<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)
----------------------------------------------
GREAT NORTHERN PAPER, INC. SAVINGS
AND CAPITAL GROWTH PLAN FOR SALARIED EMPLOYEES
(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, 600,000 $33.625 $20,175,000 $6,956.9
$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 Company 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
David G. Maffucci financial officer)
/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 Great Northern Paper, Inc.
Savings and Capital Growth Plan for Salaried Employees 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.
GREAT NORTHERN PAPER, INC. SAVINGS AND
CAPITAL GROWTH PLAN FOR SALARIED EMPLOYEES
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 Amended and Restated 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 Great Northern Paper, Inc.
Savings and Capital Growth Plan for
Salaried Employees Effective January 1, 1992
(Incorporating Amendments made through
September 15, 1994, as amended).
23.1 Consent of KPMG Peat Marwick LLP
dated January 31, 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
GREAT NORTHERN PAPER, INC.
SAVINGS AND CAPITAL GROWTH PLAN FOR SALARIED EMPLOYEES
Effective January 1, 1992
(Incorporating Amendments made through September 15, 1994)
<PAGE> 2
TABLE OF CONTENTS
Page
<TABLE>
<S> <C>
ARTICLE I - DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 ACP TEST . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.3 ADP TEST . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.4 AFFILIATE . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.5 AFTER-TAX CONTRIBUTION . . . . . . . . . . . . . . . . . . . 4
1.6 AFTER-TAX EMPLOYEE ACCOUNT . . . . . . . . . . . . . . . . . 4
1.7 BEFORE-TAX CONTRIBUTIONS . . . . . . . . . . . . . . . . . . 4
1.8 BEFORE-TAX EMPLOYEE ACCOUNT . . . . . . . . . . . . . . . . 4
1.9 BENEFICIARY . . . . . . . . . . . . . . . . . . . . . . . . 4
1.10 BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.11 BREAK IN SERVICE . . . . . . . . . . . . . . . . . . . . . . 5
1.12 CODE . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.13 COMPENSATION . . . . . . . . . . . . . . . . . . . . . . . . 5
1.14 CURRENT OR ACCUMULATED PROFITS . . . . . . . . . . . . . . . 6
1.15 ELIGIBLE EMPLOYEE . . . . . . . . . . . . . . . . . . . . . 6
1.16 EMPLOYEE . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.17 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.18 EMPLOYER . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.19 GNP . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.20 GNP BASIC CONTRIBUTIONS . . . . . . . . . . . . . . . . . . 7
1.21 GNP BASIC CONTRIBUTION ACCOUNT . . . . . . . . . . . . . . . 7
1.22 GNP MATCHING ACCOUNT . . . . . . . . . . . . . . . . . . . . 7
1.23 GNP MATCHING CONTRIBUTIONS . . . . . . . . . . . . . . . . . 7
1.24 HIGHLY COMPENSATED ELIGIBLE EMPLOYEE . . . . . . . . . . . . 7
1.25 HOUR OF SERVICE . . . . . . . . . . . . . . . . . . . . . . 8
1.26 INVESTMENT FUND . . . . . . . . . . . . . . . . . . . . . . 8
1.27 INVESTMENT MANAGER . . . . . . . . . . . . . . . . . . . . . 9
1.28 LEAVE OF ABSENCE . . . . . . . . . . . . . . . . . . . . . . 9
1.29 LOWER PAID ELIGIBLE EMPLOYEE . . . . . . . . . . . . . . . . 9
1.30 PARTICIPANT . . . . . . . . . . . . . . . . . . . . . . . . 9
1.31 PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.32 PLAN ADMINISTRATOR . . . . . . . . . . . . . . . . . . . . . 9
1.33 PLAN SPONSOR . . . . . . . . . . . . . . . . . . . . . . . . 9
1.34 PLAN YEAR . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.35 SERVICE . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.36 SEVERANCE DATE . . . . . . . . . . . . . . . . . . . . . . . 9
1.37 TRUST AGREEMENT. . . . . . . . . . . . . . . . . . . . . . . 10
1.38 TRUST FUND . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.39 TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.40 VALUATION DATE . . . . . . . . . . . . . . . . . . . . . . . 10
</TABLE>
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<TABLE>
<S> <C>
ARTICLE II - PARTICIPATION REQUIREMENTS . . . . . . . . . . . . . . . . . . . 11
2.1 CAPITAL GROWTH PART - GNP BASIC CONTRIBUTIONS . . . . . . . 11
2.2 SAVINGS PART - BEFORE-TAX AND AFTER-TAX CONTRIBUTIONS . . . 11
2.3 CALCULATION OF SERVICE . . . . . . . . . . . . . . . . . . . 11
2.4 NOT A CONTRACT OF EMPLOYMENT . . . . . . . . . . . . . . . . 14
ARTICLE III - CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . 15
3.1 CAPITAL GROWTH PART - GNP BASIC CONTRIBUTIONS . . . . . . . 15
3.2 SAVINGS PART - BEFORE-TAX CONTRIBUTIONS AND GNP MATCHING
CONTRIBUTIONS. . . . . . . . . . . . . . . . . . . . . . . . 16
3.3 SAVINGS PART - AFTER-TAX CONTRIBUTIONS . . . . . . . . . . . 19
3.4 ELECTION RULES . . . . . . . . . . . . . . . . . . . . . . . 20
3.5 SECTION 415 LIMITATIONS . . . . . . . . . . . . . . . . . . 21
3.6 COMBINED PLANS LIMITATION . . . . . . . . . . . . . . . . . 23
ARTICLE IV - INVESTMENT AND ALLOCATION OF
INVESTMENT GAINS AND LOSSES . . . . . . . . . . . . . . . . . . . . 24
4.1 INVESTMENT FUNDS . . . . . . . . . . . . . . . . . . . . . . 24
4.2 ELECTIONS . . . . . . . . . . . . . . . . . . . . . . . . . 25
4.3 ALLOCATION OF INVESTMENT GAINS AND LOSSES . . . . . . . . . 26
ARTICLE V - DISTRIBUTIONS, WITHDRAWALS AND LOANS . . . . . . . . . . . . . . 27
5.1 DISTRIBUTION EVENTS . . . . . . . . . . . . . . . . . . . . 27
5.2 WITHDRAWALS . . . . . . . . . . . . . . . . . . . . . . . . 29
5.3 LOANS . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
5.4 FORM AND TIMING OF DISTRIBUTIONS . . . . . . . . . . . . . . 33
ARTICLE VI - FIDUCIARIES . . . . . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE VII - PLAN ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . 39
7.1 ADMINISTRATION BY FIDUCIARIES . . . . . . . . . . . . . . . 39
7.2 RESPONSIBILITIES OF THE PLAN SPONSOR . . . . . . . . . . . . 39
7.3 RESPONSIBILITIES OF THE TRUSTEE . . . . . . . . . . . . . . 40
7.4 RESPONSIBILITIES OF THE PLAN ADMINISTRATOR . . . . . . . . . 40
7.5 DELEGATION OF DUTIES . . . . . . . . . . . . . . . . . . . . 41
7.6 COMMITTEE ACTION . . . . . . . . . . . . . . . . . . . . . . 41
7.7 INDIVIDUAL INDEMNIFICATION . . . . . . . . . . . . . . . . . 42
7.8 EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . 42
</TABLE>
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<TABLE>
<S> <C>
ARTICLE VIII - TRUST FUND AND TRUSTEE . . . . . . . . . . . . . . . . . . . . 43
ARTICLE IX - AMENDMENT AND TERMINATION . . . . . . . . . . . . . . . . . . . 44
9.1 AMENDMENT . . . . . . . . . . . . . . . . . . . . . . . . . 44
9.2 MERGER, CONSOLIDATION, OR TRANSFER OF ASSETS . . . . . . . . 44
9.3 TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . 44
9.4 WITHDRAWAL OF AN EMPLOYER . . . . . . . . . . . . . . . . . 44
9.5 PROCEDURE . . . . . . . . . . . . . . . . . . . . . . . . . 45
ARTICLE X - MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . 46
10.1 CONSTRUCTION . . . . . . . . . . . . . . . . . . . . . . . . 46
10.2 SPENDTHRIFT CLAUSE . . . . . . . . . . . . . . . . . . . . . 46
10.3 LEGALLY INCOMPETENT . . . . . . . . . . . . . . . . . . . . 46
10.4 BENEFITS SUPPORTED ONLY BY TRUST FUND . . . . . . . . . . . 46
10.5 DISCRIMINATION . . . . . . . . . . . . . . . . . . . . . . . 46
10.6 CLAIMS . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
10.7 NONREVERSION . . . . . . . . . . . . . . . . . . . . . . . . 47
10.8 AGENT FOR SERVICE OF PROCESS . . . . . . . . . . . . . . . . 47
10.9 ROLLOVER CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . 47
10.10 EXERCISE OF SHAREHOLDER RIGHTS WITH RESPECT TO BOWATER
INCORPORATED COMMON STOCK HELD IN THE TRUST FUND . . . . . . 48
10.11 QUALIFIED DOMESTIC RELATIONS ORDER . . . . . . . . . . . . . 50
10.12 PLAN TO PLAN TRANSFERS . . . . . . . . . . . . . . . . . . . 51
ARTICLE XI - TRANSFER OF ASSETS FROM AND ASSUMPTION OF
CERTAIN LIABILITIES OF THE GEORGIA-PACIFIC CORPORATION
SAVINGS AND CAPITAL GROWTH PLAN . . . . . . . . . . . . . . . . . . 52
11.1 ASSET TRANSFER . . . . . . . . . . . . . . . . . . . . . . . 52
11.2 VESTING . . . . . . . . . . . . . . . . . . . . . . . . . . 52
11.3 ELIGIBILITY TO PARTICIPATE . . . . . . . . . . . . . . . . . 52
ARTICLE XII - TOP HEAVY PROVISIONS . . . . . . . . . . . . . . . . . . . . . 53
12.1 OVERRIDING PROVISION . . . . . . . . . . . . . . . . . . . . 53
12.2 DEFINITIONS 53 . . . . . . . . . . . . . . . . . . . . . . . 53
12.3 MINIMUM CONTRIBUTION . . . . . . . . . . . . . . . . . . . . 55
</TABLE>
<PAGE> 5
GREAT NORTHERN PAPER, INC.
SAVINGS AND CAPITAL GROWTH PLAN
GREAT NORTHERN PAPER, INC., a corporation organized and existing under
the laws of the state of Delaware, on its behalf and on behalf of each other
Employer, established the GREAT NORTHERN PAPER, INC. Savings and Capital Growth
Plan in the form of this Plan effective as of January 1, 1992 (hereinafter
referred to as the "Effective Date"). This plan was established for the
benefit of Eligible Employees who worked for, or who continued to work for, an
Employer after January 1, 1992.
<PAGE> 6
- 1 -
ARTICLE I
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.
1.1 ACCOUNTS. Account means the Account established by, or at the
direction of, the Employer to show as of any Valuation Date the contributions
made by, or on behalf of, a member under this Plan, plus the investment gains
and less the investment losses on such contributions. An Account shall cease
to exist when exhausted through distributions or forfeitures made in accordance
with this Plan.
1.2 ACP TEST. ACP Test means the actual contribution percentage
test which the Plan Administrator shall perform as of the last day of each Plan
Year to determine the extent to which the GNP Matching Contributions and
After-Tax Contributions for such Plan Year in fact can be made, and such test
shall be satisfied only if the Actual Contribution Percentage (as defined in
subsection (c)) for all Highly Compensated Eligible Employees does not exceed
the greater of:
(a) One-hundred twenty-five percent (125%) of the Actual
Contribution Percentage for all Lower Paid Eligible Employees,
or
(b) The lesser of two (2) times the Actual Contribution Percentage
(as defined in subsection (c)) for all Lower Paid Eligible
Employees or the Actual Contribution Percentage for all Lower
Paid Eligible Employees plus two (2) percentage points, where
(c) The term "Actual Contribution Percentage" means as to all
Highly Compensated Eligible Employees and all Lower Paid
Eligible Employees for each Plan Year, the average of the
ratios, calculated separately for each Eligible Employee in
each such group, of (1) the sum of the GNP Matching
Contributions and After-Tax Contributions made on his behalf
to (2) his Compensation for that part of such Plan Year during
which contributions might have been made under the terms of
this Plan on his behalf from his before-tax Compensation.
For purposes of the ACP Test only, the Employer may,
to the extent permitted under Code Section 401(m)(3), elect to
treat Before-Tax Contributions or Basic Contributions for a
given Plan Year as GNP Matching Contributions, provided that
such Before-Tax and/or Basic Contributions are not disregarded
for purposes of the ACP Test to the extent required by Code
Section 401(m)(3). In any Plan Year in which the "2.0 times,
but not more
<PAGE> 7
- 2 -
than two percentage points" alternative (described in paragraph (b) of
both Section 1.2 and Section 1.3) must be utilized to pass both the
ACP Test (as described in Section 1.2) and the ADP Test (as described
in Section 1.3) the sum of the Actual Contribution Percentage ("ACP")
and the Actual Deferral Percentage ("ADP") for Highly Compensated
Eligible Employees shall not exceed the greater of:
(A) (i) 1.25 times the greater of the ACP or ADP for
Lower Paid Eligible Employees plus
(ii) 2 percent plus (but not more than two times)
the lesser of the ACP or ADP for Lower Paid
Eligible Employees;
(B) (i) 1.25 times the lesser of the ACP or ADP for
Lower Paid Eligible Employees plus
(ii) 2 percent plus the greater of (but not more
than two times the lesser of) the ACP or ADP
for Lower Paid Eligible Employees; or
(C) the maximum permitted by the Multiple Use Test set
forth in Final Treasury Regulation Section
1.401(m)-2(b) (as amended).
1.3 ADP TEST. ADP Test means the actual deferral percentage test
which the Plan Administrator shall perform as of the last day of each Plan Year
to determine the extent to which the contributions which each Highly
Compensated Eligible Employee elects to make from his Before-Tax Compensation
for such Plan Year in fact can be made, and such test shall be satisfied only
if one of (a) or (b) is met:
(a) The Actual Deferral Percentage (as defined in subsection (c))
for all Highly Compensated Eligible Employees does not exceed
one-hundred twenty-five percent (125%) of the Actual Deferral
Percentage for all Lower Paid Eligible Employees, or
(b) The excess of the Actual Deferral Percentage (as defined in
subsection (c)) for all Highly Compensated Eligible Employees
over the Actual Deferral Percentage for all Lower Paid
Eligible Employees is not more than two percentage points, and
the Actual Deferral Percentage for all Highly Compensated
Eligible Employees is not more than 2.0 times the Actual
Deferral Percentage for all Lower Paid Eligible Employees,
where
(c) The term Actual Deferral Percentage means as to all Highly
Compensated Eligible Employees and all Lower Paid Eligible
Employees for each Plan Year, the average of the ratios,
calculated separately for each Eligible
<PAGE> 8
- 3 -
Employee in each such group, of (1) the GNP Basic Contributions
and the amount of his Before-Tax Compensation to be credited
for such Plan Year to his Before-Tax Employee Account to (2)
his "compensation" for that part of such Plan Year during which
contributions might have been made under the terms of this Plan
on his behalf from his Before-Tax Compensation. For purposes
of this section, "compensation" shall be determined in
accordance with Code Section 414(s). The Employer may elect to
include compensation which is not currently includable in the
Participant's gross income by reason of the application of Code
Section 125 or 402(a)(8) provided such election is made
consistently among all Participants.
In any Plan Year in which the "2.0 times, but not
more than two percentage points" alternative (described in
paragraph (b) of both Section 1.2 and Section 1.3) must be
utilized to pass both the ACP Test (as described in Section
1.2) and the ADP Test (as described in Section 1.3) the sum of
the Actual Contribution Percentage ("ACP") and the Actual
Deferral Percentage ("ADP") for Highly Compensated Eligible
Employees shall not exceed the greater of:
(A) (i) 1.25 times the greater of the ACP or ADP for
Lower Paid Eligible Employees plus
(ii) 2 percent plus (but not more than two times)
the lesser of the ACP or ADP for Lower Paid
Eligible Employees;
(B) (i) 1.25 times the lesser of the ACP or ADP for
Lower Paid Eligible Employees plus
(ii) 2 percent plus the greater of (but not more
than two times the lesser of) the ACP or ADP
for Lower Paid Eligible EmPloyees; or
(C) the maximum permitted by the Multiple Use Test set
forth in Proposed Treasury Regulation Section
1.40(m)-2(b) (as amended by Revenue Procedure 89-65
and as from time to time further amended).
1.4 AFFILIATE. Affiliate means:
(a) Any parent, subsidiary or brother-sister corporation which is
a member of a controlled group of corporations (as defined in
Code Section 1563(a), disregarding Sections 1563(a)(4) and
1563(e)(3)) of which the Plan Sponsor is a member,
<PAGE> 9
- 4 -
(b) Any trade or business, whether or not incorporated, which is
considered to be under common control with the Plan Sponsor
under regulations prescribed by the Secretary of the Treasury
pursuant to Code Section 414(c) and
(c) Any person or organization which is a member of an affiliated
service group (as defined in Code Section 414(m)) with the
Plan Sponsor; provided, solely for purposes of Section 3.5,
the phrase "more than fifty percent (50%)" shall be
substituted for "at least eighty percent (80%)" each place
that "at least eighty percent (80%)" appears in Code Section
1563(a)(1).
1.5 AFTER-TAX CONTRIBUTION. After-Tax Contribution means that
part of a Participant's Compensation that a Participant (other than a
Participant described in Section 1.30(b)) may elect to contribute to the Plan
under Section 3.3, and which is includable in the Participant's gross income.
1.6 AFTER-TAX EMPLOYEE ACCOUNT. After-Tax Employee Account means
the sub-Account described in Section 3.3.
1.7 BEFORE-TAX CONTRIBUTIONS. Before-Tax Contributions mean that
part of a Participant's Compensation which the Plan Administrator contributes
to this Plan on his behalf under Section 3.2(a) (to the extent such
contributions are credited to his Before-Tax Employee Account) and which his
Employer is not required to report as his taxable income to the Internal
Revenue Service on its Form W-2 or on any successor or substitute form solely
by reason of the application of Code Section 401(k).
1.8 BEFORE-TAX EMPLOYEE ACCOUNT. Before-Tax Employee Account
means the sub-Account described in Section 3.2.
1.9 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 (in equal shares, where more than one):
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
<PAGE> 10
- 5 -
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.
1.10 BOARD. Board means the Board of Directors of the Plan
Sponsor.
1.11 BREAK IN SERVICE. Break in Service means a period of absence
from employment as described in Section 2.
1.12 CODE. Code means the Internal Revenue Code of 1986, as
amended, or any successor statute (in the event an amendment to the Code
renumbers a section of the Code referred to in this Plan, any such reference to
such section automatically shall become a reference to such section as
renumbered) and the rulings and regulations promulgated thereunder.
1.13 COMPENSATION. Compensation means the total salary and other
compensation earned by an Eligible Employee during each Plan Year according to
the records of his Employer, including those amounts or payments approved by
the Plan Administrator in a uniform and nondiscriminatory manner that are
provided under a severance agreement between an Eligible Employee and an
Employer and are received in periodic installments:
(a) As determined without regard to whether his Employer is
required to report such salary and other compensation as
taxable income to the Internal Revenue Service on its Form W-2
or on any successor or substitute form or is not required to
so report such salary and other compensation solely by reason
of the application of Code Section 401(k) to the contributions
made on his behalf under this Plan from his Before-Tax
Compensation; and
(b) as determined by excluding:
(1) All contributions made by his Employer on his behalf
to any employee benefit plan except for the
contributions made under this Plan from his
Before-Tax Compensation;
(2) Any sum paid to or on behalf of an Eligible Employee
as a reimbursement of expenses or any other payments
made to him by reason of, or in connection with, the
transfer of the Eligible Employee to a different work
location, other expense reimbursements, bonuses
related to the use of company cars or other vehicles,
or any other payments made to him which are entitled
to special federal tax treatment;
<PAGE> 11
- 6 -
(3) Any compensation to the Eligible Employee which
results from any option granted to him to purchase
common stock of Bowater Incorporated; and
(4) Any compensation paid to the eligible Employee
pursuant to any incentive compensation or bonus plan
or program except to the extent the terms of such
plan or program expressly state that such
compensation shall be taken into account under this
Plan; and
(5) Any compensation payment of which has been deferred
to a future year.
Notwithstanding anything in this Section 1.13 to the contrary, for purposes of
Section 3, accrued Compensation in excess of $200,000.00 and monthly
compensation in excess of $16,666.66 shall not be taken into account, provided
the foregoing limitations shall be modified automatically to reflect the
cost-of-living adjustments provided in Code Sections 401(a)(17) and 415(d).
Effective on and after January 1, 1994 the $200,000 annual
Compensation limitation described above shall be limited to $150,000.00,
adjusted for changes in the cost-of-living as provided in Section 415(d) of the
Code in $10,000 increments rounded down to the nearest $10,000, for benefit
accruals commencing on and after such date.
1.14 CURRENT OR ACCUMULATED PROFITS. The Employer's net profits
determined in accordance with generally accepted accounting principles before
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 the Plan Sponsor or any other Employer to the extent
of the current or accumulated net profits of the Plan Sponsor or such Employer
that remain after the Plan Sponsor's contributions to other plans to which it
is obligated or permitted to contribute, or 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.
1.15 ELIGIBLE EMPLOYEE. Eligible Employee means for each Plan Year
each Employee of an Employer who is employed within the United States of
America by an Employer on a regular salary basis other than an Employee who is
treated as such solely by reason of the "leased employee" rules set forth in
Code Section 414(n).
1.16 EMPLOYEE. Employee means for each Plan Year each person who
is an employee under common law of the Employer or one, or more than one,
Affiliate and each
<PAGE> 12
- 7 -
person who is treated as an employee of the Employer or one, or more than one,
Affiliate by reason of the "leased employee" rules set forth in Code Section
414(n).
1.17 ERISA. ERISA means the Employee Retirement Income Security
Act of 1974, as amended, or any successor statute (in the event an amendment to
ERISA renumbers a section of ERISA referred to in this Plan, any such reference
to such section automatically shall become a reference to such section as
renumbered), and the rulings and regulations promulgated thereunder.
1.18 EMPLOYER. Employer means GNP and each Affiliate which the
Plan Sponsor designates in writing as such from time to time and which adopts
the Plan.
1.19 GNP. GNP means Great Northern Paper, Inc., a Delaware
corporation, and any successor to such corporation.
1.20 GNP BASIC CONTRIBUTIONS. GNP Basic Contributions means the
contributions made by GNP in accordance with Section 3.1.
1.21 GNP BASIC CONTRIBUTION ACCOUNT. GNP Basic Contribution
Account means the sub-Account to which GNP Basic Contributions are credited.
1.22 GNP MATCHING ACCOUNT. GNP Matching Account means the
sub-Account to which GNP Matching Contributions are credited.
1.23 GNP MATCHING CONTRIBUTIONS. GNP Matching Contributions means
the contributions made by GNP in accordance with Section 3.2(b).
1.24 HIGHLY COMPENSATED ELIGIBLE EMPLOYEE. Highly Compensated
Eligible Employee means any Eligible Employee who has satisfied the employment
requirement for participation set forth in Sections 2.2 and who during the Plan
Year for which the determination is being made or the next preceding Plan Year:
(a) Was at any time a five percent (5%) owner of an Employer (as
defined in Code Section 416(i)(1));
(b) Received compensation from Employers in excess of $75,000.00;
(c) Received compensation in excess of $50,000.00 and was included
in the group consisting of the top twenty percent (20%) of the
Employees ranked on the basis of compensation; or
(d) Was at any time an officer and received compensation greater
than fifty percent (50%) of the defined benefit plan
limitation of Code Section 415(b)(1)(A) for the affected Plan
Year.
<PAGE> 13
- 8 -
Provided, however, that notwithstanding the foregoing:
(e) The determination of which Eligible Employees are Highly
Compensated Eligible Employees shall at all times be subject
to the rules of Code Section 414(q).
(f) The maximum number of officers taken into account under
subsection (d) above shall not exceed fifty (50);
(g) Eligible Employees who were not described in subsections (b),
(c) or (d) during the next preceding Plan Year shall not be
considered as described in such subsections for the
determination Plan Year unless the Eligible Employee is a
member of the group consisting of the one hundred (100)
Employees paid the greatest compensation for the determination
Plan Year.
(h) "Compensation" for purposes of this Section 1.24 shall be
determined in accordance with Code Section 415(c)(3), provided
that elective Before-Tax Contributions shall be included in
"compensation".
(i) A Former Employee shall be treated as a Highly Compensated
Eligible Employee if he was a Highly Compensated Eligible
Employee upon separation or was a Highly Compensated Eligible
Employee at any time after attaining age fifty-five (55).
(j) If an individual is a member of the family (as defined in Code
Section 414(q)(6)(B)) of an Eligible Employee who is described
in subsection (a) or who is a member of the group consisting
of the ten (10) Highly Compensated Eligible Employees having
the greatest compensation for the Plan Year, for purposes of
this Section 1.24, the individual will not be considered a
separate Employee, and the compensation of such individual
shall be included in the compensation of the Eligible
Employee.
1.25 HOUR OF SERVICE. Hour of Service means each hour for which an
Employee is paid, or entitled to payment, as more fully defined in Section 2.3.
1.26 INVESTMENT FUND. Investment Fund means the funds set forth in
Section 4.1, and shall mean such funds as established within the Trust Fund
from time to time at the direction of the Plan Sponsor in accordance with
Section 4.1 for the investment of the assets held under the Trust Fund.
Prior to January 1, 1993, Investment Fund was defined as the
Georgia-Pacific Stock Fund, the Bowater Incorporated Stock Fund, the Interest
Income Fund, the Common Stock Fund, and the Loan Fund.
<PAGE> 14
- 9 -
1.27 INVESTMENT MANAGER. Investment Manager means any person who
comes within the definition of an "investment manager" under Section 3(38) of
ERISA and who is appointed as such by (or at the direction of) the Plan Sponsor
pursuant to Article VII to direct the investment of all or any part of one, or
more than one, Investment Fund.
1.28 LEAVE OF ABSENCE. Leave of Absence means an absence
authorized by the Employer under its standard personnel practices as applied in
a uniform and non-discriminatory manner to all persons similarly situated,
provided the Employee resumes employment with the Employer within the period
specified in the authorization of the leave of absence.
1.29 LOWER PAID ELIGIBLE EMPLOYEE. Lower Paid Eligible Employee
means for each Plan Year each Eligible Employee (other than a Highly
Compensated Eligible Employee) who has satisfied the employment requirement for
participation set forth in Sections 2.1 and 2.2 for such Plan Year.
1.30 PARTICIPANT. Participant means for any Plan Year:
(a) An Employee who has met the requirements set forth under
either Sections 2.1 or 2.2; or
(b) A person for whom an Account continues to exist under this
Plan.
1.31 PLAN. Plan means the Great Northern Paper, Inc. Savings and
Capital Growth Plan as set forth in this document and as it may, from time to
time, be amended.
1.32 PLAN ADMINISTRATOR. Plan Administrator means the Plan
Administrator appointed and acting in accordance with Article VII.
1.33 PLAN SPONSOR. Plan Sponsor means Bowater Incorporated, a
corporation organized and existing under the laws of the State of Delaware and
which owns at least 80% of the common stock of GNP.
1.34 PLAN YEAR. Plan Year means the calendar year.
1.35 SERVICE. Service means employment and certain absences from
employment taken into account for vesting and other purposes under the Plan as
more fully described in Section 2.3.
1.36 SEVERANCE DATE. Severance Date means the date as of which an
Employee is deemed to have severed his employment relationship, as more fully
described in Section 2.3(a)(5).
<PAGE> 15
- 10 -
1.37 TRUST AGREEMENT. Trust Agreement means the Master Trust
Agreement between Bowater Incorporated and Fidelity Management Trust Company
dated as of July 1, 1994.
1.38 TRUST FUND. Trust Fund means the assets held by the Trustee
in accordance with the Trust Agreement.
1.39 TRUSTEE. Trustee means 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 its successors.
1.40 VALUATION DATE. Valuation Date means the last business day of
each calendar quarter (and any other date specified by the Trustee), on which
the Trust Fund is valued in accordance with Article IV. As to Accounts
maintained in any Investment Fund which is valued daily, each business day may
be deemed to be a Valuation Date. A Comprehensive Valuation Date is one on
which all Investment Funds are valued.
<PAGE> 16
- 11 -
ARTICLE II
PARTICIPATION REQUIREMENTS
2.1 CAPITAL GROWTH PART - GNP BASIC CONTRIBUTIONS.
(a) General Rule. Each Eligible Employee who is employed as such
on the Effective Date, or on the first day of any Plan Year thereafter will
satisfy the participation requirement for GNP Basic Contributions until his
employment as an Employee thereafter terminates.
(b) Reemployment. A former Eligible Employee who is reemployed as
an Employee on or before the fifth (5th) anniversary of the date of his
Severance Date or who previously had a nonforfeitable interest in his Account
under this Plan will be deemed to have satisfied the membership requirement set
forth in Section 2.1(a) immediately upon his reemployment while each other
reemployed former Eligible Employee will be required to satisfy the
participation requirement set forth in Section 2.1(a) as if he was a new
Employee.
2.2 SAVINGS PART - BEFORE-TAX AND AFTER-TAX CONTRIBUTIONS.
(a) General Rule. Each Eligible Employee who is employed as such
on the first day of a calendar month following the completion of one (1) year
of continuous employment with the Employer and/or its Affiliates, (including
Service credited pursuant to the terms of Section 11.3) and who completes and
delivers a timely Election Form in accordance with Section 3.4 will be deemed
to have satisfied the participation requirements to make Before-Tax
Contributions or After-Tax Contributions from his Compensation until the date
his election to make such contributions terminates in accordance with Section
3.4 or Section 5.2(a)(2)(C).
(b) Subsequent Elections. An Eligible Employee whose election to
make Before-Tax Contributions and After-Tax Contributions terminates in
accordance with Section 3.4 shall automatically satisfy the participation
requirement set forth in Section 2.2(a) as of the first day of the first
calendar month thereafter on which he is again an Eligible Employee and he
completes and delivers a timely Election Form in accordance with Section 3.4 to
make such contributions; if eligibility to make Before-Tax Contributions
terminates in accordance with Section 5.2(a)(2)(C), contributions will
recommence as described in that section.
2.3 CALCULATION OF SERVICE. The purpose of this Section 2.3 is to
describe the manner in which Service is calculated for purposes of vesting and
eligibility for certain retirements.
(a) For purposes of this Section 2.3, and for all purposes of the
Plan, the following terms shall have the designated meanings:
<PAGE> 17
- 12 -
(1) Break in Service. A Severance Period of at least
twelve (12) consecutive months during which an
Employee fails to perform an Hour of Service,
beginning on the Employee's Severance Date; provided,
however, that the first twelve (12) consecutive month
period of absence from work after a Severance Date
shall not be included within a Break in Service if
such absence is for maternity or paternity reasons.
(This provision, however, shall not be construed to
grant an individual any right to a Leave of Absence
for any reason.) An absence from work for maternity
or paternity reasons means an absence:
(A) By reason of the pregnancy of the individual,
(B) By reason of the birth of a child of the
individual,
(C) By reason of the placement of a child with
the individual in connection with the
adoption of such child by such individual, or
(D) For purposes of caring for such child for a
period beginning immediately following such
birth or placement.
(2) Employment Date. The date on which an Employee first
completes an Hour of Service.
(3) Hour of Service. "Hour of Service" shall mean each
of the following applied without duplication:
(A) Each hour for which an Employee is paid, or
entitled to payment, for the performance of
duties for an Employer or Affiliate. These
hours shall be credited to the Employee for
the computation period or periods in which
the duties are performed.
(B) Each hour for which back pay, irrespective of
mitigation of damages, is either awarded or
agreed to by an Employer or Affiliate. These
hours shall be credited to the computation
period or periods to which the award or
agreement pertains rather than the
computation period in which the award,
agreement or payment is made.
Provided, however, that:
<PAGE> 18
- 13 -
(C) An hour for which an Employee is paid, or
entitled to payment, on account of a period
when he performs no duties as an Employee
shall not be credited as an Hour of Service
if such payment is made or is due under a
plan maintained solely to comply with
applicable unemployment compensation laws,
and
(D) An Hour of Service shall not be credited to
an Employee on account of a payment which
solely reimburses such Employee for medical,
or medically-related, expenses incurred by or
on behalf of the Employees.
(4) Reemployment Date. The date on which an Employee
first completes an Hour of Service after a Severance
Date.
(5) Severance Date. The earlier of:
(A) The date on which an Employee quits, retires
(including retirement for disability under
Section 5.1(b)), is discharged or dies; or
(B) The first anniversary of the first date of a
period in which an Employee remains absent
from service with an Employer or Affiliate
(with or without pay) for any reason (such as
vacation, holiday, sickness, Leave of Absence
or layoff) other than those specified in
clause (A) of this Section 2.3(a)(5).
(6) Severance Period. Each period from an Employee's
Severance Date to his next Reemployment Date.
(b) Subject to the provisions of Sections 2.3(f), for the period
preceding January 1, 1989, an Employee shall be credited with
Service under this Plan at least equal to the Vesting Service
the Employee had accrued under the G-P Plan (as that term is
defined in Section 11.1) through December 31, 1988, determined
under the provisions of the G-P Plan then in effect.
(c) Subject to the provisions in Sections 2.3(d), (e) and (f) (and
11.2 and 11.3 with respect to prior employment with Georgia-
Pacific Corporation, for the period from and after January 1,
1989), an Employee shall be credited with Service in an amount
equal to the aggregate of the following (applied without
duplication):
(1) Each period from an Employee's Employment Date (or
Reemployment Date) to his next Severance Date; and
<PAGE> 19
- 14 -
(2) If an Employee performs an Hour of Service within
twelve (12) months of a Severance Date, the period
from such Severance Date to such Hour of Service; and
(3) In the case of an Employee who leaves employment to
enter service with the armed forces of the United
States, the period of such military service, provided
that the Employee resumes employment with the
Employer or Affiliate within the period during which
his reemployment rights are protected by applicable
law.
(d) If an Employee incurs a Break in Service, his Service in
respect of all periods before such Break in Service shall be
forfeited and disregarded for all purposes of the Plan and he
shall have no rights under the Plan (other than rights in
which he was vested prior to such Break in Service). Upon
reemployment, he shall be enrolled as a Participant effective
on his Reemployment Date (or, if later, the first day
thereafter on which he meets the requirements of Section 2.2),
and his Service in respect of all periods before such Break in
Service shall be restored to him unless disregarded under
Section 2.3(e).
(e) If the Employee had no vested rights under the Plan prior to
such Break in Service, and if the length of such Break in
Service equals or exceeds his Service prior to such Break in
Service, then his Service in respect of all periods before
such Break in Service shall thereafter be irrevocably
forfeited and disregarded for all purposes of the Plan.
Notwithstanding the foregoing, no such irrevocable forfeiture
shall occur unless the Break in Service equals or exceeds five
(5) consecutive years; provided that if, as of December 31,
1984, an individual's pre-Break in Service credit or benefits
were cancelled (or would have been cancelled if he had
returned to employment on such date) under the provisions of
the predecessor to the G-P Plan as then in effect, the
foregoing sentence shall not require such service or benefits
to be restored or otherwise taken into account under the Plan.
The Service prior to a Break in Service taken into account
under the preceding provisions of this Section 2.3 shall
exclude any period which may be disregarded by reason of a
prior application of this Section 2.3 (or corresponding
provisions of the G-P Plan and its predecessor plans as in
effect, prior to January 1, 1989).
(f) In no event shall there be any duplication of the Service of
any Employee attributable to the same period of time.
2.4 NOT A CONTRACT OF EMPLOYMENT. This Plan does not constitute a
contract of employment, and participation in this Plan shall not give any
person the right to be retained in the employ of the Employer or any Affiliate
as an Eligible Employee or as an Employee or, upon the termination of such
employment, to have any interest or right in the Trust Fund other than as
expressly set forth in this Plan.
<PAGE> 20
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ARTICLE III
CONTRIBUTIONS
3.1 CAPITAL GROWTH PART - GNP BASIC CONTRIBUTIONS.
(a) General Rules. Subject to the rules set forth in this Section
3.1 and in Section 3.5 (Section 415 Limitations), the Employer shall make a
contribution from its Current or Accumulated Profits for each Eligible Employee
who has satisfied the participation requirement for such contribution which is
equal to three percent (3%) of the first $100,000.00 of his Compensation for
such Plan Year, provided
(1) He has completed one (1) year of Service (including
Service credited pursuant to Section 11.3) in such
Plan Year and
(2) He was an Eligible Employee on the last day of such
Plan Year.
(b) Exceptions.
(1) Insufficient Earnings and Profits. If the Current
and Accumulated Profits of the Employer are
insufficient to make the full contribution called for
under Section 3.1(a) for each such Eligible Employee,
the Employer shall make a contribution under Section
3.1(a) which is equal to such Current and Accumulated
Profits and the three percent (3%) figure set forth
in Section 3.1(a) shall be reduced accordingly.
(2) Employment Requirements. The employment requirements
set forth in Sections 3.1(a)(1) and 3.1(a)(2) shall
not apply for a Plan Year to an Eligible Employee
whose employment during such Plan Year terminates by
reason of death or disability (as described in
Section 5.1(b)(2)) or whose employment terminates
after either reaching at least age sixty (60) or
reaching at least age fifty-five (55) and completing
at least ten (10) years of Service. Provided,
however, that in determining whether an Eligible
Employee's employment has terminated during a Plan
Year, any period for which the Participant receives
vacation pay shall be considered a continuation of
service.
(3) Transfer from Hourly to Salaried Status. An Employee
who was employed as such on the first day of a Plan
Year and who becomes an Eligible Employee during such
Plan Year as a result of a transfer from hourly to
salaried status shall be deemed to satisfy the
participation requirement for the GNP Basic
Contributions for such Plan Year.
(4) An Employee who is rehired by an Employer, who is an
Eligible Employee on his Reemployment Date (as
defined in Section 2.3(a)(4))
<PAGE> 21
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and whose service is restored at such time pursuant to
Sections 2.3(d) and (e) will be deemed to have
met the requirement of Section 3.1(a)(1) for the Plan
Year in which his Reemployment Date occurs.
(5) Highly Compensated Eligible Employees.
Notwithstanding anything in Section 2.1 or this
Section 3.1 to the contrary, the Plan Administrator
reserves the right to reduce or eliminate the GNP
Basic Contribution and/or Before-Tax Contributions,
After-Tax Contributions and GNP Matching
Contributions with respect to Highly Compensated
Eligible Employees for a given Plan Year. Any such
modification shall be in the form of uniform
reduction(s) of the same type(s) of contribution
percentage(s) applied first to all such employees
whose contributions of that type are at the highest
percentage of Compensation for the Plan Year in
question, then applied to additional such employees
by progressing downward one percentage point at a
time to the desired percentage of Compensation level.
(c) Account. The GNP Basic Contributions made on behalf of each
Eligible Employee shall be credited by, or at the direction
of, the Plan Administrator to his GNP Basic Contribution
Account as of the last day of the Plan Year for which such
contributions are made, and an Eligible Employee's interest in
his GNP Basic Contribution Account shall be nonforfeitable.
3.2 SAVINGS PART - BEFORE-TAX CONTRIBUTIONS AND GNP MATCHING
CONTRIBUTIONS.
(a) Before-Tax Contributions.
(1) Percentage. Subject to the rules set forth in this
Section 3.2(a) and in Sections 3.4 (Election Rules)
and 3.5 (Section 415 Limitations), an Eligible
Employee who has satisfied the participation
requirement set forth in Section 2.2 may elect that
the Employer make contributions on his behalf from
his before-tax compensation in one percent (1%)
increments of his Compensation, from one percent (1%)
to ten percent (10%) of such Compensation, provided
that such contribution when added to the Eligible
Employee's After-Tax Contributions (if any) under
Section 3.3(b) may not exceed the lesser of $7,000
(adjusted annually for changes in the cost-of-living
pursuant to Section 402(g)(5) of the Code), or 16% of
Compensation. All such contributions shall be made
by the Employer exclusively through payroll
withholding, and such contributions shall be
transferred by the Employer to the Trustee as soon as
practicable after the end of the payroll period from
which such contributions are withheld.
Notwithstanding anything in this subparagraph (1) to
the contrary, Before-Tax Contributions shall be
<PAGE> 22
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withheld on a monthly basis on the last day of each
calendar month and may not exceed for any month
one-twelfth (1/12th) of the elective deferral
limitation amount specified for each Plan Year
pursuant to Code Sections 402(g)(1) and (5); provided
that if the cost of living adjustment under Code
Section 402(g)(5) is not announced until after the
beginning of the affected Plan Year, the Employer may
adjust the maximum monthly deferral on a prospective
basis so that the maximum amount of authorized
deferrals for the Plan year equals the elective
deferral limitation under Code Section 402(g) for that
year; provided, further, that in the event an Eligible
Employee is paid on other than a monthly basis,
Before-Tax Contributions may be withheld at the end of
each payroll period subject to the monthly elective
deferral limitation described above.
(2) ADP Test and Account Credits. Notwithstanding the
foregoing, in the event that the Employer estimates
that the Actual Deferral Percentage (as defined in
Section 1.3(a)) for all Highly Compensated Eligible
Employees for a given Plan Year may not satisfy the
ADP Test (including the Multiple Use Test, if
applicable), it may, without notice or requirement of
consent by the Participant or the Participant's
spouse, take any of the following actions (or any
combination of the following actions) to assure that
the ADP Test is satisfied for that Plan Year:
(A) The Employer may direct the Trustee to
distribute to the Participant some or all of
the excess contributions (together with
income allocable to the excess contributions)
on or before the end of the Plan Year
following the Plan Year for which they were
made. Such distribution must be specifically
designated by the Employer as distribution of
excess contributions (and related income).
For purposes of this subparagraph (A),
"excess contributions" and "income allocable
to excess contributions" shall be defined as
specified in regulations under Code Section
401(k)(8).
(B) The Plan Administrator may exercise its right
under Section 3.1(b)(5)to reduce
contributions for Highly Compensated Eligible
Employees for the affected Plan Year.
(3) Conversions. The Employer shall have the right in
the exercise of its absolute discretion to make an
additional contribution under Section 3.1 from its
Current or Accumulated Profits on behalf of all Lower
Paid Eligible Employees for such Plan Year for whom
Before-Tax Contributions were made for the last
calendar month of such Plan Year and who are Eligible
Employees on the last day of such Plan Year in
<PAGE> 23
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an amount which will result in satisfying the ADP Test
for such Plan Year, and such contribution shall be
divided and allocated as of such date equally among
the GNP Basic Contribution Accounts of such Lower Paid
Eligible Employees.
(4) Nonforfeitable Interest. A Participant's interest in
contributions which are credited to his Before-Tax
Employee Account shall be nonforfeitable.
(5) Designation. No contribution credited to an Eligible
Employee's Before-Tax Employee Account shall be
"designated" as an "employee contribution" within the
meaning of Code Section 414(h)(1).
(b) GNP Matching Contributions.
(1) Percentage. Subject to the rules set forth in this
Section 3.2(b) and Section 3.5 (Section 415
Limitations), the Employer shall as of the last day
of each calendar month in each Plan Year make a
contribution from its Current or Accumulated Profits
on behalf of each Eligible Employee on whose behalf
contributions tentatively or actually were credited
as of each such date to his Before-Tax Employee
Account or After-Tax Employee Account which, together
with the forfeitures under Section 5.1(d)(2), shall
equal (i) seventy-five percent (75%) of the
contributions (taking into account contributions up
to three percent (3%) of such Eligible Employee's
Compensation only) tentatively or actually credited
to his Before-Tax Employee Account as of such date,
plus (ii) fifty percent (50%) of the contributions
(taking into account contributions in excess of three
percent (3%), but no more than six percent (6%) of
such Eligible Employee's Compensation only)
tentatively or actually credited to his Before-Tax
Employee Account as of such date.
(2) Insufficient Profits. If the Employer after making the
contribution called for under Section 3.1 has insufficient
Current and Accumulated Profits to make the full contribution
called for under Section 3.2(b)(1), the Employer shall make
such contributions to the extent of such Current and
Accumulated Profits and the fifty percent (50%)/seventy-five
percent (75%) percentages set forth in Section 3.2(b)(1) shall
be reduced accordingly.
(3) ACP Test and Accounting Credits. The GNP Matching
Contributions made on behalf of each Eligible Employee as of
the last day of each calendar month in each Plan Year
tentatively shall be credited by, or at the direction of, the
Employer to his GNP Matching Account as of such date pending
the completion of the ACP Test for such Plan Year.
Notwithstanding the
<PAGE> 24
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foregoing, in the event that the Employer estimates that the
Actual Contributions Percentage (as defined in Section 1.2(a))
for all Highly Compensated Eligible Employees for a given Plan
Year may not satisfy the ACP Test (including the Multiple Use
Test, if applicable), it may (and in the case of subparagraph
(A), shall), without notice or requirement of consent by the
Participant or the Participant's spouse take any of the
following actions (or any combination of the following actions)
to assure that the ACP Test is satisfied for that Plan Year:
(A) The Employer shall treat tentative GNP Matching
Contributions (subject to an adjustment for
investment gains or losses allocable to such
tentative credit) for Highly Compensated Eligible
Employees for the Plan Year in question which are not
vested as forfeitures under Section 5.1(d)(2) to the
extent necessary to meet the ACP Test.
(B) The Employer may direct the Trustee to distribute to
the Participant some or all of the excess aggregate
contributions (together with income allocable to the
excess aggregate contributions) on or before the end
of the Plan Year following the Plan Year for which
they were made. Such distribution must be
specifically designated by the Employer as
distribution of excess aggregate contributions (and
related income). For purposes of this subparagraph
(B), "excess aggregate contributions" and "income
allocable to excess aggregate contributions" shall be
defined as specified in regulations under Code
Section 401(m)(6).
A Participant's nonforfeitable interest in the GNP Matching Contributions (and
in the investment gains and losses allocable to such contributions) actually
credited to his GNP Matching Account shall be determined under Section 5.1.
3.3 SAVINGS PART - AFTER-TAX CONTRIBUTIONS.
(a) Prior to 1988. After-Tax Contributions were permitted
pursuant to the G-P Plan (as described in Section 11.1). Such
contributions have been transferred to this Plan. Amounts
contributed to the G-P Plan before 1988 as After-Tax
Contributions and earnings thereon shall continue to be held
in existing fully-vested After-Tax Employee Accounts subject
to the provisions of this Plan applicable to such accounts.
(b) On and After January 1, 1993.
(1) On and after January 1, 1993, subject to the rules
set forth in this Section 3.3, and Sections 3.4
(Election Rules) and 3.5 (Section 415 Limitations),
an Eligible Employee who has satisfied the
participation requirements set forth in Section 2.2
may elect to contribute from 1%
<PAGE> 25
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to 16% of his Compensation, provided that such
After-Tax Contribution, when added to an
Eligible Employee's Before-Tax Contributions (if any)
under Section 3.2(a) may not exceed 16% of
Compensation.
All such contributions shall be made by the
Employer exclusively through payroll withholding, and
such contributions shall be transferred by the
Employer to the Trustee as soon as practicable after
the end of the calendar month which includes the end
of the payroll period from which such contributions
are made. After-Tax Contributions shall be withheld
on a monthly basis on the last day of each calendar
month.
(2) ACP Test. After-Tax Contributions are subject to the
ACP Test. In the event that the Employer estimates
that the Actual Contribution Percentage (as defined
in Section 1.2(a)) for all Highly Compensated
Eligible Employees for a given Plan Year may not
satisfy the ACP Test (including the Multiple Use
Test, if applicable), it may, without notice or
requirement of consent by the Participant or the
Participant's spouse, take any of the following
actions (or any combination of the following actions)
to assure that the ACP Test is satisfied for that
Plan Year:
(A) The Employer may refuse to accept, on a
prospective basis, any or all of a
Participant's After-Tax Contributions.
(B) The Employer may direct the Trustee to
distribute to the Participant some or all of
the excess aggregate contributions (together
with income allocable to the excess aggregate
contributions) on or before the end of the
Plan Year following the Plan Year for which
they were made. Such distribution must be
specifically designated by the Employer as a
distribution of excess aggregate
contributions (and related income). For
purposes of this subparagraph (A), "excess
aggregate contributions" and "income
allocable to excess aggregate contributions"
shall be defined as specified in regulations
under Code Section 401(m)(6).
The provisions for the return of After-Tax
Contributions under this Section 3.3(b)(2)
shall apply prior to the application of any
similar provisions under Section 3.2(b)(3)
for GNP Matching Contributions.
3.4 ELECTION RULES. Each Eligible Employee who has satisfied the
participation requirements set forth in Section 2.2 may elect to have GNP make
Before-Tax
<PAGE> 26
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Contributions on such Employee's behalf under Section 3.2(a) and such Employee
may elect to make After-Tax Contributions under Section 3.3(b) as of the first
day of any month, provided the Eligible Employee properly completes and
delivers the related Election Form to the Employer on or before the fifteenth
(15th) day of the immediately preceding month (or at any other time and in any
other manner deemed appropriate by the Plan Administrator). The Employer shall
have the right to reject any Election Form (or any other form of election
approved by the Plan Administrator) which is not properly completed or which is
not timely delivered. An election, once effective, can be changed effective as
of the first day of a subsequent month, provided the Eligible Employee
completes and delivers the related Election Form to the Employer on or before
the fifteenth (15th) day of the immediately preceding month (or at any other
time and in any other manner deemed appropriate by the Plan Administrator).
However, an Eligible Employee shall have the right to terminate Before-Tax or
After-Tax Contributions under Section 3.2(a) or 3.3(b) respectively, during a
calendar month, and any such termination shall become effective as soon as
practicable after the Eligible Employee completes and delivers the related
Election Form to the Employer. Any Eligible Employee whose status as such
terminates or whose employment as an Employee terminates shall be deemed to
have completed and delivered an Election Form to terminate such contributions
as of the date his status or his employment so terminates.
3.5 SECTION 415 LIMITATIONS.
Notwithstanding any other provisions of the Plan, for each Plan Year
beginning on and after January 1, 1987, "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
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 3.1, 3.2(b) and 4.1;
2. Tax-Deferred Employee Contributions and
After-Tax Employee Contributions allocated to
the Participant's Accounts under Sections 3.2
and 3.3;
(ii) The initial Maximum Permissible Dollar Amount shall
be $30,000, and the initial Maximum Permissible
Benefit shall be $90,000. The limitations 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) and Section
<PAGE> 27
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415(b)(1)(A) of the Code, respectively, are adjusted
for the cost of living in accordance with
Section 415(d) of the Code.
(iii) For purposes of this Section, the term "compensation"
shall mean the amount paid to the Employee by the
Employer during the Plan Year, excluding Tax-Deferred
Employee Contributions under Section 3.2.
(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 contributions made under all such defined
contribution plans in which the Participant has been
a participant were made to 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 Participant's Tax-Deferred
Employee Contributions;
(ii) Discontinue or reduce the Participant's After-Tax
Employee Contributions for the Plan Year.
(iii) Instruct the Trustee to return all or a portion of
the Employee's After-Tax Employee Contributions made
during the Plan Year;
(iv) Instruct the Trustee to return all or a portion of
the Employee's Tax-Deferred Employee Contributions
made during the Plan Year;
(v) Instruct the Employer to reduce or eliminate its
Employer Contributions to the Participant's Accounts
for the remainder of the Plan Year;
(vi) Instruct the Trustee to return to the Employer all or
a portion of the Employer Contributions made to the
participant's Accounts for the Plan Year;
(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.
If that Participant is not covered by the Plan as of the end of the
Plan Year, the Committee shall hold such excess amounts unallocated in a
suspense account for the Plan
<PAGE> 28
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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 3.5 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.
For purposes of this subsection, excess amounts may not be distributed
to Participants or former Participants.
The above actions shall not be considered a termination of Participant
contributions as provided in Section 3.4.
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 for use as a guide to the interpretation of the foregoing provisions.
3.6 COMBINED PLANS LIMITATION. In any case in which a Participant
in the Plan is also a participant in any defined benefit pension 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" shall 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 Participants 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 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 have the same meaning as
defined in such retirement plans.
<PAGE> 29
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ARTICLE IV
INVESTMENT AND ALLOCATION OF
INVESTMENT GAINS AND LOSSES
4.1 INVESTMENT FUNDS. The Trust Fund initially shall be
subdivided into, and 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:
(a) FUND A. The Plan Sponsor Stock Fund, which invests primarily
in shares of Bowater Incorporated common 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 Bowater Incorporated 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 Bowater
Incorporated stock attributable to Employer Contributions and
Participant Contributions. All participant Contributions
initially invested directly in this Fund pursuant to Section
4.2(b) 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.
(b) Additional Investment Funds: 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. Any such additions,
modifications or deletions shall be communicated to
Participants in advance in order to allow Participants time,
in the Employer's judgment, to make changes in their
investment elections under this Section 4.
(c) 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 Plan
Sponsor 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 Plan Sponsor 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
authorized for the respective Investment Fund or through the
medium of any common, collective
<PAGE> 30
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or commingled trust fund which is invested principally in
securities and obligations authorized for the respective
Investment Fund.
4.2 ELECTIONS.
(a) Investment Elections by Participants. Until December 31,
1994, each participant's GNP Basic Contribution Account shall
be invested exclusively in the Interest Income Fund, and no
Participant shall have the right to elect to invest such
account in any other Investment Fund. Effective July 1, 1994
(except with respect to the direction of investment of GNP
Basic Contributions, as to which the following provisions are
effective January 1, 1995), each Participant must elect by
"Appropriate Notice" (as hereinafter defined) to have all of
his Contributions and his GNP Basic and GNP Matching
Contributions 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 GNP Basic Contribution Account, a GNP Matching Account, a
Before-Tax Employee Account, and an After-Tax Employee Account
shall be established for the Participant in each of the
available Investment Funds in which contributions are invested
on his behalf. 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.
(b) Changes in Current Investment Elections. A Participant may,
by giving prior "Appropriate Notice" (as defined in subsection
(a) above), change his investment election with respect to
contributions received thereafter. Changes in investment
elections must be expressed as revised whole number
percentages of Contributions, totaling 100%. A Participant
may, by giving prior "Appropriate Notice" 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 telephonic 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).
<PAGE> 31
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4.3 ALLOCATION OF INVESTMENT GAINS AND LOSSES. The investment
gains and losses (whether realized or unrealized) for each Investment Fund
shall be determined by, or at the direction of, the Plan Administrator as of
each Valuation Date, and such investment gains shall be credited to each
Account (to the extent invested in each such Investment Fund) and such
investment losses shall be charged against each Account (to the extent invested
in each such Investment Fund) as of such Valuation Date in the same proportion
that the balance to each such Account (to the extent invested in such
Investment Fund) bears to the balance of all Accounts (to the extent invested
in such Investment Fund). Each Account balance shall be determined for this
purpose based on the balance actually or tentatively credited to such account
as of the immediately preceding Valuation Date.
<PAGE> 32
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ARTICLE V
DISTRIBUTIONS, WITHDRAWALS AND LOANS
5.1 DISTRIBUTION EVENTS.
(a) Retirement. A Participant whose employment as an Employee
terminates on or after the date he reaches age sixty (60)
shall be deemed to have retired under this Plan, and the GNP
Matching Account of a Participant who is an Employee on the
date he reaches age sixty (60) shall become nonforfeitable on
such date. The Account of a Participant who retires under
this Plan shall be distributed in accordance with the rules
set forth in Section 5.4.
(b) Disability.
(1) Nonforfeitable. If a Participant's employment as an
Employee terminates because he is treated as being
"disabled" under this Plan, his GNP Matching Account
shall become nonforfeitable on the date his
employment so terminates, and his Account shall be
distributed to him in accordance with the rules set
forth in Section 5.4.
(2) Disabled. A Participant shall be treated as
"disabled" under this Plan if his employment as an
Employee terminates as a result of an illness, injury
or other condition which makes that Participant
eligible to receive benefits under the Bowater
Incorporated Salaried Employees' Long-Term Disability
Plan or which would, in the Plan Administrator's
judgment, make such Participant eligible for such
benefits if he participated in such plan.
(3) Recovery. If a former Participant recovers and is
reemployed as an Eligible Employee after his Account
was distributed to him by reason of his being treated
as "disabled" under this Plan, his nonforfeitable
interest in any GNP Matching Contribution Account
thereafter established for his benefit shall be
determined without regard to the fact that his prior
GNP Matching Account became nonforfeitable under this
Section 5.1(b).
(c) Death. If a Participant dies while an Employee, his GNP
Matching Account shall become nonforfeitable as of his date of
death, and his Account shall be distributed to his Beneficiary
in accordance with the rules set forth in Section 5.4.
<PAGE> 33
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(d) Other Termination of Employment.
(1) Nonforfeitable Interest. If a Participant's
employment as an Employee terminates for any reason
other than retirement, disability or death under this
Section 5.1, his nonforfeitable percentage interest
in his GNP Matching Account shall equal twenty
percent (20%) multiplied by the number of Years of
Service which he completed on or before the date his
employment as an Employee so terminated or one
hundred percent (100%), whichever is less. Such a
Participant's nonforfeitable percentage interest in
his GNP Matching Account and in all his other
Accounts shall be distributed as a result of his
termination of employment in accordance with the
rules set forth in Section 5.4.
(2) Forfeitable Interest. If under this Section 5.1(d)
the nonforfeitable percentage interest of a
Participant in his GNP Matching Account is less than
one hundred percent (100%) on the date his employment
as an Employee terminates, his remaining forfeitable
percentage interest in such account shall be treated
as a forfeiture as of the first Comprehensive
Valuation Date which immediately follows the date his
employment so terminates or, if his employment
terminates on a Valuation Date, as of such Valuation
Date and shall become part of the general GNP
Matching Contributions made under Section 3.2(b) on
or after that date. If a Participant has no
nonforfeitable interest in his GNP Matching Account,
he shall be deemed to have received a distribution of
his benefits (which are deemed to have a value of
zero) as of the last day of the Plan Year in which
his employment terminated.
(3) Reemployment as Employee. If a Participant or a
former Participant who is described in Section
5.1(d)(2) is reemployed as an Employee prior to
incurring a Break in Service which equals or exceeds
five (5) years, the forfeitable percentage interest
in his GNP Matching Account which was treated as a
forfeiture under Section 5.1(d)(2) and the investment
gains or losses which would have been allocable to
such interest if such interest had been invested
(from the Valuation Date as of which it was treated
as a forfeiture through the Valuation Date as of
which restoration is made) in the Interest Income
Fund until July 1, 1994 and thereafter in U.S.
Treasury Bills of the longest duration available as
of the deemed date of purchase (deemed to be
purchased as of July 1, 1994 or the subsequent
Valuation Date of forfeiture and sold as of the
Valuation Date as of which restoration is made, and
reinvested at each intervening maturity date) (or
deemed to have been invested in any other manner, or
in such successor fund as shall be designated by the
Plan Sponsor) shall be restored by the Plan
Administrator. Such restoration shall be made as of
the Valuation Date
<PAGE> 34
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which immediately follows the date he is reemployed as
an Employee or, if he is reemployed on a Valuation
Date, as of such Valuation Date, and such
restoration shall be credited as of such date to his
GNP Matching Account by, or at the direction of, the
Plan Administrator. After a Participant's GNP Matching
Account has been restored, his nonforfeitable
percentage interest in such account thereafter shall
be determined for purposes of this Section 5.1(d)
under the formula,
X = P (AB + D) - D, where:
X = The dollar amount, if any, of his
nonforfeitable percentage interest in his
GNP Matching Account;
P = The Participant's nonforfeitable percentage
interest on the date his employment as an
Employee thereafter terminates;
D = The dollar amount initially distributed to
the Participant under this Section 5.1(d)
from his GNP matching Account; and
AB = Such amount of money, if any, as evidenced by
the last balance posted to his GNP Matching
Account.
(4) Separation From Service. No Participant's employment
shall be deemed to have terminated under this Section
5.1(d) unless he has a "separation from service"
within the meaning of Code Section 401(k)(2)(B).
5.2 WITHDRAWALS.
(a) Before Tax Employee Account. Subject to paragraphs (1) and
(2) below and to Section 5.3(f), a Participant who is then an
Employee may request a "hardship" withdrawal from the
contributed balance of his Before-Tax Employee Account
(excluding from the balance available for "hardship"
withdrawal the earnings on such contributions) by properly
completing and delivering to the Plan Administrator an
Election Form together with such additional information to
support his request as the Participant or the Plan
Administrator deems necessary or appropriate. Hardship
distributions under this subsection shall be made only if the
Employee demonstrates to the Employer that the distribution is
on account of immediate and heavy financial need and is
necessary to satisfy such financial need. The Plan
Administrator will determine that such request is based on a
"hardship" within the meaning of Code Section 401(k) by
applying the following standards:
<PAGE> 35
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(1) The distribution shall be deemed to be "on account of
immediate and heavy financial need" only if it is on
account of:
(A) Medical expenses described in Code Section
213(d) incurred by the Employee, the
Employee's spouse or any dependent(s) of the
Employee (as defined in Code Section 152);
(B) Purchase (excluding mortgage payment or
refinancing) of a principal residence for
the Employee;
(C) Payment of tuition and related educational
fees for the next quarter, semester or twelve
months of post- secondary education for the
Employee or the Employee's spouse, children
or dependents; or
(D) The need to prevent the eviction of the
Employee from his principal residence or the
foreclosure on the mortgage of the Employee's
principal residence.
(2) The distribution shall be deemed "necessary to
satisfy" a financial need described in paragraph (1)
above if the following requirements are satisfied:
(A) The distribution is not in excess of the
amount of the financial need (including any
amounts necessary to pay any federal, state
or local income taxes or penalties reasonably
anticipated to result from the distribution);
(B) The Employee has obtained all distributions
(other than hardship distributions) and all
non-taxable loans available under all
qualified retirement plans administered by
the Plan Sponsor;
(C) The Employee shall not be eligible to make
Before-Tax Contributions to this Plan
pursuant to Section 3.2(a) for twelve (12)
consecutive months following the month of the
distribution; provided, however, that such
contributions may recommence during the month
following the end of the twelve-month
suspension period (unless the suspension
period is extended in connection with a
subsequent hardship withdrawal) or thereafter
if the Employee files on a timely basis a
completed Election Form in accordance with
Section 3.4;
(D) The Employee's Before-Tax Contributions
pursuant to Section 3.2(a) for the Plan Year
following the Plan Year of the
<PAGE> 36
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distribution may not exceed the limit on such
contributions specified under Section
3.2(a)(1) for such following Plan Year reduced
by the Employee's Before-Tax Contributions for
the Plan Year of the distribution. Such
withdrawal shall be effected as of a
Valuation Date which follows the date the Plan
Administrator grants such request as soon as
practicable after such date.
(b) After-Tax Employee Account. Subject to such uniform and
nondiscriminatory rules as the Plan Administrator may
establish from time to time and to Sections 5.3(c) and 5.3(i),
a Participant may request a withdrawal under this Section
5.2(b), and such withdrawal may be made from his After-Tax
Employee Account (or from all of one such account and all or a
part of the other such account) by properly completing and
delivering to the Plan Administrator an Election Form (or such
other form of request as the Plan Administrator shall approve
for use by all Participants similarly situated) on or before
the Valuation Date as of which the Participant desires to make
such withdrawal, and the requested withdrawal shall be made as
of such date. If such a Participant has an After-Tax Employee
Account, a withdrawal may be made from such account in
accordance with such uniform and nondiscriminatory rules as
the Plan Administrator may establish from time to time.
Amounts withdrawn pursuant to this Section 5.3(b) will be
charged to principal or income of the sub-account in
accordance with the provisions of Code Section 72(e)(8).
(c) Effective January 1, 1993, the taxable portion of any amount
withdrawn in accordance with this Section 5.2 is an "eligible
rollover distribution" as defined in Section 5.4(d), eligible
for direct rollover as set forth in Section 5.4(d).
5.3 LOANS.
Effective January 1, 1990, any Active Participant or inactive
Participant who is an "interested party" as defined in Section 3(14) of ERISA
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 on a form and
in such manner as may be prescribed by the Plan Administrators.
Such loan (1) must be at least $1,000, and (2) shall not exceed the
lesser of (i) $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 (ii) 50% of the Participant's Vested Value
under the Plan.
<PAGE> 37
- 32 -
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. 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 in an account maintained for the
borrowing Participant. Repayments of principal and interest
shall be reinvested 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) The loan shall provide that a Participant shall repay his loan
by payroll deductions that will amortize the loan in level
payments over its term, but shall also provide that a
Participant may repay the remaining balance of the loan in a
single lump sum through a withdrawal from the Plan used in
whole or in part for such repayment or through a 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
Section 5.2 may withdraw from the Plan to the extent that such
withdrawal will not result in his loan exceeding the maximum
limitations under this Section, unless the Participant
authorizes the Plan Administrator to apply a sufficient amount
of
<PAGE> 38
- 33 -
such withdrawal to reduce the loan to the maximum limitations
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 take any action
(including reinstatement of the loan upon receipt of amounts,
if any, in arrears and resumption of timely, regular repayment
installments) 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 Section shall preclude the Plan Administrator
from declaring a moratorium on the approval of loans or from
amending this Section subject to applicable regulations issued
by the Internal Revenue Service.
5.4 FORM AND TIMING OF DISTRIBUTIONS.
(a) Election of Benefits. On or before a Participant's
retirement, elected benefit commencement date, or "required
beginning date" (as defined in Section 5.4(b)(2)(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:
(1) with respect to all Participants:
by a lump sum payment in cash or, with respect to the
Plan Sponsor Stock Fund, upon the request of the
Participant, in kind, plus the cash equivalent of the
fair market value of any fractional share of Plan
Sponsor Common Stock; or
(2) with respect only to Participants who will have
attained at least age 59 at the time benefit payment
commences:
<PAGE> 39
- 34 -
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 and last survivor life expectancy of the
Participant and his Beneficiary the amount of each
such installment to be determined by dividing the
Participant's Vested 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 (1) or (2), above).
(b) 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).
(1) 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:
(A) The Participant's attainment of age 65;
(B) The tenth anniversary of the year in which
the Participant commenced participation in
the Plan; or
(C) The Participant's termination of employment
with the Employer or an Affiliate.
(2) Notwithstanding any other provision of the Plan,
(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 5.04(a)(2)
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.
<PAGE> 40
- 35 -
(C) If distributions have not begun upon the
death of a Participant, if no election has
been made by the Beneficiary pursuant to
Section 5.4(c), the entire interest of the
Participant will be distributed in accordance
with Section 5.4(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. Provided
however, in the case of a Participant who is
not a 5% owner and who had attained age 70
1/2 before January 1, 1988, the term
"required beginning date" means April 1 of
the calendar year following the calendar year
in which the Participant retires or otherwise
terminates Employment.
(c) 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
5.4(a)(2), 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 as noted above shall elect to receive
the undistributed value of his Accounts under one of the
methods in Section 5.4(a) 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 5.4(a)(2)
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
5.4(b)(2)(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.
(d) Direct Rollover. Effective January 1, 1993, 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.
<PAGE> 41
- 36 -
(1) 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.
(2) For purposes of this Section, the following
definitions shall apply:
(A) A "Direct Rollover" is a payment by the Plan
to the "Eligible Retirement Plan" specified
by the Distributee;
(B) 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
Section 414(p), but only with regard to the
interest of such individual under the Plan;
(C) 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.
<PAGE> 42
- 37 -
(D) 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: (i) 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; (ii) Required under Code
Section 401(a)(9) (relating to the minimum
distribution requirements); or (iii) 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)).
(e) Claims. Subject to the distribution deadlines set forth in
Section 5.4(b), no Account shall become payable unless and
until a claim for payment is completed and filed on an
Election Form with the Plan Administrator unless the Plan
Administrator acting in its absolute discretion elects to
direct the distribution of such Account in the absence of such
a claim. All claims shall be processed in accordance with the
claims procedure described in the Summary Plan Description for
this Plan. Furthermore, if the distribution of an Account is
called for under this Section 5.4 and the Plan Administrator
is unable to locate the Participant or his Beneficiary after
sending written notice to his last known address and to the
United States Social Security Administration and no claim is
filed for such Account under this Section 5.4(e), the Plan
Administrator shall have the right to presume that the
Participant and his Beneficiary are dead and to treat such
Account as a forfeiture under Section 5.1(d)(2), subject to
reinstatement in the event that the Participant or his
Beneficiary subsequently files a claim for such Account.
<PAGE> 43
- 38 -
ARTICLE VI
FIDUCIARIES
The following parties are Fiduciaries of the Plan:
(a) The Employer;
(b) The Plan Sponsor;
(c) The Trustee; and
(d) 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.
<PAGE> 44
- 39 -
ARTICLE VII
PLAN ADMINISTRATION
7.1 ADMINISTRATION BY FIDUCIARIES.
(a) The Plan Administrator shall be the Named Fiduciary.
(b) 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.
(c) The responsibilities of each Fiduciary may be specified by the
Employer or the Plan Sponsor and accepted in writing by each
Fiduciary. If no such delegation is made by the Employer or
Plan Sponsor, the Fiduciaries may allocate responsibilities
among themselves in writing and notify the Employer and the
Plan Sponsor 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, the Plan Sponsor, 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.
(d) 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 (c), above.
7.2 RESPONSIBILITIES OF THE PLAN SPONSOR. The Plan Sponsor 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;
(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 (including the
Employer) 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
Bowater Board, or by written allocation among the Fiduciaries,
shall be effected by
<PAGE> 45
- 40 -
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.
7.3 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 Bowater Board or its
delegate to, and accepted by the Trustee.
7.4 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
Bowater 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;
(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;
<PAGE> 46
- 41 -
(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 Bowater 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
Bowater 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 7 and the requirements of ERISA, determine. Any
such allocation or delegation shall be periodically reviewed
by the Bowater Board or its designee.
7.5 DELEGATION OF DUTIES. Any committee established by the Plan
Sponsor or at its direction or by its designee may appoint subcommittees and
determine their powers; and the Plan Sponsor 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 Bowater Board;
The Plan Sponsor, the Administrator and their respective designees,
agents, officers and employees and any committee(s) established by the Plan
Sponsor 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 Plan Sponsor, the Administrator, and their
respective designees, agents, officers and employees and any committee(s)
established by the Plan Sponsor 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 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.
7.6 COMMITTEE ACTION. Unless otherwise directed by or at the
direction of the Plan Sponsor, a majority of the members of any committee(s)
established by or at the direction of the Plan Sponsor 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
<PAGE> 47
- 42 -
without a meeting shall constitute the action of a committee and shall have the
same effect as if assented to by every member.
7.7 INDIVIDUAL INDEMNIFICATION. To the extent permissible under
ERISA, the Plan Sponsor 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 Plan Sponsor 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 Plan Sponsor, notify the
Plan Sponsor of the commencement thereof, and the omission so to notify the
Plan Sponsor will relieve it from the liability hereunder, but not from any
other liability which it may have to such person. The Plan Sponsor 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 Plan Sponsor 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.
7.8 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 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.
<PAGE> 48
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ARTICLE VIII
TRUST FUND AND TRUSTEE
The Trust Fund shall be held, administered, controlled and invested by
the Trustee subject to the terms of the Trust Agreement.
<PAGE> 49
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ARTICLE IX
AMENDMENT AND TERMINATION
9.1 AMENDMENT. The Plan Sponsor 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.
9.2 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.
9.3 TERMINATION. The Plan is purely voluntary on the part of the
Plan Sponsor and each Employer, and the Plan Sponsor 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 5.4. 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 5.1(d)(2) shall be credited ratably to the
Accounts of all Participants in proportion to the amounts of GNP Basic
Contributions credited to their respective GNP Basic Contribution Account
during the current calendar year, or the prior calendar year if no GNP Basic
Contributions have been made during the current calendar year.
9.4 WITHDRAWAL OF AN EMPLOYER. Subject to the requirements of
ERISA and the Code, any one or more of the Employers may, with the consent of
the Plan Sponsor, terminate its participation in and withdraw from the Plan by
giving six months' advance notice in writing to the Plan Sponsor of its or
their intention to withdraw, unless a shorter notice shall be agreed to by the
Bowater Board. Upon such withdrawal, the Plan
<PAGE> 50
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Sponsor 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.
9.5 PROCEDURE. The termination, partial termination or amendment
of this Plan may be effected by the adoption of a resolution by the Bowater
Board to that effect, or by the execution of an instrument amending or
terminating the Plan by the Bowater Board's designee, to whom such authority to
so act has been given by resolution of the Board. The authorization of the
Bowater Board may be general and need not be given in contemplation of or with
reference to specific terms of amendment or termination.
<PAGE> 51
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ARTICLE X
MISCELLANEOUS
10.1 CONSTRUCTION. This Plan shall be construed, regulated and
administered in accordance with the laws of the State of South Carolina to the
extent that such laws are not preempted by Federal Law. The Plan and the Trust
shall be construed so as to qualify under sections 401(a), 401(k) and 501(a) of
the Code.
10.2 SPENDTHRIFT CLAUSE. Subject to Section 10.11 (Qualified
Domestic Relations Orders), no Account, benefit, payment or distribution under
this Plan shall (except to the extent permitted by law) be subject to the claim
of any creditor of a Participant or Beneficiary, or to any legal process by any
creditor of such person, and no Participant or Beneficiary shall have any right
to alienate, commute, anticipate or assign all or any portion of his Account,
benefit, payment or distribution under this Plan except under Section 5.3
(Loans).
10.3 LEGALLY INCOMPETENT. 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
appointed legal representative, shall be paid to the spouse, child, or legal
representative of such person, or to a person who has custody or who has
assumed responsibility for the care 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.
10.4 BENEFITS SUPPORTED ONLY BY TRUST FUND. Any person having any
claim for any benefit under the Plan shall look solely to the assets of the
Trust Fund for the satisfaction of such claim. In no event will the Plan
Sponsor, the Plan Administrator, an Employer or the Trustee, or any of their
employees, officers, Participants or their boards of directors or agents, be
liable in their individual capacities to any person whomsoever for the payment
of benefits under this Plan.
10.5 DISCRIMINATION. The Plan Administrator shall administer this
Plan in a uniform and consistent manner with respect to all Participants and
Beneficiaries and shall not permit discrimination in favor of its officers,
stockholders or "highly compensated employees" (as defined in Code Section
414(q)).
10.6 CLAIMS. Any payment to a Participant or Beneficiary or to his
legal representative, child, spouse, or heirs-at-law, made in accordance with
the provisions of this Plan shall to the extent thereof be in full satisfaction
of all claims hereunder against the Plan Sponsor, the Plan Administrator, the
Trustee and the Employer, any of whom may require such person, his legal
representative, child, spouse, or heirs-at-law, as a condition precedent to
such payment, to execute a receipt and release therefor in such form as shall
be
<PAGE> 52
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satisfactory to the Plan Sponsor, the Plan Administrator, the Trustee or any
Employer, as the case may be.
10.7 NONREVERSION. No part of the Trust Fund shall ever be used
for or be diverted to purposes other than for the exclusive benefit of
Participants and Beneficiaries except:
(a) As expressly provided otherwise in this Plan;
(b) A contribution which is made by the Employer by a mistake of
fact upon direction of the Employer shall be refunded by the
Trustee to the Employer within one year after the payment of
such contribution;
(c) A contribution (other than a contribution actually credited to
an After-Tax Employee Account) for which the Internal Revenue
Service denies an income tax deduction to the Plan Sponsor or
an Employer shall be refunded by the Trustee to the Employer
within one (1) year after the denial of such deduction upon
the Employer's direction, all such contributions being made
expressly on the condition that such contributions are
deductible in full for federal income tax purposes; and
(d) A contribution which would otherwise be an excess contribution
or excess aggregate contribution (as defined in Code Sections
4979(a) and (d)) may, at the direction of the Employer, be
returned to the Employer by the Trustee during the first two
and one-half (2-1/2) months of the Plan Year following the
Plan Year with respect to which the contribution was made.
10.8 AGENT FOR SERVICE OF PROCESS. The agent for service of
process for this Plan shall be the person currently listed in the Summary Plan
Description for this Plan as the agent for service of process.
10.9 ROLLOVER CONTRIBUTIONS. An Eligible Employee may transfer to
this Plan:
(a) A total distribution of the balance to the credit of a
Participant, or the cash proceeds of any such total
distribution in property or securities, to which Code Section
402(a)(5) applies to the extent that such section applies to
such distribution, or
(b) Any distribution from an individual retirement account to
which Code Section 408(d)(3)(A)(ii) applies to the extent such
section applies to such distribution; provided, however, that
<PAGE> 53
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(c) The plan administrator of the distributing plan certifies in
writing to the Plan Administrator that
(1) the distributing plan and trust are, at the time of
the distribution, qualified pursuant to Code Sections
401(a) and 501(a) (and, if requested by the Plan
Administrator, appends to such certification a copy
of the most recent determination letter issued by the
Internal Revenue Service with respect to such plan
and trust);
(2) The distributing plan is neither a defined benefit
plan nor a defined contribution plan subject to the
funding standards of Code Section 412; and
(3) with respect to the Participant, the distributing
plan is not a direct or indirect transferee (in a
transfer after 1984) of a plan described in
paragraphs (1) and (2) above or this paragraph (3),
provided that this paragraph (3) shall apply only if
the distributing plan has separately accounted for
the transferred assets and any income allocable to
such assets.
(c) The Plan Administrator acting in his absolute discretion
consents to such transfer;
(d) The Eligible Employee satisfies such uniform and
nondiscriminatory requirements which the Plan Administrator
establishes from time to time as a condition to such a
transfer; and
(e) Such Transfer is made in cash to the Trustee as of a Valuation
Date and in a manner which is acceptable to the Plan
Administrator and to the Trustee.
10.10 EXERCISE OF SHAREHOLDER RIGHTS WITH RESPECT TO BOWATER
INCORPORATED COMMON STOCK HELD IN THE TRUST FUND.
(a) Voting Shares of Bowater Incorporated Common Stock. All
shares of Bowater Incorporated common 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 10.10. For purposes of the actions
taken under this Section 10.10, 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 the shares of Bowater Incorporated common stock
allocated to his 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 not exercise such voting
rights. With respect to each occasion for the exercise
<PAGE> 54
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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) Directions to the Trustee. 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 Bowater Incorporated common stock
allocated to the Account(s) of Participants and Beneficiaries
to reflect the directions of the Participants to whom such
fractional shares of Bowater Incorporated common stock are
allocated.
(c) No Recommendations. Neither the Trustee nor the Plan
Administrator nor the members of any committees 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.
(d) 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 Bowater Incorporated common
stock allocated to his Accounts.
(e) 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 Bowater
Incorporated common stock by any person (other than the Plan
Sponsor or any Affiliate), 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 10.10(e),
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 Bowater
Incorporated common 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 Bowater Incorporated common 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 Bowater Incorporated common stock, the Trustee shall
tender all or such part of such shares of Bowater Incorporated
common stock
<PAGE> 55
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as the Trustee, in its exercise of discretion, shall deem
appropriate. The solicitation and implementation of
instructions from Participants (and Beneficiaries) pursuant to
this Section 10.10(e) 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 Plan Sponsor
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 Bowater
Incorporated common stock shall be applied under the Plan as
directed by the Plan Administrator, in accordance with the
following precepts. The Accounts of Participants and
Beneficiaries who directed the Trustee not to tender the shares
of Bowater Incorporated common stock allocated to their
respective Accounts shall continue to be invested in shares of
Bowater Incorporated common 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
Bowater Incorporated common stock allocated to their respective
Accounts shall receive the proceeds of such tender allocable to
the tendered shares of Bowater Incorporated common stock from
such Account, which shall be invested at the direction of the
Participant, 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 Bowater
Incorporated common stock, proceeds of the tender allocable to
the shares of Bowater Incorporated common stock (if any)
tendered from their respective Accounts, and the shares of
Bowater Incorporated common 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 Participant. The Trustee shall give advance notice of at
least one full business day to the Plan Sponsor 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.
10.11 QUALIFIED DOMESTIC RELATIONS ORDER. In accordance with
uniform and nondiscriminatory procedures established by the Plan Administrator
from time to time, the Plan Administrator upon the receipt of a domestic
relations order which seeks to require the distribution of a Participant's
Account in whole or in part to an "alternate payee" (as that term is defined in
Code Section 414(p)(8)) shall:
<PAGE> 56
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(a) Promptly notify the Participant and such "alternate payee" of
the receipt of such order and of the procedure which the Plan
Administrator will follow to determine whether such order
constitutes a "qualified domestic relations order" within the
meaning of Code Section 414(p);
(b) Determine whether such order constitutes a "qualified domestic
relations order", notify the Participant and such "alternate
payee" of the results of that determination and, if the Plan
Administrator determines that such order does constitute a
"qualified domestic relations order";
(c) Transfer such amounts, if any, as the Plan Administrator
determines necessary or appropriate from the Participant's
Account to a special Account for such "alternate payee" which
shall be invested in accordance with the rules provided in
Article 4 as if the "alternate payee" were a Participant with
respect to the special Account; and
(d) Make such distributions to such "alternate payee" as the Plan
Administrator deems called for under the terms of such order
in accordance with Code Section 414(p).
The determinations and distributions made by, or at the direction of, the Plan
Administrator under this Section 10.11 shall be final and binding on the
Participant and on all other persons interested in such order.
10.12 PLAN TO PLAN TRANSFERS. The Plan Administrator, in his or her
discretion, may direct transfers to a participant's Before-Tax Employee
Account, After-Tax Employee Account, GNP Basic Contribution Account, GNP
Matching Account, or Rollover Account, and may authorize the establishment of
any other Account as may be required to effect the transfer from the Trustee of
his or her account in another Bowater Incorporated defined contribution plan
qualified under Code Section 401(a), provided that such transfer would not
cause this Plan to be a direct or indirect transferee within the meaning of
Section 401(a)(11)(B)(iii)(III) of a plan described in Section 401(a)(11)(B)(i)
or (ii) of the Code.
Any such transfer shall be made as of a Valuation Date which is
acceptable to the Plan Administrator and to the Trustee. The initial
investment of any such transfer amount shall be in accordance with procedures
to be established by the Plan Administrator.
<PAGE> 57
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ARTICLE XI
TRANSFER OF ASSETS FROM AND ASSUMPTION OF
CERTAIN LIABILITIES OF
THE GEORGIA-PACIFIC CORPORATION
SAVINGS AND CAPITAL GROWTH PLAN
11.1 ASSET TRANSFER. All assets held by the trustee of the
Georgia-Pacific Corporation Savings and Capital Growth Plan (the "G-P Plan") on
the day preceding the Effective Date in accounts of participants in the G-P
Plan who became Employees on the Effective Date shall be transferred on the
Effective Date or as soon thereafter as feasible to the Trustee to become a
part of the Trust Fund and held in the Accounts of the respective Employees on
whose behalf such assets were held pursuant to the terms of the G-P Plan.
Amounts received by the Trustee upon such transfer of assets shall be invested
in the Fund maintained pursuant to this Plan with the same name as the G-P Plan
fund in which such transferred amounts were invested immediately prior to
transfer. Upon such transfer the transferred assets shall become assets of
this Plan for all purposes hereunder, effective as of the Effective Date. This
Plan shall assume the liabilities of the G-P Plan to the Employees whose G-P
Plan accounts are transferred to the Trustee with respect to the transferred
accounts.
11.2 VESTING. Each former employee of Georgia-Pacific Corporation
on whose behalf one or more accounts under the G-P Plan are transferred to this
Plan shall have a one hundred percent (100%) vested and nonforfeitable interest
in each such transferred Account as of the Effective Date. For purposes of
determining Years of Service for vesting purposes under the Plan, individuals
who became Employees on the Effective Date and who were Georgia-Pacific
Corporation employees on the immediately preceding day shall be credited with
the period(s) of employment credited toward years of service under the G-P Plan
as in effect on the day preceding the Effective Date.
11.3 ELIGIBILITY TO PARTICIPATE. For purposes of determining years
of Service with respect to eligibility to participate in the Plan and
eligibility for contributions under Section 3.1(a), individuals who became
Employees on the Effective Date and who were Georgia- Pacific Corporation
employees on the immediately preceding day shall be credited with period(s) of
employment which would have been credited toward eligibility to participate in
the G-P Plan (as in effect on the day preceding the Effective Date), had the
individual's employment with the Employer been continuous employment with
Georgia-Pacific Corporation.
<PAGE> 58
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ARTICLE XII
TOP HEAVY PROVISIONS
12.1 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.
12.2 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 12, 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:
<PAGE> 59
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(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;
(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
<PAGE> 60
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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.
(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 Comprehensive 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.
12.3 MINIMUM CONTRIBUTION. For any Plan Year in which this Plan is
top-heavy, provided the top-heavy ratio is less than 90%, each Employee who is
eligible to participate under Sections 2.01 or 2.02, 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 3.01 and 3.02 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 3.06 shall
be reduced to 100%.
<PAGE> 61
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IN WITNESS WHEREOF, Great Northern Paper, Inc. has adopted and
executed this Plan as of this 27th day of December, 1994.
GREAT NORTHERN PAPER, INC.
By /s/ Ecton Manning
------------------------------
Vice President
General Counsel
<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 the Great
Northern Paper, Inc. Savings and Capital Growth Plan for Salaried Employees'
(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 31, 1996
/s/ KPMG Peat Marwick LLP
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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
