Amendment to be executed by their duly authorized officers effective as of the
day and year first above written.
CLEAR CHANNEL FIDELITY MANAGEMENT TRUST COMPANY
COMMUNICATIONS, INC.
By: _______________________________________ By: ______________________________
Date Vice President Date
<PAGE>
SECOND AMENDMENT TO TRUST AGREEMENT BETWEEN
FIDELITY MANAGEMENT TRUST COMPANY AND
CLEAR CHANNEL COMMUNICATIONS, INC.
THIS SECOND AMENDMENT, dated as of the first day of June, 2000, by and
between Fidelity Management Trust Company (the "Trustee") and Clear Channel
Communications, Inc. (the "Sponsor");
WITNESSETH:
WHEREAS, the Trustee and the Sponsor heretofore entered into
a Trust Agreement dated July 1, 1999, with regard to the Clear
Channel Communications, Inc. 401(k) Savings Plan and the Eller
Media Company 401(k) Plan (the "Plan"); and
WHEREAS, the Sponsor has informed the Trustee that effective
June 1, 2000, the MJI Broadcasting, Inc. 401(k) Plan has merged
with and into the Clear Channel Communications, Inc. 401(k)
Savings Plan; and
WHEREAS, the Trustee and the Sponsor now desire to amend
said Trust Agreement as provided for in Section 13 thereof;
NOW THEREFORE, in consideration of the above premises, the
Trustee and the Sponsor hereby amend the Trust Agreement by:
(1) Amending the "money classifications" section of Schedule
"A" to add the following to the Clear Channel Communications,
Inc. 401(k) Savings Plan:
- Prior MJI Pre-tax
- Prior MJI Rollover
- MJI QNEC
IN WITNESS WHEREOF, the Trustee and the Sponsor have caused this Second
Amendment to be executed by their duly authorized officers effective as of the
day and year first above written.
CLEAR CHANNEL FIDELITY MANAGEMENT TRUST COMPANY
COMMUNICATIONS, INC.
By: ___________________________________ By: _______________________________
Date Vice President Date
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) dated November 8, 2000 pertaining to the Clear Channel
Communications, Inc. 401(k) Savings Plan of our reports dated March 13, 2000,
with respect to the consolidated financial statements and schedule of Clear
Channel Communications, Inc. included in its Annual Report (Form 10-K) for the
year ended December 31, 1999, filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
San Antonio, Texas
November 6, 2000
<PAGE>
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Clear Channel Communications, Inc.:
We consent to the incorporation by reference in this registration
statement on Form S-8 of our report on the consolidated financial statements of
Hispanic Broadcasting Corporation (formerly Heftel Broadcasting Corporation) and
subsidiaries as of December 31, 1999 and 1998, and for each of the years in the
three-year period ended December 31, 1999, which report is included in the
Annual Report on Form 10-K of Clear Channel Communications, Inc. for the year
ended December 31, 1999.
KPMG LLP
Dallas, Texas
November 7, 2000
<PAGE>
EXHIBIT 23.3
CONSENT OF INDEPENDENT AUDITORS
We consent to the use of our report dated February 28, 2000, with respect
to the consolidated financial statements of SFX Entertainment, Inc. as of
December 31, 1999 and 1998 and for each of the three years in the period ended
December 31, 1999 and the related financial statement schedule, incorporated by
reference from Clear Channel Communications, Inc.'s Current Report on Form 8-K
dated June 14, 2000, previously filed with the Securities and Exchange
Commission, in this Registration Statement on Form S-8 and related Prospectus
thereto dated November 8, 2000 pertaining to the Clear Channel Communications,
Inc. 401(k) Savings Plan for the registration of 2,200,000 shares of its common
stock.
ERNST & YOUNG LLP
New York, New York
November 6, 2000
<PAGE>
EXHIBIT 23.4
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-8 of Clear Channel Communications, Inc. of (1)
our report dated February 12, 1999 relating to the consolidated financial
statements of Jacor Communications, Inc., which appear in the Clear Channel
Communications, Inc. Form 8-K/A filed April 12, 1999 and (2) our report dated
February 11, 1998 relating to the consolidated financial statements of Jacor
Communications, Inc. which appear in the Clear Channel Communications, Inc.,
Form 8-K filed December 10, 1998.
PRICEWATERHOUSECOOPERS LLP
Cincinnati, Ohio
November 7, 2000
<PAGE>
EXHIBIT 23.5
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
Clear Channel Communications, Inc.:
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of Clear Channel Communications, Inc. of our report dated
March 13, 2000 relating to the consolidated financial statements of AMFM Inc.
(formerly Chancellor Media Corporation) and subsidiaries, which appears in the
Current Report on Form 8-K of Clear Channel Communications, Inc. dated June 14,
2000.
PRICEWATERHOUSECOOPERS LLP
Dallas, Texas
November 7, 2000
<PAGE>
EXHIBIT 23.6
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
Clear Channel Communications, Inc.:
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of Clear Channel Communications, Inc. of our report dated
February 26, 1999, except for Note 3 as to which the date is March 15, 1999,
relating to the consolidated financial statements of Capstar Broadcasting
Corporation and Subsidiaries, which appears in the Current Report on Form 8-K of
Clear Channel Communications, Inc. dated November 18, 1999.
PRICEWATERHOUSECOOPERS LLP
Austin, Texas
November 7, 2000
<PAGE>
EXHIBIT 23.7
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
Clear Channel Communications, Inc.:
We hereby consent to the incorporation by reference in this
registration statement on Form S-8 of Clear Channel Communications, Inc. of our
report dated June 8, 2000, relating to the statements of net assets as of
December 31, 1999 and 1998, and the statement of changes in net assets available
for benefits and supplemental schedule for the year ended December 31, 1999 of
the Clear Channel Communications, Inc. 401(k) Savings Plan, which appears in the
Annual Report on Form 11-K of the Clear Channel Communications, Inc. 401(k)
Savings Plan dated November 8, 2000.
PADGETT, STRATEMANN & CO., L.L.P.
San Antonio, Texas
November 8, 2000
<PAGE>
SEC COVER LETTER
Akin, Gump, Strauss, Hauer & Feld, l.l.p.
ATTORNEYS AT LAW
a registered limited liability partnership
including professional corporations
300 CONVENT STREET
SUITE 1500
SAN ANTONIO, TEXAS 78205
(210) 281-7000
FAX (210) 224-2035
www.akingump.com
WRITER'S DIRECT DIAL NUMBER (210) 281 - 7075
WRITER'S E-MAIL ADDRESS [email protected]
November 9, 2000
U.S. Securities and Exchange Commission
450 5th Street, N.W.
Washington, DC 20549
Re: Registration Statement on Form S-8 of Clear Channel Communications, Inc.
Ladies and Gentlemen:
On behalf of Clear Channel Communications, Inc., we are
filing a registration statement on Form S-8 relating to the
issuance, from time to time, of up to 2,200,000 shares of Clear
Channel's common stock pursuant to the terms of the Clear Channel
Communications, Inc. 401(k) Savings Plan.
If any member of the staff has any questions or desires further
information or clarification regarding the enclosed filing, please call the
undersigned at (210) 281-7075 or Mr. Steve Mount of my office at (210) 281-7296.
Very truly yours,
/s/ WILHELM E. LIEBMANN, ESQ.
WILHELM E. LIEBMANN, ESQ.
Enclosure
cc: Ms. Susan Krieg, Clear Channel Communications, Inc.
Steve Mount, Esq. [Firm]
