<PAGE> 1
REGISTRATION STATEMENT NO. 33-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
BOWATER INCORPORATED
-----------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 62-0721803
- ---------------------------------- -----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
55 EAST CAMPERDOWN WAY
P.O. BOX 1028
GREENVILLE, SOUTH CAROLINA 29602
(864) 271-7733
-------------------------------------------
(Address of principal executive offices)
BOWATER INCORPORATED SALARIED EMPLOYEES' SAVINGS PLAN
-----------------------------------------------------
(Full title of the Plan)
WENDY C. SHIBA, ESQUIRE
SECRETARY AND ASSISTANT GENERAL COUNSEL
BOWATER INCORPORATED
55 EAST CAMPERDOWN WAY
P.O. BOX 1028
GREENVILLE, SOUTH CAROLINA 29602
(864) 271-7733
-----------------------------------------------------------
(Name, address and telephone number of agent for service)
____________________________________________
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================================================
Title of Amount Proposed Maximum Proposed Maximum Amount of
Securities to be Offering Price Aggregate Registration Fee
To be Registered Per Share (1) Offering Price (1)
Registered
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 1,900,000 $33.625 $63,887,500 $22,030.17
$1.00 par value
================================================================================================================
</TABLE>
(1) The offering price for such shares is estimated pursuant to Rule
457(c) and (h) solely for the purpose of calculating the registration fee and
is based upon the average of the high and low prices of the Registrant's Common
Stock as reported on the consolidated reporting system for January 24, 1996.
In addition, pursuant to Rule 416(c) under the Securities Act of 1933,
this registration statement also covers an indeterminate amount of interests to
be offered or sold pursuant to the employee benefit plan described herein.
____________________________________________
This Registration Statement shall become effective automatically upon the
date of filing in accordance with Section 8(a) of the Securities Act of 1933,
as amended, and 17 C.F.R. Section 230.462.
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission are incorporated in this
Registration Statement by reference:
(1) The latest annual reports of the Registrant and the Plan filed
pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the
"Exchange Act");
(2) All other reports filed by the Registrant pursuant to Sections 13(a)
and 15(d) of the Securities Exchange Act of 1934 ("Exchange Act") since
December 31, 1994;
(3) The description of the Registrant's Common Stock, $1.00 par value per
share, contained in a registration statement filed under the Exchange Act,
including any amendment or report filed for the purpose of updating such
description.
All documents filed by the Registrant and the Plan with the Commission
pursuant to Sections 13(a), 13(c), 14, and 15(d) of the Exchange Act after the
date hereof and prior to the filing of a post-effective amendment which
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold shall be deemed to be incorporated by
reference in this Registration Statement and to be a part thereof from the date
of filing such documents.
ITEM 4. DESCRIPTION OF SECURITIES
The Registrant's Common Stock, par value $1.00 per share, is registered
pursuant to Section 12 of the Exchange Act.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not Applicable.
2
<PAGE> 3
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the General Corporation Law of the State of Delaware
empowers a corporation to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the corporation), by reason of the
fact that he or she is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise. Depending on the character of the
proceeding, a corporation may indemnify against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred in connection with such action, suit or proceeding if the person
indemnified acted in good faith and in a manner he or she reasonably believed
to be in or not opposed to the best interests of the corporation and, with
respect to any criminal action or proceeding, had no reasonable cause to
believe his or her conduct was unlawful. In the case of an action by or in the
right of the corporation, no indemnification may be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper. Section 145 further provides that to the extent a director,
officer, employee or agent of a corporation has been successful on the merits
or otherwise in the defense of any action, suit or proceeding referred to above
or in the defense of any claim, issue or matter therein, he or she shall be
indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him or her in connection therewith. The foregoing
statement is subject to the detailed provisions of Section 145 of the Delaware
General Corporation Law.
The Restated Certificate of Incorporation of the Registrant provides, in
effect, that, to the extent and under the circumstances permitted by Section
145 of the General Corporation Law of the State of Delaware, the Company shall
indemnify any person who was or is a party or is threatened to be made a party
to any action, suit or proceeding of the type described above by reason of the
fact that he or she is or was a director, officer, employee or agent of the
Company or is or was serving at the request of the Company as a director,
officer, employee or agent of another enterprise.
There is a directors' and officers' liability insurance policy which is
presently outstanding insuring directors and officers of the Company and its
subsidiaries. Reimbursement by the Company of the officer and director
liability as allowed by the Restated Certificate of Incorporation is
recoverable under the insurance policy subject to a deductible for each loss.
3
<PAGE> 4
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
ITEM 8. EXHIBITS
See Exhibit Index on page 6.
(a) Not applicable.
(b) Pursuant to Item 8 of Form S-8, the Registrant undertakes that it
will submit or has submitted the Plan and any amendment thereto to the Internal
Revenue Service ("IRS") in a timely manner and has made or will make all
changes required by the IRS in order to qualify the Plan.
ITEM 9. UNDERTAKINGS
(a) Rule 415 Offering.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement to include any
material information with respect to the plan of distribution not previously
disclosed in the Registration Statement or any material change to such
information in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) Filings Incorporating Subsequent Exchange Act Documents by Reference.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report under Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report under Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the Registration Statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
4
<PAGE> 5
(h) Filing of Registration Statement on Form S-8.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
5
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Greenville, State of South Carolina, on the 29 day
of January, 1996.
BOWATER INCORPORATED
By: /s/ Arnold M. Nemirow
-----------------------------
Arnold M. Nemirow
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated, on the 29 day of January, 1996.
Signature Title
/s/ Arnold M. Nemirow President, Chief Executive Officer and
- ------------------------- Director (principal executive officer)
Arnold M. Nemirow
* Chairman of the Board and Director
- -------------------------
Anthony P. Gammie
/s/ David G. Maffucci Senior Vice President, Chief Financial Officer
- ------------------------- and Treasurer (principal financial officer)
David G. Maffucci
/s/ Michael F. Nocito Vice President - Controller (principal
- ------------------------- accounting officer)
Michael F. Nocito
* Director
- -------------------------
Francis J. Aguilar
* Director
- -------------------------
Hugh D. Aycock
* Director
- -------------------------
Richard Barth
S-1
<PAGE> 7
* Director
- -------------------------
Kenneth M. Curtis
* Director
- -------------------------
H. Gordon MacNeill
* Director
- -------------------------
Donald R. Melville
* Director
- -------------------------
John A. Rolls
* Wendy C. Shiba by signing his/her named hereto, does sign this document on
behalf of the persons indicated above pursuant to powers of attorney duly
executed by such persons.
By: /s/ Wendy C. Shiba
-------------------
Wendy C. Shiba
-------------------
Attorney-in-Fact
THE PLAN. Pursuant to the requirements of the Securities Act of 1933, the
Trustee (or other persons who administer the Bowater Incorporated Salaried
Employees' Savings Plan has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Greenville, State of South Carolina , as of January 29, 1996.
BOWATER INCORPORATED SALARIED
EMPLOYEES' SAVINGS PLAN
By: /s/ Aaron B Whitlock
-------------------------
Aaron B. Whitlock
-------------------------
Plan Administrator
S-2
<PAGE> 8
EXHIBIT INDEX
The following exhibits are filed as part of this Registration Statement.
Exhibit Number Description
- -------------- -----------
4.1 Restated Certificate of Incorporation of the
Registrant, as amended (incorporated by reference
to Exhibit 4.2 to the Registrant's Registration
Statement No. 33-51569).
4.2 Certificate of Designations of the 7% PRIDES,
Series B Convertible Preferred Stock of the
Registrant (incorporated by reference to Exhibit
4.1 to the Registrant's Current Report on Form
8-K dated February 1, 1994).
4.3 Certificate of Designations of the 8.40% Series C
Cumulative Preferred Stock of the Registrant
(incorporated by reference to Exhibit 4.2 to
the Registrant's Current Report on Form 8-K
dated February 1, 1994).
4.4 Bylaws of the Registrant (incorporated by
reference to Exhibit 3.1 to the Registrant's
quarterly report filed on Form 10-Q for the
quarterly period ended September 30, 1995).
4.5 Agreement pursuant to S-K Item 601(b)(4)
(iii)(A) to provide the Commission upon
request copies of certain other instruments with
respect to long-term debt not being registered
where the amount of securities authorized
under each such instrument does not exceed
10% of the total assets of the Registrant and
its subsidiaries on a consolidated basis
(incorporated by reference to Exhibit 4.3 to
the Registrant's Registration Statement
No. 2-93455).
4.6 Rights Agreement between the Registrant and
Morgan Guaranty Trust Company of New
York (incorporated by reference to Exhibit 4.6
to the Registrant's Registration Statement
No. 33-61219).
<PAGE> 9
Exhibit Number Description
- -------------- -----------
4.6.1 Addendum to Rights Agreement substituting
The Bank of New York as successor Rights
Agent (incorporated by reference to Exhibit
4.6.1 to the Registrant's Registration
Statement No. 33-61219).
4.7 Indenture, dated as of August 1, 1989, by and
between the Registrant and Manufacturers
Hanover Trust Company, as Trustee, with
respect to the 9% Debentures Due 2009
(incorporated by reference to Exhibit 4.7 to
the Registrant's Registration Statement
No. 33-61219).
4.8 Indenture, dated as of December 1, 1991, by
and between the Registrant and Marine Midland
Bank, N.A., as Trustee with respect to the
9 3/8% Debentures Due 2021 (incorporated
by reference to Exhibit 4.8 to the Registrant's
Annual Report on Form 10-K for 1991).
4.9 Indenture, dated as of December 1, 1991, by
and between the Registrant and Marine Midland
Bank, N.A., as Trustee, with respect to the
8-1/2% Notes Due 2001 (incorporated by
reference to Exhibit 4.9 to the Registrant's
Annual Report on Form 10-K for 1991).
4.10 Indenture, dated as of October 15, 1992, by
and between the Registrant and The Chase
Manhattan Bank (N.A.) as Trustee, with
respect to the 8-1/4% Notes Due 1999
(incorporated by reference to Exhibit 4.10
to the Registrant's Annual Report on
Form 10-K for 1992).
4.11 Indenture, dated as of October 15, 1992,
between the Registrant and The Chase
Manhattan Bank (N.A.) as Trustee, with
respect to the 9-1/2% Debentures Due 2012
(incorporated by reference to Exhibit 4.11
to the Registrant's Annual Report on
Form 10-K for 1992).
<PAGE> 10
Exhibit Number Description
- -------------- -----------
4.12 Deposit Agreement, dated as of February
1, 1994, by and among the Registrant,
Trust Company Bank, as Depositary, and
the holders from time to time of the Depositary
Receipts relating to the Registrant's 7%
PRIDES, Series B Convertible Preferred
Stock, together with form of Depositary
Receipt (incorporated by reference to Exhibit
4.3 to the Registrant's Current Report on
Form 8-K dated February 1, 1994).
4.13 Deposit Agreement, dated as of February
1, 1994, by and among the Registrant,
Trust Company Bank, as Depositary, and
the holders from time to time of the
Depositary Receipts relating to the
Registrant's 8.4% Series C Cumulative
Preferred Stock, together with form of
Depositary Receipt (incorporated by
reference to Exhibit 4.4 to the Registrant's
Current Report on Form 8-K dated
February 1, 1994).
4.14 Copy of the Bowater Incorporated Salaried
Employees' Savings Plan, As Amended and
Restated Effective May 1, 1989 and
Incorporating Amendments made through
September 15, 1994, as amended).
23.1 Consent of KPMG Peat Marwick LLP
dated January 24, 1996 is filed herewith.
24.1 Powers of Attorney authorizing the signing
of the Registration Statement and amendments
hereto on behalf of the Registrant's directors.
<PAGE> 1
EXHIBIT 4.14
BOWATER INCORPORATED
SALARIED EMPLOYEES' SAVINGS PLAN
Effective December 31, 1973
And As Amended and Restated
Effective May 1, 1989
(Incorporating Amendments made through September 15, 1994)
<PAGE> 2
BOWATER INCORPORATED SALARIED EMPLOYEES' SAVINGS PLAN
(As Amended and Restated Effective May 1, 1989, incorporating
Amendments made through September 15, 1994)
Table of Contents
<TABLE>
<CAPTION>
Page
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<S> <C>
PREAMBLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vi
ARTICLE 1: DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.01 ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.02 ACQUISITION LOAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.03 ACTIVE PARTICIPANT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.04 AFFILIATED COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.05 BASIC EMPLOYEE CONTRIBUTION ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.06 BASIC TAX-DEFERRED EMPLOYEE CONTRIBUTION ACCOUNT . . . . . . . . . . . . . . . . . . . . . . 2
1.07 BENEFICIARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.08 BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.09 CODE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.10 COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.11 COMPANY CONTRIBUTION ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.12 CURRENT OR ACCUMULATED PROFITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.13 DISABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.14 EARNINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.15 EFFECTIVE DATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.16 EMPLOYEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.17 EMPLOYEE STOCK OWNERSHIP ("ESOP") ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.18 EMPLOYER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.19 EMPLOYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.20 ENROLLMENT DATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.21 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.22 FIDUCIARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.23 FINANCED SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.24 FORFEITURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.25 HOUR OF SERVICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.26 INVESTMENT FUNDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.27 PARTICIPANT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.28 PAYROLL-BASED EMPLOYEE STOCK OWNERSHIP ("PAYSOP") CONTRIBUTION . . . . . . . . . . . . . . . 5
1.29 PAYROLL-BASED EMPLOYEE STOCK OWNERSHIP ("PAYSOP") ACCOUNT . . . . . . . . . . . . . . . . . . 5
</TABLE>
<PAGE> 3
<TABLE>
<S> <C> <C> <C>
1.30 PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.31 PLAN ADMINISTRATOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.32 PLAN TO PLAN TRANSFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.33 PLAN YEAR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.34 REGULAR CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.35 RETIREMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.36 SEVERANCE FROM SERVICE DATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.37 SHARE OF COMPANY STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.38 SPECIFIED HARDSHIP WITHDRAWAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.39 SPOUSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.40 SUPPLEMENTAL EMPLOYEE CONTRIBUTION ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.41 SUPPLEMENTAL TAX-DEFERRED EMPLOYEE CONTRIBUTION ACCOUNT . . . . . . . . . . . . . . . . . . . 6
1.42 TRANSFEROR PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.43 TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.44 TRUST FUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.45 UNALLOCATED COMPANY STOCK ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.46 VALUATION DATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.47 VESTED VALUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.48 VESTING DATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.49 YEAR OF BREAK IN SERVICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
l.50 YEARS OF SERVICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE 2: ELIGIBILITY AND PARTICIPATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.01 ELIGIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.02 PARTICIPATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.03 CESSATION OF ACTIVE PARTICIPATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.04 EFFECT OF REEMPLOYMENT ON PLAN ENTRY OR REENTRY . . . . . . . . . . . . . . . . . . . . . . . 10
2.05 PRIOR EMPLOYMENT WITH AN AFFILIATED COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE 3: PARTICIPANT CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.01 BASIC EMPLOYEE CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.02 BASIC TAX-DEFERRED EMPLOYEE CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.03 SUPPLEMENTAL EMPLOYEE CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.04 SUPPLEMENTAL TAX-DEFERRED EMPLOYEE CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . 11
3.05 MODE OF PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.06 CHANGE IN AMOUNT OF CONTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.07 VOLUNTARY SUSPENSION OF PARTICIPANT CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . 12
3.08 EMPLOYMENT WITH AFFILIATED COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
</TABLE>
ii
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<TABLE>
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3.09 PLAN TO PLAN TRANSFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.10 ROLLOVER CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE 4: EMPLOYER CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.01 REGULAR CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.02 ADDITIONAL CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
4.03 PAYROLL-BASED EMPLOYEE STOCK OWNERSHIP CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . 17
4.04 MODE OF PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.05 FORFEITURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.06 RETURN OF CERTAIN CONTRIBUTIONS TO EMPLOYER . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.07 STATUTORY LIMITATION ON ADDITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4.08 COMBINED PLANS LIMITATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE 5: INVESTMENT OPTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.01 INVESTMENT OF PARTICIPANT AND EMPLOYER CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . 23
5.02 INVESTMENT ELECTIONS BY PARTICIPANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5.03 CHANGES IN CURRENT INVESTMENT ELECTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5.04 TRANSFERS OF ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
ARTICLE 6: VALUATION OF PARTICIPANTS' ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
6.01 ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
6.02 VALUATION OF ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
6.03 AMOUNT OF PARTICIPANTS' ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
6.04 STATEMENT OF PARTICIPANT ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
6.05 TIMING OF CREDITS AND DEDUCTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE 7: BENEFITS UPON RETIREMENT, DEATH,
DISABILITY, OR TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
7.01 RETIREMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
7.02 DEATH . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
7.03 DISABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
7.04 OTHER TERMINATION OF EMPLOYMENT AND VESTING . . . . . . . . . . . . . . . . . . . . . . . . . 29
7.05 TRANSFER OF EMPLOYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
7.06 ELECTION OF BENEFITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
7.07 METHOD OF PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
7.08 PROOF OF DEATH AND RIGHT OF BENEFICIARY . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
7.09 SPECIAL DISTRIBUTION AND PAYMENT REQUIREMENTS . . . . . . . . . . . . . . . . . . . . . . . . 33
</TABLE>
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7.10 OPTION TO HAVE COMPANY PURCHASE SHARES OF COMPANY STOCK . . . . . . . . . . . . . . . . . . . 34
7.11 DIRECT ROLLOVER OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE 8: WITHDRAWALS DURING EMPLOYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
8.01 GENERAL CONDITIONS FOR WITHDRAWALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
8.02 WITHDRAWAL OF BASIC AND SUPPLEMENTAL EMPLOYEE CONTRIBUTION
ACCOUNTS - LESS THAN THREE YEARS' VESTING SERVICE . . . . . . . . . . . . . . . . . . . . . . 37
8.03 WITHDRAWAL OF BASIC AND SUPPLEMENTAL EMPLOYEE CONTRIBUTION
ACCOUNTS AND COMPANY CONTRIBUTION ACCOUNT - THREE OR
MORE YEARS OF VESTING SERVICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
8.04 SPECIFIED HARDSHIP WITHDRAWAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
8.05 WITHDRAWAL AFTER AGE 59 1/2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
8.06 PAYSOP ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE 9: ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
9.01 FIDUCIARIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
9.02 RESPONSIBILITIES OF THE EMPLOYER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
9.03 RESPONSIBILITIES OF THE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
9.04 RESPONSIBILITIES OF THE PLAN ADMINISTRATOR . . . . . . . . . . . . . . . . . . . . . . . . . 41
9.05 DELEGATION OF DUTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
9.06 COMMITTEE ACTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
9.07 INDIVIDUAL INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
9.08 EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE 10: GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.01 INALIENABILITY OF BENEFITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.02 NO RIGHT TO EMPLOYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.03 UNIFORM ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.04 HEADINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.05 CONSTRUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.06 UNCLAIMED DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.07 DISTRIBUTIONS TO A LEGAL REPRESENTATIVE . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
10.08 EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
10.09 SOURCE OF PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
10.10 PLAN SUBJECT TO TAX APPROVAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
10.11 DISCONTINUANCE OF CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
</TABLE>
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ARTICLE 11: SPECIAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
11.01 AMENDMENTS TO THE PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
11.02 MERGER, CONSOLIDATION, OR TRANSFER OF ASSETS . . . . . . . . . . . . . . . . . . . . . . . . 48
11.03 TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
11.04 WITHDRAWAL OF AN EMPLOYER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
11.05 PROCEDURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
ARTICLE 12: CLAIMS PROCEDURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
12.01 SUBMISSION OF CLAIMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
12.02 WRITTEN NOTICE OF DENIED CLAIM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
12.03 REVIEW OF DECISION DENYING CLAIM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
12.04 HEARING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
12.05 WRITTEN DECISION OF COMMITTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
ARTICLE 13: TOP-HEAVY PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
13.01 OVERRIDING PROVISION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
13.02 DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
13.03 MINIMUM CONTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
ARTICLE 14: EXERCISE OF SHAREHOLDER'S RIGHTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
14.01 VOTING SHARES OF COMPANY STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
14.02 RIGHTS OTHER THAN VOTING RIGHTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
14.03 PUBLIC OFFERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
ARTICLE 15: SPECIAL LIMITATIONS ON CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
15.01 DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
15.02 DETERMINATION AND TREATMENT OF EXCESS DEFERRALS . . . . . . . . . . . . . . . . . . . . . . . 58
15.03 COMPUTATION OF ACTUAL DEFERRAL PERCENTAGE . . . . . . . . . . . . . . . . . . . . . . . . . . 59
15.04 LIMITATION ON CONTRIBUTION PERCENTAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
15.05 DISTRIBUTION OF EXCESS CONTRIBUTIONS AND EXCESS AGGREGATE CONTRIBUTIONS . . . . . . . . . . . 61
ARTICLE 16: ESOP INVESTMENTS AND ACQUISITION LOANS . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
16.01 INVESTMENT OF EMPLOYERS' REGULAR AND CERTAIN ADDITIONAL CONTRIBUTIONS . . . . . . . . . . . . 62
16.02 VALUATION OF SHARES OF COMPANY STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
16.03 ACQUISITION LOANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
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16.04 DIVIDENDS USED IN REPAYMENT OF ACQUISITION LOAN . . . . . . . . . . . . . . . . . . . . . . . 63
16.05 CREATION OF UNALLOCATED COMPANY STOCK ACCOUNT AND RELEASE OF
SHARES OF COMPANY STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
16.06 ALLOCATION OF PROCEEDS OF SALE OR OTHER DISPOSITION . . . . . . . . . . . . . . . . . . . . . 64
</TABLE>
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BOWATER INCORPORATED SALARIED EMPLOYEES' SAVINGS PLAN
(As Amended and Restated Effective May 1, 1989)
(Incorporating Amendments made through September 15, 1994)
PREAMBLE
Establishment of Plan
The Bowater Incorporated Salaried Employees' Savings Plan was established
effective December 31, 1973 for the benefit of eligible salaried Employees of
the Company, and of such of its subsidiaries as might adopt the Plan. The Plan
was amended and restated, effective January 1, 1984, to provide for
payroll-based employee stock ownership contributions (effective December 31,
1983), to provide for employee contributions on a before-tax basis, to
incorporate amendments previously made to the Plan, and to make certain
additional technical changes (effective January 1, 1984), and to provide for
voluntary investments in Company stock (effective October 1, 1984).
Restatement of Plan
The purposes of the January 1, 1985 amendment were to amend the Plan to comply
with applicable provisions of the Tax Equity and Fiscal Responsibility Act of
1982, the Tax Reform Act of 1984 and the Retirement Equity Act of 1984, as well
as to reflect certain changes in the administration of the Plan and certain
technical changes. Effective May 1, 1989 the Plan was amended to be comprised
of both an employee stock ownership plan ("ESOP") as defined in Section
4975(e)(7) of the Internal Revenue Code and a defined contribution savings plan
(in the nature of a profit-sharing plan) with an Internal Revenue Code Section
401(k) cash or deferred arrangement feature. Effective January 1, 1989, the
Plan is amended and restated to bring its provisions into conformance with the
Tax Reform Act of 1986, accommodate certain provisions of the July 1, 1994
Master Trust Agreement between Bowater Incorporated and Fidelity Management
Trust Company and to conform the language of the Plan to administrative
practice.
Objective of Plan
The objective of the Plan is to enhance the existing benefit programs of the
Company with respect to eligible Employees and to encourage such Employees to
further their own financial independence. The Plan is designed to provide a
systematic method of savings through regular contributions by eligible
Employees. Employee contributions will be supplemented by Employer
contributions. All funds contributed will be held in trust, as described
hereinafter, and invested to achieve the objective of the Plan. The Plan and
the Trust forming a part thereof are intended to meet the requirements of
Sections 41, 401(a), 401(k), 409 and 501(a) of the Internal Revenue Code of
1954, as amended from time to time and the provisions of the Employee
Retirement Income Security Act of 1974, as amended from time to time.
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<PAGE> 9
BOWATER INCORPORATED SALARIED EMPLOYEES' SAVINGS PLAN
(As Amended and Restated Effective May 1, 1989)
(Incorporating Amendments made through September 15, 1994)
ARTICLE 1: DEFINITIONS
The following words and phrases as used herein shall, for the purposes of the
Plan and any subsequent amendment thereof, have the following meanings, unless
a different meaning is plainly required by the context. Wherever applicable,
the masculine pronoun shall include the feminine pronoun, and the singular
shall include the plural.
1.01 ACCOUNTS: The separate accounts maintained for each Participant in
each Investment Fund in which the Participant has a balance, including,
but not limited to, the Basic Employee Contribution Account, the
Supplemental Employee Contribution Account, the Basic Tax-Deferred
Employee Contribution Account, the Supplemental Tax-Deferred Employee
Contribution Account, the Company Contribution Account, the Employee
Stock Ownership ("ESOP") Account, and the PAYSOP Account, as determined
under Articles 3 and 4.
1.02 ACQUISITION LOAN: A loan or other extension of credit made or
guaranteed by a "disqualified person", as defined in Section 4975(e)(2)
of the Code, used by the Trustee to finance the acquisition of Shares
of Company Stock for purposes of the Plan pursuant to the provisions of
Section 16.03.
1.03 ACTIVE PARTICIPANT: An eligible Employee who has on file with the
Employer an election to withhold part of his Earnings as a periodic
contribution to the Plan and who is currently having Earnings withheld,
and any eligible Employee on whose behalf a Payroll-based Employee
Stock Ownership Contribution has been made for the Plan Year.
1.04 AFFILIATED COMPANY: Any company or organization directly or indirectly
controlled by, controlling, or under common control with the Company,
within the meaning of Section 1563(a) of the Code, determined without
regard to Sections 1563(a)(4) and 1563(e)(3)(C) thereof, or is a member
of an affiliated service group within the meaning of Section 414(m) of
the Code. With respect to periods prior to July 23, 1984, Affiliated
Company includes any company which would have been an Affiliated
Company prior to the separation under United Kingdom law of the Company
from Bowater plc.
1.05 BASIC EMPLOYEE CONTRIBUTION ACCOUNT: The value of that portion of the
Trust Fund which, with respect to any Participant, is attributable to
his Basic Employee Contributions under Section 3.01.
<PAGE> 10
1.06 BASIC TAX-DEFERRED EMPLOYEE CONTRIBUTION ACCOUNT: The value of that
portion of the Trust Fund which, with respect to any Participant, is
attributable to his Basic Tax-Deferred Employee Contributions under
Section 3.02.
1.07 BENEFICIARY: The person, estate or trust last designated by a
Participant, by written notice filed with the Plan Administrator, to
receive any benefits payable in the event of his death. In the absence
of an effective designation, or if no Beneficiary so designated
survives the Participant, the Beneficiary shall be the first of the
following classes of successive preference beneficiaries then
surviving: the Participant's (a) widow or widower; (b) children; (c)
parents; (d) brothers and sisters; (e) executor or administrator.
Notwithstanding the above, if a Participant is married on the date of
his death, his Beneficiary shall be his surviving Spouse unless:
a) The Participant has designated a Beneficiary other than his
Spouse, and
b) the Participant's Spouse has consented in writing to such other
Beneficiary designation and the Spouse's consent acknowledges the
effect of such election and is witnessed by a representative of
the Plan Administrator or a notary public, or it is established to
the satisfaction of the Plan Administrator that such consent
cannot be obtained because there is no Spouse or because the
Spouse cannot be located.
1.08 BOARD: The Board of Directors of the Company.
1.09 CODE: The Internal Revenue Code of 1954, as amended from time to time.
All references to any Section of the Code shall be deemed to refer not
only to such Section but also to any successor statutory provision to
such Section.
1.10 COMPANY: Bowater Incorporated or any successor by merger, purchase or
otherwise with respect to its Employees. Whenever any power, right,
privilege, duty, or responsibility is reserved to the Company under the
terms of the Plan or the Trust, it may be exercised by the Board or by
any individual(s), committee(s) or entity(ies) to whom the Board has,
in accordance with any procedure it has established, expressly
delegated or upon whom the Board has conferred the authority to act.
1.11 COMPANY CONTRIBUTION ACCOUNT: The value of that portion of the Trust
Fund which, with respect to any Participant, is attributable to any
contributions made on his behalf by an Employer under Section 4.01 and
4.02.
1.12 CURRENT OR ACCUMULATED PROFITS: The Employer's net profits determined
in accordance with generally accepted accounting principles before
2
<PAGE> 11
provision for income taxes and extraordinary items. No Employer
Contribution shall be made in any Plan Year where there are not
sufficient current or accumulated net profits. If the current or
accumulated net profits of any Employer are not sufficient to permit
the required Employer Contributions, then the amount of the Employer
Contribution which such Employer is not permitted to make may be
contributed by any other Employer to the extent of the current or
accumulated net profits of such Employer that remain after contribution
of the Employer Contributions required on behalf of Participants
employed by such other Employer. No reimbursement shall be required as
a result of such contribution.
1.13 DISABILITY: The status of being totally and permanently disabled, as
determined by the Plan Administrator in its sole discretion, based on
satisfactory evidence furnished to the Plan Administrator by a licensed
physician.
1.14 EARNINGS: The basic compensation paid to an Employee by the Employer,
excluding overtime pay, commissions, bonuses and any other extra
remuneration, but including severance pay received in periodic
installments as approved by the Plan Administrator in a uniform and
nondiscriminatory manner, and including any contribution to the Plan
under Sections 3.02 and 3.04 and any compensation excluded from taxable
income under Section 125 of the Code. [This first paragraph of Section
1.14 is effective January 1, 1992.] In addition to other applicable
limitations which may be set forth in the Plan and notwithstanding any
other contrary provision of the Plan, compensation taken into account
under the Plan shall not exceed $150,000, adjusted for changes in the
cost of living as provided in Section 415(d) of the Code, for the
purpose of calculating a Plan Participant's accrued benefit (including
the right to any optional benefit provided under the Plan) for any Plan
Year commencing after December 31, 1993. However, the accrued benefit
determined in accordance with this provision shall not be less than the
accrued benefit determined on December 31, 1993 without regard to this
provision. [This second paragraph of Section 1.14 is effective January
1, 1994.]
1.15 EFFECTIVE DATE: December 31, 1973 or, in the case of an Employer other
than the Company, the date such employer becomes an Employer. Except
where another effective date is specified herein, the effective date of
this amended and restated Plan is May 1, 1989.
1.16 EMPLOYEE: Any individual who is hired to perform duties for the
Employer on a salaried basis, who is subject to its control, and who
receives a regular stated compensation, including a pay arrangement or
paid leave of absence, unless contractually agreed otherwise, but
excluding a pension, retainer or fee under contract. The term
"Employee" shall not include an individual who performs services as a
leased employee within the meaning of Section 414(n) of the Code.
3
<PAGE> 12
1.17 EMPLOYEE STOCK OWNERSHIP ("ESOP") ACCOUNT: The Accounts established
within the Company Stock Fund, maintained as an employee stock
ownership plan as defined in Section 4975(e)(7) of the Code ("ESOP")
which are used exclusively to receive allocations of Regular
Contributions that match Participants' Basic Contributions and, in
certain instances, discretionary Additional (matching) Company
Contributions to the Plan, which are designated as ESOP Contributions
by the Employer.
1.18 EMPLOYER: Bowater Incorporated or any successor by merger, purchase or
otherwise with respect to its Employees, or any Affiliated Company
which the Board shall designate as an Employer for purposes of this
Plan, upon such terms and conditions as said board shall determine, and
with the approval of the board of directors of such Affiliated Company.
1.19 EMPLOYMENT: The service as an Employee with the Employer.
1.20 ENROLLMENT DATE: The Effective Date and thereafter, until July 1,
1994, the first day of each January, April, July and October.
Beginning July 1, 1994, the first day of each month is an Enrollment
Date. In the case of any Affiliated Company which is designated as an
Employer, Enrollment Date shall also mean the effective date of such
designation and each day thereafter specified in the applicable
preceding sentence.
1.21 ERISA: The Employee Retirement Income Security Act of 1974, as amended
from time to time. All references to any Section of the Act shall be
deemed to refer not only to such Section but also to any successor
statutory provisions to such Section.
1.22 FIDUCIARY: A person or company who exercises discretionary control
over the Plan or assets, as defined in Section 3(21) of ERISA.
1.23 FINANCED SHARES: Shares of Company Stock acquired with an Acquisition
Loan.
1.24 FORFEITURES: The excess of all amounts in Participants' Accounts,
accumulated with investment return, over the Vested Values, upon
distribution of such values.
1.25 HOUR OF SERVICE: Each hour, or part thereof, during which an Employee
is paid, or entitled to payment, for the performance of duties for an
Employer.
1.26 INVESTMENT FUNDS: The funds, together with the investment return
thereon, as described under Section 5.01, to which contributions are
allocated and into which a Participant may direct that contributions or
accounts be invested, pursuant to Article 5.
4
<PAGE> 13
1.27 PARTICIPANT: An Active Participant or former Active Participant who
still has contributions credited to his Accounts.
1.28 PAYROLL-BASED EMPLOYEE STOCK OWNERSHIP ("PAYSOP") CONTRIBUTION: The
contributions made by an Employer pursuant to Section 4.03.
1.29 PAYROLL-BASED EMPLOYEE STOCK OWNERSHIP ("PAYSOP") ACCOUNT: The Account
established under that portion of the Company Stock Fund maintained as
an ESOP which, with respect to any Participant, is attributable to his
Payroll-Based Employee Stock Ownership Contributions under Section
4.03.
1.30 PLAN: The Bowater Incorporated Salaried Employees' Savings Plan as set
forth herein, and as it may, from time to time, be amended.
1.31 PLAN ADMINISTRATOR: The Company or the individual(s) and/or
committee(s) appointed pursuant to procedures established by the Board
to administer the Plan.
1.32 PLAN TO PLAN TRANSFER: The transfer described in Section 3.09 hereof.
1.33 PLAN YEAR: The calendar year commencing January 1 and ending
December 31.
1.34 REGULAR CONTRIBUTIONS: Company Contributions which match (in the
percentage specified in Section 4.01) a Participant's Basic Employee
Contributions or Basic Tax-Deferred Employee Contributions.
1.35 RETIREMENT: Termination of employment after having attained age 55 or
having attained the age and completed the required Years of Service to
be eligible for early, normal or postponed retirement under the
Employer's qualified retirement plan in which the Employee
participates.
1.36 SEVERANCE FROM SERVICE DATE:
(a) The date on which the Employee quits, retires, is discharged or
dies; or
(b) The first anniversary of the first date of a period in which the
Employee remains absent from Employment with or without pay, for
any reason other than those specified in clause (a) of this
Section 1.35, such as vacation, holiday, sickness, disability,
leave of absence or layoff.
In the case of an Employee who is absent from work for maternity
or paternity reasons beyond the first anniversary of the first
date of such absence, the Severance From Service Date shall be the
second anniversary of the first date of such absence. For
purposes of this paragraph, an absence
5
<PAGE> 14
from work for maternity or paternity reasons means an absence
(1) by reason of the pregnancy of the Employee; (2) by reason
of the birth of a child of the Employee; (3) by reason of a
placement of a child with the Employee in connection with the
adoption of such child by such Employee; or (4) for purposes
of caring for such child for a period beginning immediately
following such birth or placement.
1.37 SHARE OF COMPANY STOCK: A share of common stock of the Company which
is either tradeable on an established securities market or which has
voting power and dividend rights no less favorable than any other class
of common stock issued by such Company; provided, however, that when
used to describe shares to be acquired pursuant to an Acquisition Loan
or to be allocated to a Participant's ESOP Account, such term shall
mean stock described in Section 4975(e)(8) of the Code.
1.38 SPECIFIED HARDSHIP WITHDRAWAL: A withdrawal necessitated by the need
of the Participant for funds to cover costs related to education,
health or medical care, or housing requirements. For purposes of
clarification, a Specified Hardship Withdrawal shall be allowed only
for financial need arising out of expenses incurred or assumed by a
Participant (a) related to medical expenses of a Participant or a
member of his family or dependent, and not covered by insurance; (b)
related to the post-secondary school tuition for the next quarter or
semester of a Participant or a member of his family or dependents; or
(c) relating to the acquisition of a primary residence of a
Participant; or (d) expenses to prevent eviction from, or foreclosure
on the mortgage on, the Participant's primary residence. The amount
withdrawn may not exceed the actual expense (including reasonably
anticipated state and federal taxes and penalties payable with respect
to the receipt of the amount withdrawn) incurred by the Participant due
to such emergency and shall not be reasonably available from other
resources of the Employee. Such resources include all distributions
(other than hardship) or loans available under the Plan, the ability to
borrow from banks, credit unions or other legitimate lenders, and the
disposition of personal assets which can be readily sold without need
for replacement. The Plan Administrator shall determine whether
applications for such withdrawal satisfy the definition for Specified
Hardship Withdrawal.
1.39 SPOUSE: The person legally married to the Participant at the time an
action or event relevant for Plan purposes occurs, or immediately prior
to his death.
1.40 SUPPLEMENTAL EMPLOYEE CONTRIBUTION ACCOUNT: The value of that portion
of the Trust Fund which, with respect to any Participant, is
attributable to his Supplemental Employee Contributions under Section
3.03.
1.41 SUPPLEMENTAL TAX-DEFERRED EMPLOYEE CONTRIBUTION ACCOUNT: The value of
that portion of the Trust Fund which, with respect to any Participant,
6
<PAGE> 15
is attributable to his Supplemental Tax-Deferred Employee Contributions
under Section 3.04.
1.42 TRANSFEROR PLAN: The Bowater Southern Hourly Employees' Savings Plan,
the Bowater Carolina Hourly Employees' Savings Plan, the Bowater
Communication Papers Inc. Employees' Savings Plan, the Great Northern
Paper, Inc. Savings and Capital Growth Plan, the Great Northern Paper,
Inc. Hourly 401(k) Savings Plan, and such other tax-qualified plan as
may be approved by the Plan Administrator.
1.43 TRUSTEE: Fidelity Management Trust Company, as Trustee under the
Master Trust Agreement between Bowater Incorporated and Fidelity
Management Trust Company dated as of July 1, 1994, and, to the extent
not succeeded thereby, Wachovia Bank and Trust Company as Trustee under
the Bowater Incorporated Master Trust Agreement, as amended and
restated as of May 1, 1989, and their respective successors.
1.44 TRUST FUND: The aggregate funds held by the Trustees under the Plan
pursuant to the trust agreements between the Company and the Trustees.
1.45 UNALLOCATED COMPANY STOCK ACCOUNT: The Account established for
Financed Shares pursuant to Section 16.05 of the Plan, which shares
have not yet been released from such Account for purposes of allocation
to Participants' Accounts.
1.46 VALUATION DATE: The last business day of each month (and any other
date specified by the Trustee), on which the Trust Fund is valued in
accordance with Article 6. As to Accounts maintained in any Investment
Fund which is valued daily, each business day may be deemed to be a
Valuation Date.
1.47 VESTED VALUE: When used to refer to the interest of a Participant in
the Trust Fund on any date, the nonforfeitable portion thereof at the
time of determination.
1.48 VESTING DATE: The date on which a Participant completes three Years of
Service, determined pursuant to Sections 1.49, 2.04, 2.05 and 7.05.
1.49 YEAR OF BREAK IN SERVICE: Any twelve (12) consecutive-month period,
computed from Severance From Service Date, during which an Employee
does not complete one or more Hours of Service. A One Year Break in
Service shall occur on the last day of the first such twelve-month
period. Notwithstanding the above, an Employee shall be deemed to have
not incurred a One Year Break in Service if he is either on a leave of
absence in excess of twelve months authorized by his Employer and
returns to Employment upon the expiration of such leave, or on military
leave in excess of twelve months and returns to Employment with an
7
<PAGE> 16
Employer within ninety days after his discharge, or such longer period
as may be prescribed by law.
l.50 YEARS OF SERVICE:
(a) For Employment on and after January 1, 1984, the aggregate period
of Employment consisting of Years of Service and parts thereof,
with each Year of Service consisting of twelve months and with a
month consisting of thirty days. Years of Service shall be
computed beginning on the date the Employee completes an Hour of
Service upon commencing or recommencing employment and ending on
his next following Severance From Service Date. Years of Service
shall include the period of time between an Employee's Severance
From Service Date and the date he next completes an Hour of
Service within twelve months from the date he last completed an
Hour of Service.
(b) For Employment prior to January 1, 1984, Years of Service shall be
equal to the years of service credited under the provisions of the
Plan in existence as of December 31, 1983.
8
<PAGE> 17
ARTICLE 2: ELIGIBILITY AND PARTICIPATION
2.01 ELIGIBILITY: An Employee who is an Active Participant as of December
31, 1984 shall continue to be an Active Participant as of January 1,
1985, provided that the Participant continues to meet the requirements
of Section 2.02 and has not ceased Active Participation under Section
2.03. Subject to the provisions of Section 2.05, each other Employee
shall be eligible to become a Participant on any Enrollment Date
following completion of the following requirements:
(a) He has completed one Year of Service; and
(b) He is not a member of any other non-governmental tax qualified
defined contribution plan to which his Employer is making
contributions on his behalf; and
(c) He has not terminated Employment at the time he could otherwise
enter the Plan; and
(d) He is not a member of any collective bargaining unit for which
qualified plan benefits have been the subject of bargaining with
his Employer pursuant to a currently effective collective
bargaining agreement.
Each Employee transferred from hourly status shall be eligible to make
a Plan to Plan Transfer under the provisions of Section 3.09 at any
time.
2.02 PARTICIPATION: An eligible Employee shall become an Active Participant
as of any Enrollment Date, if on or before such date and within the
time period prescribed by the Plan Administrator, the Employee files
with the Employer an enrollment form prescribed by the Plan
Administrator on which he designates the rate of his Participant
contributions, designates a Beneficiary, authorizes the Employer to
make payroll deductions, and makes investment elections as provided
under the Plan. An eligible Employee who does not file an enrollment
form in accordance with the preceding sentence shall become an Active
Participant on the first succeeding Enrollment Date after the date the
Employee files such enrollment form with the Employer.
With respect to the Plan to Plan Transfers under Section 3.09, an
Employee shall automatically become a Participant at the time of such
transfer.
2.03 CESSATION OF ACTIVE PARTICIPATION: An Employee shall cease to be an
Active Participant whenever any of the following occur:
(a) upon the voluntary suspension of his contributions, pursuant to
Section 3.07;
9
<PAGE> 18
(b) upon the mandatory suspension of his contributions, pursuant to
Article 8;
(c) upon a Year of Break in Service by the Employee;
(d) upon any change in his status as an Employee which would make him
ineligible to become or remain a Participant under the terms of
Section 2.01, including a transfer to hourly status or to the
payroll of an Affiliated Company which is not an Employer.
Participation (but not Active Participation) shall not cease due to
(a), (b) or to temporary absence from employment. The Employee's
Participation shall continue until his Accounts are distributed in full
to him or his Beneficiary or until forfeited.
2.04 EFFECT OF REEMPLOYMENT ON PLAN ENTRY OR REENTRY: In the event of
reemployment after Termination of Employment, an Employee may enter or
reenter the Plan pursuant to the following rules:
(a) If an Employee who has less than three (3) Years of Service at the
time of his termination of Employment incurred five or more Years
of Break in Service, he may enter or reenter the Plan on any
Enrollment Date after meeting the requirements of Section 2.01.
(b) If the Employee was previously a Participant in the Plan and (i)
did not incur five (5) or more Years of Break in Service, or (ii)
had three (3) or more Years of Service at the time of his
termination of Employment he may reenter the Plan on the date of
his reemployment;
(c) If the Employee did not incur a Year of Break in Service, had
satisfied the eligibility conditions of Section 2.01 but
terminated Employment prior to becoming a Participant, he may
become a Participant in the Plan on the later of (i) the date of
his reemployment, or (ii) the Enrollment Date on which he would
have become a Participant had he not incurred the termination of
Employment;
(d) Any other Employee shall become a Participant in the Plan in
accordance with the provisions of Section 2.01.
2.05 PRIOR EMPLOYMENT WITH AN AFFILIATED COMPANY: Any person who becomes an
Employee and who was previously employed by an Affiliated Company, or
who previously performed service as a leased employee within the
meaning of Section 414(n) of the Code (if the Company was the recipient
of such services) shall have such service taken into account, credited
solely for purposes of determining eligibility to participate and
vesting under the Plan.
10
<PAGE> 19
ARTICLE 3: PARTICIPANT CONTRIBUTIONS
3.01 BASIC EMPLOYEE CONTRIBUTIONS: Each Active Participant may elect to
make Basic Employee Contributions to the Plan. The rate of such
Contribution shall be an integral percentage of the Participant's
Earnings. The maximum rate that may be elected (including
Contributions under Section 3.02) shall be 6%.
3.02 BASIC TAX-DEFERRED EMPLOYEE CONTRIBUTIONS: Each Active Participant
may, subject to the terms and conditions of other Sections of this
Article, elect to make Basic Tax-Deferred Employee Contributions to the
Plan. The rate of such Contribution shall be an integral percentage of
the Participant's Earnings. The maximum rate that may be elected
(including Contributions under Section 3.01) shall be 6%.
3.03 SUPPLEMENTAL EMPLOYEE CONTRIBUTIONS: Each Active Participant who is
making Contributions of 6% of Earnings under Section 3.01 and/or 3.02
may elect to make Supplemental Employee Contributions to the Plan. The
rate of such Contribution shall be an integral percentage of the
Participant's Earnings. The maximum rate that may be elected
(including Contributions under Section 3.04) shall be 10% of the
Participant's Earnings for all Plan Years in which he was an Active
Participant, reduced by all prior Supplemental Employee Contributions
and Supplemental Tax-Deferred Employee Contributions made with respect
to such Earnings under this Plan or under any other qualified employee
pension plan maintained by the Employer or an Affiliated Company.
3.04 SUPPLEMENTAL TAX-DEFERRED EMPLOYEE CONTRIBUTIONS: Each Active
Participant who is making Contributions of 6% of Earnings under Section
3.02 may elect to make Supplemental Tax-Deferred Employee Contributions
to the Plan. The maximum rate that may be elected (not including
Contributions under Section 3.03) shall be three percent.
3.05 MODE OF PAYMENT: Employee Contributions shall be made by means of
payroll deductions for each payroll period, effective with the first
full payroll period which ends after the date on which he becomes an
Active Participant. Contributions shall be accrued by the Employer
from a Participant's Earnings at the rate designated by the
Participant, credited to the applicable Accounts by the end of such
payroll period, and paid to the Trustee promptly and, in any event, no
later than 30 days after the end of the Plan Year with respect to which
such Contributions are made.
3.06 CHANGE IN AMOUNT OF CONTRIBUTION: Subject to the provisions of Article
15, a Participant may elect to change the rate of his Basic Employee
Contributions and/or Supplemental Employee Contributions by giving
prior written
11
<PAGE> 20
notice to the Employer on a form provided by the Plan Administrator for
such purpose within the time period prescribed by the Plan
Administrator.
Subject to the provisions of Article 15, a Participant may change the
rate of his Basic Tax-Deferred and/or Supplemental Tax-Deferred
Employee Contributions by giving prior written notice to the Employer
on a form provided by the Plan Administrator for such purpose within
the time period prescribed by the Plan Administrator.
Changes will be effective with the first full payroll period which
begins in the month following the expiration of the time period
prescribed by the Plan Administrator for the submission of a
Participant's notice of election to change his Contributions.
If the Participant's total contribution rate is in excess of 6% of his
Earnings, any such change will first be applied to adjust the amount of
his Supplemental Employee Contributions and/or Supplemental
Tax-Deferred Employee Contributions, and then, if necessary, to adjust
the amount of his Basic Employee Contributions and/or Basic
Tax-Deferred Employee Contributions. If the Participant's total
contribution rate is less than 6% of his Earnings, any such change will
first be applied to adjust the amount of his Basic Employee
Contributions and/or Basic Tax-Deferred Employee Contributions, and
then, if necessary, to provide for Supplemental Employee Contributions
and/or Supplemental Tax-Deferred Employee Contributions.
3.07 VOLUNTARY SUSPENSION OF PARTICIPANT CONTRIBUTIONS: A Participant may
suspend his Basic or Supplemental Employee Contributions as of the
first day of any month by giving prior written notice to the Employer
within the time period prescribed by the Plan Administrator. A
suspension of any Basic Employee Contributions will automatically
suspend all Supplemental Employee Contributions and/or Supplemental
Tax-Deferred Employee Contributions.
A Participant may suspend his Basic Tax-Deferred or Supplemental
Tax-Deferred Employee Contributions as of the first day of any month by
giving prior written notice to the Employer within the time period
prescribed by the Plan Administrator. A suspension of any Basic Tax-
Deferred Employee Contributions will automatically suspend all
Supplemental Employee Contributions and/or Supplemental Tax-Deferred
Employee Contributions.
The Participant may resume his Contributions as of the first day of any
month after the date the suspension commenced by giving prior written
notice to the Employer within the time period prescribed by the Plan
Administrator.
Written notice of suspension or resumption of Contributions shall be on
a form provided by the Plan Administrator for such purpose.
12
<PAGE> 21
3.08 EMPLOYMENT WITH AFFILIATED COMPANY: A Participant may not contribute
to the Plan while he is employed by an Affiliated Company which is not
an Employer, unless and except to the extent that he continues to
receive Earnings from an Employer. A Participant who receives Earnings
from an Employer and compensation from such an Affiliated Company may
elect to contribute to the Plan, by means of payroll deductions for
each payroll period, as if his Earnings from the Employer included his
basic compensation from the Affiliated Company. However, a
Participant's prior and concurrent service with an Affiliated Company
which is not an Employer shall be counted for Years of Service to the
extent such credit has been given under Section 1.49 and 1.50 as if
such Affiliated Company had been an Employer. For this purpose, the
fact that the Participant has made no contributions under the Plan
shall be disregarded.
3.09 PLAN TO PLAN TRANSFER: Balances may be transferred into the Plan,
without the consent of the Plan Administrator, if the amount
transferred is from the Bowater Southern Hourly Employees' Savings
Plan, the Bowater Carolina Hourly Employees' Savings Plan, the Bowater
Communication Papers Inc. Employees' Savings Plan, the Great Northern
Paper, Inc. Savings and Capital Growth Plan, the Great Northern Paper,
Inc. Hourly 401(k) Savings Plan, and with the Plan Administrator's
consent, if the transfer is from another tax- qualified plan. Amounts
transferred under this Section shall be subject to the applicable
restrictions of Article 8 but shall not be subject to the limitations
of Section 4.07 or 4.08; nor shall amounts transferred under this
Section be included in the calculation of the Participant's rate of
Basic or Supplemental Contribution pursuant to Section 3.06.
The balance transferred shall be treated as follows:
(i) The portion attributable to pre-tax contributions pursuant to
Section 401(k) of the Code shall be credited to the Employee's
Supplemental Tax-Deferred Employee Contribution Account;
(ii) The portion attributable to after-tax contributions pursuant to
Section 401(a) of the Code shall be credited to the Employee's
Supplemental Employee Contribution Account;
(iii) The portion attributable to Employer matching contributions
pursuant to Section 401(a) of the Code shall be credited to
The Employee's Company Contribution Account;
(iv) The portion attributable to Employer contributions pursuant to
Section 41 of the Code shall be credited to the Employee's PAYSOP
Account.
The Plan Administrator shall require that the Employee furnish a
written statement containing such information as may be necessary to
establish that the transfer is
13
<PAGE> 22
consistent with the provisions of this Plan and otherwise meets the
requirements of law.
3.10 ROLLOVER CONTRIBUTIONS: An Employee, whether or not a Participant, may
request the Plan Administrator to direct the Trustee to accept any of
the following amounts from or on behalf of the Employee and place them
in a Rollover Contribution Account for the Employee:
(a) amounts transferred to this Plan directly from another trust or
annuity contract maintained as part of a plan qualified under
Section 401(a) of the Code;
(b) amounts which (i) constitute or form a part of a qualifying
rollover distribution within the meaning of Section 402(a)(5) of
the Code which have been received by the Employee from another
trust or annuity contract maintained as part of a plan qualified
under Section 401(a) of the Code (other than one forming part of a
plan under which the Employee was one described in Section
401(c)(1) of the Code at the time the contributions were made on
his behalf), (ii) are eligible for tax-free rollover treatment,
and (iii) are transferred to this Plan by the Employee within 60
days following his receipt; or
(c) amounts which have been deposited and held in a conduit Individual
Retirement Account (as defined in Section 408 of the Code)
consisting solely of assets and the income thereon which were (i)
previously distributed to the Employee from another trust or
annuity contract maintained as part of a plan qualified under
Section 401(a) of the Code (other than one forming part of a plan
under which the Employee was described in Section 401(c)(1) of the
Code at the time the contributions were made on his behalf) as
part of a qualifying rollover distribution as defined in Section
402(a)(5) of the Code and which were deposited in the Individual
Retirement Account within 60 days of their receipt, and (ii) are
transferred directly to this Plan from the conduit Individual
Retirement Account or are transferred to this Plan within 60 days
of their distribution to the Employee from the conduit Individual
Retirement Account.
Any amounts transferred into this Plan under this Section shall be
by check. No securities shall be contributed. The Employee shall
make application to the Plan Administrator in writing, submitting
whatever information is deemed necessary and sufficient by the
Plan Administrator to establish compliance with the requirements
of this sub-section 3.10. Amounts accepted by the Plan
Administrator shall be placed in a Rollover Contribution Account
established for the Employee and shall become part of the Trust
Fund. Any amounts in the Employee's Rollover Contribution
14
<PAGE> 23
Account shall be one hundred percent (100%) vested at all times. The
Employee shall be able to direct the investment of this Account in
accordance with the provisions of Article 5. An Employee's Rollover
Contribution Account shall be subject to the same terms and conditions
as are applicable to a Supplemental Tax-Deferred Employee Contribution
Account.
15
<PAGE> 24
ARTICLE 4: EMPLOYER CONTRIBUTIONS
4.01 REGULAR CONTRIBUTIONS: With respect to each Active Participant in its
employ, each Employer shall contribute to the Plan from its Current or
Accumulated Profits an amount equal to sixty percent of such
Participant's Basic Employee Contributions and/or Basic Tax- Deferred
Employee Contributions accrued for the corresponding pay period.
Contributions by each Employer with respect to Active Participants
shall be:
(a) paid to the Trustee in the form specified in Section 4.04; and
(b) allocated to the appropriate account of the Participant as
promptly as possible, but no later than as of the end of the Plan
Year in which the payroll period (to which such contribution
relates) ends.
The "appropriate" account is the Participant's Non-ESOP Company
Contribution Account for such contributions made with respect to (1)
the 1988 Plan Year or subsequent payroll periods ending prior to May 1,
1989, and (2) payroll periods ending on and after May 1, 1989, to the
extent, if any, such contributions are not applied to the payment of
principal or interest on an Acquisition Loan and are not designated by
the Employer as ESOP contributions. Otherwise, the "appropriate"
account for such contributions made with respect to payroll periods
ending on and after May 1, 1989 is the Participant's ESOP Account.
(Regular contributions which are applied to the payment of principal or
interest on an Acquisition Loan shall be ESOP Contributions, allocable
to the ESOP Accounts of the Participants to whom such contributions are
allocated.)
4.02 ADDITIONAL CONTRIBUTIONS: The Board and the board of directors of any
Employer may from time to time, but not more often than once a Plan
Year for any Employer, authorize additional contributions by an
Employer from its Current or Accumulated Profits for its Employees who
on the last day of such Plan Year are Active Participants or who were
Active Participants during the Plan Year but are then currently
suspended under Article 8. Except to the extent that such additional
Employer Contributions are designated by the Employer as contributions
to be allocated to the ESOP Account of the Employees, such additional
Employer Contributions shall be allocated to the Non-ESOP Company
Contribution Account of its Employees. Except to the extent that such
additional Employer Contributions are designated by the Employer as
Contributions which are to be allocated (either alone or aggregated
with other specified Employer Contributions to the Plan in the same
Plan Year) among all Participants in proportion to their respective
Earnings for such Plan Year (or in any other permissible manner), such
additional Employer contributions shall be allocated as a uniform
percentage (with respect to each Account to which contributions are
allocated) of the Regular Contributions made by the Employer pursuant
to Section 4.01 and remaining in the Accounts of each
16
<PAGE> 25
Participant who made Contributions for such Plan Year. Except to the
extent required for the allocation of Shares of Company Stock required
to be allocated to Participants' Accounts by reason of the release of
such Shares from the Unallocated Company Stock Account upon payment of
principal and/or interest on an Acquisition Loan, in no event shall
such uniform percentage exceed an additional forty percent of the
Participant's Basic Employee Contributions and/or Basic Tax-Deferred
Employee Contributions for the Plan Year.
4.03 PAYROLL-BASED EMPLOYEE STOCK OWNERSHIP CONTRIBUTIONS: For each Plan
Year, beginning in 1983 and ending in 1986, the Employer shall
contribute to the Trust Fund out of Current or Accumulated Profits, an
amount equal to the percentage of the aggregate (W-2) compensation paid
to Employees who are eligible for participation under Section 2.01 of
Article 2 during the Plan Year, or as of the subsequent January 1, and
who have not terminated Employment as of the end of such Plan Year.
Such percentage shall be determined in accordance with the following
table, less the amount of any reduction in such credit for a prior Plan
Year due to a final determination of such credit which is not taken
into account in any deduction under Section 404(i)[h](2) of the Code
(or to the maximum extent permitted by law):
<TABLE>
<CAPTION>
Calendar Percentage of
Year Aggregate Compensation
---- ----------------------
<S> <C>
1983 0.50
1984 0.50
1985 0.50
1986 0.50
1987 0.00
1988 or thereafter 0.00
</TABLE>
4.04 MODE OF PAYMENT: For Plan Years beginning prior to January 1, 1988,
Regular Contributions under Section 4.01 shall be made in cash. For
Plan Years beginning on January 1, 1988 and January 1, 1989, Regular
Contributions under Section 4.01 shall be made solely in Shares of
Company Stock until April 30, 1989. Effective May 1, 1989, Regular
Contributions under Section 4.01 may be made either in cash or in
Shares of Company Stock. For Plan Years beginning prior to January
1, 1987, Additional Contributions under Section 4.02 shall be made
in cash. For the Plan Years beginning January 1, 1987, January 1,
1988 and January 1, 1989, Additional Contributions under Section
4.02 shall be made solely in Shares of Company Stock until April 30,
1989. Effective May 1, 1989 and for Plan Years beginning
thereafter, Additional Contributions under Section 4.02 shall,
unless (and except to the extent) designated by the Employer as ESOP
Contributions allocable to the ESOP Accounts of Participants, be
made solely in Shares of Company Stock. For such Plan Years, to the
extent such Additional Contributions under Section 4.02
17
<PAGE> 26
are designated by the Employer as ESOP Contributions allocable to
the ESOP Accounts of Participants, such contributions may be made
either in cash or in Shares of Company Stock. Contributions
designated as ESOP Contributions shall be available to the Trustee
for allocation to Participants' ESOP Accounts, acquisition of Shares
of Company Stock or payment of principal and interest under or on
Acquisition Loans, as may be appropriate under the circumstances and
as permitted or required by the terms of the Plan and any applicable
Loan documentation.
Whenever Contributions under Section 4.01 or 4.02 are required or
permitted to be made in Shares of Company Stock, the number of
Shares of Company Stock so contributed shall be determined by
reference to the price of Shares of Company Stock on the New York
Stock Exchange for the "Applicable Trading Day". For purposes of
Shares of Company Stock contributed under Section 4.01, the
"Applicable Trading Day" shall be the trading day immediately
preceding the last day of the month in which the payroll period
(with respect to which such Shares of Company Stock are to be
transferred to the Trust Fund) ends. For purposes of Shares of
Company Stock contributed under Section 4.02, the "Applicable
Trading Day" shall be the trading day immediately preceding the
Valuation Date selected for this purpose by the Plan Administrator
in conformity with any other applicable provisions of the Plan.
4.05 FORFEITURES: The amount of any Forfeitures under Section 7.04 and
8.02 shall be applied to reduce future Employer contributions under
the Plan as soon as practicable after the event giving rise to the
Forfeiture shall have occurred.
4.06 RETURN OF CERTAIN CONTRIBUTIONS TO EMPLOYER: The following Employer
contributions may be returned to an Employer:
(a) Any contribution made by an Employer under a mistake of fact
may be returned to the Employer within one year of payment;
(b) Any contribution which is disallowed as a deduction under
Section 404 of the Code may be returned to an Employer
within one year after disallowance.
The amount which may be returned to an Employer shall not exceed the
amount of the Employer's contribution reduced by any losses
attributable to the contribution between the date of contribution
and the Valuation Date immediately preceding the date of withdrawal.
No contribution or portion of a contribution will be returned to an
Employer if the return of such amount would cause the value of an
Company Contribution Account to be less than what its value would
have been had the contribution not been made.
18
<PAGE> 27
4.07 STATUTORY LIMITATION ON ADDITIONS: Notwithstanding any other
provisions of the Plan, for each Plan Year, "the annual addition" to
a Participant's Accounts shall not exceed the lesser of (a) and (b)
below:
(a) The Maximum Permissible Dollar Amount; and
(b) 25% of the Employee's compensation for the Plan Year.
For the purposes of applying the above limits, the following
conditions and definitions shall apply:
(i) The term "annual additions" shall mean the sum of:
1. Employer Contributions and forfeitures
allocated to the Participant's Accounts
under Sections 4.01, 4.02, 4.03 and 5.01:
2. Basic Tax-Deferred Employee Contributions
and Supplemental Tax-Deferred Employee
Contributions allocated to the
Participant's Accounts under Sections 3.02
and 3.04;
3. The lesser of: (a) the Basic Employee
Contributions and Supplemental Employee
Contributions allocated to the
Participant's Accounts under Sections 3.01
and 3.03 in excess of 6% of the Employee's
Total Compensation; or (b) one-half of such
Contributions.
(ii) The initial Maximum Permissible Dollar Amount shall
be $30,000. The limitation shall be adjusted
automatically in accordance with regulations issued
or to be issued by the Secretary of the Treasury as
the corresponding limitation in Section
415(c)(1)(A) of the Code is adjusted for the cost
of living in accordance with Section 415(d) of the
Code.
If, however, during any Plan Year, no more than one-third of
the Company Contributions under Section 4.03, and, in Plan
Years beginning on and after January 1, 1989 the
contributions under Section 4.01 and so much (if any) of the
contributions under Section 4.02 as are designated as ESOP
Contributions, are allocated to the "highly compensated
employees" as that term is defined in Code Section 414(q),
then for purposes of determining the Maximum Permissible
Dollar Amount with respect to any Participant for a Plan
Year, the amount under (a) shall be adjusted by adding to it
the lesser of
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1. the amount under (a) above, or
2. the amount contributed under Section 4.03
for a Participant, plus, with respect to
Plan Years beginning on and after January
1, 1989, the amounts contributed for a
Participant as an ESOP Contribution under
Sections 4.01 and 4.02.
(iii) For purposes of this Section, the term "Total
Compensation" shall mean the amount paid to the
Employee by the Employer during the Plan Year,
excluding Basic Tax-Deferred Employee Contributions
under Section 3.02 and Supplemental Tax-Deferred
Employee Contributions under Section 3.04, as
reported on his Form W-2.
(iv) The limitations of this Section with respect to any
Participant who at any time has been a participant
in any other defined contribution plan maintained
by the Company or an Affiliated Company shall apply
as if the total benefit payable under all such
defined contribution plans in which the Participant
has been a participant were payable from one plan.
If the above limitations would be exceeded in any Plan Year,
the Plan Administrator shall take the following action in
any order at such times as required and to the extent
necessary to prevent the limitations from being exceeded.
(i) Discontinue or reduce the Supplemental Employee
and/or Supplemental Tax-Deferred Employee
Contribution;
(ii) Discontinue or reduce the Basic Employee and/or
Basic Tax-Deferred Employee Contributions for the
remainder of the Plan Year;
(iii) Instruct the Trustee to return all or a portion of
the Employee's Supplemental Contributions made
during the Plan Year;
(iv) Instruct the Trustee to return all or a portion of
the Employee's Supplemental Tax-Deferred
Contributions made during the Plan Year;
(v) Instruct the Employer to reduce or eliminate its
Employer Contributions, other than the
Payroll-based Employee Stock Ownership
Contribution, to the Participant's Accounts for the
remainder of the Plan Year;
(vi) Instruct the Trustee to return to the Company all
or a portion of the Company Contributions, other
than the Payroll- based Employee Stock
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Ownership Contribution, made to the Participant's
Accounts for the Plan Year; and
(vii) Apply any amounts in excess of such limitations
("excess amounts") for a Participant to reduce
Employer Contributions for the next Plan Year (and
succeeding Plan Years, as necessary) for that
Participant, if that Participant is covered by the
Plan as of the end of the Plan Year. For purposes
of this sub-section, excess amounts may not be
distributed to Participants or former Participants.
The above actions shall not be considered a suspension of
Participant Contributions as provided in Section 3.07. The
provisions of this Section shall be effective January 1,
1983.
If that Participant is not covered by the Plan as of the end
of the Plan Year, the Plan Administrator shall instruct the
Trustee to hold such excess amounts unallocated in a
suspense account for the Plan Year and allocated and
reallocated in the next Plan Year to all of the remaining
Participants in the Plan. Such allocation or reallocation
shall not result in the limitations of this Section 4.07
being exceeded for any Participant for the Plan Year.
Any excess amounts not allocated to Participants in the
preceding paragraph shall be used to reduce Employer
contributions for the next Plan Year (and succeeding Plan
Years, as necessary) for all of the Participants in the
Plan. Notwithstanding the foregoing, the provisions of
Section 415 of the Code, as amended by the Tax Reform Act of
1986, are hereby incorporated by reference.
4.08 COMBINED PLANS LIMITATION: In any case in which a Participant in
the Plan is also a participant in any defined benefit plan
maintained by the Employer, the allocations set for them in this
Plan shall be additionally limited so that the sum of the "defined
benefit fraction" and the "defined contribution fraction" would not
exceed 1.0 for any Plan Year.
The term "defined contribution fraction" for a Plan Year shall mean
a fraction, the numerator of which is the sum of annual additions to
the Participant's Accounts for all Plan Years as of the end of the
Plan Year and the denominator of which is the lesser of 125% of the
Maximum Permissible Dollar Amount for the Plan Year and all prior
Years of Service or 140% of 25% of the Participant's Total
Compensation for that year and all prior Years of Service.
The term "defined benefit fraction" for a Plan Year shall mean a
fraction, the numerator of which is the projected annual benefit for
the Participant under all qualified retirement plans of the Employer
and the denominator of which is the
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lesser of 125% of the Maximum Permissible Dollar Amount under the
Retirement Plans for the Plan Year or 140% of the Participant's
average compensation for the three highest paid years. Such
fraction shall be determined as of the end of the Plan Year.
The Participant's projected annual benefit shall be determined under
such retirement plans assuming that his earnings continue to normal
retirement date at the same level as at the end of the Plan Year and
assuming that his service continues to accrue to his normal
retirement date without a break in service prior to his normal
retirement date. The terms "earnings", "service", "normal
retirement date" and "break in service" shall mean the same as
defined in such retirement plan.
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<PAGE> 31
ARTICLE 5: INVESTMENT OPTIONS
5.01 INVESTMENT OF PARTICIPANT AND EMPLOYER CONTRIBUTIONS: Participant
and Employer Contributions shall be invested by the Trustee either
as directed by the Provisions of the Plan or as directed by the
Participant (or, where applicable, the Participant's Beneficiary or
an Alternate Payee designated pursuant to a Qualified Domestic
Relations Order) in one or more Investment Funds, which shall
include the following:
Company Stock Fund: This Fund invests primarily in shares of
Company stock. However, a small percentage of the Fund is invested
in money market instruments to facilitate daily cash transactions.
Cash dividends received on shares of Company stock held by this Fund
will be automatically reinvested in the Fund. Accounts in this Fund
shall segregate, separately account for and respectively consist of
shares of Company stock attributable to (1) PAYSOP Contributions,
(2) Non-ESOP Employer Contributions, (3) Employee Contributions, (4)
ESOP Employer Contributions, and (5) the Unallocated Company stock
account. The portions of this Fund consisting of Accounts numbered
(1), (4) and (5) have, since May 1, 1989, and will continue to
constitute an Employee Stock Ownership Plan within the meaning of
Section 4975(e)(7) of the Code. All Employee Contributions
initially invested directly in this Fund pursuant to Section 5.02
shall be treated as if invested at 95% of market value, with the
Employer making the necessary contributions to effect allocations at
full fair market value.
Additional Investment Funds: There shall be established by the
Trustee at the direction of the Company such additional Investment
Funds as shall be deemed necessary or appropriate to meet the three
investment alternative requirements prescribed by Section
401(a)(28)(B)(ii)(II) of the Code and any applicable regulations
promulgated thereunder. Additionally, there may be established by
the Trustee at the direction of the Board or its designee such
further additional Investment Funds as shall be deemed appropriate,
including Investment Funds appropriate for purposes of meeting the
requirements of Section 404(c) of ERISA and the regulations
thereunder.
Temporary Investment: Pending investment and reinvestment, the
Trustee may invest temporarily all or any part of the Investment
Funds and such other Investment Funds as may be established by the
Trustee at the direction of the Board or its designee pursuant to
the provisions of the Plan in short and medium term securities
including but not limited to commercial paper, notes of finance
companies or in obligations of the U.S. Government or any
instrumentality or agency thereof. The Board or its designee may
from time to time specify additional or different investment
vehicles for the temporary investment of funds by the Trustee, or
may direct the Trustee in the temporary investment of funds. The
Trustee may invest all or any part of any Investment Fund directly
in the securities and obligations
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<PAGE> 32
authorized for the respective Investment Fund or through the medium
of any common, collective or commingled trust fund which is invested
principally in securities and obligations authorized for the
respective Investment Fund.
5.02 INVESTMENT ELECTIONS BY PARTICIPANTS: Each Participant must elect
by "Appropriate Notice" (as hereinafter defined) to have all of his
Contributions and his Company Contributions (other than
contributions of Shares of Company Stock under Sections 4.01 and
4.02 and the contributions under Section 4.03) invested in any one
of the available Investment Funds or among such Funds, with the
Investment in each Fund being a whole number percentage of such
Contributions and the sum of such percentages equal to 100%.
("Appropriate Notice" means, for these purposes, written, telephonic
or other electronic communication directed to the Plan Administrator
(or as the Plan Administrator specifies in rules or procedures
uniformly applicable to all similarly situated Participants.) A
Basic Employee Contribution Account, a Basic Tax-Deferred Employee
Contribution Account, a Supplemental Employee Contribution Account,
a Supplemental Tax-Deferred Employee Contribution Account, a
Rollover Contribution Account and a Company Contribution Account
shall be established for the Participant in each of the available
Investment Funds in which contributions are invested on his behalf.
In addition an ESOP Account shall be established in the Company
Stock Fund for each Participant on whose behalf contributions of
Shares of Company Stock under Section 4.01 have been allocated with
respect to pay periods ending on or after May 1, 1989. All
contributions made pursuant to Section 4.03 shall be invested in the
Company Stock Fund and allocated to a PAYSOP Account established for
the Participant therein. All contributions of Shares of Company
Stock made pursuant to Sections 4.01 and 4.02 whether made before or
after May 1, 1989 (provided such Contributions are not applied to
the payment of principal or interest on an Acquisition Loan) unless
designated by the Employer when made as an ESOP Contribution shall
be invested in the Company Stock Fund and allocated to a Company
Contribution Account established for the Participant therein. All
contributions of Shares of Company Stock made on and after May 1,
1989 pursuant to Sections 4.01 and 4.02 designated by the Employer
when made as ESOP Contributions or applied to the payment of
principal or interest on an Acquisition Loan, shall be invested in
the Company Stock Fund and allocated to an ESOP Account established
for the Participant therein. Contributions and earnings thereon as
to which no current, valid investment direction exists may be
invested as the Trustee, in its discretion, shall deem appropriate;
provided, however, that in the event no trustee has agreed to
undertake such investment responsibility, such contributions and
earnings shall be temporarily invested in one or more of the
investment vehicles authorized in the preceding paragraph for
temporary investment of funds, until a valid investment direction is
obtained.
5.03 CHANGES IN CURRENT INVESTMENT ELECTIONS: A Participant may, by
giving prior "Appropriate Notice", change his investment election as
with respect to
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contributions (other than contributions under Section 4.03),
received thereafter. Changes in investment elections must be
expressed as revised whole number percentages of Contributions,
totaling 100%.
5.04 TRANSFERS OF ACCOUNTS: Except as otherwise provided in this Section
5.04, a Participant may, by giving prior "Appropriate Notice", (as
defined in Section 5.02) elect to transfer all, or part (specified
as a whole number percentage of the existing balance) of his Account
in any Investment Fund to another Investment Fund. Such transfer
shall be effective as soon thereafter as practicable (which, with
respect to Funds which are valued daily and accessible by telephone
or other electronic investment direction, can be the same day as
directions are transmitted, if received before 4:00 P.M. local time,
or the next business day thereafter). No transfers pursuant to this
Section 5.04 shall be permitted at any time with respect to the
Participant's PAYSOP Account in the Company Stock Fund. No
transfers pursuant to this Section 5.04 shall be permitted with
respect to the Participant's ESOP Account in the Company Stock Fund
or so much of his Company Contribution Account in the Company Stock
Fund as is attributable to Regular Contributions allocable to
payroll periods ending after January 1, 1988 or allocable to
Additional Contributions made after December 1, 1986, until the
earliest of the following:
(a) the Participant attains age 55;
(b) the Participant retires pursuant to a qualified retirement
plan maintained by an Employer; or
(c) the amount to be transferred has been allocated to the
Participant's Company Contribution Account in the Company
Stock Fund or the Participant's ESOP Account, as
appropriate, for a period of at least two years.
The Plan Administrator may authorize changes in investment options
on dates other than a scheduled or regular Valuation Date as special
conditions may warrant. The Plan Administrator may establish rules
and procedures as the circumstances require to allow such changes in
investment options, including a special valuation of Participants'
Accounts.
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<PAGE> 34
ARTICLE 6: VALUATION OF PARTICIPANTS' ACCOUNTS
6.01 ACCOUNTS: Each Participant shall have established for him separate
accounts which shall reflect all amounts contributed by the
Participant and by the Employer on his behalf and the investment
accretions thereon.
6.02 VALUATION OF ACCOUNTS: As of each Valuation Date designated by the
Plan Administrator as one as of which written reports shall be
prepared, the Accounts of each Participant shall be adjusted
separately for each Fund to reflect any appreciation or depreciation
in the fair market value of the Funds and income earned by the
Funds. The fair market value of the Funds shall be determined by
the Trustee and communicated to the Plan Administrator in writing.
It shall represent the fair market value of all securities or other
property held for the respective Investment Funds, plus cash and
accrued earnings, less accrued expenses and proper charges against
the Funds as of the Valuation Date. The Company Stock Fund shall be
represented by Shares of Company Stock plus the value of any
fractional share which shall be held in cash or may be unitized and
expressed as a cash value, as the Plan Administrator and Trustee
shall agree. The Trustee's determination of value shall be final
and conclusive for all purposes of this Plan. A Participant's
Accounts shall be adjusted in proportion to the balance in each
Participant's Account on the last Valuation Date, less
distributions.
When determining the value of Participant's Accounts, any deposits
due which have not been deposited to the Fund on behalf of the
Participant shall be added to his Accounts. Similarly, adjustment
of Accounts for appreciation or depreciation of the Fund shall be
deemed to have been made as of the Valuation Date to which the
adjustment relates, notwithstanding the fact that they are actually
made as of a later date.
Any cash dividends received by the Trustee with respect to Shares of
Company Stock held by the Plan (other than such Shares held in an
ESOP Account and Financed Shares held in the Unallocated Company
Stock Account) shall be invested in additional Shares of Company
Stock. Any Shares of Company Stock purchased from cash dividends
plus any other Shares of Company Stock received as a result of a
stock split or a stock dividend shall be allocated to the
appropriate Investment Fund Account in proportion to the respective
Shares of Company Stock credited to such Account balances as of the
appropriate record date. Cash dividends received by the Trustee on
Shares of Company Stock held in ESOP Accounts of Participants and on
Financed Shares held in the Unallocated Company Stock Account shall
(unless the Plan Administrator directs the Trustee to allocate
dividends paid on Shares held in ESOP Accounts pursuant to the
preceding provisions of this paragraph) be applied by the Trustee to
the payment of principal and interest on one or more outstanding
Acquisition Loans; provided, however, that with respect to such
application of dividends,
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<PAGE> 35
(a) dividends on Financed Shares shall be applied only to the
payment of principal and interest on the Acquisition Loan,
the proceeds of which were used to acquire such Financed
Shares;
(b) at any time more than one Acquisition Loan is outstanding,
dividends on Shares of Company Stock held in ESOP Accounts
of Participants shall be applied to the payment of principal
and interest on the Acquisition Loan, the proceeds of which
were used to acquire such Shares of Company Stock, so long
as there remains any unpaid balance due on such Loan; and
(c) dividends on Shares of Company Stock held in ESOP Accounts
of Participants shall be so applied only to the extent that
such application releases from the Unallocated Company Stock
Account sufficient Shares of Company Stock for immediate
allocation to the respective ESOP Accounts of Participants
to compensate for such application of dividends.
The Company may establish a cash reserve from Payroll-based Employee
Stock Ownership Contributions transferred in cash equal to an amount
not more than the value of fractional shares allocable to
Participants entitled to receive an immediate distribution at the
time of transfer.
6.03 AMOUNT OF PARTICIPANTS' ACCOUNTS: The amount of a Participant's
Accounts for purposes of distribution shall be equal to:
(a) The value of the Participant's Accounts as of the most
recent Valuation Date, plus
(b) The Participant and Company Contributions made to such
Accounts since the most recent Valuation Date, plus
(c) Principal and interest payments made by the Participant on
any outstanding loan under Article 17 since the most recent
Valuation Date, minus
(d) Any distribution to the Participant since the most recent
Valuation Date, minus
(e) Any loan granted to the Participant under Article 17 since
the most recent Valuation Date.
Notwithstanding the above, the Plan Administrator may in its
discretion use the value of the Participant's Accounts as of a
special valuation date to determine the amount of a Participant's
Accounts for purposes of distribution in lieu of the amount
determined above. The Plan Administrator may delay any distribution
under the Plan until the valuation as of such special date is
completed.
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6.04 STATEMENT OF PARTICIPANT ACCOUNTS: As soon as practicable after the
completion of a calendar quarter, an individual statement will be
issued to each Participant showing the value of his Accounts.
6.05 TIMING OF CREDITS AND DEDUCTIONS: The credits to or deductions from
a Participant's Account(s) shall be deemed to have been made on the
date to which they relate, although they may actually be determined
at another date. Notwithstanding the foregoing, to the extent
utilization of Investment Funds which are valued daily renders it
feasible to do so, transactions will be effected by the Fund manager
on the date money or investment directions are received prior to
4:00 P.M. local time, otherwise on the next business day. The
Accounts of Participants will be debited or credited, as
appropriate, no later than the date on which transactions are
effected.
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ARTICLE 7: BENEFITS UPON RETIREMENT, DEATH,
DISABILITY, OR TERMINATION
7.01 RETIREMENT: Upon Retirement, the Vested Value shall be the value of
the Participant's Accounts. The Vested Value shall be paid to him
in full under any of the methods selected by the Participant under
Sections 7.06 and 7.07.
7.02 DEATH: Upon termination of Employment of a Participant by death
before or after Retirement, the Vested Value shall be the value of
his Accounts, to the extent not yet distributed. The Vested Value
shall be paid to his Beneficiary in full, under Sections 7.06, 7.07
and 7.08.
7.03 DISABILITY: Upon termination of Employment of a Participant by
Disability before Retirement, the Vested Value shall be the value of
his Accounts. The Vested Value shall be paid to him or his
Beneficiary in full under Sections 7.06 and 7.07 and/or 10.07.
7.04 OTHER TERMINATION OF EMPLOYMENT AND VESTING: Upon termination of
Employment of a Participant other than by Retirement, death or
Disability, and other than by transfer to an Affiliated Company
which is not an Employer, the Vested Value of his Accounts shall be
paid to him in accordance with Sections 7.06 and 7.07 provided,
however, that installment payments pursuant to Section 7.06(b) may
not be elected by a terminated Participant prior to attainment of
age 59 1/2. The Vested Value of a Participant's Accounts shall
include the entire value of his Accounts arising pursuant to his own
contributions, his PAYSOP Account and his Rollover Contribution
Account (if any). In addition, if he has completed at least three
Years of Service, he shall be entitled to receive the full value of
his Company Contribution Account.
A Participant who has completed less than three Years of Service as
of such termination of Employment shall forfeit his entire Company
Contribution Account; provided, however, that the Forfeiture shall
be reinstated if he is reemployed by an Employer, and if he repays
the full amount of his Basic Employee Contribution Account and/or
Basic Employee Tax-Deferred Contribution Account at any time before
he has five Years of Break in Service. The Vested Value of a
terminated Participant described in this Section 7.04 shall be paid
to the Participant in accordance with Sections 7.06 and 7.07. If a
Participant has no Vested Value, he shall be deemed to have been
paid his benefits (which shall be deemed to have a value of zero) as
of the last day of the Plan Year in which his Employment terminated.
In the event that the employment of a Participant who has completed
less than three Years of Service is involuntarily terminated without
cause within 12 months following, and as a result of, a "change in
control" of the Company, the Vested Value of such a Participant's
Accounts shall be the value of the Participant's Accounts on the
date of such termination of employment. For purposes of this
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Section 7.04, a change in control of the Company shall be deemed to
have occurred upon the occurrence of any event(s) which
constitute(s) a 'change in control' of the Company for purposes of
(and within the meaning of that term as defined in) any employee
benefit plan maintained by the Company at the time of the occurrence
of the event.
A Participant who transfers to an Affiliated Company that is not an
Employer and subsequently terminates his Employment with that
Company shall be deemed to have terminated his Employment under this
Section unless he transfers without intervening employment to an
Employer or another Affiliated Company that is not an Employer.
7.05 TRANSFER OF EMPLOYMENT: If a Participant transfers to an employment
status with the Employer or an Affiliated Company such that he no
longer meets the definition of employee, he shall be given the
following options:
(a) To elect a Plan to Plan Transfer of the Vested Value of his
Accounts to any savings or profit-sharing plan maintained by
the Company or an Affiliated Company as of any Valuation
Date (on which all Accounts are valued), if the Trustee of
such plan is authorized to receive such transfer.
(b) To defer such transfer or the receipt of any such
distribution until a later date. His Accounts will remain
in the Plan until Retirement, death, Disability or
termination of Employment or, except for the PAYSOP Account,
until eligible for withdrawal under Article 8.
A Participant will receive credit for Years of Service for his
period of employment with the Employer or Affiliated Company.
7.06 ELECTION OF BENEFITS: On or before a Participant's Retirement,
elected benefit commencement date, or "required beginning date" (as
defined in Section 7.07(d)) he shall notify the Plan Administrator
of his election that benefits due to him upon termination of
Employment be paid or made available in accordance with one or more
of the following methods:
(a) by a lump sum payment in cash or, with respect to the
Company Stock Fund, upon the request of the Participant, in
kind, plus the cash equivalent of the fair market value of
any fractional share of Company Common Stock; or
(b) in annual installments over a period not to exceed ten
years, provided such period does not exceed the greater of
the life expectancy of the Participant or the joint life
expectancy of the Participant and his Beneficiary. The
amount of each installment will be determined by dividing
the Participant's Vested
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<PAGE> 39
Value by the number of annual installments which remain to
be made at the time a particular installment is to be paid.
A Participant may change his election of benefits by filing a new
election at any time prior to his benefit commencement date (with
respect to (a) (i) and (ii), above,) or at any time prior to the
purchase of the annuity contract with which payments pursuant to
(b), above, are to be funded.
The Participant may elect that the Employee Stock Ownership Account
be paid in kind, equal to the full Shares of Company Stock plus the
cash equivalent of the fair market values of any fractional Share of
Company Stock. The Trustee, in the case of a fractional share,
shall be deemed to have purchased such fractional share from the
Participant concerned at a price equal to the cash payment to be
made to the Participant. Cash for the purchase of fractional shares
may be taken from dividend receipts or other cash in the Trust.
A Participant who has previously elected to receive benefits under
Subsection (b) may subsequently apply in writing to the Plan
Administrator for a lump sum distribution in cash. Under such a
distribution the Plan Administrator may permit the Participant to
withdraw the total Vested Value of the Participant's Accounts,
determined as of the Valuation Date next preceding the date on which
the Plan Administrator approves the withdrawal or the Valuation Date
next following the Participant's application for withdrawal,
whichever Valuation Date is later; such amount shall not include the
amount of any installments paid to the Participants since the
preceding Valuation Date. Any residual amounts will be paid to the
Participant following the next Valuation Date.
7.07 METHOD OF PAYMENT: Benefits shall be paid or made available under
the Plan upon the direction of the Plan Administrator as soon as
practicable after termination of Employment occurs and shall be
distributable thereafter at the written request of the Participant
(or, where applicable, his Beneficiary or alternate Payee).
Unless the Participant elects otherwise, distribution of benefits
will begin no later than sixty days after the end of the Plan Year
in which the latest of the following events occurs:
(i) The Participant's attainment of age 65;
(ii) The tenth anniversary of the year in which the
Participant commenced participation in the Plan; or
(iii) The Participant's termination of Employment with
the Employer or an Affiliated Company.
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Notwithstanding any other provision of the Plan (including
Section 7.09),
(a) The entire interest of an Employee (i) will be distributed
to such Participant not later than the "required beginning
date" (as defined under subsection (d)); or (ii) will be
distributed under Section 7.06(b) beginning not later than
the required beginning date, in accordance with regulations
prescribed by the Secretary of the Treasury.
(b) If distributions have begun under (a)(ii), upon the death of
an Employee before his entire interest has been distributed,
the remaining portion will be distributed at least as
rapidly as under the method being used under (a)(ii) as of
the date of his death.
(c) If distributions have not begun upon the death of a
Participant, if no election has been made by the Beneficiary
pursuant to Section 7.08, the entire interest of the
Participant will be distributed in accordance with Section
7.06(a) at the end of the calendar year containing the fifth
anniversary of the Participant's death.
(d) For purposes of this Section, the term "required beginning
date" means April 1 of the calendar year following the
calendar year in which the Employee attains age 70 1/2, or
such other date as may be prescribed by applicable law or
regulations.
7.08 PROOF OF DEATH AND RIGHT OF BENEFICIARY: In the event of the death
of a Participant who has begun to receive benefits in annual
installments under the provisions of subsection (b) of Section 7.06,
his Beneficiary will receive the undistributed value of his Accounts
in annual installments on the same basis as the Participant had
elected. Alternatively, his Beneficiary may receive the
undistributed value of his Accounts in a lump sum of cash by an
election in writing filed with the Plan Administrator within 90 days
of the Participant's death. The Beneficiary of a deceased
Participant other than noted above shall elect to receive the
undistributed value of his Accounts under one of the methods in
Section 7.06 by an election in writing filed with the Plan
Administrator within 180 days of the Participant's death, except
that the maximum period in Section 7.06(b) shall be five years. If
the Beneficiary does not elect a distribution within 180 days, the
Plan Administrator will distribute the Account in accordance with
Section 7.07(c).
The Plan Administrator may require and rely upon such proof of death
and such evidence of the right of any Beneficiary to receive
benefits of a deceased Participant as the Plan Administrator may
deem proper, and its determination of death and of the right of such
Beneficiary to receive payments shall be conclusive.
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7.09 SPECIAL DISTRIBUTION AND PAYMENT REQUIREMENTS: This Section 7.09
shall not eliminate any form or time of distribution available under
this Plan on the May 1, 1989 effective date of the Amendment of
which this Section 7.09 is a part.
(a) Notwithstanding any other provision of this Plan other than
such provisions as require the consent of the Participant to
a distribution with a present value in excess of $3,500.00,
a Participant may elect to have the portion of his Account
attributable to Shares of Company Stock acquired by the Plan
after December 31, 1986 distributed as follows:
(i) If the Participant separates from service by reason
of the attainment of normal retirement age under
the Plan, death, or disability, the distribution of
such portion of the Participant's Account balance
will begin not later than one year after the close
of the Plan Year in which such event occurs unless
the Participant otherwise elects under the
provisions of the Plan other than this Section
7.09.
(ii) If the Participant separates from service for any
reason other than those enumerated in subparagraph
(i) above and is not reemployed by an Employer at
the end of the fifth Plan Year following the Plan
Year of such separation from service, distribution
of such portion of the Participant's Account
balance will begin not later than one year after
the close of the fifth Plan Year following the Plan
Year in which the Participant separated from
service, unless the Participant otherwise elects
under the provisions of this Plan other than this
Section 7.09.
(iii) If the Participant separates from service for a
reason other than those described in subparagraph
(i) above, and is employed by the Employer as of
the last day of the fifth Plan Year following the
Plan Year of such separation from service,
distribution to the Participant prior to any
subsequent separation from service shall be in
accordance with the terms of the Plan other than
this Section 7.09.
(b) For purposes of this Section 7.09 only, at times when such
Stock is not then publicly traded on an established
securities market, Shares of Company Stock shall not include
any such Shares acquired with the proceeds of an Acquisition
Loan until the close of the Plan Year in which such loan is
repaid in full.
(c) Distributions required under this Section 7.09 shall be made
in substantially equal annual payments over a period of five
years unless the Participant otherwise elects under the
provisions of this Plan other than this Section
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7.09. In no event shall such distribution period exceed the
period permitted under Section 401(a)(9) of the Code.
(d) The portion of a Participant's Account balance attributable
to Shares of Company Stock which were acquired by the Plan
after December 31, 1986, shall be determined by multiplying
the number of Shares of Company Stock held in the
Participant's Accounts by a fraction, the numerator of which
is the number of such Shares acquired by the Plan after
December 31, 1986, and allocated to the Participant's
Accounts (not to exceed the number of Shares of Company
Stock held by the Plan on the date of distribution) and the
denominator of which is the total number of Shares of
Company Stock held by the Plan at the date of the
distribution.
7.10 OPTION TO HAVE COMPANY PURCHASE SHARES OF COMPANY STOCK: Any
Participant who receives Shares of Company Stock pursuant to any of
the provisions of this Article 7 and any person who has received
Shares of Company Stock from such a Participant by reason of the
Participant's death or incompetency, shall have the right to require
the Company to purchase the Shares of Company Stock for its current
fair market value (hereinafter referred to as the "put option").
The put option shall only apply if, when the Shares of Company Stock
are distributed or within fifteen (15) months thereafter, the stock
is not publicly traded on an established securities market or are
(or become) subject to a restriction under federal or state
securities laws or regulations or an agreement affecting the Shares
of Company Stock that would make the Shares of Company Stock not as
freely tradable as a security not subject to such restrictions. The
put option shall be exercisable by written notice to the Plan
Administrator during the 15 months after the Shares of Company Stock
are distributed by the Plan; provided, however, that if the put
option first becomes exercisable after the distribution of such
Shares by the Plan, the put option shall remain exercisable after
the end of such 15-month period for the number of days (if any) by
which the number of days between (1) the date on which the Shares of
Company Stock cease to be so traded (or tradable) and (2) the date
on which the Employer notifies the Participant in writing that such
Shares have ceased to be so traded (or tradable) exceeds ten (10).
If the put option is exercised, the Trustee may, in the Trustee's
sole discretion, assume the Company's rights and obligations with
respect to purchasing the Shares of Company Stock. The Company, or
the Trustee if applicable, may elect to pay for the Shares of
Company Stock in equal periodic installments (not less frequent than
annually) over a period not longer than 5 years from the date the
put option is exercised, with interest at a reasonable rate, all
such terms to be set forth in a promissory note delivered to the
seller with usual business terms as to acceleration upon any uncured
default. With the seller's consent, the installment period may be
extended to the earlier of 10 years from the exercise of the put
option or the date on which the Acquisition Loans related to the
Shares of Company Stock have been satisfied, if that is longer than
5 years, provided the purchaser furnishes adequate security in
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addition to the purchaser's promissory note. Nothing contained
herein shall be deemed to obligate the Company to register any
Shares of Company Stock under any federal or state securities law or
to create a public market to facilitate transferability of the
Shares of Company Stock. The put option herein described may only
be exercised by a person described in the first sentence of this
Section and may not be transferred either separately or together
with any Shares of Company Stock to any other person. The put
option shall continue in effect to the extent provided herein in the
event that the Plan ceases to have a qualified employee stock
ownership plan feature.
7.11 DIRECT ROLLOVER OF DISTRIBUTION: Any "Eligible Rollover
Distribution" under this Article may, at the Participant's election,
and subject to such uniform and nondiscriminatory conditions as the
Plan Administrator may require, be transferred to an "Eligible
Retirement Plan," subject to the provisions of Section 402 of the
Code and the regulations thereunder and as hereinafter provided.
(a) The Plan Administrator shall advise any "Distributee"
entitled to receive an "Eligible Rollover Distribution" no
less than thirty nor more than ninety days before the
starting date of any payment (or at such other time as is
permitted by law) of his right to elect a "Direct Rollover"
to an "Eligible Retirement Plan" pursuant to the provisions
of this Section. To elect a Direct Rollover, the
Distributee must request in writing to the Plan
Administrator that all or a specified portion of the
Eligible Rollover Distribution be transferred directly to
one or more "Eligible Retirement Plans." If a distribution
will be made on behalf of the Distributee in more than one
year, the notice specified in the first sentence of this
Paragraph must be given to the Distributee in each year in
which there is an Eligible Rollover Distribution, and the
Distributee must file a new election with the Plan
Administrator if he wishes to have the Eligible Rollover
Distribution transferred directly to an Eligible Retirement
Plan.
The Distributee shall not be entitled to elect a Direct Rollover
pursuant to this Section, unless he has obtained any applicable
Spousal Consent that would otherwise be required to obtain a
distribution in the amount of the Eligible Rollover Distribution.
(b) For purposes of this Section, the following definitions
shall apply:
(i) A "Direct Rollover" is a payment by the Plan to the
"Eligible Retirement Plan" specified by the
Distributee;
(ii) A "Distributee" includes Participants, a
Participant's surviving spouse and a Participant's
spouse or former spouse who is the alternate payee
under a qualified domestic relations order, as
defined in Code
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Section 414(p), but only with regard to the
interest of such individual under the Plan;
(iii) An "Eligible Retirement Plan" is a retirement plan
which meets the requirements of Code Section
401(a), an annuity described in Code Section
403(a), an individual retirement account described
in Code Section 408(a), or an individual retirement
annuity (other than an endowment contract)
described in Code Section 408(b), the terms of
which permit the acceptance of a Direct Rollover of
the Distributee's Eligible Rollover Distribution.
However, in the case of an Eligible Rollover
Distribution to the surviving spouse of a
Participant, an Eligible Retirement Plan is an
individual retirement account or an individual
retirement annuity. The Plan Administrator may
establish reasonable procedures for ascertaining
that the Eligible Retirement Plan meets the
preceding requirements.
(iv) An "Eligible Rollover Distribution" is any
distribution from this Plan on or after January 1,
1993 of all or any portion of the balance to the
credit of the Distributee, except for distributions
(or portions thereof) which are:
(1) Part of a series of substantially equal
periodic payments (not less frequently than
annually) made over the life of the
Participant (or the joint lives of the
Participant and the Participant's
designated beneficiary), the life
expectancy of the Participant (or the joint
life and last survivor expectancy of the
Participant and the Participant's
designated beneficiary), or a specified
period of ten years or more;
(2) Required under Code Section 401(a)(9)
(relating to the minimum distribution
requirements); or
(3) The portion of any distribution that is not
includable in gross income (determined
without regard to the exclusion for net
unrealized appreciation in employer
securities described in Code Section
402(e)(4).
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ARTICLE 8: WITHDRAWALS DURING EMPLOYMENT
8.01 GENERAL CONDITIONS FOR WITHDRAWALS: A Participant's rights to his
Basic Employee Contribution, Basic Tax-Deferred Employee
Contribution, Supplemental Employee Contribution, Supplemental
Tax-Deferred Employee Contribution, Rollover Contribution Account
and PAYSOP Accounts shall be nonforfeitable at all times.
Any distribution under this Section may, at the Participant's
election, and subject to such uniform and nondiscriminatory
conditions as the Plan Administrator may require, be transferred to
an individual retirement account or another tax-qualified plan,
subject to the provisions of Section 402 of the Code and the
regulations thereunder, and in accordance with the procedures
described in Section 7.06 of this Plan.
Subject to the conditions set forth in the subsequent sections of
this Article, upon written notice to his Employer in the manner
prescribed by the Plan Administrator for such purpose, a Participant
may make withdrawals of all or a portion of the Vested Value of his
Accounts (excluding the PAYSOP Account). No withdrawals may be made
under this Article 8 from a Participant's Basic Tax- Deferred
Employee Contributions Account or his Supplemental Tax-Deferred
Employee Contributions Account except pursuant to the provisions of
Sections 8.04 and 8.05 hereof.
All amounts withdrawn must be paid in cash. In the case of a
partial withdrawal under this Article by a Participant having an
interest in more than one Investment Fund, the amount withdrawn
shall be taken, pro rata, from all Investment Funds in which the
Participant maintains Accounts and from which withdrawal is
permissible in the same proportion as the value of the Participant's
interest in each such Fund bears to the total value of his Accounts.
8.02 WITHDRAWAL OF BASIC AND SUPPLEMENTAL EMPLOYEE CONTRIBUTION
ACCOUNTS - LESS THAN THREE YEARS' VESTING SERVICE: A Participant
who has ess than three years of vesting service may withdraw all or
any part of the value of his Basic Employee Contribution Account,
Rollover Contribution Account, and Supplemental Employee
Contribution Account determined as of the next Valuation Date.
Upon a withdrawal under this Section, the Participant shall forfeit
the full amount of his Company Contribution Account attributable to
the amount withdrawn from such Participant's Basic and Supplemental
Employee Contribution accounts. However, such Forfeiture shall be
reinstated if the Participant repays the full dollar amount of the
prior withdrawal within two years after the withdrawal, or prior to
the time that the Participant has a Year of Break in Service,
whichever occurs first.
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8.03 WITHDRAWAL OF BASIC AND SUPPLEMENTAL EMPLOYEE CONTRIBUTION ACCOUNTS
AND COMPANY CONTRIBUTION ACCOUNT - THREE OR MORE YEARS OF VESTING
SERVICE: A Participant who has at least three years of vesting
service may withdraw all or any part of his Basic Employee
Contribution Account, Rollover Contribution Account, Supplemental
Employee Contribution Account and Company Contribution Account,
determined as of the next Valuation Date.
The amounts available for withdrawal at any given time shall exclude
Company Contributions made during the two years immediately
preceding withdrawal. These amounts may not be distributed to the
Participant until his termination of Employment or until such funds
have been in the Plan for at least two years, whichever occurs
first.
A Participant who has made a withdrawal under this section shall not
forfeit any part of his Company Contribution Account.
8.04 SPECIFIED HARDSHIP WITHDRAWAL: A Participant as to whom no loan is
available under the Plan may apply for a Specified Hardship
Withdrawal. Under such a withdrawal, the Plan Administrator may
permit the Participant to withdraw all or a portion of his Basic
Employee Contribution Account, Supplemental Employee Contribution
Account, Basic Tax-Deferred Employee Contribution Account,
Supplemental Tax-Deferred Employee Contribution Account, Company
Contribution Account (excluding Company Contributions made during
the two years immediately preceding withdrawal), Rollover
Contribution Account and investment return accrued as of December
31, 1988 on his Tax-Deferred Accounts. Notwithstanding the
foregoing, the Participant may not withdraw his Basic Tax-Deferred
Employee Contribution Account or Supplemental Tax-Deferred Employee
Contribution Account unless the Participant's assets are not
otherwise reasonably available or he is age 59 1/2 or older.
The value of the Accounts for purposes of this Section shall be
determined as of the Valuation Date next preceding the date on which
the Plan Administrator approves the withdrawal, or the Valuation
Date next following the Participant's application for withdrawal,
whichever Valuation Date is later. The value shall include Basic
Employee Contributions, Supplemental Employee Contributions, Basic
Tax-Deferred Employee Contributions and Supplemental Tax-Deferred
Employee Contributions made since the applicable Valuation Date and
shall not include the amount of any withdrawals made by the
Participant since the Valuation Date.
A Participant who has made a withdrawal under this Section shall
incur a mandatory suspension of 12 months for all types of
contributions, if the withdrawal includes any amounts from the
Participant's Tax-Deferred Accounts. In addition, the Participant's
Tax-Deferred Contributions for the Plan Year following the Plan Year
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in which the withdrawal occurs shall not exceed the limit on
Elective Deferrals under Section 15.02 hereof for that Plan Year,
reduced by the Tax-Deferred Contributions made by the Participant in
the Plan Year in which the withdrawal occurs.
The provisions of this Section are completely independent of those
contained in Sections 8.02 and 8.03. Not more than one withdrawal
may be made under this Section during any Plan Year, except for
withdrawal for post-secondary school tuition expenses, as specified
in Section 1.37.
Amounts withdrawn shall be considered to be taken first from the
Participant's Basic and Supplemental Employee Contribution Account.
8.05 WITHDRAWAL AFTER AGE 59 1/2: A Participant who has attained age 59
1/2 may make a withdrawal under the provisions of Section 8.04
without satisfying the conditions of that Section for a Specified
Hardship. Upon such a withdrawal, the Participant shall not incur a
Mandatory Suspension.
8.06 PAYSOP ACCOUNTS: A Participant may not withdraw any amounts from
this Account while employed.
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ARTICLE 9: ADMINISTRATION
9.01 FIDUCIARIES:
(a) The following parties are Fiduciaries of the Plan:
(i) The Employer;
(ii) The Trustee; and
(iii) Any committee(s) or individual(s) appointed by the
Employer or the Plan Sponsor as Plan Administrator
or to whom discretionary administrative authority
or responsibility with respect to the Plan has been
delegated by the Employer or the Plan Sponsor.
(b) The Plan Administrator shall be the Named Fiduciary.
(c) If a Plan Administrator has not been appointed, or ceases
for any reason to serve, the Employer shall function as the
Administrator until a Plan Administrator (or successor, as
appropriate) is appointed.
(d) The responsibilities of each Fiduciary may be specified by
the Employer and accepted in writing by each Fiduciary. If
no such delegation is made by the Employer, the Fiduciaries
may allocate responsibilities among themselves in writing
and notify the Employer that they have done so, specifying
in such notification the responsibilities of each Fiduciary.
If the Fiduciaries provide a copy of such notification to
the Trustee, the Trustee shall thereafter (until such time
as the Employer or the Fiduciaries deliver to the Trustee a
written revocation of such allocation) accept and be
justified in relying upon any documents executed by the
appropriate Fiduciary pursuant to the allocation of
responsibilities disclosed in such notification.
(e) Each Fiduciary shall have only those specific powers,
duties, responsibilities and obligations as are assigned to
such Fiduciary under the Plan, delegated to the Fiduciary by
action of the Employer or the Plan Sponsor, or allocated to
the Fiduciary by written allocation among the Fiduciaries
pursuant to Paragraph (d), above.
9.02 RESPONSIBILITIES OF THE EMPLOYER: The Employer shall have the
following powers and duties with respect to the Plan;
(a) to appoint the members any committee created to exercise any
responsibility with respect to the Plan;
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<PAGE> 49
(b) to terminate the Plan in whole or in part pursuant to the
procedures provided hereunder;
(c) to delegate any of the fiduciary responsibilities under the
Plan to any individual, committee, or entity it may
designate; provided, however, that any delegation of a
fiduciary duty that has already been assigned by the
provisions of the Plan, by previous action of the Board, or
by written allocation among the Fiduciaries, shall be
effected by delivery in writing to the Fiduciaries to and
from whom such responsibility is being reassigned;
(d) to designate any individual, committee, or entity to whom
fiduciary responsibilities are delegated as an additional
Fiduciary or Named Fiduciary of the Plan; and
(e) to exercise any other powers or responsibilities not
specifically allocated to another fiduciary.
9.03 RESPONSIBILITIES OF THE TRUSTEE: The Trustee shall have the powers
and duties allocated to it in the trust agreement. The Trustee
shall have no other responsibilities with respect to the Plan,
except to the extent such responsibilities are delegated or assigned
by the Board or its delegate to, and accepted by the Trustee.
9.04 RESPONSIBILITIES OF THE PLAN ADMINISTRATOR: The Plan Administrator
(the "Administrator") shall be responsible for and shall discharge
all duties and obligations imposed on a Plan Administrator by ERISA
and the Code. The Administrator shall prepare, publish, file and
furnish the Plan reporting and disclosure reports, statements, plan
descriptions and benefit rights reports of Participants in the
manner and at the times required by law. The Plan Administrator may
employ counsel and/or consultants to render advice with regard to
any responsibility of the Plan Administrator under the Plan and may
employ necessary clerical help. Any individual or committee
designated as the Plan Administrator shall report to (or as directed
by) the Board in order that the Plan Administrator's performance of
his duties may be periodically reviewed. In addition, the Plan
Administrator shall have the following powers and duties with
respect to the Plan:
(a) To establish and enforce such rules, regulations and
procedures as the Administrator shall deem necessary or
proper for the efficient administration of the Plan;
(b) To interpret the Plan, the Administrator's interpretation
thereof in good faith to be final and conclusive;
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(c) To decide all questions concerning the Plan and the
eligibility of any Employee to participate in the Plan;
(d) To compute the amount of benefits which shall be payable to
any Participant, retired Participant or Beneficiary in
accordance with the provisions of the Plan, and to determine
the person or persons to whom such benefits shall be Paid;
(e) To advise the Trustee in writing with respect to all
benefits which become payable under the terms of the Plan
and to direct the Trustee to pay such benefits from the
Trust Fund;
(f) To submit annually to the Board or its designee a report
showing in reasonable summary the financial condition of the
Plan and Trust Fund, a summary of the operations of the Plan
for the past year, and any further information which the
Board or its designee may require;
(g) To maintain all such books of account, records and other
data as shall be necessary for proper administration of and
necessary actuarial valuations for the Plan and to meet the
reporting and disclosure requirements of ERISA;
(h) To appoint any accountant, attorney, consultant or other
professional; and
(i) To appoint Unit Administrators and determine their powers
and to delegate to the Unit Administrators such of the
Administrator's duties as the Administrator may, subject to
this Article 9 and the requirements of ERISA, determine.
Any such allocation or delegation shall be periodically
reviewed by the Board or its designee.
9.05 DELEGATION OF DUTIES: Any committee established by the Employer or
at its direction or by its designee may appoint subcommittees and
determine their powers and the Employer and its designees and their
designees may allocate among themselves or may delegate to another
person or persons such of the fiduciary duties as they may in their
sole discretion determine. Any such allocation or delegation shall
be periodically reviewed by the Board.
The Employer, the Administrator and their respective designees,
agents, officers and employees and any committee(s) established by
the Employer or at its direction or by its designee, shall be
entitled to rely upon all certificates and reports made by the
accountant or consultant and upon all opinions given by legal
counsel; the Employer, the Administrator, and their respective
designees, agents, officers and employees and any committee(s)
established by the Employer or at its direction or by its designee,
shall be fully protected in respect to any action taken or suffered
by them in good faith and acting as prudent men would act in like
circumstances in
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reliance upon such certificate, report or the advice or opinion of
such accountant, consultant or counsel and all action so taken or
suffered shall be conclusive upon each of them and upon all
Participants, retired Participants, surviving Spouses, Beneficiaries
and Contingent Annuitants.
9.06 COMMITTEE ACTION: Unless otherwise directed by or at the direction
of the Employer, a majority of the members of any committee(s)
established by or at the direction of the Employer or by its
designee shall constitute a quorum. Decisions with a quorum present
shall be by majority vote. The action of a majority expressed in
writing without a meeting shall constitute the action of a committee
and shall have the same effect as if assented to by every member.
9.07 INDIVIDUAL INDEMNIFICATION: To the extent permissible under ERISA,
the Employer shall indemnify each member of the Plan
Sponsor's/Employer's board of directors, each member of any
committee(s) established by or at the direction of the Employer or
its designee, and the Plan Administrator or any of their delegees
against costs, expenses and liabilities, including attorney's fees,
incurred in connection with any action, suit or proceeding
instituted against them or any one of them because of any act of
omission or commission performed by them or any one of them as a
director, committee member or Administrator, or designee or delegee
thereof, as the case may be, while acting in good faith and
exercising his judgment for the best interest of the Plan.
Promptly after receipt by an indemnified party under this section of
notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the
Employer, notify the Employer of the commencement thereof, and the
omission so to notify the Employer will relieve it from the
liability hereunder, but not from any other liability which it may
have to such person. The Employer shall be entitled to participate
at its own expense in the defense or to assume the defense of any
action brought against any party indemnified hereunder.
In the event the Employer elects to assume the defense of any such
suit, such defense shall be conducted by counsel chosen by it and
reasonably satisfactory to the indemnified party, and the
indemnified party shall bear the fees and expenses of any additional
counsel retained by him.
9.08 EXPENSES: Any expenses reasonably incurred by the Plan
Administrator or the member(s) of any committee(s) in the
performance of their duties shall be paid by the Employer. Such
reasonable expenses include the Employer's securing insurance to
protect them from personal liability resulting from their actions
taken in a fiduciary capacity with respect to this Plan. All
reasonable expenses incurred in connection with the administration
of the Plan, including (without limitation) the compensation of the
Trustee, administrative expenses, any investment management
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charges and proper charges and disbursements of the Trustee and
compensation and other expenses and charges of any counsel,
accountant, specialist or other person who shall be retained by the
Employer in connection with the administration of the Plan shall be
paid from the Trust Fund to the extent not paid by the Employer.
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ARTICLE 10: GENERAL PROVISIONS
10.01 INALIENABILITY OF BENEFITS: No benefit under the Plan shall be
subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, garnishment, encumbrance or change, and any
attempt to do so shall be void. However, the creation, assignment,
or recognition of a right to any benefit payable with respect to a
Participant pursuant to a qualified domestic relations order (as
defined under the Retirement Equity Act of 1984 and regulations
thereunder) shall not be considered an assignment or alienation of
benefits under the Plan. The Plan Administrator shall comply with
such order. However, the amount and form of benefits provided by
the Plan shall not be altered by such order.
10.02 NO RIGHT TO EMPLOYMENT: Nothing herein contained nor any action
taken under the provisions hereof shall be construed as giving any
Employee the right to be retained in the employ of the Employer or
as interfering with the rights of the Employer to discharge an
Employee at any time.
10.03 UNIFORM ADMINISTRATION: Whenever in the administration of the Plan
any action is required by the Plan Administrator, such action shall
be uniform in nature as applied to all persons similarly situated
and no such action shall be taken which will discriminate in favor
of highly compensated Participants or Participants whose principal
duties consist of supervising the work of others.
10.04 HEADINGS: The headings of the sections of this Plan are placed
herein for convenience of reference and in the case of any conflict,
the text of the Plan, rather than such headings, shall control.
10.05 CONSTRUCTION: The Plan shall be construed, regulated and
administered in accordance with the laws of the State of South
Carolina except to the extent that such laws are superseded by
ERISA. The Plan and the trust shall be construed so as to qualify
under Sections 401(a), 401(k), and 501(a) of the Code.
10.06 UNCLAIMED DISTRIBUTIONS: If within five years after any
distribution becomes due to a Participant or Beneficiary, the same
shall not have been claimed, provided due care shall have been
exercised in attempting to make such distribution, the amount
thereof shall be treated as a forfeiture under Section 4.05 and
applied to reduce future Employer contributions under the Plan;
provided, however, that such Employer shall restore the amount so
applied with earnings thereon if and when the same shall be claimed
by the Participant or Beneficiary entitled to receive it.
10.07 DISTRIBUTIONS TO A LEGAL REPRESENTATIVE: If the Plan Administrator
finds that a person entitled to a benefit is unable to care for his
affairs because he is a minor or because of illness or accident, the
Plan Administrator may direct that any benefits due him, unless
claim shall have been made therefor by a duly
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<PAGE> 54
appointed legal representative, shall be paid to the spouse, child,
or legal representative of such person. Any payments so made under
the direction of the Plan Administrator shall be a complete
discharge of the liabilities of the Plan therefor.
10.08 EXPENSES: The Plan shall pay all costs and expenses incurred in
administering the Plan to the extent not paid by the Company.
Direct charges and expenses arising out of the purchase or sale of
securities or other assets and taxes levied on or measured by such
transaction, shall be charged against the Account(s) of the
Participant(s) in the Investment Fund(s) for which the transaction
took place. The Company shall provide for the allocation among the
Employers of such fees and expenses as the Company shall undertake
to pay.
All funds deposited to the Trust Fund and all income earned by the
Trust Fund shall be used for the exclusive benefit of the Plan
Participants and for payment of the expenses of administering the
Plan and the Trust Fund to the extent such expenses are not paid by
the Employers, and for no other purpose. No portion of the Trust
Fund shall revert to or become the property of the Company until all
liabilities under the Trust Fund pursuant to the Plan are satisfied.
10.09 SOURCE OF PAYMENT: Benefits under the Plan shall be payable only
out of the Trust Fund. The Employers shall have no obligation,
responsibility, or liability to make any direct payment of benefits
under the Plan. Except as otherwise provided by law, including
ERISA, neither the Employers nor the Trustee guarantee the Trust
Fund against any loss or depreciation or guarantees the payment of
any benefit hereunder.
10.10 PLAN SUBJECT TO TAX APPROVAL: The adoption of the Plan and the
trust incident hereto, as it applies to any Employer, is expressly
subject to the condition that it shall be approved and qualified by
the Internal Revenue Service as meeting the requirements of the Code
and regulations issued thereunder with respect to employees' trusts.
If implementation of the ESOP and Leveraged ESOP provisions of the
May 1, 1989 Amendment as recipients of the Company's Regular and/or
Additional Contributions jeopardizes the Plan's receipt or retention
of a favorable determination by the IRS of its qualification under
Section 401 of the Code or results in the issuance of a private
letter ruling rendering the abandonment of those provisions to be
the prudent or preferred course of action, then the Plan
Administrator may rescind the ESOP and Leveraged ESOP provisions of
the Plan, whereupon the provisions of the Plan relating to Regular
and Additional pre-amendment Contributions in Company Stock shall be
reinstated from the effective date of this Amendment to the
effective date of such rescission.
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<PAGE> 55
10.11 DISCONTINUANCE OF CONTRIBUTIONS: The Plan is voluntary on the part
of the Employers. Although the Company does not anticipate
terminating the Plan at any point in the foreseeable future, the
Company and each other Employer that elects to participate in the
Plan reserves the right, through its board of directors, to
terminate its participation in the Plan pursuant to Article 11
and/or discontinue further contributions by Participants or the
Employer to the Trust.
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ARTICLE 11: SPECIAL PROVISIONS
11.01 AMENDMENTS TO THE PLAN: The Company reserves the right at any time
and from time to time, and retroactively if deemed necessary or
appropriate to conform with governmental regulations or other
policies, to modify or amend in whole or in part any or all of the
provisions of the Plan; provided that no such modification or
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 Participants or their Beneficiaries; and
provided further, that no such amendment shall increase the duties
of the trustee without its consent thereto in writing. Except as
may be required to conform with governmental regulations, no such
amendment shall adversely affect the rights of any Participant or
beneficiary with respect to contributions made on his behalf prior
to the date of such amendment.
11.02 MERGER, CONSOLIDATION, OR TRANSFER OF ASSETS: The Plan shall not
merge or consolidate with, or transfer its assets or liabilities to
any other plan or entity unless each Participant would, if the
surviving plan or entity then terminated, receive a benefit
immediately after the merger, consolidation, or transfer which is
equal to or greater than the benefit he would have been entitled to
receive if the Plan had terminated immediately before the merger,
consolidation or transfer.
Any such merger, consolidation, or transfer shall be accomplished in
accordance with applicable regulations of the Internal Revenue
Service.
11.03 TERMINATION: The Plan is purely voluntary on the part of the
Company and each other Employer, and the Company reserves the right
to terminate or completely discontinue contributions under the Plan,
and terminate the trust agreement and the trust hereunder. Upon a
complete or partial termination of the Plan, or complete
discontinuance of contributions hereunder, the value of the Account
of each Participant affected by such termination or discontinuance
shall be fully vested, and payment of benefits shall be made to such
Participants or their Beneficiaries either upon such termination or
upon the termination of Employment of the respective Participants,
at the discretion of the Plan Administrator, in the same manner as
on termination of Employment under Section 7.06. In the case of a
complete termination or a complete discontinuance of contributions
to the Plan, any forfeitures not previously applied in accordance
with Section 4.05 shall be credited ratably to the Accounts of all
Participants in proportion to the amounts of Company Contributions
credited to their respective Company Contribution Account during the
current calendar year, or the prior calendar year if no Company
Contributions have been made during the current calendar year.
11.04 WITHDRAWAL OF AN EMPLOYER: Subject to the requirement of ERISA and
the Code, any one or more of the Employers (other than the Company)
may terminate its participation in and withdraw from the Plan by
giving six months'
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advance notice in writing to the Company of its or their intention
to withdraw, unless a shorter notice shall be agreed to by the
Board.
Upon such withdrawal, the Company shall certify to the Trustee the
equitable shares of such withdrawing Employers in the trust Fund and
the Trustee shall thereupon set aside such securities and/or
property to such legal representatives as may be designated by such
withdrawing Employer(s).
The withdrawal of an Employer from the Plan shall not constitute a
termination of the Plan as thereafter in effect for any other
Employer that has not withdrawn.
11.05 PROCEDURE: The termination, partial termination or amendment of
this Plan may be effected by the adoption of a resolution by the
Board to that effect, or by the execution of an instrument amending
or terminating the Plan by the Board's designee, to whom such
authority to so act has been given by resolution of the Board. The
authorization of the Board may be general and need not be given in
contemplation of or with reference to specific terms of amendment or
termination.
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ARTICLE 12: CLAIMS PROCEDURE
12.01 SUBMISSION OF CLAIMS: Claims for benefits under the Plan shall be
submitted in writing to the Plan Administrator for this purpose.
Written notice of the disposition of a claim shall be furnished to
the claimant within 30 days after the application therefor is filed.
Such 30-day period may be extended (for an additional 90 days) if
the Plan Administrator determines that such an extension of time is
necessary to process the claim and so advises the claimant in
writing within 30 days after receipt of the claim.
12.02 WRITTEN NOTICE OF DENIED CLAIM: The Plan Administrator shall
provide adequate notice in writing to any person whose claim for
benefits has been denied. Such notice shall set forth the specific
reason or reasons for the denial and shall be written in a manner
calculated to be understood by the recipient. Such notice shall
also refer specifically to pertinent Plan provisions on which the
denial is based; shall describe any additional material or
information necessary for the claimant to perfect the claims; and
shall explain why such material or information is necessary. Such
notice shall also explain the Plan's claims review procedure.
12.03 REVIEW OF DECISION DENYING CLAIM: If a claimant's claim has been
denied in whole or in part, the claimant shall be advised in writing
that he or his duly authorized representative may request a review
by the Board or its designee upon written application to the Plan
Administrator. The claimant or his duly authorized representative
shall request such review in writing not more than 90 days after
receipt by the claimant of written notification of denial of a
claim. Within 10 days after, or as part of, a timely request for
review, the claimant may submit issues and comments in writing and
may review pertinent documents.
12.04 HEARING: Upon receipt of a timely request for review, the Board or
its designee may hold a hearing, or, in its discretion, appoint one
or more of its members (or if its designee is a committee, the
committee may appoint one or more of its members) to hear the
claimant's request and inquire into the merits of the matter. Such
member(s) shall meet promptly with the claimant and/or his duly
authorized representative and hear such arguments and/or examine
such documents as the claimant or his representative shall present.
The member(s) shall report his (their) findings to the Board or its
designee and the Plan Administrator orally or in writing.
12.05 WRITTEN DECISION OF COMMITTEE: A decision of the Board or its
designee on review of a claim shall be in writing and shall include
specific reasons for the decision, written in a manner calculated to
be understood by the claimant. Such decision shall include specific
references to the pertinent Plan provisions on which the decision is
based. The decision shall be made promptly and not later than 60
days after a request for review, unless special circumstances
require an extension of time for processing, in which case the
claimant shall be so advised in writing prior
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to the expiration of the initial 60-day period and decision shall be
rendered as soon as possible, but not later than 120 days after
receipt of a request for review.
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ARTICLE 13: TOP-HEAVY PROVISIONS
13.01 OVERRIDING PROVISION: If the Plan is or becomes top-heavy in any
Plan Year beginning after December 31, 1983, the provisions of this
Article shall supersede any conflicting provisions in the Plan.
13.02 DEFINITIONS:
(i) DETERMINATION DATE: For any Plan Year subsequent to the
first Plan Year, the last day of the preceding Plan Year.
For the first Plan Year of the Plan, the last day of that
Year.
(ii) EARNINGS: For purposes of this Article 13, the compensation
that is included on an Employee's Form W-2 for the calendar
year that ends with or within the Plan Year plus the amount
of any Tax-Deferred Contributions made on behalf of the
Employee for such calendar year.
(iii) KEY EMPLOYEE: Any Employee or former employee (and the
Beneficiary(ies) of such employee) who, at any time during
the termination period, was a Key Employee, in accordance
with Section 416(i)(1) of the Code and regulations
thereunder.
(iv) PERMISSIVE AGGREGATION GROUP: The Required Aggregation
Group of plans plus any other plan or plans of the Employer
which, when considered as a group with the Required
Aggregation Group, would continue to satisfy the
requirements of Sections 401(a)(4) and 410 of the Code.
(v) PRESENT VALUE: The value based on the 1983 Group Annuity
Mortality Table, separately for males and females, and an
interest rate of 5% per annum.
(vi) REQUIRED AGGREGATION GROUP: (1) Each qualified plan of the
Employer in which at least one Key Employee participates,
and (2) any other qualified plan of the Employer which
enables a plan described in (1) to meet the requirements of
Sections 401(a)(4) and 410 of the Code.
(vii) TOP-HEAVY PLAN: For any Plan Year beginning after December
31, 1983, this Plan is top-heavy if any of the following
conditions exist:
(a) If the Top-Heavy Ratio for this Plan exceeds 60
percent and the Plan is not part of any Required
Aggregation Group or Permissive Aggregation Group
of plans;
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(b) If this Plan is a part of a Required Aggregation
Group of plans (but not part of a Permissive
Aggregation Group) and the Top-Heavy Ratio for the
group of plans exceeds 60 percent; or
(c) If this Plan is a part of a Required Aggregation
Group of plans and part of a Permissive Aggregation
Group and the Top-Heavy Ratio for the group of
plans exceeds 60 percent.
(viii) TOP-HEAVY RATIO:
(a) If the Employer maintains one or more defined
benefit plans and has not maintained any defined
contribution plans (including any simplified
employee pension plan), which, during the 5-year
period ending on the Determination Date, has or has
had account balances, the Top-Heavy Ratio for this
group alone or for the Required or Permissive
Aggregation Group, as applicable, is a fraction.
The numerator is the sum of the Present Values of
accrued benefits of all Key Employees as of the
Determination Date, and the denominator of which is
the sum of the Present Values of all accrued
benefits, determined in accordance with Section 416
of the Code and the regulations thereunder. Both
the numerator and the denominator include any part
of any accrued benefits distributed in the 5-year
period ending on the Determination Date.
(b) If the Employer maintains one or more defined
benefit plans and maintains or has maintained one
or more defined contribution plans (including any
simplified employee pension plan), which, during
the 5-year period ending on the Determination Date,
has or has had any account balances, the Top-Heavy
Ratio for any Required or Permissive Aggregation
Group, as applicable, is a fraction. The numerator
is the sum of the Present Values of accrued
benefits under the aggregate defined benefit plan
or plans for all Key Employees, determined in
accordance with (a) above, plus the sum of account
balances under the aggregate defined contribution
plan or plans of all Key Employees as of the
Determination Date. The denominator is the sum of
the Present Values of all accrued benefits under
the aggregate defined benefit plan or plans for all
Participants and the sum of the account balances
under the aggregate defined contribution plan or
plans for all Participants, all determined in
accordance with Section 416 of the Code and the
regulations thereunder. Both the numerator and the
denominator include any part of any accrued
benefits or account balances distributed in the
5-year period ending on the Determination Date.
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(c) For purposes of (a) and (b) above, the value of
account balances and the Present Value of accrued
benefits will be determined as of the most recent
Valuation Date that falls within or ends with the
12-month period ending on the Determination Date,
except as provided in Section 416 of the Code and
the regulations thereunder for the first and second
plan years for a defined benefit plan. The account
balances and accrued benefits will be disregarded
for a participant: (1) who is not a Key Employee
but who was a Key Employee in a prior year, or (2)
who has not received any compensation from any
Employer maintaining the Plan at any time during
the 5-year period ending on the Determination Date.
The calculation of the Top-Heavy Ratio, and the
extent to which distributions, rollovers, and
transfers are taken into account will be made in
accordance with Section 416 of the Code and the
regulations thereunder. Deductible employee
contributions will not be taken into account for
computing the Top-Heavy Ratio. When aggregating
plans, the values of account balances and accrued
benefits will be calculated with reference to the
Determination Dates that fall within the same
calendar year.
(ix) VALUATION DATE: The first day of the Plan Year.
13.03 MINIMUM CONTRIBUTION: For any Plan Year in which this Plan as
top-heavy, provided the top-heavy ratio is less than 90%, each
Employee who is eligible to participate under Section 2.01, and who
is not eligible for participation under any defined benefit plan
maintained by his Employer shall have a contribution of 5% of
Earnings credited to his Accounts. Such contribution will be made
with respect to any such Employee irrespective of whether such
Employee has performed or will perform 1,000 Hours of Service (or
the equivalent) for such Plan Year or has made any contributions to
this Plan with respect to such Plan Year. This contribution shall
include amounts contributed under Sections 3.02 and 3.04 and Article
4. For any Plan Year in which the top-heavy ratio for this Plan is
90% or more, such minimum contribution shall be 3% of Earnings, and
the 125% factor in Section 4.08 shall be reduced to 100%.
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ARTICLE 14: EXERCISE OF SHAREHOLDER'S RIGHTS
14.01 VOTING SHARES OF COMPANY STOCK:
(a) All Shares of Company Stock held in the Trust Fund shall be
voted by the Trustee only in accordance with instructions
from the Participants or Beneficiaries, as set forth in this
Section 14.01. For purposes of the actions taken under this
Section 14.01, Participants and Beneficiaries shall be
considered to be named fiduciaries within the meaning of
Section 402(a)(2) of ERISA. Each Participant or Beneficiary
shall be entitled to give voting instructions with respect
to (1) the Shares of Company Stock allocated to his
Accounts, and (2) a pro rata portion of the Shares of
Company Stock held in an Unallocated Company Stock Account,
in the proportion that the Shares of Company Stock allocated
to his Accounts bear to the total Shares of Company Stock
allocated to all Accounts. In the event that a Participant
or Beneficiary fails to direct the Trustee as to the
exercise of such voting rights, the Trustee shall vote such
Shares of Company Stock in the same proportion as the
Trustee is required to vote Shares of Company Stock for
which instructions have been received, so that the same
percentage of voting rights with respect to such Shares of
Company Stock will be exercised for or against any proposal
or nominee submitted to shareholders as are exercised with
respect to Shares of Company Stock for which instructions
have been received. With respect to each occasion for the
exercise of such voting rights, the Trustee, through the
Plan Administrator, will notify each Participant or
Beneficiary within a reasonable time (not less than 30 days)
before such rights are to be exercised. Such notification
will include all the information distributed to the Trustee
regarding the exercise of such rights.
(b) Not less than five (5) business days prior to the date on
which such voting rights are to be exercised, each
Participant or Beneficiary wishing to exercise such rights
shall inform the Trustee, in the form and manner prescribed
by the Plan Administrator, with respect to the manner in
which such voting rights are to be exercised. To the extent
possible, the Trustee shall vote the combined fractional
Shares of Company Stock allocated to the Account(s) of
Participants and Beneficiaries to reflect the directions of
the Participants to whom such fractional Shares of Company
Stock are allocated.
(c) Neither the Trustee nor the Plan Administrator nor any of
the committee(s) established by or at the direction of the
Board, nor any other designee of the Board may make any
recommendation to the Participants or Beneficiaries
regarding the manner of exercising any voting rights,
including whether or not such rights should be exercised.
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14.02 RIGHTS OTHER THAN VOTING RIGHTS: Each Participant shall be entitled
to direct the Trustee, in the form and manner prescribed by the Plan
Administrator, with respect to the exercise of rights, other than
voting rights, attributable to his interest in the Shares of Company
Stock allocated to his Accounts.
14.03 PUBLIC OFFERS: Notwithstanding any provision of the Plan to the
contrary, in the event of a "tender offer" within the meaning
ascribed to that term pursuant to Section 14(d) of the Securities
Exchange Act of 1934, for Shares of Company Stock by any person
(other than the Company or any affiliate thereof), the Trustee,
through the Plan Administrator, shall promptly provide a copy of the
offer, and any other material or information concerning such offer,
to each Participant or Beneficiary (as appropriate). For purposes
of the actions taken under this Section 14.03, Participants and
Beneficiaries shall be considered to be "named fiduciaries" within
the meaning of Section 402(a)(2) of ERISA. Each Participant or
Beneficiary (as appropriate) shall be entitled to give the Trustee
instructions with respect to the tender of all, but not less than
all, Shares of Company Stock allocated to his Account. Upon receipt
of instructions from a Participant or Beneficiary (as appropriate)
to so tender, the Trustee shall tender all such Shares of Company
Stock to the tender offeror. In the event that a Participant or
Beneficiary fails to direct the Trustee as to whether to tender or
to not tender Shares of Company Stock, the Trustee shall tender all
or a part of such Shares of Company Stock, the tendered Shares to be
in the same proportion to the total number of Shares of Company
Stock held in the Account of such non-directing Participant or
Beneficiary as the number of Shares of Company Stock as to which the
Trustee is required to tender Shares of Company Stock bears to the
total number of Shares of Company Stock held in the Accounts of
Participants and Beneficiaries as to which instructions have been
received. The Trustee shall also tender a pro rata portion of the
Shares of Company Stock held in any Unallocated Company Stock
Account, the Shares tendered to be in the same proportion that the
number of Shares of Company Stock the Trustee is directed to tender
from the Accounts of Participants and Beneficiaries who direct the
Trustee to tender or not to tender such Shares bears to the total
number of Shares of Company Stock allocated to all Accounts of the
Participants and Beneficiaries who so direct the Trustee. The
solicitation and implementation of instructions from Participants
(and Beneficiaries) pursuant to this Section 14.03 shall, to the
best of the abilities of the Trustee, be carried out in such a
manner as will, for a reasonable time, preserve the
"confidentiality" of the instructions given by any particular
Participant or Beneficiary within the meaning and intent of that
term as used in Section 203(a)(2) of the General Corporation Law of
the State of Delaware. In the event that instructions cannot
otherwise be returned to the Trustee in a timely fashion, the
Company shall use its best efforts to collect and tabulate such
instructions in a manner that will assure a confidential and timely
tender by the Trustee. The proceeds received by the Trustee as a
result of having tendered Shares of Company Stock shall be applied
under the Plan as directed by the Plan Administrator, in accordance
with the following precepts. The Accounts of
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Participants and Beneficiaries who directed the Trustee not to
tender the Shares of Company Stock allocated to their respective
Accounts shall continue to be invested in Shares of Company Stock,
subject to any other investment direction the Participant (or
Beneficiary) may be entitled to give. The Accounts of Participants
and Beneficiaries who directed the Trustee to tender the Shares of
Company Stock allocated to their respective Accounts shall receive
the proceeds of such tender allocable to the tendered Shares of
Company Stock from such Account, which shall be invested at the
direction of the Board or its designee, as hereinafter provided,
subject to any other investment direction the Participant (or
Beneficiary) may be entitled to give. There shall be allocated to
the Accounts of Participants and Beneficiaries who gave no
directions to the Trustee with respect to the tender of Shares of
Company Stock, proceeds of the tender allocable to the Shares of
Company Stock (if any) tendered from their respective Accounts, and
the Shares of Company Stock and such proceeds shall be invested in
the same manner provided for in the preceding two sentences. Any
cash so received may be invested in short-term investments, pending
the Trustee's receipt of directions from the Board or its designee.
The Trustee shall give advance notice of at least one full business
day to the Company before taking any action in response to such an
offer other than the actions described above. The Trustee shall be
entitled to reasonable compensation and reimbursement for its
out-of-pocket expenses for any extraordinary services attributable
to the duties and responsibilities described in this Section.
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ARTICLE 15: SPECIAL LIMITATIONS ON CONTRIBUTIONS
15.01 DEFINITIONS: For purposes of this Article 15, the following terms
shall have the meaning set forth hereafter:
(i) "Actual Deferral Percentage" has the meaning
defined in Code section 401(k)(3)(B).
(ii) "Code" means the Internal Revenue Code of 1986, as
amended from time to time. A reference to any
section of the Code shall also be deemed to refer
to any successor statutory provision.
(iii) "Contribution Percentage" has the meaning defined
in Code section 401(m)(3).
(iv) "Elective Deferrals" has the meaning defined in
Code section 402(g)(3).
(v) "Excess Aggregate Contributions" has the meaning
defined in Code section 401(m)(6)(B).
(vi) "Excess Contributions" has the meaning defined in
Code section 401(k)(8)(B).
(vii) "Excess Deferral" has the meaning defined in Code
section 402(g)(2), but excluding amounts described
in section 1105(c)(5) of the Tax Reform Act of
1986.
(viii) "Highly Compensated Employees" has the meaning
defined in Code section 414(q).
(ix) "Matching Contributions" has the meaning defined in
Code section 401(m)(4)(A).
(x) "Qualified Nonelective Contributions" has the
meaning defined in Code section 401(m)(4)(C).
15.02 DETERMINATION AND TREATMENT OF EXCESS DEFERRALS:
(a) The amount of Elective Deferrals for a Participant for his
taxable year shall be limited to $7,000 (or such other
applicable amount pursuant to the provisions of Sections
401(g)(4), (5) and (8) of the Code). Any Excess Deferral
shall be distributed to the Participant in accordance with
the rules of subsection (b) hereof.
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(b) To the extent the Participant has made Elective Deferrals to
the Plan in excess of the amount set forth in subsection
(a), such Excess deferrals shall be distributed to him no
later than the 15th day of April following the end of the
taxable year during which such Elective Deferrals are made.
If, for a taxable year, a Participant makes Elective
Deferrals to this Plan and to any other plan or arrangement,
he may allocate the amount of any Excess Deferrals for such
taxable year among such plans. No later than the first day
of March following the close of the taxable year during
which the Excess Deferrals are made, the Participant shall
notify the Plan Administrator in writing of the amount of
the Excess Deferrals allocated to this Plan. Such amount
shall then be distributed (including income thereon) to the
Participant no later than the following April 15th.
15.03 COMPUTATION OF ACTUAL DEFERRAL PERCENTAGE:
(a) For each Plan Year beginning after December 31, 1986, the
Actual Deferral Percentage for the group of eligible Highly
Compensated Employees shall bear a relationship to the
Actual Deferral Percentage for all other eligible employees
that meets either of the following tests:
(i) The Actual Deferral Percentage for the group of
eligible Highly Compensated Employees is not more
than the Actual Deferral Percentage of all other
eligible employees multiplied by 1.25; or
(ii) The excess of the Actual Deferral Percentage for
the group of eligible Highly Compensated Employees
over that of all other eligible employees is not
more than 2 percentage points, and the Actual
Deferral Percentage for the group of eligible
Highly Compensated Employees is not more than the
Actual Deferral Percentage of all other eligible
employees multiplied by 2.
(b) For purposes of computing the Actual Deferral Percentages in
subsection (a) hereof, the Company Contributions on behalf
of any Participant shall include:
(i) Any Company Contributions made pursuant to the
Participant's election; and
(ii) At the election of the Company, Matching
Contributions (other than Matching Contributions
which have been allocated to an ESOP Account) that
meet the withdrawal and nonforfeitability
restrictions of Code Section 401(k)(2)(B) and (C),
and/or Qualified Nonelective Contributions.
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(c) For purposes of applying the provisions of subsection (a)
hereof, the Actual Deferral Percentage taken into account
for any Highly Compensated Employee who is a Participant in
two or more cash or deferred arrangements of the Employer
shall be the sum of the Actual Deferral Percentages for such
Highly Compensated Employee under each of such arrangements
divided by the Participant's Compensation from the Employer
and the Affiliated Companies.
(d) Except to the extent provided in regulations or rules
provided by the Secretary of the Treasury, notwithstanding
the distribution of any portion of an Excess Deferral under
Section 15.02 hereof, such portion shall, for purposes of
applying this Section 15.03, be treated as an Employer
Contribution.
15.04 LIMITATION ON CONTRIBUTION PERCENTAGE:
(a) For each Plan Year beginning after December 31, 1986, the
Contribution Percentage for eligible Highly Compensated
Employees shall not exceed the greater of:
(i) 125 percent of the Contribution Percentage for all
other eligible Employees; or
(ii) The lesser of 200 percent of the Contribution
Percentage for all other eligible Employees or the
Contribution Percentage for all other eligible
Employees plus 2 percentage points.
(b) (i) If two or more plans of the employer to which Matching
Contributions, Employee Contributions or Elective Deferrals
are made are treated as one plan for purposes of Section
410(b) of the Code, such plans shall be treated as one plan
and (ii) if a Highly Compensated Employee participates in
two or more plans of the Employer to which such
contributions are made, all such contributions shall be
aggregated.
(c) Any Employee who is eligible to make an Employee
Contribution (or, if the Employer takes elective
contributions into account, elective contributions) or to
receive a Matching Contribution shall be considered an
eligible employee. In addition, if an Employee Contribution
is required as a condition of participation in the Plan, any
employee who would be a Participant in the Plan if such
employee made a contribution shall be treated as an eligible
employee on behalf of whom no Company Contributions are
made.
(d) For purposes of computing the Contribution Percentages, the
Employer may elect to take into account Elective Deferrals
and/or Qualified Nonelective
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Contributions allocated to a Participant's Account under the Plan or
any other plan it sponsors.
15.05 DISTRIBUTION OF EXCESS CONTRIBUTIONS AND EXCESS AGGREGATE
CONTRIBUTIONS: The Plan shall be treated as satisfying the
requirements of Sections 15.03(d) and 15.04(a) hereof for any Plan
Year if, before the close of the following Plan Year, (i) the amount
of the Excess Contributions and Excess Aggregate Contributions for
such Plan Year (and any income allocable to such Contributions) is
distributed to the Participant, (ii) in the case of Excess
Contributions, to the extent provided by regulation issued by the
Secretary of the Treasury, an Employee elects to treat such Excess
Deferral as distributed and recontributed by the Employee to the
Plan, or (iii) in the case of Excess Aggregate Contributions, to the
extent such Contributions are forfeitable, are forfeited.
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ARTICLE 16: ESOP INVESTMENTS AND ACQUISITION LOANS
16.01 INVESTMENT OF EMPLOYERS' REGULAR AND CERTAIN ADDITIONAL
CONTRIBUTIONS: The Trustee will maintain that portion of the
Company Stock Fund consisting of Participants' ESOP Accounts, and
that portion of the Company Stock Fund comprised of Participants'
PAYSOP Accounts and that portion of the Company Stock Fund
consisting of the Unallocated Company Stock Accounts, as an Employer
Stock Ownership Plan as defined in Section 4975(e)(7) of the Code
(the "ESOP") and will on and after May 1, 1989 invest all cash
contributions made pursuant to Section 4.01 and such, if any, of the
contributions made under Section 4.02 and designated by the Employer
when made as ESOP Contributions, together with cash dividends
thereon and any other form of cash income primarily in Shares of
Company Stock in accordance with the investment objectives and
guidelines promulgated pursuant to Article 9 of the Plan. The
Trustee shall retain in the ESOP all Shares of Company Stock
contributed to it for distribution or transfer as provided herein.
The Trustee is authorized to invest in and hold up to 100% of the
ESOP in Shares of Company Stock. The Trustee may retain some part
of the ESOP in other forms of investment, or in cash, and may sell
Shares of Company Stock as the Trustee determines, to meet
administrative requirements of the Plan. The Trustee may purchase
Shares of Company Stock from or sell Shares of Company Stock to the
Company or from or to any other source, and such Shares of Company
Stock may be outstanding, newly issued, or Treasury securities.
16.02 VALUATION OF SHARES OF COMPANY STOCK:
(a) On any Valuation Date on which it is necessary or desirable
to value Shares of Company Stock, all Shares of Company
Stock shall be valued at their fair market value. All
valuations of Shares of Company Stock must be made in good
faith and based on all relevant factors for determining
their fair market value. So long as the Shares of Company
Stock are listed and traded on the New York Stock Exchange
(or other national stock exchange), the determination of
fair market value shall be made by reference to the price of
Shares of Company Stock on such exchange (and, unless
otherwise required by law or other applicable provision,
shall be based on the closing price on such exchange on the
preceding trading day). If the stock ceases to be listed on
a national exchange, a determination of fair market value
independently arrived at by a person who customarily makes
such appraisals and who is independent of any party to a
transaction involving this Plan shall be deemed a good faith
determination of value whenever the transaction does not
involve a "disqualified person" as such term is defined in
Code Section 4975(e)(2).
(b) For purposes of a transaction between the Plan and a
"disqualified person," the valuation must be determined as
of the date of the transaction.
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16.03 ACQUISITION LOANS: The Board or its designee may direct the Trustee
to incur Acquisition Loans from time to time to finance the
acquisition of Financed Shares for the trust or to repay a prior
Acquisition Loan. Acquisition Loans may be made from persons
determined to be "disqualified persons" within the meaning of
Section 4975(e)(2) of the Code or guaranteed by such "disqualified
persons" provided such loan or loans satisfy all of the requirements
of an exempt loan described in Section 4975(d)(3) of the Code and
Section 408(b)(3) of ERISA, and any regulations issued thereunder.
Repayments of principal and interest on any Acquisition Loan shall
be made by the Trustee (as directed by the Plan Administrator) (i)
only from Company Contributions, (ii) from earnings attributable to
such Company Contributions, (iii) from Financed Shares (whether
pledged to secure such loan or not) remaining in the Unallocated
Company Stock Account or the proceeds of a sale or other disposition
thereof, (iv) from loan proceeds not yet applied to the purchase of
Shares of Common Stock (and any earnings attributable thereto), and
(v) (as provided in Section 16.04) from any cash dividends received
by the trust on Financed Shares. The Employer shall contribute to
the Plan in any Plan Year in which there exists an outstanding
balance on an Acquisition Loan, an amount sufficient to pay the
principal and interest payments thereon which come due during such
Plan Year.
16.04 DIVIDENDS USED IN REPAYMENT OF ACQUISITION LOAN: The Plan
Administrator may in his discretion direct the Trustee to use any
cash dividends paid on Financed Shares (and, subject to the
provisions of Section 6.02 of the Plan, dividends paid on Shares of
Company Stock held in ESOP Accounts of Participants) to pay any
currently maturing obligation under an Acquisition Loan.
16.05 CREATION OF UNALLOCATED COMPANY STOCK ACCOUNT AND RELEASE OF SHARES
OF COMPANY STOCK:
(a) All Financed Shares shall be added to and maintained in an
Unallocated Company Stock Account whether or not they are
encumbered under the terms of the Acquisition Loan. A
separate Unallocated Company Stock Account shall be
maintained for each Acquisition Loan. The Unallocated
Company Stock Account shall be deemed an asset of this Plan.
(b) As of a Valuation Date at the end of each month, with
respect to Regular Contributions made pursuant to Section
4.01, and the end of each Plan Year, with respect to
Additional Contributions made pursuant to Section 4.02,
Financed Shares will be withdrawn from the Unallocated
Company Stock Account and allocated to Participants'
Accounts in accordance with the provisions of Section 4.04.
For each month or Plan Year, as applicable (a "Release
Period") the number of Financed Shares withdrawn from the
Unallocated Company Stock Account shall be released as
follows:
63
<PAGE> 72
If
(i) The Acquisition Loan provides for payments of
principal and interest at a cumulative rate that is
not less rapid at any time than level annual
payments of such amounts for ten years, and
(ii) Interest included in any payment is disregarded (in
determining the portion of such payment
constituting principal) only to the extent that it
would be determined to be interest under standard
loan amortization tables,
then the number of shares released from the Unallocated
Company Stock Account shall bear the same ratio to the
number of shares attributable to the Acquisition Loan that
are then in the Unallocated Company Stock Account (prior to
the release) as (1) the principal payments on the
Acquisition Loan in the Release Period ending with such
Valuation Date bear to (2) the Release Period's principal
payments described in (1), plus the total remaining
principal payments required (or projected to be required on
the basis of the interest rate on the Acquisition Loan in
effect at the end of the Release Period) to satisfy the
Acquisition Loan. If the Acquisition Loan does not meet the
requirements of the preceding sentence, or if, at any time,
by reason of a renewal, extension or refinancing, the sum of
the expired duration of the Acquisition Loan, the renewal
period, the extension period and the duration of a new
Acquisition Loan exceeds 10 years, then the number of shares
released shall be determined in accordance with Paragraph
(c) of this Section 16.05.
(c) Unless Section 16.05(b) (above) applies, the number of
shares released from the Unallocated Company Stock Account
shall bear the same ratio to the number of shares
attributable to the Acquisition Loan that are then in the
Unallocated Company Stock Account (prior to the release) as
(1) the principal and interest payments made on the
Acquisition Loan in the Release Period ending with such
Valuation Date bear to (2) the Release Period's payments
described in (1), plus the total remaining principal and
interest payments required (or projected to be required on
the basis of the interest rate on the Acquisition Loan in
effect at the end of such Release Period) to satisfy the
Acquisition Loan.
(d) For purposes of this Section, each Acquisition Loan, the
purchase of Shares of Company Stock in connection with it,
and any stock dividends on such Shares of Company Stock
shall be considered separately.
16.06 ALLOCATION OF PROCEEDS OF SALE OR OTHER DISPOSITION: If, in
connection with a "change in control" of the Company (as that term
is defined in
64
<PAGE> 73
Section 7.04 hereof), the Trustee sells or otherwise disposes of
Financed Shares held in the Unallocated Company Stock Account in one
or more transactions which result in the Trustee's receipt of cash,
or consideration other than Shares of Company Stock (or securities
which are for all Plan purposes substituted for Shares of Company
Stock), the proceeds of such sale or other disposition shall be used
first to pay so much of the unpaid principal (and any interest due
thereon) of the Acquisition Loan(s) pursuant to which such Financed
Shares were acquired as shall be necessary to obtain the release
from the Unallocated Company Stock Account of each such Share sold
by the Trustee. If the proceeds per Share so received by the
Trustee exceed the amount required to be paid to obtain the release
of one Share of Company Stock from the Unallocated Company Stock
Account, the amount of such excess per Share (the "Excess
Proceeds") shall (whether obtained or retained by the Trustee in the
form of cash, released Financed Shares, or other property), to the
greatest extent permissible by law, be deemed to be Plan income,
which shall be allocable to the Accounts of those Participants in
the Plan for whom one or more Accounts are maintained pursuant to
the Plan at the time of the "change in control" and who, as of the
date the change in control occurs, have Earnings for the Plan Year
in which such allocation is made ("Eligible Participants").
(a) The allocation required hereby shall be made as of the
Valuation Date next following the date of the "change in
control" of the Company.
(b) The allocation of Excess Proceeds to the Account of each
Eligible Participant shall bear the same ratio to the total
value of the Excess Proceeds available for allocation as
each such Eligible Participant's Earnings for that portion
of the Plan Year in which such allocation is made occurring
prior to the date of the "change in control" bears to the
total Earnings of all Eligible Participants for the same
portion of the Plan Year.
65
<PAGE> 74
ARTICLE 17: LOAN TO PARTICIPANTS
17.01 ELIGIBILITY: Any Participant may apply for a loan from the Plan in lieu
of a Withdrawal. To obtain a loan, such Participant must submit a
written application for approval in such manner as may be prescribed by
the Plan Administrator.
17.02 AMOUNT OF LOAN: A Participant may borrow from his Accounts (other than
Accounts from which transfer is restricted under Section 5.04) up to a
maximum amount equal to his Vested Value, provided that the loan:
(a) must be at least $1,000 and
(b) shall not exceed the lesser of (1) $50,000, reduced by the
excess of the highest outstanding balance of loans from the
Plan during the one-year period ending on the day before the date
the loan is made over the outstanding balance of the loans from the
Plan on the date the loan is made, or (2) 50% of the Participant's
Vested Value under the Plan.
17.03 TERMS AND CONDITIONS: In addition to such rules and regulations as the
Plan Administrator may adopt, all loans shall comply with the following
terms and conditions:
(a) The Participant shall execute a promissory note and assign to the
Plan his rights to his Accounts to the extent necessary to pay off
the loan in the event of default.
(b) The term for repaying the loan shall be at least 12 months but
not more than 5 years; provided, however, that a loan used to
acquire any dwelling unit which, within a reasonable time, is to be
used (determined at the time the loan is made) as a principal
residence of the Participant shall provide for periodic repayment
over a reasonable period of time that may not exceed 15 years.
(c) Loan disbursements shall be made from the Participant's
Investment Funds in proportion to his vested balance in the
Investment Funds (omitting that portion of the Company Stock Fund
excluded under the provisions of Section 17.02). A loan shall be
considered to be an investment of the Participant's interest in the
Plan which has been directed by the Participant, and the evidence
of debt shall be held as an asset for the borrowing Participant.
Repayments of principal and interest shall be made in accordance
with the Participant's then-current investment election.
(d) The loan shall bear interest at a reasonable rate as determined
by the Plan Administrator. The Plan Administrator shall not
discriminate among Participants in the matter of interest rates,
but loans granted at different times may have different interest
rates if, in the opinion of the Plan Administrator, the difference
in rates is justified by economic conditions.
(e) A Participant shall repay his loan:
<PAGE> 75
(i) by payroll deductions that will amortize the loan in level
payments over its term, or
(ii) through a withdrawal from the Plan used in whole or in part to
repay the loan in a single lump sum or in a single lump sum cash
payment.
If a Participant is absent from work with less than full compensation,
payroll deductions will continue as long as his pay is sufficient to cover the
amounts due under the terms of the loan. If the Participant's compensation is
insufficient to cover the regular payments due, the Participant shall make
arrangements with the Plan Administrator for repaying principal and interest on
a current basis.
(f) A Participant who qualifies for a hardship withdrawal under Article 8
may withdraw from the Plan to the extent that such withdrawal will not
result in his loan exceeding the maximum limitations under Section
17.02, unless the Participant authorizes the Plan Administrator to
apply a sufficient amount of such withdrawal to reduce the loan to the
maximum limitations under Section 17.02 after such withdrawal.
(g) A Participant shall not be approved for a loan under this Article until
any prior loan has been completely amortized.
(h) A Participant will be deemed to have defaulted on his loan upon the
earlier of:
(i) separation from service due to retirement, death, total and
permanent disability, layoff, or any other reason; or
(ii) failure to make a loan repayment when due.
(i) Upon default, the Plan Administrator may taken any action permitted by
law and consistent with the provisions of the Plan and its continued
qualification to collect the balance due on the loan (or see to the
application of collateral to the payment thereof). No amount shall be
distributed to a Participant in default on an outstanding loan until
the loan is repaid in full. If the amount of any such distribution is
insufficient to repay the loan, the Participant or his Beneficiary
shall be liable for repaying any amount still outstanding.
(j) Nothing in this Article 17 shall preclude the Plan Administrator from
declaring a moratorium on the approval of loans or from amending this
Article 17, subject to applicable regulations issued by the Internal
Revenue Service.
IN WITNESS WHEREOF, BOWATER INCORPORATED has caused this document to be
executed by its duly authorized officers and its corporate seal to be affixed
hereto this 27th day of December, 1994.
<PAGE> 76
BOWATER INCORPORATED
By: /s/ Ecton Manning
----------------------------------
Its Vice President General Counsel
<PAGE> 77
<TABLE>
<S> <C> <C> <C>
16.04 DIVIDENDS USED IN REPAYMENT OF ACQUISITION LOAN . . . . . . . . . . . . . . . . . . . . . . . 63
16.05 CREATION OF UNALLOCATED COMPANY STOCK ACCOUNT
AND RELEASE OF SHARES OF COMPANY STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
16.06 ALLOCATION OF PROCEEDS OF SALE OR OTHER DISPOSITION . . . . . . . . . . . . . . . . . . . . . 64
ARTICLE 17: LOAN TO PARTICIPANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
17.01 ELIGIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
17.02 AMOUNT OF LOAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
17.03 TERMS AND CONDITIONS .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
</TABLE>
<PAGE> 1
Exhibit 23.1
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Bowater Incorporated
We consent to the use of our report February 10, 1995 on the financial
statements of Bowater Incorporated (the Company) for the three-year period
ended December 31, 1994, incorporated herein by reference, which report appears
in the December 31, 1994 annual report on Form 10-K of Bowater Incorporated,
and to our report dated June 16, 1995 on the financial statements of Bowater
Incorporated Salaried Employees' Savings Plan (the Plan) for the two years ended
December 31, 1994, incorporated herein by reference, which report appears in
the December 31, 1994 annual report on Form 11-K of the Plan.
Our report covering the December 31, 1992 financial statements of Bowater
Incorporated refers to accounting changes regarding the Company's adoption of
the provisions of the Financial Accounting Standards Board's Statement on
Financial Accounting Standards No. 106, "Employers' Accounting for
Postretirement Benefits Other Than Pensions," and Statement of Financial
Accounting Standards No. 109,"Accounting for Income Taxes," in 1992.
Greenville, South Carolina
January 24, 1996
/s/ KPMG Peat Marwick LLP
----------------------------------------
KPMG Peat Marwick LLP
<PAGE> 1
EXHIBIT 24.1
POWER OF ATTORNEY
We, the undersigned directors of Bowater Incorporated, hereby
severally constitute Ecton R. Manning, David G. Maffucci and Wendy C. Shiba,
and each of them singly, our true and lawful attorneys with full power of
substitution, to sign for us and in our names in the capacities listed below,
(1) Registration Statements on Form S-8 pertaining to the Bowater Incorporated
Salaried Employees' Savings Plan (the "Bowater Plan") and the Great Northern
Papers, Inc. Savings and Capital Growth Plan (the "GNP Plan") and any and all
amendments to such Registration Statements and (2) a Post-Effective Amendment
to the Registration Statement on Form S-8 pertaining to the Bowater Plan
(Registration Statement No. 2-92900) and a Post-Effective Amendment to the
Registration Statement on Form S-8 pertaining to the GNP Plan (Registration
Statement No. 33-44887) and any and all amendments to such Registration
Statements, and generally to do all such things in our names and on our behalf
in our capacities as directors to enable Bowater Incorporated to comply with
the provisions of the Securities Act of 1933, as amended, all requirements of
the Securities and Exchange Commission, and all requirements of any other
applicable law or regulation, hereby ratifying and confirming our signatures as
they may be signed by our said attorneys, or any of them, to such Registration
Statements and Post-Effective Amendments and any and all amendments thereto,
including post-effective amendments.
Signatures Title Date
- ---------- ----- ----
/s/ Anthony P. Gammie Director and November 15, 1995
- ---------------------- Chairman of the Board
Anthony P. Gammie
/s/ Francis J. Aquilar Director November 15, 1995
- ----------------------
Francis J. Aquilar
/s/ Hugh D. Aycock Director November 15, 1995
- -------------------
Hugh D. Aycock
/s/ Richard Barth Director November 15, 1995
- ------------------
Richard Barth
/s/ Kenneth M. Curtis Director November 15, 1995
- ----------------------
Kenneth M. Curtis
/s/ H. Gordon MacNeill Director November 15, 1995
- ----------------------
H. Gordon MacNeill
/s/ Donald R. Melville Director November 15, 1995
- -----------------------
Donald R. Melville
/s/ John A. Rolls Director November 15, 1995
- -----------------
John A. Rolls
