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EXHIBIT 4.3
LANCER CORPORATION
EMPLOYEE PROFIT SHARING PLAN
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TABLE OF CONTENTS
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INTRODUCTION
ARTICLE I FORMAT AND DEFINITIONS
Section 1.01 -- Format
Section 1.02 -- Definitions
ARTICLE II PARTICIPATION
Section 2.01 -- Active Participant
Section 2.02 -- Inactive Participant
Section 2.03 -- Cessation Of Participation
Section 2.04 -- Adopting Employers - Single Plan
ARTICLE III CONTRIBUTIONS
Section 3.01 -- Employer Contributions
Section 3.01a -- Rollover Contributions
Section 3.02 -- Forfeitures
Section 3.03 -- Allocation
Section 3.04 -- Contribution Limitation
Section 3.05 -- Excess Amounts
ARTICLE IV INVESTMENT OF CONTRIBUTIONS
Section 4.01 -- Investment Of Contributions
Section 4.01a -- Nvestment In Qualifying Employer Securities
ARTICLE V BENEFITS
Section 5.01 -- Retirement Benefits
Section 5.02 -- Death Benefits
Section 5.03 -- Vested Benefits
Section 5.04 -- When Benefits Start
Section 5.05 -- Withdrawal Privileges
Section 5.06 -- Loans To Participants
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ARTICLE VI DISTRIBUTION OF BENEFITS
Section 6.01 -- Automatic Forms Of Distribution
Section 6.02 -- Optional Forms Of Distribution And Distribution
Section 6.03 -- Election Procedures
Section 6.04 -- Notice Requirements
ARTICLE VII TERMINATION OF PLAN
ARTICLE VIII ADMINISTRATION OF PLAN
Section 8.01 -- Administration
Section 8.02 -- Records
Section 8.03 -- Information Available
Section 8.04 -- Claim And Appeal Procedures
Section 8.05 -- Unclaimed Vested Account Procedure
Section 8.06 -- Delegation Of Authority
Section 8.07 -- Voting And Tender Of Qualifying Employer Securities
ARTICLE IX GENERAL PROVISIONS
Section 9.01 -- Amendments
Section 9.02 -- Direct Rollovers
Section 9.03 -- Mergers And Direct Transfers
Section 9.04 -- Provisions Relating To The Insurer And Other Parties
Section 9.05 -- Employment Status
Section 9.06 -- Rights To Plan Assets
Section 9.07 -- Beneficiary
Section 9.08 -- Nonalienation Of Benefits
Section 9.09 -- Construction
Section 9.10 -- Legal Actions
Section 9.11 -- Small Amounts
Section 9.12 -- Word Usage
Section 9.13 -- Transfers Between Plans
ARTICLE X TOP-HEAVY PLAN REQUIREMENTS
Section 10.01 -- Application
Section 10.02 -- Definitions
Section 10.03 -- Modification Of Vesting Requirements
Section 10.04 -- Modification Of Contributions
Section 10.05 -- Modification Of Contribution Limitation
PLAN EXECUTION
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INTRODUCTION
The Primary Employer previously established a profit sharing plan on
January 1, 1985.
The Primary Employer is of the opinion that the plan should be changed.
It believes that the best means to accomplish these changes is to completely
restate the plan's terms, provisions and conditions. The restatement, effective
January 1, 2000, is set forth in this document and is substituted in lieu of the
prior document.
The restated plan continues to be for the exclusive benefit of
employees of the Employer. All persons covered under the plan on December 31,
1999, shall continue to be covered under the restated plan with no loss of
benefits.
It is intended that the plan, as restated, shall qualify as a profit
sharing plan under the Internal Revenue Code of 1986, including any later
amendments to the Code.
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ARTICLE I
FORMAT AND DEFINITIONS
SECTION 1.01--FORMAT.
Words and phrases defined in the DEFINITIONS SECTION of Article I shall
have that defined meaning when used in this Plan, unless the context clearly
indicates otherwise.
These words and phrases have an initial capital letter to aid in
identifying them as defined terms.
SECTION 1.02--DEFINITIONS.
ACCOUNT means, for a Participant, his share of the Investment Fund.
Separate accounting records are kept for those parts of his Account
that result from:
(a) Elective Deferral Contributions
(b) Matching Contributions
(c) Other Employer Contributions
(d) Rollover Contributions
If the Participant's Vesting Percentage is less than 100% as to any of
the Employer Contributions, a separate accounting record will be kept
for any part of his Account resulting from such Employer Contributions
and, if there has been a prior Forfeiture Date, from such Contributions
made before a prior Forfeiture Date.
A Participant's Account shall be reduced by any distribution of his
Vested Account and by any Forfeitures. A Participant's Account will
participate in the earnings credited, expenses charged and any
appreciation or depreciation of the Investment Fund. His Account is
subject to any minimum guarantees applicable under the Group Contract
or other investment arrangement.
ACCRUAL COMPUTATION PERIOD means a 12-consecutive month period ending
on the last day of each Plan Year, including corresponding
12-consecutive month periods before January 1, 1985.
ACTIVE PARTICIPANT means an Eligible Employee who is actively
participating in the Plan according to the provisions in the ACTIVE
PARTICIPANT SECTION of Article II.
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ADOPTING EMPLOYER means an employer controlled by or affiliated with
the Employer and listed in the ADOPTING EMPLOYERS - SINGLE PLAN SECTION
of Article II.
AFFILIATED SERVICE GROUP means any group of corporations, partnerships
or other organizations of which the Employer is a part and which is
affiliated within the meaning of Code Section 414(m) and regulations
thereunder. Such a group includes at least two organizations one of
which is either a service organization (that is, an organization the
principal business of which is performing services), or an organization
the principal business of which is performing management functions on a
regular and continuing basis. Such service is of a type historically
performed by employees. In the case of a management organization, the
Affiliated Service Group shall include organizations related, within
the meaning of Code Section 144(a)(3), to either the management
organization or the organization for which it performs management
functions. The term Controlled Group, as it is used in this Plan, shall
include the term Affiliated Service Group.
ANNUAL COMPENSATION means, on any given date, the Employee's
Compensation for the latest Compensation Year ending on or before the
given date.
ANNUITY STARTING DATE means, for a Participant, the first day of the
first period for which an amount is payable as an annuity or any other
form.
BENEFICIARY means the person or persons named by a Participant to
receive any benefits under this Plan upon the Participant's death. See
the BENEFICIARY SECTION of Article IX.
CLAIMANT means any person who has made a claim for benefits under this
Plan. See the CLAIM AND APPEAL PROCEDURES SECTION of Article VIII.
CODE means the Internal Revenue Code of 1986, as amended.
COMPENSATION means, except as modified in this definition, the total
earnings paid or made available to an Employee by the Employer during
any specified period.
"Earnings" in this definition means Compensation as defined in the
CONTRIBUTION LIMITATION SECTION of Article III.
Compensation shall also include elective contributions. Elective
contributions are amounts excludable from the Employee's gross income
under Code Sections 125, 402(e)(3), 402(h) or 403(b), and contributed
by the Employer, at the Employee's election, to a Code Section 401(k)
arrangement, a simplified employee pension, cafeteria plan or
tax-sheltered annuity. Elective contributions also include Compensation
deferred under a Code Section 457 plan maintained by the Employer
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and Employee contributions "picked up" by a governmental entity and,
pursuant to Code Section 414(h)(2), treated as Employer contributions.
For purposes of the EXCESS AMOUNTS SECTION of Article III, the Employer
may elect to use an alternative nondiscriminatory definition of
Compensation in accordance with the regulations under Code Section
414(s).
For purposes of determining the amount of Elective Deferral
Contributions, Compensation shall exclude reimbursements or other
expense allowances, fringe benefits (cash and noncash), moving
expenses, deferred compensation and welfare benefits.
For an Employee whose Entry Date occurs after July 1, 1993,
Compensation shall exclude earnings paid before the Employee's Entry
Date.
For Plan Years beginning after December 31, 1988, and before January 1,
1994, the annual Compensation of each Participant taken into account
for determining all benefits provided under the Plan for any year shall
not exceed $200,000. For Plan Years beginning on or after January 1,
1994, the annual Compensation of each Participant taken into account
for determining all benefits provided under the Plan for any year shall
not exceed $150,000.
The $200,000 limit shall be adjusted by the Secretary at the same time
and in the same manner as under Code Section 415(d). The $150,000 limit
shall be adjusted by the Commissioner for increases in the cost of
living in accordance with Code Section 401(a)(17)(B). The cost of
living adjustment in effect for a calendar year applies to any period,
not exceeding 12 months, over which pay is determined (determination
period) beginning in such calendar year. If a determination period
consists of fewer than 12 months, the annual compensation limit will be
multiplied by a fraction; the numerator of which is the number of
months in the determination period, and the denominator of which is 12.
In determining the Compensation of a Participant for purposes of the
annual compensation limit, the rules of Code Section 414(q)(6) shall
apply, except that in applying such rules, the term "family" shall
include only the spouse of the Participant and any lineal descendants
of the Participant who have not attained age 19 before the close of the
year. If, as a result of the application of such rules the adjusted
annual compensation limit is exceeded, then (except for purposes of
determining the portion of Compensation up to the integration level if
this Plan provides for permitted disparity) the limitation shall be
prorated among the affected individuals in proportion to each such
individual's Compensation as determined under this definition prior to
the application of this limitation.
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If Compensation for any prior determination period is taken into
account in determining a Participant's benefits accruing in the current
Plan Year, the Compensation for that prior determination period is
subject to the annual compensation limit in effect for that prior
determination period. For this purpose, for determination periods
beginning before the first day of the first Plan Year beginning on or
after January 1, 1989, which are used to determine benefits in Plan
Years beginning after December 31, 1988 and before January 1, 1994, the
annual compensation limit is $200,000. For this purpose, for
determination periods beginning before the first day of the first Plan
Year beginning on or after January 1, 1994, which are used to determine
benefits in Plan Years beginning on or after January 1, 1994, the
annual compensation limit is $150,000.
COMPENSATION YEAR means each one-year period ending on the last day of
the Plan Year, including corresponding periods before January 1, 1985.
CONTINGENT ANNUITANT means an individual named by the Participant to
receive a lifetime benefit after the Participant's death in accordance
with a survivorship life annuity.
CONTRIBUTIONS means
Elective Deferral Contributions
Matching Contributions
Discretionary Contributions
Rollover Contributions
as set out in Article III, unless the context clearly indicates
otherwise.
CONTROLLED GROUP means any group of corporations, trades or businesses
of which the Employer is a part that are under common control. A
Controlled Group includes any group of corporations, trades or
businesses, whether or not incorporated, which is either a
parent-subsidiary group, a brother-sister group, or a combined group
within the meaning of Code Section 414(b), Code Section 414(c) and
regulations thereunder and, for purposes of determining contribution
limitations under the CONTRIBUTION LIMITATION SECTION of Article III,
as modified by Code Section 415(h) and, for the purpose of identifying
Leased Employees, as modified by Code Section 144(a)(3). The term
Controlled Group, as it is used in this Plan, shall include the term
Affiliated Service Group and any other employer required to be
aggregated with the Employer under Code Section 414(o) and the
regulations thereunder.
DIRECT ROLLOVER means a payment by the Plan to the Eligible Retirement
Plan specified by the Distributee.
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DISCRETIONARY CONTRIBUTIONS means discretionary contributions made by
the Employer to fund this Plan. See the EMPLOYER CONTRIBUTIONS SECTION
of Article III.
DISTRIBUTEE means an Employee or former Employee. In addition, the
Employee's or former Employee's surviving spouse and the Employee's or
former Employee's spouse or former spouse who is the alternate payee
under a qualified domestic relations order, as defined in Code Section
414(p), are Distributees with regard to the interest of the spouse or
former spouse.
ELECTIVE DEFERRAL CONTRIBUTIONS means Contributions made by the
Employer to fund this Plan in accordance with a qualified cash or
deferred arrangement as described in Code Section 401(k). See the
EMPLOYER CONTRIBUTIONS SECTION of Article III.
ELIGIBILITY BREAK IN SERVICE means an Eligibility Computation Period in
which an Employee is credited with 500 or fewer Hours-of-Service. An
Employee incurs an Eligibility Break in Service on the last day of an
Eligibility Computation Period in which he has an Eligibility Break in
Service.
ELIGIBILITY COMPUTATION PERIOD means a 12-consecutive month period. The
first Eligibility Computation Period begins on an Employee's Employment
Commencement Date. Later Eligibility Computation Periods shall be
12-consecutive month periods ending on the last day of each Plan Year
that begins after his Employment Commencement Date.
To determine an Eligibility Computation Period after an Eligibility
Break in Service, the Plan shall use the 12-consecutive month period
beginning on an Employee's Reemployment Commencement Date as if his
Reemployment Commencement Date were his Employment Commencement Date.
ELIGIBILITY SERVICE means one year of service for each Eligibility
Computation Period that has ended and in which an Employee is credited
with at least 1,000 Hours-of-Service.
However, Eligibility Service is modified as follows:
Period of Military Duty included:
A Period of Military Duty shall be included as service with
the Employer to the extent it has not already been credited.
For purposes of crediting Hours-of-Service during the Period
of Military Duty, an Hour-of-Service shall be credited
(without regard to the 501 Hour-of-Service limitation) for
each hour an
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Employee would normally have been scheduled to work for the
Employer during such period.
Controlled Group service included:
An Employee's service with a member firm of a Controlled Group
while both that firm and the Employer were members of the
Controlled Group shall be included as service with the
Employer.
Other service included:
An Employee's service with Lancer FBD Partnership, Ltd. shall
be included as service with the Employer.
ELIGIBLE EMPLOYEE means any Employee of the Employer who meets the
following requirements. He is not employed as a nonresident alien who
does not receive any earned income (as defined in Code 911(d)(2)) from
the Employer which constitutes United States income (as defined in Code
861(a)(3)). His employment classification with the Employer is the
following:
Nonbargaining class (not represented for collective bargaining
purposes by a bargaining unit which has bargained in good
faith with the Employer on the subject of retirement
benefits).
In any event, an Employee of Lancer, Ltd. shall also be considered an
Employee of the Employer.
ELIGIBLE RETIREMENT PLAN means an individual retirement account
described in Code Section 408(a), an individual retirement annuity
described in Code Section 408(b), an annuity plan described in Code
Section 403(a) or a qualified trust described in Code Section 401(a),
that accepts the Distributee's Eligible Rollover Distribution.
However, in the case of an Eligible Rollover Distribution to the
surviving spouse, an Eligible Retirement Plan is an individual
retirement account or individual retirement annuity.
ELIGIBLE ROLLOVER DISTRIBUTI0N means any distribution of all or any
portion of the balance to the credit of the Distributee, except that an
Eligible Rollover Distribution does not include:
(a) Any distribution that is one of a series of substantially
equal periodic payments (not less frequently than annually)
made for the life (or life expectancy) of the Distributee or
the joint lives (or joint life expectancies) of the
Distributee and the
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Distributee's designated Beneficiary, or for a specified
period of ten years or more.
(b) Any distribution to the extent such distribution is required
under Code Section 401(a)(9).
(c) The portion of any distribution that is not includible in
gross income (determined without regard to the exclusion for
net unrealized appreciation with respect to employer
securities).
EMPLOYEE means an individual who is employed by the Employer or any
other employer required to be aggregated with the Employer under Code
Sections 414(b), (c), (m) or (o). A Controlled Group member is required
to be aggregated with the Employer.
The term Employee shall also include any Leased Employee deemed to be
an employee of any employer described in the preceding paragraph as
provided in Code Sections 414(n) or 414(o).
EMPLOYER means the Primary Employer. This will also include any
successor corporation or firm of the Employer which shall, by written
agreement, assume the obligations of this Plan or any predecessor
corporation or firm of the Employer (absorbed by the Employer, or of
which the Employer was once a part) which became a predecessor because
of a change of name, merger, purchase of stock or purchase of assets
and which maintained this Plan.
EMPLOYER CONTRIBUTIONS means
Elective Deferral Contributions
Matching Contributions
Discretionary Contributions
as set out in Article III, unless the context clearly indicates
otherwise.
EMPLOYMENT COMMENCEMENT DATE means the date an Employee first performs
an Hour-of-Service.
ENTRY DATE means the date an Employee first enters the Plan as an
Active Participant. See the ACTIVE PARTICIPANT SECTION of Article II.
FISCAL YEAR means the Primary Employer's taxable year. The last day of
the Fiscal Year is December 31.
FORFEITURE means the part, if any, of a Participant's Account that is
forfeited. See the FORFEITURES SECTION of Article III.
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FORFEITURE DATE means, as to a Participant, the date the Participant
incurs five consecutive Vesting Breaks in Service. A Participant incurs
a Vesting Break in Service on the last day of the period used to
determine the Vesting Break in Service.
This is the date on which the Participant's Nonvested Account will be
forfeited unless an earlier forfeiture occurs as provided in the
FORFEITURES SECTION of Article III.
GROUP CONTRACT means the group annuity contract or contracts into which
the Primary Employer enters with the Insurer for the investment of
Contributions and the payment of benefits under this Plan. The term
Group Contract as it is used in this Plan is deemed to include the
plural unless the context clearly indicates otherwise.
HIGHLY COMPENSATED EMPLOYEE means a highly compensated active Employee
or a highly compensated former Employee.
A highly compensated active Employee means any Employee who performs
service for the Employer during the determination year and who, during
the look-back year is:
(a) An Employee who is a 5% owner, as defined in Section
416(i)(1)(B)(i), at any time during the determination year or
the look-back year.
(b) An Employee who receives compensation in excess of $75,000
(indexed in accordance with Section 415(d) during the
look-back year.
(c) An Employee who receives compensation in excess of $50,000
(indexed in accordance with Section 415(d) during the
look-back year and is a member of the top-paid group for the
look-back year.
(d) An Employee who is an officer, within the meaning of Section
416(i), during the look-back year and who receives
compensation in the look-back year greater than 50% of the
dollar limitation in effect under Section 415(b)(1)(A) for the
calendar year in which the look-back year begins. The number
of officers is limited to 50 (or, if lesser, the greater of 3
employees or 10% of employees) excluding those employees who
may be excluded in determining the top-paid group.
(e) An Employee who is both described in paragraph b, c or d above
when these paragraphs are modified to substitute the
determination year for the look-back year and one of the 100
Employees who receive the most compensation from the Employer
during the determination year.
If no officer has satisfied the compensation requirement of (c) above
during either a determination year or look-back year, the highest paid
officer for such year shall be treated as a Highly Compensated
Employee.
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For this purpose, the determination year shall be the Plan Year. The
look-back year shall be the twelve-month period immediately preceding
the determination year.
A highly compensated former Employee means any Employee who separated
from service (or was deemed to have separated) prior to the
determination year, performs no service for the Employer during the
determination year, and was a highly compensated active Employee for
either the separation year or any determination year ending on or after
the Employee's 55th birthday.
If an Employee is, during a determination year or look-back year, a
family member of either a 5 percent owner who is an active or former
Employee or a Highly Compensated Employee who is one of the 10 most
highly compensated Employees ranked on the basis of compensation paid
by the Employer during such year, then the family member and the 5
percent owner or top-ten highly compensated Employee shall be
aggregated. In such case, the family member and 5 percent owner or
top-ten highly compensated Employee shall be treated as a single
Employee receiving compensation and Plan contributions or benefits
equal to the sum of such compensation and contributions or benefits of
the family member and 5 percent owner or top-ten highly compensated
Employee. For purposes of this definition, family member includes the
spouse, lineal ascendants and descendants of the Employee or former
Employee and the spouses of such lineal ascendants and descendants.
Compensation is compensation within the meaning of Code Section
415(c)(3), including elective or salary reduction contributions to a
cafeteria plan, cash or deferred arrangement or tax-sheltered annuity.
The top-paid group consists of the top 20% of employees ranked on the
basis of compensation received during the year.
Employers aggregated under Section 414(b), (c), (m) or (o) are treated
as a single Employer.
HOUR-OF-SERVICE means the following:
(a) Each hour for which an Employee is paid, or entitled to
payment, for performing duties for the Employer during the
applicable computation period.
(b) Each hour for which an Employee is paid, or entitled to
payment, by the Employer because of a period of time in which
no duties are performed (irrespective of whether the
employment relationship has terminated) due to vacation,
holiday, illness, incapacity (including disability), layoff,
jury duty, military duty or leave of absence. Notwithstanding
the preceding provisions of this subparagraph (b), no credit
will be given to the Employee
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(1) for more than 501 Hours-of-Service under this
subparagraph (b) because of any single continuous
period in which the Employee performs no duties
(whether or not such period occurs in a single
computation period); or
(2) for an Hour-of-Service for which the Employee is
directly or indirectly paid, or entitled to payment,
because of a period in which no duties are performed
if such payment is made or due under a plan
maintained solely for the purpose of complying with
applicable worker's or workmen's compensation, or
unemployment compensation or disability insurance
laws; or
(3) for an Hour-of-Service for a payment which solely
reimburses the Employee for medical or medically
related expenses incurred by him.
For purposes of this subparagraph (b), a payment shall be
deemed to be made by, or due from the Employer, regardless of
whether such payment is made by, or due from the Employer,
directly or indirectly through, among others, a trust fund or
insurer, to which the Employer contributes or pays premiums
and regardless of whether contributions made or due to the
trust fund, insurer or other entity are for the benefit of
particular employees or are on behalf of a group of employees
in the aggregate.
(c) Each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by the Employer. The
same Hours-of-Service shall not be credited both under
subparagraph (a) or subparagraph (b) above (as the case may
be) and under this subparagraph (c). Crediting of
Hours-of-Service for back pay awarded or agreed to with
respect to periods described in subparagraph (b) above will be
subject to the limitations set forth in that subparagraph.
The crediting of Hours-of-Service above shall be applied under the
rules of paragraphs (b) and (c) of the Department of Labor Regulation
2530.200b-2 (including any interpretations or opinions implementing
said rules); which rules, by this reference, are specifically
incorporated in full within this Plan. The reference to paragraph (b)
applies to the special rule for determining hours of service for
reasons other than the performance of duties such as payments
calculated (or not calculated) on the basis of units of time and the
rule against double credit. The reference to paragraph (c) applies to
the crediting of hours of service to computation periods.
Hours-of-Service shall be credited for employment with any other
employer required to be aggregated with the Employer under Code
Sections 414(b), (c), (m) or (o) and the regulations thereunder for
purposes of eligibility and vesting. Hours-of-Service shall also be
credited for any individual who is considered an employee for purposes
of this
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Plan pursuant to Code Section 414(n) or Code Section 414(o) and the
regulations thereunder.
Solely for purposes of determining whether a one-year break in service
has occurred for eligibility or vesting purposes, during a Parental
Absence an Employee shall be credited with the Hours-of-Service which
otherwise would normally have been credited to the Employee but for
such absence, or in any case in which such hours cannot be determined,
eight Hours-of-Service per day of such absence. The Hours-of-Service
credited under this paragraph shall be credited in the computation
period in which the absence begins if the crediting is necessary to
prevent a break in service in that period; or in all other cases, in
the following computation period.
INACTIVE PARTICIPANT means a former Active Participant who has an
Account. See the INACTIVE PARTICIPANT SECTION of Article II.
INSURER means Principal Life Insurance Company and any other insurance
company or companies named by the Trustee or Primary Employer.
INVESTMENT FUND means the total assets held for the purpose of
providing benefits for Participants. These funds result from
Contributions made under the Plan.
INVESTMENT MANAGER means any fiduciary (other than a trustee or Named
Fiduciary)
(a) who has the power to manage, acquire, or dispose of any assets
of the Plan; and
(b) who (1) is registered as an investment adviser under the
Investment Advisers Act of 1940, or (2) is a bank, as defined
in the Investment Advisers Act of 1940, or (3) is an insurance
company qualified to perform services described in
subparagraph (a) above under the laws of more than one state;
and
(c) who has acknowledged in writing being a fiduciary with respect
to the Plan.
LATE RETIREMENT DATE means the first day of any month which is after a
Participant's Normal Retirement Date and on which retirement benefits
begin. If a Participant continues to work for the Employer after his
Normal Retirement Date, his Late Retirement Date shall be the earliest
first day of the month on or after he ceases to be an Employee. An
earlier or a later Retirement Date may apply if the Participant so
elects. An earlier Retirement Date may apply if the Participant is age
70 1/2. See the WHEN BENEFITS START SECTION of Article V.
LOAN ADMINISTRATOR means the person or positions authorized to
administer the Participant loan program.
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The Loan Administrators are Stephanie Sheffield and Irene Garza.
MATCHING CONTRIBUTIONS means matching contributions made by the
Employer to fund this Plan. See the EMPLOYER CONTRIBUTIONS SECTION of
Article III.
MONTHLY DATE means each Yearly Date and the same day of each following
month during the Plan Year beginning on such Yearly Date.
NAMED FIDUCIARY means the person or persons who have authority to
control and manage the operation and administration of the Plan.
The Named Fiduciary is the Employer.
NONHIGHLY COMPENSATED EMPLOYEE means an Employee of the Employer who is
neither a Highly Compensated Employee nor a family member.
NONVESTED ACCOUNT means the part, if any, of a Participant's Account
that is in excess of his Vested Account.
NORMAL FORM means a single life annuity with installment refund.
NORMAL RETIREMENT AGE means the age at which the Participant's normal
retirement benefit becomes nonforfeitable. A Participant's Normal
Retirement Age is 65.
NORMAL RETIREMENT DATE means the date the Participant reaches his
Normal Retirement Age. Unless otherwise provided in this Plan, a
Participant's retirement benefits shall begin on a Participant's Normal
Retirement Date if he has ceased to be an Employee on such date and has
a Vested Account. Even if the Participant is an Employee on his Normal
Retirement Date, he may choose to have his retirement benefit begin on
such date. See the WHEN BENEFITS START SECTION of Article V.
PARENTAL ABSENCE means an Employee's absence from work which begins on
or after the first Yearly Date after December 31, 1984,
(a) by reason of pregnancy of the Employee,
(b) by reason of birth of a child of the Employee,
(c) by reason of the placement of a child with the Employee in
connection with adoption of such child by such Employee, or
(d) for purposes of caring for such child for a period beginning
immediately following such birth or placement.
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PARTICIPANT means either an Active Participant or an Inactive
Participant.
PERIOD OF MILITARY DUTY means, for an Employee
(a) who served as a member of the armed forces of the United
States, and
(b) who was reemployed by the Employer at a time when the Employee
had a right to reemployment in accordance with seniority
rights as protected under Section 2021 through 2026 of Title
38 of the U.S. Code,
the period of time from the date the Employee was first absent from
active work for the Employer because of such military duty to the date
the Employee was reemployed.
PLAN means the profit sharing plan of the Employer set forth in this
document, including any later amendments to it.
PLAN ADMINISTRATOR means the person or persons who administer the Plan.
The Plan Administrator is the Employer.
PLAN YEAR means a period beginning on a Yearly Date and ending on the
day before the next Yearly Date.
PRIMARY EMPLOYER means LANCER CORPORATION.
QUALIFIED JOINT AND SURVIVOR FORM means, for a Participant who has a
spouse, an immediate survivorship life annuity with installment refund,
where the survivorship percentage is 50% and the Contingent Annuitant
is the Participant's spouse. A former spouse will be treated as the
spouse to the extent provided under a qualified domestic relations
order as described in Code Section 414(p). If a Participant does not
have a spouse, the Qualified Joint and Survivor Form means the Normal
Form.
The amount of benefit payable under the Qualified Joint and Survivor
Form shall be the amount of benefit which may be provided by the
Participant's Vested Account.
QUALIFIED PRERETIREMENT SURVIVOR ANNUITY means a single life annuity
with installment refund payable to the surviving spouse of a
Participant who dies before his Annuity Starting Date. A former spouse
will be treated as the surviving spouse to the extent provided under a
qualified domestic relations order as described in Code Section 414(p).
QUALIFYING EMPLOYER SECURITIES means any security which is issued by
the Employer or any Controlled Group member and which meets the
requirements of Code
16
<PAGE> 18
Section 409(l) and ERISA Section 407(d)(5). This shall also include any
securities that satisfied the requirements of the definition when these
securities were assigned to the Plan.
QUALIFYING EMPLOYER SECURITIES FUND means that part of the assets of
the Trust Fund that are designated to be held primarily or exclusively
in Qualifying Employer Securities for the purpose of providing benefits
for Participants.
REEMPLOYMENT COMMENCEMENT DATE means the date an Employee first
performs an Hour-of-Service following an Eligibility Break in Service.
REENTRY DATE means the date a former Active Participant reenters the
Plan. See the ACTIVE PARTICIPANT SECTION of Article II.
RETIREMENT DATE means the date a retirement benefit will begin and is a
Participant's Normal or Late Retirement Date, as the case may be.
ROLLOVER CONTRIBUTIONS means the Rollover Contributions which are made
by or for a Participant according to the provisions of the ROLLOVER
CONTRIBUTIONS SECTION of Article III.
SEMI-YEARLY DATE means each Yearly Date and the sixth Monthly Date
after each Yearly Date which is within the same Plan Year.
TEFRA means the Tax Equity and Fiscal Responsibility Act of 1982.
TEFRA COMPLIANCE DATE means the date a plan is to comply with the
provisions of TEFRA. The TEFRA Compliance Date as used in this Plan is,
(a) for purposes of contribution limitations, Code Section 415,
(1) if the plan was in effect on July 1, 1982, the first
day of the first limitation year which begins after
December 31, 1982, or
(2) if the plan was not in effect on July 1, 1982, the
first day of the first limitation year which ends
after July 1, 1982.
(b) for all other purposes, the first Yearly Date after December
31, 1983.
TOTALLY AND PERMANENTLY DISABLED means that a Participant is disabled,
as a result of sickness, injury, or mental disability, to the extent
that he is completely prevented from performing any work, engaging in
any occupation for wage or profit and has been continuously disabled
for an indefinite period which the Plan Administrator considers will be
of long continued duration. A Participant is also disabled if he incurs
17
<PAGE> 19
the permanent loss or loss of use of a member or function of the body,
or is permanently disfigured and ceases to be an Employee.
A Participant is considered Totally and Permanently Disabled on the
date the Plan Administrator determines the Participant satisfies the
definition of Totally and Permanently Disabled. Initial written proof
that the disability exists may be required. The Plan Administrator will
apply such definition in a nondiscriminatory, consistent and uniform
manner.
TRUST means an agreement of trust between the Primary Employer and
Trustee established for the purpose of holding and distributing the
Trust Fund under the provisions of the Plan. The Trust may provide for
the investment of all or any portion of the Trust Fund in the Group
Contract.
TRUST FUND means the total funds held under the Trust for the purpose
of providing benefits for Participants. These funds result from
Contributions made under the Plan which are forwarded to the Trustee to
be deposited in the Trust Fund.
TRUSTEE means the trustee or trustees under the Trust. The term Trustee
as it is used in this Plan is deemed to include the plural unless the
context clearly indicates otherwise.
VALUATION DATE means the date on which the value of the assets of the
Investment Fund is determined. The value of each Account which is
maintained under this Plan shall be determined on the Valuation Date.
In each Plan Year, the Valuation Date shall be the last day of the Plan
Year. At the discretion of the Plan Administrator, Trustee, or Insurer
(whichever applies), assets of the Investment Fund may be valued more
frequently. These dates shall also be Valuation Date.
VESTED ACCOUNT means the vested part of a Participant's Account. The
Participant's Vested Account is determined as follows.
If the Participant's Vesting Percentage is 100%, his Vested Account
equals his Account.
If the Participant's Vesting Percentage is less than 100%, his Vested
Account equals the sum of (a) and (b) below:
(a) The part of the Participant's Account that results from
Employer Contributions made before a prior Forfeiture Date and
all other Contributions which were 100% vested when made.
(b) The balance of the Participant's Account in excess of the
amount in (a) above multiplied by his Vesting Percentage.
18
<PAGE> 20
If the Participant has withdrawn any part of his Account resulting from
Employer Contributions, other than the vested Employer Contributions
included in (a) above, the amount determined under this subparagraph
(b) shall be equal to P(AB + D) - D as defined below:
P The Participant's Vesting Percentage.
AB The balance of the Participant's Account in excess of the
amount in (a) above.
D The amount of withdrawal resulting from Employer
Contributions, other than the vested Employer Contributions
included in (a) above.
The Participant's Vested Account is nonforfeitable.
VESTING BREAK IN SERVICE means a Vesting Computation Period in which an
Employee is credited with 500 or fewer Hours-of-Service. An Employee
incurs a Vesting Break in Service on the last day of a Vesting
Computation Period in which he has a Vesting Break in Service.
VESTING COMPUTATION PERIOD means a 12-consecutive month period ending
on the last day of each Plan Year, including corresponding
12-consecutive month periods before January 1, 1985.
VESTING PERCENTAGE means the percentage used to determine the
nonforfeitable portion of a Participant's Account attributable to
Employer Contributions which were not 100% vested when made.
A Participant's Vesting Percentage is shown in the following schedule
opposite the number of whole years of his Vesting Service.
<TABLE>
<CAPTION>
VESTING SERVICE VESTING
(whole years) PERCENTAGE
<S> <C> <C>
Less than 2 0
2 20
3 40
4 60
5 80
6 or more 100
</TABLE>
However, the Vesting Percentage for a Participant who is an Employee on
or after the earliest of (i) the date he reaches his Normal Retirement
Age, (ii) the date of his death, or (iii) the date he becomes Totally
and Permanently Disabled, shall be 100% on such date.
19
<PAGE> 21
If the schedule used to determine a Participant's Vesting Percentage is
changed, the new schedule shall not apply to a Participant unless he is
credited with an Hour-of-Service on or after the date of the change and
the Participant's nonforfeitable percentage on the day before the date
of the change is not reduced under this Plan. The amendment provisions
of the AMENDMENT SECTION of Article IX regarding changes in the
computation of the Vesting Percentage shall apply.
VESTING SERVICE means the sum of (a) and (b) below:
(a) The total of an Employee's service with the Employer before
July 1, 1993, shall be determined according to the provisions
of the Plan in effect on June 30, 1993. Service prior to the
date the Plan became subject to the Employee Retirement Income
Security Act of 1974 may be disregarded if such service would
have been disregarded in accordance with the break in service
rules of the Plan as in effect on the day before such date.
(b) One year of service for each Vesting Computation Period ending
on or after July 1, 1993, in which an Employee is credited
with at least 1,000 Hours-of-Service.
However, Vesting Service is modified as follows:
Other service excluded:
Service before an Employee attained age 18 is excluded.
However, service accrued based on Hours-of-Service within a
Vesting Computation Period shall only be excluded if he did
not attain age 18 in such period.
Period of Military Duty included:
A Period of Military Duty shall be included as service with
the Employer to the extent it has not already been credited.
For purposes of crediting Hours-of-Service during the Period
of Military Duty, an Hour-of-Service shall be credited
(without regard to the 501 Hour-of-Service limitation) for
each hour an Employee would normally have been scheduled to
work for the Employer during such period.
Controlled Group service included:
An Employee's service with a member firm of a Controlled Group
while both that firm and the Employer were members of the
Controlled Group shall be included as service with the
Employer.
20
<PAGE> 22
Other service included:
An Employee's service with Lancer FBD Partnership, Ltd. shall
be included as service with the Employer.
YEARLY DATE means January 1, 1985, and the same day of each following
year.
YEARS OF SERVICE means an Employee's Vesting Service disregarding any
modifications which exclude service.
21
<PAGE> 23
ARTICLE II
PARTICIPATION
SECTION 2.01--ACTIVE PARTICIPANT.
(a) An Employee shall first become an Active Participant (begin
active participation in the Plan) on the earliest Semi-yearly
Date on or after January 1, 2000, on which he is an Eligible
Employee and has met both of the eligibility requirements set
forth below. This date is his Entry Date.
(1) He has competed one year of Eligibility Service
before his Entry Date.
(2) He is age 21 or older.
Each Employee who was an Active Participant under the Plan on
December 31, 1999, shall continue to be an Active Participant
if he is still an Eligible Employee on January 1, 2000, and
his Entry Date shall not change.
If a person has been an Eligible Employee who has met all the
eligibility requirements above, but is not an Eligible
Employee on the date which would have been his Entry Date, he
shall become an Active Participant on the date he again
becomes an Eligible Employee. This date is his Entry Date.
(b) An Inactive Participant shall again become an Active
Participant (resume active participation in the Plan) on the
date he again performs an Hour-of-Service as an Eligible
Employee. This date is his Reentry Date.
Upon again becoming an Active Participant, he shall cease to
be an Inactive Participant.
(c) A former Participant shall again become an Active Participant
(resume active participation in the Plan) on the date he again
performs an Hour-of-Service as an Eligible Employee. This date
is his Reentry Date.
There shall be no duplication of benefits for a Participant under this
Plan because of more than one period as an Active Participant.
SECTION 2.02--INACTIVE PARTICIPANT.
An Active Participant shall become an Inactive Participant (stop
accruing benefits under the Plan) on the earlier of the following:
22
<PAGE> 24
(a) The date on which he ceases to be an Eligible Employee (on his
Retirement Date if the date he ceases to be an Eligible
Employee occurs within one month of his Retirement Date).
(b) The effective date of complete termination of the Plan.
An Employee or former Employee who was an Inactive Participant under
the Plan on December 31, 1999, shall continue to be an Inactive Participant on
January 1, 2000. Eligibility for any benefits payable to him or on his behalf
and the amount of the benefits shall be determined according to the provisions
of the prior document, unless otherwise stated in this document.
SECTION 2.03--CESSATION OF PARTICIPATION.
A Participant shall cease to be a Participant on the date he is no
longer an Eligible Employee and his Account is zero.
SECTION 2.04--ADOPTING EMPLOYERS - SINGLE PLAN.
Each of the employers controlled by or affiliated with the Employer and
listed below is an Adopting Employer. Each Adopting Employer listed below
participates with the Employer in this Plan. An Adopting Employer's agreement to
participate in this Plan shall be in writing.
If the Adopting Employer did not maintain its plan before its date of
adoption specified below, its date of adoption shall be the Entry Date for any
of its employees who have met the requirements in the ACTIVE PARTICIPANT SECTION
of Article II as of that date. Service with and earnings from an Adopting
Employer shall be included as service with and earnings from the Employer.
Transfer of employment, without interruption, between an Adopting Employer and
another Adopting Employer or the Employer shall not be considered an
interruption of service.
Contributions made by an Adopting Employer shall be treated as
Contributions made by the Employer. Forfeitures arising from those Contributions
shall be used for the benefit of all Participants.
An employer shall not be an Adopting Employer if it ceases to be
controlled by or affiliated with the Employer. Such an employer may continue a
retirement plan for its employees in the form of a separate document. This Plan
shall be amended to delete a former Adopting Employer from the list below.
If an employer ceases to be an Adopting Employer and does not continue
a retirement plan for the benefit of its employees, partial termination may
result and the provisions of Article VII apply.
23
<PAGE> 25
ADOPTING EMPLOYERS
<TABLE>
<CAPTION>
NAME FISCAL YEAR END DATE OF ADOPTION
<S> <C> <C>
LANCER PARTNERSHIP, LTD. December 31 May 1, 1996
ADVANCED BEVERAGE SOLUTIONS December 31 March 23, 2000
</TABLE>
24
<PAGE> 26
ARTICLE III
CONTRIBUTIONS
SECTION 3.01--EMPLOYER CONTRIBUTIONS.
Employer Contributions for Plan Years which end on or after January 1,
2000, may be made without regard to current or accumulated net income, earnings,
or profits of the Employer. Notwithstanding the foregoing, the Plan shall
continue to be designed to qualify as a profit sharing plan for purposes of Code
Sections 401(a), 402, 412, and 417. Such Contributions will be equal to the
Employer Contributions as described below:
(a) The amount of each Elective Deferral Contribution for a
Participant shall be equal to any whole percentage (not more
than 15%) of his Compensation for the month as elected in his
elective deferral agreement. An Employee who is eligible to
participate in the Plan may file an elective deferral
agreement with the Employer. The elective deferral agreement
to start Elective Deferral Contributions may be effective on a
Participant's Entry Date (Reentry Date, if applicable) or any
following Monthly Date. The Participant shall make any change
or terminate the elective deferral agreement by filing a new
elective deferral agreement. A Participant's elective deferral
agreement making a change may be effective on any date an
elective deferral agreement to start Elective Deferral
Contributions could be effective. A Participant's elective
deferral agreement to stop Elective Deferral Contributions may
be effective on any date. The elective deferral agreement must
be in writing and completed before the beginning of the pay
period in which Elective Deferral Contributions are to start,
change or stop.
Elective Deferral Contributions are fully (100%) vested and
nonforfeitable.
(b) The amount of each Matching Contribution for a Participant
shall be equal to a percentage (not more than 100%) as
determined by the Employer, of the Elective Deferral
Contributions made for him for the month, disregarding any
Elective Deferral Contributions in excess of a percentage as
determined by the Employer, of his Compensation for the month.
Matching Contributions are subject to the Vesting Percentage.
(c) The amount of each Discretionary Contribution shall be
determined by the Employer.
Discretionary Contributions are subject to the Vesting
Percentage.
25
<PAGE> 27
No Participant shall be permitted to have Elective Deferral
Contributions, as defined in the EXCESS AMOUNTS SECTION of Article III, made
under this Plan, or any other qualified plan maintained by the Employer, during
any taxable year, in excess of the dollar limitation contained in Code Section
402(g) in effect at the beginning of such taxable year.
In any Plan Year, the Employer may make all or a part of the following
Contributions for such Plan Year in advance of the last day of the Plan Year:
Discretionary Contributions
Such Contributions shall be allocated when made in a manner which approximates
the allocation which would otherwise have been made as of the last day of the
Plan Year. Succeeding allocations shall take into account amounts previously
allocated for the Plan Year. The percentage of the Employer Contribution
allocated to the Participant for the Plan Year shall be the same percentage
which would have been allocated to him if the entire allocation had been made as
of the last day of the Plan Year. Excess allocations shall be forfeited and
reallocated as necessary to provide the percentage applicable to each
Participant.
The Employer shall pay to the Trustee its Contributions used to
determine the Actual Deferral Percentage, as defined in the EXCESS AMOUNTS
SECTION of Article III, to the Plan for each Plan Year not later than the end of
the twelve-month period immediately following the Plan Year for which they are
deemed to be paid. Any such Contributions accumulated through payroll deductions
shall be paid within 90 days of the date withheld or the date it is first
reasonably practical for the Employer to do so, if earlier.
A portion of the Plan assets resulting from Employer Contributions (but
not more than the original amount of those Contributions and reduced
proportionately for losses, if applicable) may be returned if the Employer
Contributions are made because of a mistake of fact or are more than the amount
deductible under Code Section 404 (excluding any amount which is not deductible
because the Plan is disqualified). The amount involved must be returned to the
Employer within one year after the date the Employer Contributions are made by
mistake of fact or the date the deduction is disallowed, whichever applies.
Except as provided under this paragraph and Article VII, the assets of the Plan
shall never be used for the benefit of the Employer and are held for the
exclusive purpose of providing benefits to Participants and their Beneficiaries
and for defraying reasonable expenses of administering the Plan.
SECTION 3.01 A--ROLLOVER CONTRIBUTIONS.
A Rollover Contribution may be made by or for an Eligible Employee if
the following conditions are met:
(a) The Contribution is a rollover contribution which the Code
permits to be transferred to a plan that meets the
requirements of Code Section 401(a).
26
<PAGE> 28
(b) If the Contribution is made by the Eligible Employee, it is
made within sixty days after he receives the distribution.
(c) The Eligible Employee furnishes evidence satisfactory to the
Plan Administrator that the proposed transfer is in fact a
rollover contribution that meets conditions (a) and (b) above.
The Rollover Contribution may be made by the Eligible Employee or the
Eligible Employee may direct the trustee or named fiduciary of another plan to
transfer the funds which would otherwise be a Rollover Contribution directly to
this Plan. Such transferred funds shall be called a Rollover Contribution. The
Contribution shall be made according to procedures set up by the Plan
Administrator.
If the Eligible Employee is not an Active Participant at the time the
Rollover Contribution is made, he shall be deemed to be a Participant only for
the purposes of investment and distribution of the Rollover Contribution. He
shall not share in the allocation of Employer Contributions or Forfeitures until
the time he meets all the requirements to become an Active Participant.
Rollover Contributions made by or for an Eligible Employee shall be
credited to his Account. The part of the Participant's Account resulting from
Rollover Contributions is fully (100%) vested and nonforfeitable at all times. A
separate accounting record shall be maintained for that part of his Rollover
Contribution which consists of voluntary contributions that were deducted from
the Participant's gross income for Federal income tax purposes.
SECTION 3.02--FORFEITURES.
The Nonvested Account of a Participant shall be forfeited as of the
earlier of the following: the date of the Participant's death, if prior to such
date he had ceased to be an Employee; or his Forfeiture Date. All or a part of a
Participant's Nonvested Account will be forfeited if, after he ceases to be an
Employee, he receives a distribution of his entire Vested Account or a
distribution of his Vested Account derived from Employer Contributions which
were not 100% vested when made according to the provisions of the VESTED
BENEFITS SECTION of Article V or the SMALL AMOUNTS SECTION of Article IX. If a
Participant's Vested Account is zero on the date he ceases to be an Employee, he
shall be deemed to have received a distribution of his entire Vested Account on
such date. The forfeiture will occur as of the date he receives the distribution
or on the date such provision became effective, if later. If he receives a
distribution of his entire Vested Account, his entire Nonvested Account will be
forfeited. If he receives a distribution of his Vested Account from Employer
Contributions which were not 100 % vested when made, but less than his entire
Vested Account, the amount to be forfeited will be determined by multiplying his
Nonvested Account by a fraction. The numerator of the fraction is the amount of
the distribution derived from Employer Contributions
27
<PAGE> 29
which were not 100% vested when made and the denominator of the fraction is his
entire Vested Account derived from such Employer Contributions on the date of
distribution.
A Forfeiture shall also occur as described in the EXCESS AMOUNTS
SECTION of Article III.
Forfeitures may first be applied to pay administrative expenses under
the Plan which would otherwise be paid by the Employer.
Forfeitures not used to pay administrative expenses shall be allocated
as described in the ALLOCATION SECTION of Article III as of the last day of the
Plan Year in which they arise. Upon such allocation, Forfeitures shall be deemed
to be Discretionary Contributions.
Forfeitures of Matching Contributions which relate to excess amounts
shall be applied as provided in the EXCESS AMOUNTS SECTION of Article III.
If a Participant again becomes an Eligible Employee after receiving a
distribution which caused his Nonvested Account to be forfeited, he shall have
the right to repay to the Plan the entire amount of the distribution he received
(excluding any amount of such distribution resulting from Contributions which
were 100% vested when made). The repayment must be made before the earlier of
the date five years after the date he again becomes an Eligible Employee or the
end of the first period of five consecutive Vesting Breaks in Service which
begin after the date of the distribution.
If the Participant makes the repayment provided above, the Plan
Administrator shall restore to his Account an amount equal to his Nonvested
Account which was forfeited on the date of distribution, unadjusted for any
investment gains or losses. If the amount of the repayment is zero dollars
because the Participant was deemed to have received a distribution or the plan
did not have repayment provisions in effect on the date the distribution was
made and he again performs an Hour-of-Service as an Eligible Employee within the
repayment period, the Plan Administrator shall restore the Participant's Account
as if he had made a required repayment on the date he performed such
Hour-of-Service. Restoration of the Participant's Account shall include
restoration of all Code Section 411(d)(6) protected benefits with respect to
that restored Account, according to applicable Treasury regulations. Provided,
however, the Plan Administrator shall not restore the Nonvested Account if a
Forfeiture Date has occurred after the date of the distribution and on or before
the date of repayment and that Forfeiture Date would result in a complete
forfeiture of the amount the Plan Administrator would otherwise restore.
The Plan Administrator shall restore the Participant's Account by the
close of the Plan Year following the Plan Year in which repayment is made.
Permissible sources for restoration are Forfeitures or Employer Contributions.
The Employer shall contribute, without regard to any requirement or condition of
the EMPLOYER CONTRIBUTIONS SECTION of Article III,
28
<PAGE> 30
such additional amount needed to make the required restoration. The repaid and
restored amounts are not included in the Participant's Annual Addition, as
defined in the CONTRIBUTION LIMITATION SECTION of Article III.
SECTION 3.03--ALLOCATION.
The following Contributions for the Plan Year, plus any Forfeitures
released for allocation for the Plan Year, shall be allocated among all eligible
persons:
Discretionary Contributions
The eligible persons are all Participants who had 1,000 or more
Hours-of-Service in the Accrual Computation Period that ends in the Plan Year
and who are Active Participants on the last day of the Plan Year. The amount
allocated to such a person shall be determined below and under Article X.
The following Contributions for each Plan Year shall be allocated to
each Participant for whom such Contributions were made under the EMPLOYER
CONTRIBUTIONS SECTION of Article III:
Elective Deferral Contributions
Matching Contributions
These Contributions shall be allocated when made and credited to the
Participant's Account.
Discretionary Contributions plus any Forfeitures are allocated as of
the last day of each Plan Year. The amount allocated to each eligible person for
the Plan Year shall be equal to the Discretionary Contributions plus any
Forfeitures for the Plan Year, multiplied by the ratio of (a) his Annual
Compensation as of the last day of the Plan Year to (b) the total of such
compensation for all eligible persons. This amount is credited to his Account.
SECTION 3.04--CONTRIBUTION LIMITATION.
(a) For the purpose of determining the contribution limitation set
forth in this section, the following terms are defined:
Aggregate Annual Addition means, for a Participant with
respect to any Limitation Year, the sum of his Annual
Additions under all defined contribution plans of the
Employer, as defined in this section, for such Limitation
Year. The nondeductible participant contributions which the
Participant makes to a defined benefit plan shall be treated
as Annual Additions to a defined contribution plan. The
Contributions the Employer, as defined in this section, made
for the Participant for a Plan Year beginning on or after
March 31, 1984, to an individual medical
29
<PAGE> 31
benefit account, as defined in Code Section 415(l)(2), under a
pension or annuity plan of the Employer, as defined in this
section, shall be treated as Annual Additions to a defined
contribution plan. Also, amounts derived from contributions
paid or accrued after December 31, 1985, in Fiscal Years
ending after such date, which are attributable to
post-retirement medical benefits allocated to the separate
account of a key employee, as defined in Code Section
419A(d)(3), under a welfare benefit fund, as defined in Code
Section 419(e), maintained by the Employer, as defined in this
section, are treated as Annual Additions to a defined
contribution plan. The 25% of Compensation limit under Maximum
Permissible Amount does not apply to. Annual Additions
resulting from contributions made to an individual medical
account, as defined in Code Section 415(1)(2), or to Annual
Additions resulting from contributions for medical benefits,
within the meaning of Code Section 419A, after separation from
service. '
Annual Addition means the amount added to a Participant's
account for any Limitation Year which may not exceed the
Maximum Permissible Amount. The Annual Addition under any plan
for a Participant with respect to any Limitation Year, shall
be equal to the sum of (1) and (2) below:
(1) Employer contributions and forfeitures credited to
his account for the Limitation Year.
(2) Participant contributions made by him for the
Limitation Year.
Before the first Limitation Year beginning after December 31,
1986, the amount under (2) above is the lesser of (i) 1 1/2 of
his nondeductible participant contributions made for the
Limitation Year, or (ii) the amount, if any, of his
nondeductible participant contributions made for the
Limitation Year which is in excess of six percent of his
Compensation, as defined in this section, for such Limitation
Year.
Compensation means all wages for Federal income tax
withholding purposes, as defined under Code Section 3401(a)
(for purposes of income tax withholding at the source),
disregarding any rules limiting the remuneration included as
wages based on the nature or location of the employment or the
services performed.
For any self-employed individual Compensation will mean earned
income.
For purposes of applying the limitations of this section,
Compensation for a Limitation Year is the Compensation
actually paid or made available during such Limitation Year.
30
<PAGE> 32
Defined Benefit Plan Fraction means, with respect to a
Limitation Year for a Participant who is or has been a
participant in a defined benefit plan ever maintained by the
Employer, as defined in this section, the quotient, expressed
as a decimal, of
(1) the Participant's Projected Annual Benefit under all
such plans as of the close of such Limitation Year,
divided by
(2) on and after the TEFRA Compliance Date, the lesser of
(i) or (ii) below:
(i) 1.25 multiplied by the maximum dollar
limitation which applies to defined benefit
plans determined for the Limitation Year
under Code Sections 415(b) or (d) or
(ii) 1.4 multiplied by the Participant's highest
average compensation as defined in the
defined benefit plan(s),
including any adjustments under Code Section 415(b).
Before the TEFRA Compliance Date, this denominator is
the Participant's Projected Annual Benefit as of the
close of the Limitation Year if the plans) provided
the maximum benefit allowable.
The Defined Benefit Plan Fraction shall be modified as
follows:
If the Participant was a participant as of the first day of
the first Limitation Year beginning after December 31, 1986,
in one or more defined benefit plans maintained by the
Employer, as defined in this section, which were in existence
on May 6, 1986, the denominator of this fraction will not be
less than 125 percent of the sum of the annual benefits under
such plans which the Participant had accrued as of the close
of the last Limitation Year beginning before January 1, 1987,
disregarding any changes in the terms and conditions of the
plan after May 5, 1986. The preceding sentence applies only if
the defined benefit plans individually and in the aggregate
satisfied the requirements of Code Section 415 for all
Limitation Years beginning before January 1, 1987.
Defined Contribution Plan Fraction means, for a Participant
with respect to a Limitation Year, the quotient, expressed as
a decimal, of
(1) the Participant's Aggregate Annual Additions for such
Limitation Year and all prior Limitation Years, under
all defined contribution plans (including the
Aggregate Annual Additions attributable to
nondeductible accounts under defined benefit plans
and attributable to all welfare benefit funds, as
defined in Code Section 419(e) and attributable to
individual medical
31
<PAGE> 33
accounts, as defined in Code Section 415(l)(2) ever
maintained by the Employer, as defined in this
section, divided by
(2) on and after the TEFRA Compliance Date, the sum of
the amount determined for the Limitation Year under
(i) or (ii) below, whichever is less, and the amounts
determined in the same manner for all prior
Limitation Years during which he has been an Employee
or an employee of a predecessor employer:
(i) 1.25 multiplied by the maximum permissible
dollar amount for each such Limitation Year,
or
(ii) 1.4 multiplied by the maximum permissible
percentage of the Participant's
Compensation, as defined in this section,
for each such Limitation Year.
Before the TEFRA Compliance Date, this denominator is
the sum of the maximum allowable amount of Annual
Addition to his account(s) under all the plan(s) of
the Employer, as defined in this section, for each
such Limitation Year.
The Defined Contribution Plan Fraction shall be modified as
follows:
If the Participant was a participant as of the first day of
the first Limitation Year beginning after December 31, 1986,
in one or more defined contribution plans maintained by the
Employer, as defined in this section, which were in existence
on May 6, 1986, the numerator of this fraction shall be
adjusted if the sum of the Defined Contribution Plan Fraction
and Defined Benefit Plan Fraction would otherwise exceed 1.0
under the terms of this Plan. Under the adjustment, the dollar
amount determined below shall be permanently subtracted from
the numerator of this fraction. The dollar amount is equal to
the excess of the sum of the two fractions, before adjustment,
over 1.0 multiplied by the denominator of his Defined
Contribution Plan Fraction. The adjustment is calculated using
his Defined Contribution Plan Fraction and Defined Benefit
Plan Fraction as they would be computed as of the end of the
last Limitation Year beginning before January 1, 1987, and
disregarding any changes in the terms and conditions of the
plan made after May 5, 1986, but using the Code Section 415
limitations applicable to the first Limitation Year beginning
on or after January 1, 1987.
The Annual Addition for any Limitation Year beginning before
January 1, 1987, shall not be recomputed to treat all employee
contributions as Annual Additions.
For a plan that was in existence on July 1, 1982, for purposes
of determining the Defined Contribution Plan Fraction for any
Limitation Year ending after
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<PAGE> 34
December 31, 1982, the Plan Administrator may elect, in
accordance with the provisions of Code Section 415, that the
denominator for each Participant for all Limitation Years
ending before January 1, 1983, will be equal to
(1) the Defined Contribution Plan Fraction denominator
which would apply for the last Limitation Year ending
in 1982 if an election under this paragraph were not
made, multiplied by.
(2) a fraction, equal to (i) over (ii) below:
(i) the lesser of (A) $51,875, or (B) 1.4,
multiplied by 25% of the Participant's
Compensation, as defined in this section,
for the Limitation Year ending in 1981;
(ii) the lesser of (A) $41,500, or (B) 25% of the
Participant's Compensation, as defined in
this section, for the Limitation Year ending
in 1981.
The election described above is applicable only if the plan
administrators under all defined contribution plans of the
Employer, as defined in this section, also elect to use the
modified fraction.
Employer means any employer that adopts this Plan and all
Controlled Group members and any other entity required to be
aggregated with the employer pursuant to regulations under
Code Section 414(o).
Limitation Year means the 12-consecutive month period within
which it is determined whether or not the limitations of Code
Section 415 are exceeded. Limitation Year means each
12-consecutive month period ending on the last day of each
Plan Year, including corresponding 12-consecutive month
periods before January 1, 1985. If the Limitation Year is
other than the calendar year, execution of this Plan (or any
amendment to this Plan changing the Limitation Year)
constitutes the Employer's adoption of a written resolution
electing the Limitation Year. If the Limitation Year is
changed, the new Limitation Year shall begin within the
current Limitation Year, creating a short Limitation Year.
Maximum Permissible Amount means, for a Participant with
respect to any Limitation Year, the lesser of (1) or (2)
below:
(1) The greater of $30,000 or one-fourth of the maximum
dollar limitation which applies to defined benefit
plans set forth in Code Section 415(b)(1)(A) as in
effect for the Limitation Year. (Before the TEFRA
Compliance Date, $25,000 multiplied by the cost of
living adjustment factor permitted by Federal
regulations.)
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<PAGE> 35
(2) 25% of his Compensation, as defined in this section,
for such Limitation Year.
The compensation limitation referred to in (2) shall not apply
to any contribution for medical benefits (within the meaning
of Code Section 401(h) or Code Section 419A(f)(2)) which is
otherwise treated as an annual addition under Code Section
415(l)(1) or Code Section 419A(d)(2).
If there is a short Limitation Year because of a change in
Limitation Year, the Maximum Permissible Amount will not
exceed the maximum dollar limitation which would otherwise
apply multiplied by the following fraction:
<TABLE>
<CAPTION>
Number of months in the short Limitation Year
---------------------------------------------
<S> <C>
12
</TABLE>
Projected Annual Benefit means a Participant's expected annual
benefit under all defined benefit plan(s) ever maintained by
the Employer, as defined in this section. The Projected Annual
Benefit shall be determined assuming that the Participant will
continue employment until the later of current age or normal
retirement age under such plan(s), and that the Participant's
compensation for the current Limitation Year and all other
relevant factors used to determine benefits under such plans)
will remain constant for all future Limitation Years. Such
expected annual benefit shall be adjusted to the actuarial
equivalent of a straight life annuity if expressed in a form
other than a straight life or qualified joint and survivor
annuity.
(b) The Annual Addition under this Plan for a Participant during a
Limitation Year shall not be more than the Maximum Permissible
Amount.
(c) Contributions and Forfeitures which would otherwise be
credited to the Participant's Account shall be limited or
reallocated to the extent necessary to meet the restrictions
of subparagraph (b) above for any Limitation Year in the
following order. Forfeitures shall be reallocated in the same
manner as described in the ALLOCATION SECTION of Article III
to the remaining Participants to whom the limitations do not
apply for the Limitation Year. Discretionary Contributions
shall be reallocated in the same manner as described in the
ALLOCATION SECTION of Article III to the remaining
Participants to whom the limitations do not apply for the
Limitation Year. The Discretionary Contributions shall be
limited if there are no such remaining Participants. Elective
Deferral Contributions that are not the basis for Matching
Contributions shall be limited. Matching Contributions shall
be limited to the extent necessary to limit the Participant's
Annual Addition under this Plan to his maximum amount. If
Matching Contributions are limited because of this limit,
Elective Deferral
34
<PAGE> 36
Contributions that are the basis for Matching Contributions
shall be reduced in proportion.
If, due to (i) an error in estimating a Participant's
Compensation as defined in this section, (ii) because
Forfeitures cannot be reallocated to remaining Participants
due to the limits of this section, (iii) as a result of a
reasonable error in determining the amount of elective
deferrals (within the meaning of Code Section 402(g)(3)) that
may be made with respect to any individual under the limits of
Code Section 415, or (iv) other limited facts and
circumstances, a Participant's Annual Addition is greater than
the amount permitted in (b) above, such excess amount shall be
applied as follows. Elective Deferral Contributions which are
not the basis for Matching Contributions will be returned to
the Participant. If an excess still exists, Elective Deferral
Contributions that are the basis for Matching Contributions
will be returned to the Participant. Matching Contributions
based on Elective Deferral Contributions which are returned
shall be forfeited. If after the return of Elective Deferral
Contributions, an excess amount still exists, and the
Participant is an Active Participant as of the end of the
Limitation Year, the excess amount shall be used to offset
Employer Contributions for him in the next Limitation Year. If
after the return of Elective Deferral Contributions, an excess
amount still exists, and the Participant is not an Active
Participant as of the end of the Limitation Year, the excess
amount will be held in a suspense account which will be used
to offset Employer Contributions for all Participants in the
next Limitation Year. No Employer Contributions that would be
included in the next Limitation Year's Annual Addition may be
made before the total suspense account has been used.
(d) A Participant's Aggregate Annual Addition for a Limitation
Year shall not exceed the Maximum Permissible Amount.
If, for the Limitation Year, the Participant has an Annual
Addition under more than one defined contribution plan or a
welfare benefit fund, as defined in Code Section 419(e), or an
individual medical account, as defined in Code Section
415(l)(2), maintained by the Employer, as defined in this
section, and such plans and welfare benefit funds and
individual medical accounts do not otherwise limit the
Aggregate Annual Addition to the Maximum Permissible Amount,
any reduction necessary shall be made first to the profit
sharing plans, then to all other such plans and welfare
benefit funds and individual medical accounts and, if
necessary, by reducing first those that were most recently
allocated. Welfare benefit funds and individual medical
accounts shall be deemed to be allocated first. However,
elective deferral contributions shall be the last
contributions reduced before the welfare benefit fund or
individual medical account is reduced.
35
<PAGE> 37
If some of the Employer's defined contribution plans were not
in existence on July 1, 1982, and some were in existence on
that date, the Maximum Permissible Amount which is based on a
dollar amount may differ for a Limitation Year. The Aggregate
Annual Addition for the Limitation Year in which the dollar
limit differs shall not exceed the lesser of (1) 25% of
Compensation as defined in this section, (2) $45,475, or (3)
the greater of $30,000 or the sum of the Annual Additions for
such Limitation Year under all the plan(s) to which the
$45,475 amount applies:
(e) If a Participant is or has been a participant in both defined
benefit and defined contribution plans (including a welfare
benefit fund or individual medical account) ever maintained by
the Employer, as defined in this section, the sum of the
Defined Benefit Plan Fraction and the Defined Contribution
Plan Fraction for any Limitation Year shall not exceed 1.0
(1.4 before the TEFRA Compliance Date).
After all other limitations set out in the plans and funds
have been applied, the following limitations shall apply so
that the sum of the Participant's Defined Benefit Plan
Fraction and Defined Contribution Plan Fraction shall not
exceed 1.0 (1.4 before the TEFRA Compliance Date). The
Projected Annual Benefit shall be limited first. If the
Participant's annual benefit(s) equal his Projected Annual
Benefit, as limited, then Annual Additions to the defined
contribution plan(s) shall be limited to the extent needed to
reduce the sum to 1.0 (1.4). First, the voluntary
contributions the Participant may make for the Limitation Year
shall be limited. Next, in the case of a profit sharing plan,
any forfeitures allocated to the Participant shall be
reallocated to remaining participants to the extent necessary
to reduce the decimal to 1.0 (1.4). Last, to the extent
necessary, employer contributions for the Limitation Year
shall be reallocated or limited, and any required and optional
employee contributions to which such employer contributions
were geared shall be reduced in proportion.
If, for the Limitation Year, the Participant has an Annual
Addition under more than one defined contribution plan or
welfare benefit fund or individual medical account maintained
by the Employer, as defined in this section, any reduction
above shall be made first to the profit sharing plans, then to
all other such plans and welfare benefit plans and individual
medical accounts and, if necessary, by reducing first those
that were most recently allocated. However, elective deferral
contributions shall be the last contributions reduced before
the welfare benefit fund or individual medical account is
reduced. The annual addition to the welfare benefit fund and
individual medical account shall be limited last.
36
<PAGE> 38
SECTION 3.05--EXCESS AMOUNTS.
(a) For the purposes of this section, the following terms are
defined:
Actual Deferral Percentage means the ratio (expressed as a
percentage) of Elective Deferral Contributions under this Plan
on behalf of the Eligible Participant for the Plan Year to the
Eligible Participant's Compensation for the Plan Year. In
modification of the foregoing, Compensation shall be limited
to the Compensation received while an Active Participant. The
Elective Deferral Contributions used to determine the Actual
Deferral Percentage shall include Excess Elective Deferrals
(other than Excess Elective Deferrals of Nonhighly Compensated
Employees that arise solely from Elective Deferral
Contributions made under this Plan or any other plans of the
Employer or a Controlled Group member), but shall exclude
Elective Deferral Contributions that are used in computing the
Contribution Percentage (provided the Average Actual Deferral
Percentage test is satisfied both with and without exclusion
of these Elective Deferral Contributions. Under such rules as
the Secretary of the Treasury shall prescribe in Code Section
401(k)(3)(D), the Employer may elect to include Qualified
Nonelective Contributions and Qualified Matching Contributions
under this Plan in computing the Actual Deferral Percentage.
For an Eligible Participant for whom such Contributions on his
behalf for the Plan Year are zero, the percentage is zero.
Aggregate Limit means the greater of (1) or (2) below:
(1) The sum of
(i) 125 percent of the greater of the Average
Actual Deferral Percentage of the Nonhighly
Compensated Employees for the Plan Year or
the Average Contribution Percentage of
Nonhighly Compensated Employees under the
Plan subject to Code Section 401(m) for the
Plan Year beginning with or within the Plan
Year of the cash or deferred arrangement and
(ii) the lesser of 200% or two plus the lesser of
such Average Actual Deferral Percentage or
Average Contribution Percentage.
(2) The sum of
(i) 125 percent of the lesser of the Average
Actual Deferral Percentage of the Nonhighly
Compensated Employees for the Plan Year or
the Average Contribution Percentage of
Nonhighly Compensated Employees under the
Plan subject to Code Section 401(m) for the
Plan Year beginning with or within the Plan
Year of the cash or deferred arrangement and
37
<PAGE> 39
(ii) the lesser of 200% or two plus the greater
of such Average Actual Deferral Percentage
or Average Contribution Percentage.
Average Actual Deferral Percentage means the average
(expressed as a percentage) of the Actual Deferral Percentages
of the Eligible Participants in a group.
Average Contribution Percentage means the average (expressed
as a percentage) of the Contribution Percentages of the
Eligible Participants in a group.
Contribution Percentage means the ratio (expressed as a
percentage) of the Eligible Participant's Contribution
Percentage Amounts to the Eligible Participant's Compensation
for the Plan Year. In modification of the foregoing,
Compensation shall be limited to the Compensation received
while an Active Participant. For an Eligible Participant for
whom such Contribution Percentage Amounts for the Plan Year
are zero, the percentage is zero.
Contribution Percentage Amounts means the sum of the
Participant Contributions and Matching Contributions (that are
not Qualified Matching Contributions) under this Plan on
behalf of the Eligible Participant for the Plan Year. Such
Contribution Percentage Amounts shall not include Matching
Contributions that are forfeited either to correct Excess
Aggregate Contributions or because the Contributions to which
they relate are Excess Elective Deferrals, Excess
Contributions or Excess Aggregate Contributions. Under such
rules as the Secretary of the Treasury shall prescribe in Code
Section 401(k)(3)(D), the Employer may elect to include
Qualified Nonelective Contributions and Qualified Matching
Contributions under this Plan which were not used in computing
the Actual Deferral Percentage in computing the Contribution
Percentage. The Employer may also elect to use Elective
Deferral Contributions in computing the Contribution
Percentage so long as the Average Actual Deferral Percentage
test is met before the Elective Deferral Contributions are
used in the Average Contribution Percentage test and continues
to be met following the exclusion of those Elective Deferral
Contributions that are used to meet the Average Contribution
Percentage test.
Elective Deferral Contributions means employer contributions
made on behalf of a participant pursuant to an election to
defer under any qualified cash or deferred arrangement as
described in Code Section 401(k), any simplified employee
pension cash or deferred arrangement as described in Code
Section 402(h)(1)(B), any eligible deferred compensation plan
under Code Section 457, any plan as described under Code
Section 501(c)(18), and any employer contributions made on
behalf of a participant for the purchase of an annuity
38
<PAGE> 40
contract under Code Section 403(b) pursuant to a salary
reduction agreement. Elective Deferral Contributions shall not
include any deferrals properly distributed as excess Annual
Additions.
Eligible Participant means, for purposes of the Actual
Deferral Percentage, any Employee who is eligible to make an
Elective Deferral Contribution, and shall include the
following: any Employee who would be a plan participant if he
chose to make required contributions; any Employee who can
make Elective Deferral Contributions but who has changed the
amount of his Elective Deferral Contribution to 0%, or whose
eligibility to make an Elective Deferral Contribution is
suspended because of a loan, distribution or hardship
withdrawal; and, any Employee who is not able to make an
Elective Deferral Contribution because of Code Section
415(c)(1) - Annual Additions limits. The Actual Deferral
Percentage for any such included Employee is zero.
Eligible Participant means, for purposes of the Average
Contribution Percentage, any Employee who is eligible to make
a Participant Contribution or to receive a Matching
Contribution, and shall include the following: any Employee
who would be a plan participant if he chose to make required
contributions; any Employee who can make a Participant
Contribution or receive a matching contribution but who has
made an election not to participate in the Plan; and any
Employee who is not able to make a Participant Contribution or
receive a matching contribution because of Code Section
415(c)(1) or 415(e) limits. The Average Contribution
Percentage for any such included Employee is zero.
Excess Aggregate Contributions means, with respect to any Plan
Year, the excess of:
(1) The aggregate Contributions taken into account in
computing the numerator of the Contribution
Percentage actually made on behalf of Highly
Compensated Employees for such Plan Year, over
(2) The maximum amount of such Contributions permitted by
the Average Contribution Percentage test (determined
by reducing Contributions made on behalf of Highly
Compensated Employees in order of their Contribution
Percentages beginning with the highest of such
percentages).
Such determination shall be made after first determining
Excess Elective Deferrals and then determining Excess
Contributions.
39
<PAGE> 41
Excess Contributions means, with respect to any Plan Year, the
excess of:
(1) The aggregate amount of Contributions actually taken
into account in computing the Actual Deferral
Percentage of Highly Compensated Employees for such
Plan Year, over
(2) The maximum amount of such Contributions permitted by
the Actual Deferral Percentage test (determined by
reducing Contributions made on behalf of Highly
Compensated Employees in order of the Actual Deferral
Percentages, beginning with the highest of such
percentages).
A Participant's Excess Contributions for a Plan Year will be
reduced by the amount of Excess Elective Deferrals, if any,
previously distributed to the Participant for the taxable year
ending in that Plan Year.
Excess Elective Deferrals means those Elective Deferral
Contributions that are includible in a Participant's gross
income under Code Section 402(g) to the extent such
Participant's Elective Deferral Contributions for a taxable
year exceed the dollar limitation under such Code section.
Excess Elective Deferrals shall be treated as Annual
Additions, as defined in the CONTRIBUTION LIMITATION SECTION
of Article III, under the Plan, unless such amounts are
distributed no later than the first April 15 following the
close of the Participant's taxable year.
Family Member means an Employee, or former employee; the
spouse of the Employee or former employee, and the lineal
ascendants or descendants and the spouses of such lineal
ascendants or descendants of any such Employee or former
employee. In determining if an individual is a family member
as to an Employee or former employee, legal adoptions are
taken into account.
Matching Contributions means employer contributions made to
this or any other defined contribution plan, or to a contract
described in Code Section 403(b), on behalf of a participant
on account of a Participant Contribution made by such
participant, or on account of a participant's Elective
Deferral Contributions, under a plan maintained by the
employer.
Participant Contributions means contributions made to any plan
by or on behalf of a participant that are included in the
participant's gross income in the year in which made and that
are maintained under a separate account to which earnings and
losses are allocated.
Qualified Matching Contributions means Matching Contributions
which are subject to the distribution and nonforfeitability
requirements under Code Section 401(k) when made.
40
<PAGE> 42
Qualified Nonelective Contributions means any employer
contributions (other than Matching Contributions) which an
employee may not elect to have paid to him in cash instead of
being contributed to the plan and which are subject to the
distribution and nonforfeitability requirements under Code
Section 401(k) when made.
(b) A Participant may assign to this Plan any Excess Elective
Deferrals made during a taxable year by notifying the Plan
Administrator in writing on or before the first following
March 1 of the amount of the Excess Elective Deferrals to be
assigned to the Plan. A Participant is deemed to notify the
Plan Administrator of any Excess Elective Deferrals that arise
by taking into account only those Elective Deferral
Contributions made to this Plan and any other plans of the
Employer or a Controlled Group member and reducing such Excess
Elective Deferrals by the amount of Excess Contributions, if
any, previously distributed for the Plan Year beginning in
that taxable year. The Participant's claim for Excess Elective
Deferrals shall be accompanied by the Participant's written
statement that if such amounts are not distributed, such
Excess Elective Deferrals, when added to amounts deferred
under other plans or arrangements described in Code Sections
401(k), 408(k) or 403(b), will exceed the limit imposed on the
Participant by Code Section 402(g) for the year in which the
deferral occurred. The Excess Elective Deferrals assigned to
this Plan can not exceed the Elective Deferral Contributions
allocated under this Plan for such taxable year.
Notwithstanding any other provisions of the Plan, Elective
Deferral Contributions in an amount equal to the Excess
Elective Deferrals assigned to this Plan, plus any income and
minus any loss allocable thereto, shall be distributed no
later than April 15 to any Participant to whose Account Excess
Elective Deferrals were assigned for the preceding year and
who claims Excess Elective Deferrals for such taxable year.
The income or loss allocable to such Excess Elective Deferrals
shall be equal to the income or loss allocable to the
Participant's Elective Deferral Contributions for the taxable
year in which the excess occurred multiplied by a fraction.
The numerator of the fraction is the Excess Elective
Deferrals. The denominator of the fraction is the closing
balance without regard to any income or loss occurring during
such taxable year (as of the end of such taxable year) of the
Participant's Account resulting from Elective Deferral
Contributions.
Any Matching Contributions which were based on the Elective
Deferral Contributions which are distributed as Excess
Elective Deferrals, plus any income and minus any loss
allocable thereto, shall be forfeited. These Forfeitures shall
be used to offset the earliest Employer Contribution due after
the Forfeiture arises.
41
<PAGE> 43
(c) As of the end of each Plan Year after Excess Elective
Deferrals have been determined, one of the following tests
must be met:
(1) The Average Actual Deferral Percentage for Eligible
Participants who are Highly Compensated Employees for
the Plan Year is not more than the Average Actual
Deferral Percentage for Eligible Participants who are
Nonhighly Compensated Employees for the Plan Year
multiplied by 1.25.
(2) The Average Actual Deferral Percentage for Eligible
Participants who are Highly Compensated Employees for
the Plan Year is not more than the Average Actual
Deferral Percentage for Eligible Participants who are
Nonhighly Compensated Employees for the Plan Year
multiplied by 2 and the difference between the
Average Actual Deferral Percentages is not more than
2.
The Actual Deferral Percentage for any Eligible Participant
who is a Highly Compensated Employee for the Plan Year and who
is eligible to have Elective Deferral Contributions (and
Qualified Nonelective Contributions or Qualified Matching
Contributions, or both, if used in computing the Actual
Deferral Percentage) allocated to his account under two or
more plans or arrangements described in Code Section 401(k)
that are maintained by the Employer or a Controlled Group
member shall be determined as if all such Elective Deferral
Contributions (and, if applicable, such Qualified Nonelective
Contributions or Qualified Matching Contributions, or both)
were made under a single arrangement. If a Highly Compensated
Employee participates in two or more cash or deferred
arrangements that have different Plan Years, all cash or
deferred arrangements ending with or within the same calendar
year shall be treated as a single arrangement. Notwithstanding
the foregoing, certain plans shall be treated as separate if
mandatorily disaggregated under the regulations under Code
Section 401(k) or permissibly disaggregated as provided.
In the event that this Plan satisfies the requirements of Code
Sections 401(k), 401(a)(4), or 410(b) only if aggregated with
one or more other plans, or if one or more other plans satisfy
the requirements of such Code sections only if aggregated with
this Plan, then this section shall be applied by determining
the Actual Deferral Percentage of employees as if all such
plans were a single plan. Plans may be aggregated in order to
satisfy Code Section 401(k) only if they have the same Plan
Year.
For purposes of determining the Actual Deferral Percentage of
an Eligible Participant who is a five-percent owner or one of
the ten most highly-paid Highly Compensated Employees, the
Elective Deferral Contributions (and Qualified Nonelective
Contributions or Qualified Matching Contributions, or both, if
used in
42
<PAGE> 44
computing the Actual Deferral Percentage) and Compensation of
such Eligible Participant include the Elective Deferral
Contributions (and, if applicable, Qualified Nonelective
Contributions or Qualified Matching Contributions, or both)
and Compensation for the Plan Year of Family Members. Family
Members, with respect to such Highly Compensated Employees,
shall be disregarded as separate employees in determining the
Actual Deferral Percentage both for Participants who are
Nonhighly Compensated Employees and for Participants who are
Highly Compensated Employees.
For purposes of determining the Actual Deferral Percentage,
Elective Deferral Contributions, Qualified Nonelective
Contributions and Qualified Matching Contributions must be
made before the last day of the 12-month period immediately
following the Plan Year to which contributions relate.
The Employer shall maintain records sufficient to demonstrate
satisfaction of the Average Actual Deferral Percentage test
and the amount of Qualified Nonelective Contributions or
Qualified Matching Contributions, or both, used in such test.
The determination and treatment of the Contributions used in
computing the Actual Deferral Percentage shall satisfy such
other requirements as may be prescribed by the Secretary of
the Treasury.
If the Plan Administrator should determine during the Plan
Year that neither of the above tests is being met, the Plan
Administrator may adjust the amount of future Elective
Deferral Contributions of the Highly Compensated Employees.
Notwithstanding any other provisions of this Plan, Excess
Contributions, plus any income and minus any loss allocable
thereto, shall be distributed no later than the last day of
each Plan Year to Participants to whose Accounts such Excess
Contributions were allocated for the preceding Plan Year. If
such excess amounts are distributed more than 2 1/2 months
after the last day of the Plan Year in which such excess
amounts arose, a ten (10) percent excise tax will be imposed
on the employer maintaining the plan with respect to such
amounts. Such distributions shall be made beginning with the
Highly Compensated Employee(s) who has the greatest Actual
Deferral Percentage, reducing his Actual Deferral Percentage
to the next highest Actual Deferral Percentage level. Then, if
necessary, reducing the Actual Deferral Percentage of the
Highly Compensated Employees at the next highest level, and
continuing in this manner until the average Actual Deferral
Percentage of the Highly Compensated Group satisfies the
Actual Deferral Percentage test. Excess Contributions of
Participants who are subject to the family member aggregation
rules shall be allocated among the Family Members in
proportion to the Elective
43
<PAGE> 45
Deferral Contributions (and amounts treated as Elective
Deferral Contributions) of each Family Member that is combined
to determine the combined Actual Deferral Percentage.
Excess Contributions shall be treated as Annual Additions, as
defined in the CONTRIBUTION LIMITATION SECTION of Article III,
under the Plan.
The Excess Contributions shall be adjusted for income or loss.
The income or loss allocable to such Excess Contributions
shall be equal to the income or loss allocable to the
Participant's Elective Deferral Contributions (and, if
applicable, Qualified Nonelective Contributions or Qualified
Matching Contributions, or both) for the Plan Year in which
the excess occurred multiplied by a fraction. The numerator of
the fraction is the Excess Contributions. The denominator of
the fraction is the closing balance without regard to any
income or loss occurring during such Plan Year (as of the end
of such Plan Year) of the Participant's Account resulting from
Elective Deferral Contributions (and Qualified Nonelective
Contributions or Qualified Matching Contributions, or both, if
used in computing the Actual Deferral Percentage).
Excess Contributions shall be distributed from the
Participant's Account resulting first from Elective Deferral
Contributions not the basis for Matching Contributions, then
if necessary, from Elective Deferral Contributions which are
the basis for Matching Contributions. If such Excess
Contributions exceed the balance in the Participant's Account
resulting from Elective Deferral Contributions, the balance
shall be distributed from the Participant's Account resulting
from Qualified Matching Contributions (if applicable) and
Qualified Nonelective Contributions, respectively.
Any Matching Contributions which were based on the Elective
Deferral Contributions which are distributed as Excess
Contributions, plus any income and minus any loss allocable
thereto, shall be forfeited. These Forfeitures shall be used
to offset the earliest Employer Contribution due after the
Forfeiture arises.
(d) As of the end of each Plan Year, one of the following tests
must be met:
(1) The Average Contribution Percentage for Eligible
Participants who are Highly Compensated Employees for
the Plan Year is not more than the Average
Contribution Percentage for Eligible Participants who
are Nonhighly Compensated Employees for the Plan Year
multiplied by 1.25.
(2) The Average Contribution Percentage for Eligible
Participants who are Highly Compensated Employees for
the Plan Year is not more than the
44
<PAGE> 46
Average Contribution Percentage for Eligible
Participants who are Nonhighly Compensated Employees
for the Plan Year multiplied by 2 and the difference
between the Average Contribution Percentages is not
more than 2.
If one or more Highly Compensated Employees participate in
both a cash or deferred arrangement and a plan subject to the
Average Contribution Percentage test maintained by the
Employer or a Controlled Group member and the sum of the
Average Actual Deferral Percentage and Average Contribution
Percentage of those Highly Compensated Employees subject to
either or both tests exceeds the Aggregate Limit, then the
Contribution Percentage of those Highly Compensated Employees
who also participate in a cash or deferred arrangement will be
reduced (beginning with such Highly Compensated Employees
whose Contribution Percentage is the highest) so that the
limit is not exceeded. The amount by which each Highly
Compensated Employee's Contribution Percentage is reduced
shall be treated as an Excess Aggregate Contribution. The
Average Actual Deferral Percentage and Average Contribution
Percentage of the Highly Compensated Employees are determined
after any corrections required to meet the Average Actual
Deferral Percentage and Average Contribution Percentage tests.
Multiple use does not occur if either the Average Actual
Deferral Percentage or Average Contribution Percentage of the
Highly Compensated Employees does not exceed 1.25 multiplied
by the Average Actual Deferral Percentage and Average
Contribution Percentage of the Nonhighly Compensated
Employees.
The Contribution Percentage for any Eligible Participant who
is a Highly Compensated Employee for the Plan Year and who is
eligible to have Contribution Percentage Amounts allocated to
his account under two or more plans described in Code Section
401(a) or arrangements described in Code Section 401(k) that
are maintained by the Employer or a Controlled Group member
shall be determined as if the total of such Contribution
Percentage Amounts was made under each plan. If a Highly
Compensated Employee participates in two or more cash or
deferred arrangements that have different Plan Years, all cash
or deferred arrangements ending with or within the same
calendar year shall be treated as a single arrangement.
Notwithstanding the foregoing, certain plans shall be treated
as separate if mandatorily disaggregated under the regulations
under Code Section 401(m) or permissibly disaggregated as
provided.
In the event that this Plan satisfies the requirements of Code
Sections 401(m), 401(a)(4), or 410(b) only if aggregated with
one or more other plans, or if one or more other plans satisfy
the requirements of Code sections only if aggregated with this
Plan, then this section shall be applied by determining the
Contribution
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Percentages of Eligible Participants as if all such plans were
a single plan. Plans may be aggregated in order to satisfy
Code Section 401(m) only if they have the same Plan Year.
For purposes of determining the Contribution Percentage of an
Eligible Participant who is a five-percent owner or one of the
ten most highly-paid Highly Compensated Employees, the
Contribution Percentage Amounts and Compensation of such
Participant shall include Contribution Percentage Amounts and
Compensation for the Plan Year of Family Members. Family
Members, with respect to Highly Compensated Employees, shall
be disregarded as separate employees in determining the
Contribution Percentage both for employees who are Nonhighly
Compensated Employees and for employees who are Highly
Compensated Employees.
For purposes of determining the Contribution Percentage,
Participant Contributions are considered to have been made in
the Plan Year in which contributed to the Plan. Matching
Contributions and Qualified Nonelective Contributions will be
considered made for a Plan Year if made no later than the end
of the 12-month period beginning on the day after the close of
the Plan Year.
The Employer shall maintain records sufficient to demonstrate
satisfaction of the Average Contribution Percentage test and
the amount of Qualified Nonelective Contributions or Qualified
Matching Contributions, or both, used in such test.
The determination and treatment of the Contribution Percentage
of any Participant shall satisfy such other requirements as
may be prescribed by the Secretary of the Treasury.
Notwithstanding any other provisions of this Plan, Excess
Aggregate Contributions, plus any income and minus any loss
allocable thereto, shall be forfeited, if not vested, or
distributed, if vested, no later than the last day of each
Plan Year to Participants to whose Accounts such Excess
Aggregate Contributions were allocated for the preceding Plan
Year. If such Excess Aggregate Contributions are distributed
more than 2 1/2 months after the last day of the Plan Year in
which such excess amounts arose, a ten (10) percent excise tax
will be imposed on the employer maintaining the plan with
respect to those amounts. Excess Aggregate Contributions will
be distributed beginning with the Highly Compensated
Employee(s) who has the greatest Contribution Percentage,
reducing his contribution percentage to the next highest
level. Then, if necessary, reducing the Contribution
Percentage of the Highly Compensated Employee at the next
highest level, and continuing in this manner until the Actual
Contribution Percentage of the Highly Compensated Group
satisfies the Actual Contribution Percentage Test. Excess
Aggregate Contributions of Participants
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who are subject to the family member aggregation rules shall
be allocated among the Family Members in proportion to the
Employee and Matching Contributions (or amounts treated as
Matching Contributions) of each Family Member that is combined
to determine the combined Contribution Percentage. Excess
Aggregate Contributions shall be treated as Annual Additions,
as defined in the CONTRIBUTION LIMITATION SECTION of Article
III, under the Plan.
The Excess Aggregate Contributions shall be adjusted for
income or loss. The income or loss allocable to such Excess
Aggregate Contributions shall be equal to the income or loss
allocable to the Participant's Contribution Percentage Amounts
for the Plan Year in which the excess occurred multiplied by a
fraction. The numerator of the fraction is the Excess
Aggregate Contributions. The denominator of the fraction is
the closing balance without regard to any income or loss
occurring during such Plan Year (as of the end of such Plan
Year) of the Participant's Account resulting from Contribution
Percentage Amounts.
Excess Aggregate Contributions shall be distributed from the
Participant's Account resulting from participant Contributions
that are not required as a condition of employment or
participation or for obtaining additional benefits from
Employer Contributions. If such Excess Aggregate Contributions
exceed the balance in the Participant's Account resulting from
such Participant Contributions, the balance shall be
forfeited, if not vested, or distributed, if vested, on a
pro-rata basis from the Participant's Account resulting from
Contribution Percentage Amounts. These Forfeitures shall be
used to offset the earliest Employer Contribution due after
the Forfeiture arises.
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ARTICLE IV
INVESTMENT OF CONTRIBUTIONS
SECTION 4.01--INVESTMENT OF CONTRIBUTIONS.
All Contributions are forwarded by the Employer to the Insurer to be
deposited under the Group Contract or forwarded to the Trustee to be deposited
in the Trust Fund.
Investment of Contributions is governed by the provisions of the Trust,
the Group Contract and any other funding arrangement in which the Trust Fund is
or may be invested. To the extent permitted by the Trust, Group Contract or
other funding arrangement, the parties named below shall direct the
Contributions to any of the accounts available under the Trust or Group Contract
and may request the transfer of assets resulting from those Contributions
between such accounts. A Participant may not direct the Trustee to invest the
Participant's Account in collectibles. Collectibles means any work of art, rug
or antique, metal or gem, stamp or coin, alcoholic beverage or other tangible
personal property specified by the Secretary of Treasury. To the extent that a
Participant does not direct the investment of his Account, such Account shall be
invested ratably in the accounts available under the Trust or Group Contract in
the same manner as the undirected Accounts of all other Participants. The Vested
Accounts of all Inactive Participants may be segregated and invested separately
from the Accounts of all other Participants.
The Trust Fund shall be valued at current fair market value as of the
last day of the last calendar month ending in the Plan Year and, at the
discretion of the Trustee, may be valued more frequently. The valuation shall
take into consideration investment earnings credited, expenses charged, payments
made and changes in the value of the assets held in the Trust Fund. The Account
of a Participant shall be credited with its share of the gains and losses of the
Trust Fund. That part of a Participant's Account invested in a funding
arrangement which establishes an account or accounts for such Participant
thereunder shall be credited with the gain or loss from such account or
accounts. That part of a Participant's Account which is invested in other
funding arrangements shall be credited with a proportionate share of the gain or
loss of such investments. The share shall be determined by multiplying the gain
or loss of the investment by the ratio of the part of the Participant's Account
invested in such funding arrangement to the total of the Trust Fund invested in
such funding arrangement.
At least annually, the Named Fiduciary shall review all pertinent
Employee information and Plan data in order to establish the funding policy of
the Plan and to determine appropriate methods of carrying out the Plan's
objectives. The Named Fiduciary shall inform the Trustee and any Investment
Manager of the Plan's short-term and long-term financial needs so the investment
policy can be coordinated with the Plan's financial requirements.
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(a) Employer Contributions other than Elective Deferral
Contributions: The Participant shall direct the investment of
such Employer Contributions and transfer of assets resulting
from those Contributions.
(b) Elective Deferral Contributions: The Participant shall direct
the investment of Elective Deferral Contributions and transfer
of assets resulting from those Contributions.
(c) Rollover Contributions: The Participant shall direct the
investment of Rollover Contributions and transfer of assets
resulting from those Contributions.
However, the Named Fiduciary may delegate to the Investment Manager
investment discretion for Contributions and Plan assets which are not subject to
Participant direction.
SECTION 4.01 A--INVESTMENT IN QUALIFYING EMPLOYER SECURITIES.
All or some portion of the Participant's Account may be invested in
Qualifying Employer Securities. Once an investment in the Qualifying Employer
Securities Fund is made available to Participants, it shall continue to be
available unless the Plan is amended to disallow such available investment. In
the absence of an election to invest in Qualifying Employer Securities,
Participants shall be deemed to have elected to have their Accounts invested
wholly in other investment options of the Investment Fund. Once an election is
made, it shall be considered to continue until a new election is made.
For purposes of determining the annual valuation of the Plan, and for
reporting to Participants and regulatory authorities, the assets of the Plan
shall be valued at least annually on the Valuation Date which corresponds to the
last day of the Plan Year. The fair market value of Qualifying Employer
Securities shall be determined on such Valuation Date. The prices of Qualifying
Employer Securities as of the date of the transaction shall apply for purposes
of valuing transactions of the Plan, including purchases of Qualifying Employer
Securities. In the case of Qualifying Employer Securities for which there is a
generally recognized market, the price shall be the price prevailing on a
national securities exchange which is registered under section 6 of the
Securities Exchange Act of 1934, or, if the Qualifying Employer Securities are
not traded on such a national securities exchange, the price shall be not less
favorable to the Plan than the offering price for the Qualifying Employer
Securities as established by the current bid and asked prices quoted by persons
independent of the issuer and independent of any party in interest. If the
Qualifying Employer Securities do not trade on the relevant date, or if the
market is very thin on such date, then the Plan Administrator may use for the
valuation the next preceding trading day on which the trading prices are
representative of the fair market value of such securities in the opinion of the
Plan Administrator.
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<PAGE> 51
In the case of Qualifying Employer Securities for which, in the opinion
of the Plan Administrator, there is no generally recognized market at the time
of the transaction, the price shall be the fair market value of the Qualifying
Employer Securities as determined in good faith by the Plan Administrator and in
accordance with regulations, if any, promulgated by the Secretary of Labor. The
value of a Participant's Account held in the Qualifying Employer Securities Fund
may be expressed in units.
If the Qualifying Employer Securities are not publicly traded, or if,
in the opinion of the Plan Administrator, an extremely thin market exists for
such securities so that a reasonable valuation may not be obtained from the
marketplace, then such securities must be valued at least annually by an
independent appraiser who is not associated with the Employer, the Plan
Administrator, the Trustee, or any person related to any fiduciary under the
Plan, or any party (other than the Plan) participating in the transaction. The
independent appraiser may be associated with a person who is merely a contract
administrator with respect to the Plan, but who exercises no discretionary
authority and is not a plan fiduciary, if such contract administrator is not
otherwise disqualified under this provision.
Cash dividends payable on the Qualifying Employer Securities shall be
reinvested in additional shares of such securities. In the event of any cash or
stock dividend or any stock split, such dividend or split shall be credited to
the Accounts based on the number of shares of Qualifying Employer Securities
credited to each Account as of the record date of such dividend or split.
With respect to any cash dividend or any stock dividend on Qualifying
Employer Securities, the Participant shall be entitled to a trailer distribution
of such dividend if distribution of his Account occurs between the record date
and the payable date of such dividend.
The Plan Administrator may direct the Trustee to sell, resell, or
otherwise dispose of Qualifying Employer Securities to any person, including the
Employer, provided that any such sales to any disqualified person or
party-in-interest, including the Employer, will be made at not less than the
fair market value and no commission will be charged. Any such sale shall be made
in conformance with ERISA Section 408(e).
The Employer is responsible for compliance with any applicable Federal
or state securities law with respect to all aspects of the Plan. If the
Qualifying Employer Securities or the interests in this Plan are required to be
registered in order to permit investment in the Qualifying Employer Securities
Fund as provided in this section, then any such investment will not be effective
until the later of the effective date of this section of the Plan or the date
such registration or qualification is effective. The Employer, at its own
expense, will take or cause to be taken any and all such actions as may be
necessary or appropriate to effect such registration or qualification. Further,
if the Trustee is directed to dispose of any Qualifying Employer Securities held
under the Plan under circumstances which require registration or qualification
of the securities under applicable Federal or state securities laws, then the
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Employer will, at its own expense, take or cause to be taken any and all such
action as may be necessary or appropriate to effect such registration or
qualification. The Employer is responsible for all compliance requirements under
Section 16 of the Securities Act.
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ARTICLE V
BENEFITS
SECTION 5.01--RETIREMENT BENEFITS.
On a Participant's Retirement Date, his Vested Account shall be
distributed to him according to the distribution of benefits provisions of
Article VI and the provisions of the SMALL AMOUNTS SECTION of Article IX.
SECTION 5.02--DEATH BENEFITS.
If a Participant dies before his Annuity Starting Date, his Vested
Account shall be distributed according to the distribution of benefits
provisions of Article VI and the provisions of the SMALL AMOUNTS SECTION of
Article IX.
SECTION 5.03--VESTED BENEFITS.
A Participant may receive a distribution of his Vested Account at any
time after he ceases to be an Employee, provided he has not again become an
Employee. If such amount is not payable under the provisions of the SMALL
AMOUNTS SECTION of Article IX, it will be distributed only if the Participant so
elects. The Participant's election shall be subject to the requirements in the
ELECTION PROCEDURES SECTION of Article VI for a qualified election of a
retirement benefit.
If a Participant does not receive an earlier distribution according to
the provisions of this section or the SMALL AMOUNTS SECTION of Article IX, upon
his Retirement Date or death, his Vested Account shall be applied according to
the provisions of the RETIREMENT BENEFITS SECTION or the DEATH BENEFITS SECTION
of Article V.
The Nonvested Account of a Participant who has ceased to be an Employee
shall remain a part of his Account until it becomes a Forfeiture; provided,
however, if the Participant again becomes an Employee so that his Vesting
Percentage can increase, the Nonvested Account may become a part of his Vested
Account.
SECTION 5.04--WHEN BENEFITS START.
Benefits under the Plan begin when a Participant retires, dies or
ceases to be an Employee, whichever applies, as provided in the preceding
sections of this article. Benefits which begin before Normal Retirement Date for
a Participant who became Totally and Permanently Disabled when he was an
Employee shall be deemed to begin because he is Totally and Permanently
Disabled. The start of benefits is subject to the qualified election procedures
of Article VI.
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Unless otherwise elected, benefits shall begin before the sixtieth day
following the close of the Plan Year in which the latest date below occurs:
(a) The date the Participant attains age 65 (Normal Retirement Age,
if earlier).
(b) The tenth anniversary of the Participant's Entry Date.
(c) The date the Participant ceases to be an Employee.
Notwithstanding the foregoing, the failure of a Participant and spouse
to consent to a distribution while a benefit is immediately distributable,
within the meaning of the ELECTION PROCEDURES SECTION of Article VI, shall be
deemed to be an election to defer commencement of payment of any benefit
sufficient to satisfy this section.
The Participant may elect to have his benefits begin after the latest
date for beginning benefits described above, subject to the provisions of this
section. The Participant shall make the election in writing and deliver the
signed statement of election to the Plan Administrator before Normal Retirement
Date or the date he ceases to be an Employee, if later. The election must
describe the form of distribution and the date the benefits will begin. The
Participant shall not elect a date for beginning benefits or a form of
distribution that would result in a benefit payable when he dies which would be
more than incidental within the meaning of governmental regulations.
Benefits shall begin by the Participant's Required Beginning Date, as
defined in the OPTIONAL FORMS OF DISTRIBUTION AND DISTRIBUTION REQUIREMENTS
SECTION of Article VI.
Contributions which are used to compute the Actual Deferral Percentage,
as defined in the EXCESS AMOUNTS SECTION of Article III, may be distributed upon
disposition by the Employer of substantially all of the assets (within the
meaning of Code Section 409(d)(2)) used by the Employer in a trade or business
or disposition by the Employer of the Employer's interest in a subsidiary
(within the meaning of Code Section 409(d)(3)) if the transferee corporation is
not a Controlled Group member, the Employee continues employment with the
transferee corporation and the transferor corporation continues to maintain the
Plan. Such distributions made after March 31, 1988, must be made in a single
sum.
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SECTION 5.05--WITHDRAWAL PRIVILEGES.
A Participant may withdraw all or any portion of his Vested Account
which results from the following Contributions
Elective Deferral Contributions
Matching Contributions
Discretionary Contributions
Rollover Contributions
in the event of hardship due to an immediate and heavy financial need.
Withdrawals from the Participant's Account resulting from Elective Deferral
Contributions shall be limited to the amount of the Participant's Elective
Deferral Contributions plus income allocable thereto credited to his Account as
of December 31, 1988. Immediate and heavy financial need shall be limited to:
(i) expenses incurred or necessary for medical care, described in Code Section
213(d), of the Participant, the Participant's spouse, or any dependents of the
Participant (as defined in Code Section 152); (ii) purchase (excluding mortgage
payments) of a principal residence for the Participant; (iii) payment of tuition
and related educational fees and the payment of room and board expenses for the
next 12 months of post-secondary education for the Participant, his spouse,
children or dependents; (iv) the need to prevent the eviction of the Participant
from his principal residence or foreclosure on the mortgage of the Participant's
principal residence; or (v) any other distribution which is deemed by the
Commissioner of Internal Revenue to be made on account of immediate and heavy
financial need as provided in Treasury regulations. The Participant's request
for a withdrawal shall include his written statement that an immediate and heavy
financial need exists and explain its nature.
No withdrawal shall be allowed which is not necessary to satisfy such
immediate and heavy financial need. Such withdrawal shall be deemed necessary
only if all of the following requirements are met: (i) the distribution is not
in excess of the amount of the immediate and heavy financial need of the
Participant (including amounts necessary to pay any Federal, state or local
income taxes or penalties reasonably anticipated to result from the
distribution); (ii) the Participant has obtained all distributions, other than
hardship distributions, and all nontaxable loans currently available under all
plans maintained by the Employer; (iii) the Plan, and all other plans maintained
by the Employer, provide that the Participant's elective contributions and
employee contributions will be suspended, for at least 12 months after receipt
of the hardship distribution; and (iv) the Plan, and all other plans maintained
by the Employer, provide that the Participant may not make elective
contributions for the Participant's taxable year immediately following the
taxable year of the hardship distribution in excess of the applicable limit
under Code Section 402(g) for such next taxable year less the amount of such
Participant's elective contributions for the taxable year of the hardship
distribution. The Plan will suspend elective contributions and employee
contributions for 12 months and limit elective deferrals as provided in the
preceding sentence. A Participant shall not cease to be an Eligible Participant,
as defined in the EXCESS AMOUNTS SECTION of Article III, merely because his
elective contributions or employee contributions are suspended.
The portion of the Participant's Account held in the Qualifying
Employer Securities Fund may not be redeemed for purposes of a withdrawal.
A request for withdrawal shall be in writing on a form furnished for
that purpose and delivered to the Plan Administrator before the withdrawal is to
occur. The Participant's request
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shall be subject to the requirements in the ELECTION PROCEDURES SECTION of
Article VI for a qualified election of a retirement benefit payable in a form
other than a Qualified Joint and Survivor Form.
A forfeiture shall not occur solely as a result of a withdrawal.
SECTION 5.06--LOANS TO PARTICIPANTS.
Loans shall be made available to all Participants on a reasonably
equivalent basis. For purposes of this section, Participant means any
Participant or Beneficiary who is a party-in-interest, within the meaning of
Section 3(14) of the Employee Retirement Income Security Act of 1974 (ERISA).
Loans shall not be made to highly compensated employees, as defined in Code
Section 414(q), in an amount greater than the amount made available to other
Participants.
No loans will be made to any shareholder-employee or owner-employee.
For purposes of this requirement, a shareholder-employee means an employee or
officer of an electing small business (Subchapter S) corporation who owns (or is
considered as owning within the meaning of Code Section 318(a)(1)), on any day
during the taxable year of such corporation, more than 5% of the outstanding
stock of the corporation.
A loan to a Participant shall be a Participant-directed investment of
his Account. The portion of the Participant's Account held in the Qualifying
Employer Securities Fund may not be redeemed for purposes of a loan. No Account
other than the borrowing Participant's Account shall share in the interest paid
on the loan or bear any expense or loss incurred because of the loan.
The number of outstanding loans shall be limited to one. No more than
two loans will be approved for any Participant in any 12-month period. The
minimum amount of any loan shall be $1,000.
Loans must be adequately secured and bear a reasonable rate of
interest.
The amount of the loan shall not exceed the maximum amount that may be
treated as a loan under Code Section 72(p) (rather than a distribution) to the
Participant and shall be equal to the lesser of (a) or (b) below:
(a) $50,000 reduced by the highest outstanding loan balance of
loans during the one-year period ending on the day before the
new loan is made.
(b) The greater of (1) or (2), reduced by (3) below:
(1) One-half of the Participant's Vested Account.
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(2) $10,000.
(3) Any outstanding loan balance on the date the new loan
is made.
For purposes of this maximum, a Participant's Vested Account does not
include any accumulated deductible employee contributions, as defined in Code
Section 72(o)(5)(B), and all qualified employer plans, as defined in Code
Section 72(p)(4), of the Employer and any Controlled Group member shall be
treated as one plan.
The foregoing notwithstanding, the amount of such loan shall not exceed
50% of the amount of the Participant's Vested Account. For purposes of this
maximum, a Participant's Vested Account does not include any accumulated
deductible employee contributions, as defined in Code Section 72(o)(5)(B). No
collateral other than a portion of the Participant's Vested Account (as limited
above) shall be accepted. The Loan Administrator shall determine if the
collateral is adequate for the amount of the loan requested.
A Participant must obtain the consent of the Participant's spouse, if
any, to the use of the Vested Account as security for the loan. Spousal consent
shall be obtained no earlier than the beginning of the 90-day period that ends
on the date on which the loan to be so secured is made. The consent must be in
writing, must acknowledge the effect of the loan, and must be witnessed by a
plan representative or a notary public. Such consent shall thereafter be binding
with respect to the consenting spouse or any subsequent spouse with respect to
that loan. A new consent shall be required if the Vested Account is used for
collateral upon renegotiation, extension, renewal, or other revision of the
loan.
If a valid spousal consent has been obtained in accordance with the
above, then, notwithstanding any other provision of this Plan, the portion of
the Participant's Vested Account used as a security interest held by the Plan by
reason of a loan outstanding to the Participant shall be taken into account for
purposes of determining the amount of the Vested Account payable at the time of
death or distribution, but only if the reduction is used as repayment of the
loan. If less than 100% of the Participant's Vested Account (determined without
regard to the preceding sentence) is payable to the surviving spouse, then the
Vested Account shall be adjusted by first reducing the Vested Account by the
amount of the security used as repayment of the loan, and then determining the
benefit payable to the surviving spouse.
Each loan shall bear a reasonable fixed rate of interest to be
determined by the Loan Administrator. In determining the interest rate, the Loan
Administrator shall take into consideration fixed interest rates currently being
charged by commercial lenders for loans of comparable risk on similar terms and
for similar durations, so that the interest will provide for a return
commensurate with rates currently charged by commercial lenders for loans made
under similar circumstances. The Loan Administrator shall not discriminate among
Participants in the matter of interest rates; but loans granted at different
times may bear different interest rates in accordance with the current
appropriate standards.
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The loan shall by its terms require that repayment (principal and
interest) be amortized in level payments, not less frequently than quarterly,
over a period not extending beyond five years from the date of the loan. The
period of repayment for any loan shall be arrived at by mutual agreement between
the Loan Administrator and the Participant.
The Participant shall make a written application for a loan from the
Plan on forms provided by the Loan Administrator. The application must specify
the amount and duration requested. No loan will be approved unless the
Participant is creditworthy. The Participant must grant authority to the Loan
Administrator to investigate the Participant's creditworthiness so that the loan
application may be properly considered.
Information contained in the application for the loan concerning the
income, liabilities, and assets of the Participant will be evaluated to
determine whether there is a reasonable expectation that the Participant will be
able to satisfy payments on the loan as due. Additionally, the Loan
Administrator will pursue any appropriate further investigations concerning the
creditworthiness and/or credit history of the Participant to determine whether a
loan should be approved.
Each loan shall be fully documented in the form of a promissory note
signed by the Participant for the face amount of the loan, together with
interest determined as specified above.
There will be an assignment of collateral to the Plan executed at the
time the loan is made.
In those cases where repayment through payroll deduction by the
Employer is available, installments are so payable, and a payroll deduction
agreement will be executed by the Participant at the time of making the loan.
Where payroll deduction is not available, payments are to be timely
made.
Any payment that is not by payroll deduction shall be made payable to
the Employer or Trustee, as specified in the promissory note, and delivered to
the Loan Administrator, including prepayments, service fees and penalties; if
any, and other amounts due under the note.
The promissory note may provide for reasonable late payment penalties
and/or service fees. Any penalties or service fees shall be applied to all
Participants in a nondiscriminatory manner. If the promissory note so provides,
such amounts may be assessed and collected from the Account of the Participant
as part of the loan balance.
Each loan may be paid prior to maturity, in part or in full, without
penalty or service fee, except as may be set out in the promissory note.
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If any amount remains unpaid for more than 31 days after due, a default
is deemed to occur.
Upon default, the Plan has the right to pursue any remedy available by
law to satisfy the amount due, along with accrued interest, including the right
to enforce its claim against the security pledged and execute upon the
collateral as allowed by law.
If any payment of principal or interest or any other amount due under
the promissory note, or any portion thereof, is not made for a period of 90 days
after due, the entire principal balance whether or not otherwise then due, shall
become immediately due and payable without demand or notice, and subject to
collection or satisfaction by any lawful means, including specifically but not
limited to the right to enforce the claim against the security pledged and to
execute upon the collateral as allowed by law.
In the event of default, foreclosure on the note and attachment of
security or use of amounts pledged to satisfy the amount then due, will not
occur until a distributable event occurs in accordance with the Plan, and will
not occur to an extent greater than the amount then available upon any
distributable event which has occurred under the Plan.
All reasonable costs and expenses, including but not limited to
attorney's fees, incurred by the Plan in connection with any default or in any
proceeding to enforce any provision of a promissory note or instrument by which
a promissory note for a Participant loan is secured, shall be assessed and
collected from the Account of the Participant as part of the loan balance.
If payroll deduction is being utilized, in the event that a
Participant's available payroll deduction amounts in any given month are
insufficient to satisfy the total amount due, there will be an increase in the
amount taken subsequently, sufficient to make up the amount that is then due. If
the subsequent deduction is also insufficient to satisfy the amount due within
31 days, a default is deemed to occur as above. If any amount remains past due
more than 90 days, the entire principal amount, whether or not otherwise then
due, along with interest then accrued and any other amount then due under the
promissory note, shall become due and payable, as above.
If the Participant ceases to be a party-in-interest (as defined in this
section) the balance of the outstanding loan becomes due and payable, and the
Participant's Vested Account will be used as available for distribution(s) to
pay the outstanding loan. The Participant's Vested Account will not be used to
pay any amount due under the outstanding loan before the date which is 31 days
after the date he ceased to be an Employee, and the Participant may elect to
repay the outstanding loan with interest on the day of repayment. If no
distributable event has occurred under the Plan at the time that the
Participant's Vested Account would otherwise be used under this provision to pay
any amount due under the outstanding loan, this will not occur until the time,
or in excess of the extent to which, a distributable event occurs under the
Plan.
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ARTICLE VI
DISTRIBUTION OF BENEFITS
SECTION 6.01--AUTOMATIC FORMS OF DISTRIBUTION.
Unless a qualified election of an optional form of benefit has been
made within the election period (see the ELECTION PROCEDURES SECTION of Article
VI), the automatic form of benefit payable to or on behalf of a Participant is
determined as follows:
(a) The automatic form of retirement benefit for a Participant who
does not die before his Annuity Starting Date shall be the
Qualified Joint and Survivor Form.
(b) The automatic form of death benefit for a Participant who dies
before his Annuity Starting Date shall be:
(1) A Qualified Preretirement Survivor Annuity for a
Participant who has a spouse to whom he has been
continuously married throughout the one-year period
ending on the date of his death. The spouse may elect
to start receiving the death benefit on any first day
of the month on or after the Participant dies and
before the date the Participant would have been age
70 1/2. If the spouse dies before benefits start, the
Participant's Vested Account, determined as of the
date of the spouse's death, shall be paid to the
spouse's Beneficiary.
(2) A single-sum payment to the Participant's Beneficiary
for a Participant who does not have a spouse who is
entitled to a Qualified Preretirement Survivor
Annuity.
Before a death benefit will be paid on account of the death of
a Participant who does not have a spouse who is entitled to a
Qualified Preretirement Survivor Annuity, it must be
established to the satisfaction of a plan representative that
the Participant does not have such a spouse.
SECTION 6.02--OPTIONAL FORMS OF DISTRIBUTION AND DISTRIBUTION REQUIREMENTS.
(a) For purposes of this section, the following terms are defined:
Applicable Life Expectancy means Life Expectancy (or Joint and
Last Survivor Expectancy) calculated using the attained age of
the Participant (or Designated Beneficiary) as of the
Participant's (or Designated Beneficiary's) birthday in the
applicable calendar year reduced by one for each calendar year
which has
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elapsed since the date Life Expectancy was first calculated.
If Life Expectancy is being recalculated, the Applicable Life
Expectancy shall be the Life Expectancy so recalculated. The
applicable calendar year shall be the first Distribution
Calendar Year, and if Life Expectancy is being recalculated
such succeeding calendar year.
Designated Beneficiary means the individual who is designated
as the beneficiary under the Plan in accordance with Code
Section 401(a)(9) and the regulations thereunder.
Distribution Calendar Year means a calendar year for which a
minimum distribution is required. For distributions beginning
before the Participant's death, the first Distribution
Calendar Year is the calendar year immediately preceding the
calendar year which contains the Participant's Required
Beginning Date. For distributions beginning after the
Participant's death, the first Distribution Calendar Year is
the calendar year in which distributions are required to begin
pursuant to (e) below.
Joint and Last Survivor Expectancy means joint and last
survivor expectancy computed by use of the expected return
multiples in Table VI of section 1.72-9 of the Income Tax
Regulations.
Unless otherwise elected by the Participant (or spouse, in the
case of distributions described in (e)(2)(ii) below) by the
time distributions are required to begin, life expectancies
shall be recalculated annually. Such election shall be
irrevocable as to the Participant (or spouse) and shall apply
to all subsequent years. The life expectancy of a nonspouse
Beneficiary may not be recalculated.
Life Expectancy means life expectancy computed by use of the
expected return multiples in Table V of section 1.72-9 of the
Income Tax Regulations.
Unless otherwise elected by the Participant (or spouse, in the
case of distributions described in (e)(2)(ii) below) by the
time distributions are required to begin, life expectancies
shall be recalculated annually. Such election shall be
irrevocable as to the Participant (or spouse) and shall apply
to all subsequent years. The life expectancy of a nonspouse
Beneficiary may not be recalculated.
Participant's Benefit means
(1) The Account balance as of the last valuation date in
the calendar year immediately preceding the
Distribution Calendar Year (valuation calendar year)
increased by the amount of any contributions or
forfeitures allocated to the Account balance as of
the dates in the valuation calendar year after
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the valuation date and decreased by distributions
made in the valuation calendar year after the
valuation date.
(2) For purposes of (1) above, if any portion of the
minimum distribution for the first Distribution
Calendar Year is made in the second Distribution
Calendar Year on or before the Required Beginning
Date, the amount of the minimum distribution made in
the second Distribution Calendar Year shall be
treated as if it had been made in the immediately
preceding Distribution Calendar Year.
Required Beginning Date means, for a Participant, the first
day of April of the calendar year following the calendar year
in which the Participant attains age 70 1/2, unless otherwise
provided in (1), (2) or (3) below:
(1) The Required Beginning Date for a Participant who
attains age 70 1/2 before January 1, 1988, and who is
not a 5-percent owner is the first day of April of
the calendar year following the calendar year in
which the later of retirement or attainment of age
70 1/2 occurs.
(2) The Required Beginning Date for a Participant who
attains age 70 1/2 before January 1, 1988, and who is
a 5-percent owner is the first day of April of the
calendar year following the later of
(i) the calendar year in which the Participant
attains age 70 1/2, or
(ii) the earlier of the calendar year with or
within which ends the Plan Year in which the
Participant becomes a 5-percent owner, or
the calendar year in which the Participant
retires.
(3) The Required Beginning Date of a Participant who is
not a 5-percent owner and who attains age 70 1/2
during 1988 and who has not retired as of January 1,
1989, is April 1, 1990.
A Participant is treated as a 5-percent owner for purposes of
this section if such Participant is a 5-percent owner as
defined in Code Section 416(i) (determined in accordance with
Code Section 416 but without regard to whether the Plan is
top-heavy) at any time during the Plan Year ending with or
within the calendar year in which such owner attains age
66 1/2 or any subsequent Plan Year.
Once distributions have begun to a 5-percent owner under this
section, they must continue to be distributed, even if the
Participant ceases to be a 5-percent owner in a subsequent
year.
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(b) The optional forms of retirement benefit shall be the
following: a straight life annuity; single life annuities with
certain periods of five, ten or fifteen years; a single life
annuity with installment refund; survivorship life annuities
with installment refund and survivorship percentages of 50,
66 2/3 or 100; fixed period annuities for any period of whole
months which is not less than 60 and does not exceed the Life
Expectancy of the Participant and the named Beneficiary as
provided in (d) below where the Life Expectancy is not
recalculated; and a series of installments chosen by the
Participant with a minimum payment each year beginning with
the year the Participant turns age 70 1/2. The payment for the
first year in which a minimum payment is required will be made
by April 1 of the following calendar year. The payment for the
second year and each successive year will be made by December
31 of that year. The minimum payment will be based on a period
equal to the Joint and Last Survivor Expectancy of the
Participant and the Participant's spouse, if any, as provided
in (d) below where the Joint and Last Survivor Expectancy is
recalculated. The balance of the Participant's Vested Account,
if any, will be payable on the Participant's death to his
Beneficiary in a single sum. The Participant may also elect to
receive his Vested Account in a single-sum payment.
Furthermore, to the extent that a Participant's Account is
invested in Qualifying Employer Securities immediately before
the Participant elects to receive a single-sum payment, the
Participant may elect to receive a distribution in the form of
whole (but not fractional) shares of Qualifying Employer
Securities.
Election of an optional form is subject to the qualified
election provisions of Article VI.
Any annuity contract distributed shall be nontransferable. The
terms of any annuity contract purchased and distributed by the
Plan to a Participant or spouse shall comply with the
requirements of this Plan.
(c) The optional forms of death benefit are a single-sum payment
and any annuity that is an optional form of retirement
benefit. However, a series of installments shall not be
available if the Beneficiary is not the spouse of the deceased
Participant. Furthermore, to the extent that a Participant's
Account is invested in Qualifying Employer Securities
immediately before the Beneficiary elects to receive a
single-sum payment, the Beneficiary may elect to receive a
distribution in the form of whole (but not fractional) shares
of Qualifying Employer Securities.
(d) Subject to the AUTOMATIC FORMS OF DISTRIBUTION SECTION of
Article VI, joint and survivor annuity requirements, the
requirements of this section shall apply to any distribution
of a Participant's interest and will take precedence over any
inconsistent provisions of this Plan. Unless otherwise
specified, the
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provisions of this section apply to calendar years beginning
after December 31, 1984.
All distributions required under this section shall be
determined and made in accordance with the proposed
regulations under Code Section 401(a)(9), including the
minimum distribution incidental benefit requirement of section
1.401(a)(9)-2 of the proposed regulations.
The entire interest of a Participant must be distributed or
begin to be distributed no later than the Participant's
Required Beginning Date.
As of the first Distribution Calendar Year, distributions, if
not made in a single sum, may only be made over one of the
following periods (or combination thereof):
(1) the life of the Participant,
(2) the life of the Participant and a Designated
Beneficiary,
(3) a period certain not extending beyond the Life
Expectancy of the Participant, or
(4) a period certain not extending beyond the Joint and
Last Survivor Expectancy of the Participant and a
Designated Beneficiary.
If the Participant's interest is to be distributed in other
than a single sum, the following minimum distribution rules
shall apply on or after the Required Beginning Date:
(5) Individual account:
(i) If a Participant's Benefit is to be distributed
over
(a) a period not extending beyond the Life
Expectancy of the Participant or the Joint
Life and Last Survivor Expectancy of the
Participant and the Participant's
Designated Beneficiary or
(b) a period not extending beyond the Life
Expectancy of the Designated Beneficiary,
the amount required to be distributed for each
calendar year beginning with the distributions
for the first Distribution Calendar
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Year, must be at least equal to the quotient
obtained by dividing the Participant's
Benefit by the Applicable Life Expectancy.
(ii) For calendar years beginning before January
1, 1989, if the Participant's spouse is not
the Designated Beneficiary, the method of
distribution selected must assure that at
least 50% of the present value of the amount
available for distribution is paid within
the Life Expectancy of the Participant.
(iii) For calendar years beginning after December
31, 1988, the amount to be distributed each
year, beginning with distributions for the
first Distribution Calendar Year shall not
be less than the quotient obtained by
dividing the Participant's Benefit by the
lesser of
(a) the Applicable Life Expectancy or
(b) if the Participant's spouse is not
the Designated Beneficiary, the
applicable divisor determined from
the table set forth in Q&A-4 of
section 1.401(a)(9)-2 of the
proposed regulations.
Distributions after the death of the
Participant shall be distributed using the
Applicable Life Expectancy in (5)(i) above
as the relevant divisor without regard to
Proposed Regulations section 1.401(a)(9)-2.
(iv) The minimum distribution required for the
Participant's first Distribution Calendar
Year must be made on or before the
Participant's Required Beginning Date. The
minimum distribution for the Distribution
Calendar Year for other calendar years,
including the minimum distribution for the
Distribution Calendar Year in which the
Participant's Required Beginning Date
occurs, must be made on or before December
31 of that Distribution Calendar Year.
(6) Other forms:
(i) If the Participant's Benefit is distributed
in the form of an annuity purchased from an
insurance company, distributions thereunder
shall be made in accordance with the
requirements of Code Section 401(a)(9) and
the proposed regulations thereunder.
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(e) Death distribution provisions:
(1) Distribution beginning before death. If the
Participant dies after distribution of his interest
has begun, the remaining portion of such interest
will continue to be distributed at least as rapidly
as under the method of distribution being used prior
to the Participant's death.
(2) Distribution beginning after death. If the
Participant dies before distribution of his interest
begins, distribution of the Participant's entire
interest shall be completed by December 31 of the
calendar year containing the fifth anniversary of the
Participant's death except to the extent that an
election is made to receive distributions in
accordance with (i) or (ii) below:
(i) if any portion of the Participant's interest
is payable to a Designated Beneficiary,
distributions may be made over the life or
over a period certain not greater than the
Life Expectancy of the Designated
Beneficiary commencing on or before December
31 of the calendar year immediately
following the calendar year in which the
Participant died;
(ii) if the Designated Beneficiary is the
Participant's surviving spouse, the date
distributions are required to begin in
accordance with (i) above shall not be
earlier than the later of
(a) December 31 of the calendar year
immediately following the calendar
year in which the Participant died
and
(b) December 31 of the calendar year in
which the Participant would have
attained age 70 1/2.
If the Participant has not made an election pursuant to this
(e)(2) by the time of his death, the Participant's Designated
Beneficiary must elect the method of distribution no later
than the earlier of
(iii) December 31 of the calendar year in which
distributions would be required to begin
under this subparagraph, or
(iv) December 31 of the calendar year which
contains the fifth anniversary of the date
of death of the Participant.
If the Participant has no Designated Beneficiary, or if the
Designated Beneficiary does not elect a method of
distribution, distribution of the Participant's entire
interest must be completed by December 31 of the calendar year
containing the fifth anniversary of the Participant's death.
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(3) For purposes of (e)(2) above, if the surviving spouse
dies after the Participant, but before payments to
such spouse begin, the provisions of (e)(2) above,
with the exception of (e)(2)(ii) therein, shall be
applied as if the surviving spouse were the
Participant.
(4) For purposes of this (e), any amount paid to a child
of the Participant will be treated as if it had been
paid to the surviving spouse if the amount becomes
payable to the surviving spouse when the child
reaches the age of majority.
(5) For purposes of this (e), distribution of a
Participant's interest is considered to begin on the
Participant's Required Beginning Date (or if (e)(3)
above is applicable, the date distribution is
required to begin to the surviving spouse pursuant to
(e)(2) above). If distribution in the form of an
annuity irrevocably commences to the Participant
before the Required Beginning Date, the date
distribution is considered to begin is the date
distribution actually commences.
SECTION 6.03--ELECTION PROCEDURES.
The Participant, Beneficiary, or spouse shall make any election under
this section in writing. The Plan Administrator may require such individual to
complete and sign any necessary documents as to the provisions to be made. Any
election permitted under (a) and (b) below shall be subject to the qualified
election provisions of (c) below.
(a) Retirement Benefits. A Participant may elect his Beneficiary
or Contingent Annuitant and may elect to have retirement
benefits distributed under any of the optional forms of
retirement benefit described in the OPTIONAL FORMS OF
DISTRIBUTION AND DISTRIBUTION REQUIREMENTS SECTION of Article
VI.
(b) Death Benefits. A Participant may elect his Beneficiary and
may elect to have death benefits distributed under any of the
optional forms of death benefit described in the OPTIONAL
FORMS OF DISTRIBUTION AND DISTRIBUTION REQUIREMENTS SECTION of
Article VI.
If the Participant has not elected an optional form of
distribution for the death benefit payable to his Beneficiary,
the Beneficiary may, for his own benefit, elect the form of
distribution, in like manner as a Participant.
The Participant may waive the Qualified Preretirement Survivor
Annuity by naming someone other than his spouse as
Beneficiary.
In lieu of the Qualified Preretirement Survivor Annuity
described in the AUTOMATIC FORMS OF DISTRIBUTION SECTION of
Article VI, the spouse
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may, for his own benefit, waive the Qualified Preretirement
Survivor Annuity by electing to have the benefit distributed
under any of the optional forms of death benefit described in
the OPTIONAL FORMS OF DISTRIBUTION AND DISTRIBUTION
REQUIREMENTS SECTION of Article VI.
(c) Qualified Election. The Participant, Beneficiary or spouse may
make an election at any time during the election period. The
Participant, Beneficiary, or spouse may revoke the election
made (or make a new election) at any time and any number of
times during the election period. An election is effective
only if it meets the consent requirements below.
The election period as to retirement benefits is the 90-day
period ending on the Annuity Starting Date. An election to
waive the Qualified Joint and Survivor Form may not be made
before the date he is provided with the notice of the ability
to waive the Qualified Joint and Survivor Form. If the
Participant elects the series of installments, he may elect on
any later date to have the balance of his Vested Account paid
under any of the optional forms of retirement benefit
available under the Plan. His election period for this
election is the 90-day period ending on the Annuity Starting
Date for the optional form of retirement benefit elected.
A Participant may make an election as to death benefits at any
time before he dies. The spouse's election period begins on
the date the Participant dies and ends on the date benefits
begin. The Beneficiary's election period begins on the date
the Participant dies and ends on the date benefits begin. An
election to waive the Qualified Preretirement Survivor Annuity
may not be made by the Participant before the date he is
provided with the notice of the ability to waive the Qualified
Preretirement Survivor Annuity. A Participant's election to
waive the Qualified Preretirement Survivor Annuity which is
made before the first day of the Plan Year in which he reaches
age 35 shall become invalid on such date. An election made by
a Participant after he ceases to be an Employee will not
become invalid on the first day of the Plan Year in which he
reaches age 35 with respect to death benefits from that part
of his Account resulting from Contributions made before he
ceased to be an Employee.
If the Participant's Vested Account has at any time exceeded
$5,000, any benefit which is (1) immediately distributable or
(2) payable in a form other than a Qualified Joint and
Survivor Form or a Qualified Preretirement Survivor Annuity
requires the consent of the Participant and the Participant's
spouse (or where either the Participant or the spouse has
died, the survivor). The consent of the Participant or spouse
to a benefit which is immediately distributable must not be
made before the date the Participant or spouse is provided
with the notice of the ability to defer the distribution. Such
consent shall be made in writing. The consent shall not be
made more than 90 days before the Annuity Starting Date.
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Spousal consent is not required for a benefit which is
immediately distributable in a Qualified Joint and Survivor
Form. Furthermore, if spousal consent is not required because
the Participant is electing an optional form of retirement
benefit that is not a life annuity pursuant to (d) below, only
the Participant need consent to the distribution of a benefit
payable in a form that is not a life annuity and which is
immediately distributable. Neither the consent of the
Participant nor the Participant's spouse shall be required to
the extent that a distribution is required to satisfy Code
Section 401(a)(9) or Code Section 415. In addition, upon
termination of this Plan if the Plan does not offer an annuity
option (purchased from a commercial provider), the
Participant's Account balance may, without the Participant's
consent, be distributed to the Participant or transferred to
another defined contribution plan (other than an employee
stock ownership plan as defined in Code Section 4975(e)(7))
within the same Controlled Group. A benefit is immediately
distributable if any part of the benefit could be distributed
to the Participant (or surviving spouse) before the
Participant attains (or would have attained if not deceased)
the older of Normal Retirement Age or age 62. If the Qualified
Joint and Survivor Form is waived, the spouse has the right to
limit consent only to a specific Beneficiary or a specific
form of benefit. The spouse can relinquish one or both such
rights. Such consent shall be made in writing. The consent
shall not be made more than 90 days before the Annuity
Starting Date. If the Qualified Preretirement Survivor Annuity
is waived, the spouse has the right to limit consent only to a
specific Beneficiary. Such consent shall be in writing. The
spouse's consent shall be witnessed by a plan representative
or notary public. The spouse's consent must acknowledge the
effect of the election, including that the spouse had the
right to limit consent only to a specific Beneficiary or a
specific form of benefit, if applicable, and that the
relinquishment of one or both such rights was voluntary.
Unless the consent of the spouse expressly permits
designations by the Participant without a requirement of
further consent by the spouse, the spouse's consent must be
limited to the form of benefit, if applicable, and the
Beneficiary (including any Contingent Annuitant), class of
Beneficiaries, or contingent Beneficiary named in the
election. Spousal consent is not required, however, if the
Participant establishes to the satisfaction of the plan
representative that the consent of the spouse cannot be
obtained because there is no spouse or the spouse cannot be
located. A spouse's consent under this paragraph shall not be
valid with respect to any other spouse. A Participant may
revoke a prior election without the consent of the spouse. Any
new election will require a new spousal consent, unless the
consent of the spouse expressly permits such election by the
Participant without further consent by the spouse. A spouse's
consent may be revoked at any time within the Participant's
election period.
(d) Special Rule for Profit Sharing Plan. As provided in the
preceding provisions of the Plan, if a Participant has a
spouse to whom he has been continuously
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married throughout the one-year period ending on the date of
his death, the Participant's Vested Account shall be paid to
such spouse. However, if there is no such spouse or if the
surviving spouse has already consented in a manner conforming
to the qualified election requirements in (c) above, the
Vested Account shall be payable to the Participant's
Beneficiary in the event of the Participant's death.
The Participant may waive the spousal death benefit described
above at any time provided that no such waiver shall be
effective unless it satisfies the conditions of (c) above
(other than the notification requirement referred to therein)
that would apply to the Participant's waiver of the Qualified
Preretirement Survivor Annuity.
Because this is a profit sharing plan which pays death
benefits as described above, this subsection (d) applies if
the following condition is met: with respect to the
Participant, this Plan is not a direct or indirect transferee
after December 31, 1984, of a defined benefit plan, money
purchase plan (including a target plan), stock bonus plan or
profit sharing plan which is subject to the survivor annuity
requirements of Code Section 401(a)(11) and Code Section 417.
If the above condition is met, spousal consent is not required
for electing a benefit payable in a form that is not a life
annuity. If the above condition is not met, the consent
requirements of this article shall be operative.
SECTION 6.04--NOTICE REQUIREMENTS.
(a) Optional forms of retirement benefit. The Plan Administrator
shall furnish to the Participant and the Participant's spouse
a written explanation of the optional forms of retirement
benefit in the OPTIONAL FORMS OF DISTRIBUTION AND DISTRIBUTION
REQUIREMENTS SECTION of Article VI, including the material
features and relative values of these options, in a manner
that would satisfy the notice requirements of Code Section
417(a)(3) and the right of the Participant and the
Participant's spouse to defer distribution until the benefit
is no longer immediately distributable. The Plan Administrator
shall furnish the written explanation by a method reasonably
calculated to reach the attention of the Participant and the
Participant's spouse no less than 30 days and no more than 90
days before the Annuity Starting Date.
(b) Qualified Joint and Survivor Form. The Plan Administrator
shall furnish to the Participant a written explanation of the
following: the terms and conditions of the Qualified Joint and
Survivor Form; the Participant's right to make, and the effect
of, an election to waive the Qualified Joint and Survivor
Form; the rights of the Participant's spouse; and the right to
revoke an election and the effect of such a revocation. The
Plan Administrator shall furnish the written explanation by a
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method reasonably calculated to reach the attention of the
Participant no less than 30 days and no more than 90 days
before the Annuity Starting Date.
After the written explanation is given, a Participant or
spouse may make written request for additional information.
The written explanation must be personally delivered or mailed
(first class mail, postage prepaid) to the Participant or
spouse within 30 days from the date of the written request.
The Plan Administrator does not need to comply with more than
one such request by a Participant or spouse.
The Plan Administrator's explanation shall be written in
nontechnical language and will explain the terms and
conditions of the Qualified Joint and Survivor Form and the
financial effect upon the Participant's benefit (in terms of
dollars per benefit payment) of electing not to have benefits
distributed in accordance with the Qualified Joint and
Survivor Form.
(c) Qualified Preretirement Survivor Annuity. As required by the
Code and Federal regulation, the Plan Administrator shall
furnish to the Participant a written explanation of the
following: the terms and conditions of the Qualified
Preretirement Survivor Annuity; the Participant's right to
make, and the effect of, an election to waive the Qualified
Preretirement Survivor Annuity; the rights of the
Participant's spouse; and the right to revoke an election and
the effect of such a revocation. The Plan Administrator shall
furnish the written explanation by a method reasonably
calculated to reach the attention of the Participant within
the applicable period. The applicable period for a Participant
is whichever of the following periods ends last:
(1) the period beginning one year before the date the
individual becomes a Participant and ending one year
after such date; or
(2) the period beginning one year before the date the
Participant's spouse is first entitled to a Qualified
Preretirement Survivor Annuity and ending one year
after such date.
If such notice is given before the period beginning with the
first day of the Plan Year in which the Participant attains
age 32 and ending with the close of the Plan Year preceding
the Plan Year in which the Participant attains age 35, an
additional notice shall be given within such period. If a
Participant ceases to be an Employee before attaining age 35,
an additional notice shall be given within the period
beginning one year before the date he ceases to be an Employee
and ending one year after such date.
After the written explanation is given, a Participant or
spouse may make written request for additional information.
The written explanation must be personally
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delivered or mailed (first class mail, postage prepaid) to the
Participant or spouse within 30 days from the date of the
written request. The Plan Administrator does not need to
comply with more than one such request by a Participant or
spouse.
The Plan Administrator's explanation shall be written in
nontechnical language and will explain the terms and
conditions of the Qualified Preretirement Survivor Annuity and
the financial effect upon the spouse's benefit (in terms of
dollars per benefit payment) of electing got to have benefits
distributed in accordance with the Qualified Preretirement
Survivor Annuity.
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ARTICLE VII
TERMINATION OF PLAN
The Employee expects to continue the Plan indefinitely but, reserves
the right to terminate the Plan in whole or in part at any time upon giving
written notice to all parties concerned. Complete discontinuance of
Contributions under the Plan constitutes complete termination of Plan.
The Account of each Participant shall be fully (100%) vested and
nonforfeitable as of the effective date of complete termination of Plan. The
Account of each Participant who is included in the group of Participants deemed
to be affected by the partial termination of the Plan shall be fully (100%)
vested and nonforfeitable as of the effective date of the partial Plan
termination. The Participant's Account shall continue to participate in the
earnings credited, expenses charged and any appreciation or depreciation of the
Investment Fund until the Vested Account is distributed. A distribution under
this article will be a retirement benefit and shall be distributed to the
Participant according to the provisions of Article VI.
A Participant's Account which does not result from Contributions which
are used to compute the Actual Deferral Percentage, as defined in the EXCESS
AMOUNTS SECTION of Article III, may be distributed to the Participant after the
effective date of the complete or partial Plan termination. A Participant's
Account resulting from Contributions which are used to compute such percentage
may be distributed upon termination of the Plan without the establishment or
maintenance of another defined contribution plan, other than an employee stock
ownership plan (as defined in Code Section 4975(e) or Code Section 409) or a
simplified employee pension plan (as defined in Code Section 408(k)). Such a
distribution made after March 31, 1988, must be in a single sum.
Upon complete termination of Plan, no more Employees shall become
Participants and no more Contributions shall be made.
The assets of this Plan shall not be paid to the Employer at any time,
except that, after the satisfaction of all liabilities under the Plan, any
assets remaining may be paid to the Employer. The payment may not be made if it
would contravene any provision of law.
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ARTICLE VIII
ADMINISTRATION OF PLAN
SECTION 8.01--ADMINISTRATION.
Subject to the provisions of this article, the Plan Administrator has
complete control of the administration of the Plan. The Plan Administrator has
all the powers necessary for it to properly carry out its administrative duties.
Not in limitation, but in amplification of the foregoing, the Plan Administrator
has the power to construe the Plan, including ambiguous provisions, and to
determine all questions that may arise under the Plan, including all questions
relating to the eligibility of Employees to participate in the Plan and the
amount of benefit to which any Participant, Beneficiary, spouse or Contingent
Annuitant may become entitled. The Plan Administrator's decisions upon all
matters within the scope of its authority shall be final.
Unless otherwise set out in the Plan or Group Contract, the Plan
Administrator may delegate recordkeeping and other duties which are necessary
for the administration of the Plan to any person or firm which agrees to accept
such duties. The Plan Administrator shall be entitled to rely upon all tables,
valuations, certificates and reports furnished by the consultant or actuary
appointed by the Plan Administrator and upon all opinions given by any counsel
selected or approved by the Plan Administrator.
The Plan Administrator shall receive all claims for benefits by
Participants, former Participants, Beneficiaries, spouses, and Contingent
Annuitants. The Plan Administrator shall determine all facts necessary to
establish the right of any Claimant to benefits and the amount of those benefits
under the provisions of the Plan. The Plan Administrator may establish rules and
procedures to be followed by Claimants in filing claims for benefits, in
furnishing and verifying proofs necessary to determine age, and in any other
matters required to administer the Plan.
SECTION 8.02--RECORDS.
All acts and determinations of the Plan Administrator shall be duly
recorded. All these records, together with other documents necessary for the
administration of the Plan, shall be preserved in the Plan Administrator's
custody.
Writing (handwriting, typing, printing), photostating, photographing,
microfilming, magnetic impulse, mechanical or electrical recording or other
forms of data compilation shall be acceptable means of keeping records.
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SECTION 8.03--INFORMATION AVAILABLE.
Any Participant in the Plan or any Beneficiary may examine copies of
the Plan description, latest annual report, any bargaining agreement, this Plan,
the Group Contract or any other instrument under which the Plan was established
or is operated. The Plan Administrator shall maintain all of the items listed in
this section in its office, or in such other place or places as it may designate
in order to comply with governmental regulations. These items may be examined
during reasonable business hours. Upon the written request of a Participant or
Beneficiary receiving benefits under the Plan, the Plan Administrator will
furnish him with a copy of any of these items. The Plan Administrator may make a
reasonable charge to the requesting person for the copy.
SECTION 8.04--CLAIM AND APPEAL PROCEDURES.
A Claimant must submit any required forms and pertinent information
when making a claim for benefits under the Plan.
If a claim for benefits under the Plan is denied, the Plan
Administrator shall provide adequate written notice to the Claimant whose claim
for benefits under the Plan has been denied. The notice must be furnished within
90 days of the date that the claim is received by the Plan Administrator. The
Claimant shall be notified in writing within this initial 90-day period if
special circumstances require an extension of time needed to process the claim
and the date by which the Plan Administrator's decision is expected to be
rendered. The written notice shall be furnished no later than 180 days after the
date the claim was received by the Plan Administrator.
The Plan Administrator's notice to the Claimant shall specify the
reason for the denial; specify references to pertinent Plan provisions on which
denial is based; describe any additional material and information needed for the
Claimant to perfect his claim for benefits; explain why the material and
information is needed; inform the Claimant that any appeal he wishes to make
must be in writing to the Plan Administrator within 60 days after receipt of the
Plan Administrator's notice of denial of benefits and that failure to make the
written appeal within such 60-day period shall render the Plan Administrator's
determination of such denial final, binding and conclusive.
If the Claimant appeals to the Plan Administrator, the Claimant, or his
authorized representative, may submit in writing whatever issues and comments
the Claimant, or his representative, feels are pertinent. The Claimant, or his
authorized representative may review pertinent Plan documents. The Plan
Administrator shall reexamine all facts related to the appeal and make a final
determination as to whether the denial of benefits is justified under the
circumstances. The Plan Administrator shall advise the Claimant of its decision
within 60 days of his written request for review, unless special circumstances
(such as a hearing) would make rendering a decision within the 60-day limit
unfeasible. The Claimant must be notified within
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the 60-day limit if an extension is necessary. The Plan Administrator shall
render a decision on a claim for benefits no later than 120 days after the
request for review is received.
SECTION 8.05--UNCLAIMED VESTED ACCOUNT PROCEDURE.
At the time the Participant's Vested Account is distributable to the
Participant, spouse or Beneficiary without his consent according to the
provisions of Article VI or Article IX, the Plan Administrator, by certified or
registered mail addressed to his last known address and in accordance with the
notice requirements of Article VI, will notify him of his entitlement to a
benefit. If the Participant, spouse or Beneficiary fails to claim the Vested
Account or make his whereabouts known in writing within six months from the date
of mailing the notice, the Plan Administrator may treat such unclaimed Vested
Account as a forfeiture and apply it according to the forfeiture provisions of
Article III. If Article III contains no forfeiture provisions, such amount will
be applied to reduce the earliest Employer Contributions due after the
forfeiture arises.
If a Participant's Vested Account is forfeited according to the
provisions of the above paragraph and the Participant, his spouse or his
Beneficiary at any time make a claim for benefits, the forfeited Vested Account
shall be reinstated, unadjusted for any gains or losses occurring after the date
it was forfeited. The reinstated Vested Account shall then be distributed to the
Participant, spouse or Beneficiary according to the preceding provisions of the
Plan.
SECTION 8.06--DELEGATION OF AUTHORITY.
All or any part of the administrative duties and responsibilities under
this article may be delegated by the Plan Administrator to a retirement
committee. The duties and responsibilities of the retirement committee shall be
set out in a separate written agreement.
SECTION 8.07--VOTING AND TENDER OF QUALIFYING EMPLOYER SECURITIES.
Voting rights with respect to Qualifying Employer Securities will be
passed through to Participants. Participants will be allowed to direct the
voting rights of Qualifying Employer Securities for any matter put to the vote
of shareholders generally. Before each meeting of shareholders, the Employer
shall cause to be sent to each person with power to control such voting rights a
copy of any notice and any other information provided to shareholders and, if
applicable, a form for instructing the Trustee how to vote at such meeting (or
any adjournment thereof) the number of full and fractional shares subject to
such person's voting control. The Trustee' may establish a deadline in advance
of the meeting by which such forms must be received in order to be effective.
Each Participant shall be entitled to one vote for each share credited
to his Account.
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If some or all of the Participants have not directed or have not timely
directed the Trustee on how to vote, then the Trustee shall vote such Qualifying
Employer Securities in the same proportion as those shares of Qualifying
Employer Securities for which the Trustee has received proper direction for such
matter.
Tender rights or exchange offers for Qualifying Employer Securities
will be passed through to Participants. As soon as practicable after the
commencement of a tender of exchange offer for Qualifying Employer Securities,
the Employer shall cause each person with power to control the response to such
tender or exchange offer to be advised in writing as to the terms of the offer
and, if applicable, to be provided with a form for instructing the Trustee, or
for revoking such instruction, to tender or exchange shares of Qualifying
Employer Securities, to the extent permitted under the terms of such offer. In
advising such persons of the terms of the offer, the Employer may include
statements from the board of directors setting forth its position with respect
to the offer.
If some or all of the Participants have not directed or have not timely
directed the Trustee on how to tender, then the Trustee shall tender such
Qualifying Employer Securities in the same proportion as those shares of
Qualifying Employer Securities for which the Trustee has received proper
direction for such matter.
If the tender or exchange offer is limited so that all of the shares
that the Trustee has been directed to tender or exchange cannot be sold or
exchanged, the shares that each Participant directed to be tendered or exchanged
shall be deemed to have been sold or exchanged in the same ratio that the number
of shares actually sold or exchanged bears to the total number of shares that
the Trustee was directed to tender or exchange.
The Trustee shall hold the Participant's individual directions with
respect to voting rights or tender decisions in confidence and, except as
required by law, shall not divulge or release such individual directions to
anyone associated with the Employer. The Employer may require verification of
the Trustee's compliance with the directions received from Participants by any
independent auditor selected by the Employer, provided that such auditor agrees
to maintain the confidentiality of such individual directions.
The Employer may develop procedures to facilitate the exercise of votes
or tender rights, such as the use of facsimile transmissions for the
Participants located in physically remote areas.
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ARTICLE IX
GENERAL PROVISIONS
SECTION 9.01--AMENDMENTS.
The Employer may amend this Plan at any time, including any remedial
retroactive changes (within the specified period of time as may be determined by
Internal Revenue Service regulations) to comply with the requirements of any law
or regulation issued by any governmental agency to which the Employer is
subject. An amendment may not diminish or adversely affect any accrued interest
or benefit of Participants or their Beneficiaries or eliminate an optional form
of distribution with respect to benefits attributable to service before the
amendment nor allow reversion or diversion of Plan assets to the Employer at any
time, except as may be necessary to comply with the requirements of any law or
regulation issued by any governmental agency to which the Employer is subject.
No amendment to this Plan shall be effective to the extent that it has the
effect of decreasing a Participant's accrued benefit. However, a Participant's
Account may be reduced to the extent permitted under Code Section 412(c)(8). For
purposes of this paragraph, a Plan amendment which has the effect of decreasing
a Participant's Account or eliminating an optional form of benefit, with respect
to benefits attributable to service before the amendment shall be treated as
reducing an accrued benefit. Furthermore, if the vesting schedule of the Plan is
amended, in the case of an Employee who is a Participant as of the later of the
date such amendment is adopted or the date it becomes effective, the
nonforfeitable percentage (determined as of such date) of such Employee's
employer-derived accrued benefit will not be less than his percentage computed
under the Plan without regard to such amendment.
An amendment shall not decrease a Participant's vested interest in the
Plan. If an amendment to the Plan, or a deemed amendment in the case of a change
in top-heavy status of the Plan as provided in the MODIFICATION OF VESTING
REQUIREMENTS SECTION of Article X, changes the computation of the percentage
used to determine that portion of a Participant's Account attributable to
Employer Contributions which is nonforfeitable (whether directly or indirectly),
each Participant or former Participant
(a) who has completed at least three Years of Service on the date
the election period described below ends (five Years of
Service if the Participant does not have at least one
Hour-of-Service in a Plan Year beginning after December 31,
1988) and
(b) whose nonforfeitable percentage will be determined on any date
after the date of the change
may elect, during the election period, to have the nonforfeitable percentage of
his Account that results from Employer Contributions determined without regard
to the amendment. This
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election may not be revoked. An election does not need to be provided for any
Participant or former Participant whose nonforfeitable percentage, determined
according to the Plan provisions as changed, cannot at any time be less than the
percentage determined without regard to such change. The election period shall
begin no later than the date the Plan amendment is adopted, or deemed adopted in
the case of a change in the top-heavy status of the Plan, and end no earlier
than the sixtieth day after the latest of the date the amendment is adopted
(deemed adopted) or becomes effective, or the date the Participant is issued
written notice of the amendment (deemed amendment) by the Employer or the Plan
Administrator.
SECTION 9.02--DIRECT ROLLOVERS.
This section applies to distributions made on or after January 1, 1993.
Notwithstanding any provision of the Plan to the contrary that would otherwise
limit a Distributee's election under this section, a Distributee may elect, at
the time and in the manner prescribed by the Plan Administrator, to have any
portion of an Eligible Rollover Distribution paid directly to an Eligible
Retirement Plan, specified by the Distributee, in a Direct Rollover.
SECTION 9.03--MERGERS AND DIRECT TRANSFERS.
The Plan may not be merged or consolidated with, nor have its assets or
liabilities transferred to, any other retirement plan, unless each Participant
in the plan would (if the plan then terminated) receive a benefit immediately
after the merger, consolidation or transfer which is equal to or greater than
the benefit the Participant would have been entitled to receive immediately
before the merger, consolidation or transfer (if this Plan had then terminated).
The Employer may enter into merger agreements or direct transfer of assets
agreements with the employers under other retirement plans which are qualifiable
under Code Section 401(a), including an elective transfer, and may accept the
direct transfer of plan assets, or may transfer plan assets, as a party to any
such agreement. The Employer shall not consent to, or be a party to a merger,
consolidation or transfer of assets with a defined benefit plan if such action
would result in a defined benefit feature being maintained under this Plan.
The Plan may accept a direct transfer of plan assets on behalf of an
Eligible Employee. If the Eligible Employee is not an Active Participant when
the transfer is made, the Eligible Employee shall be deemed to be an Active
Participant only for the purpose of investment and distribution of the
transferred assets. Employer Contributions shall not be made for or allocated to
the Eligible Employee, until the time he meets all of the requirements to become
an Active Participant.
The Plan shall hold, administer and distribute the transferred assets
as a part of the Plan. The Plan shall maintain a separate account for the
benefit of the Employee on whose behalf the Plan accepted the transfer in order
to reflect the value of the transferred assets. Unless a transfer of assets to
the Plan is an elective transfer, the Plan shall apply the optional forms of
benefit protections described in the AMENDMENTS SECTION of Article IX to all
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transferred assets. A transfer is elective if: (1) the transfer is voluntary,
under a fully informed election by the Participant; (2) the Participant has an
alternative that retains his Code Section 411(d)(6) protected benefits
(including an option to leave his benefit in the transferor plan, if that plan
is not terminating); (3) if the transferor plan is subject to Code Sections
401(a)(11) and 417, the transfer satisfies the applicable spousal consent
requirements of the Code; (4) the notice requirements under Code Section 417,
requiring a written explanation with respect to an election not to receive
benefits in the form of a qualified joint and survivor annuity, are met with
respect to the Participant and spousal transfer election; (5) the Participant
has a right to immediate distribution from the transferor plan under provisions
in the plan not inconsistent with Code Section 401(a); (6) the transferred
benefit is equal to the Participant's entire nonforfeitable accrued benefit
under the transferor plan, calculated to be at least the greater of the single
sum distribution provided by the transferor plan (if any) or the present value
of the Participant's accrued benefit under the transferor plan payable at the
plan's normal retirement age and calculated using an interest rate subject to
the restrictions of Code Section 417(e) and subject to the overall limitations
of Code Section 415; (7) the Participant has a 100% nonforfeitable interest in
the transferred benefit; and (8) the transfer otherwise satisfies applicable
Treasury regulations.
SECTION 9.04--PROVISIONS RELATING TO THE INSURER AND OTHER PARTIES.
The obligations of an Insurer shall be governed solely by the
provisions of the Group Contract. The Insurer shall not be required to perform
any act not provided in or contrary to the provisions of the Group Contract. See
the CONSTRUCTION SECTION of this article.
Any issuer or distributor of investment contracts or securities is
governed solely by the terms of its policies, written investment contract,
prospectuses, security instruments, and any other written agreements entered
into with the Trustee.
Such Insurer, issuer or distributor is not a party to the Plan, nor
bound in any way by the Plan provisions. Such parties shall not be required to
look to the terms of this Plan, nor to determine whether the Employer, the Plan
Administrator, the Trustee, or the Named Fiduciary have the authority to act in
any particular manner or to make any contract or agreement.
Until notice of any amendment or termination of this Plan or a change
in Trustee has been received by the Insurer at its home office or an issuer or
distributor at their principal address, they are and shall be fully protected in
assuming that the Plan has not been amended or terminated and in dealing with
any party acting as Trustee according to the latest information which they have
received at their home office or principal address.
SECTION 9.05--EMPLOYMENT STATUS.
Nothing contained in this Plan gives an Employee the right to be
retained in the Employer's employ or to interfere with the Employer's right to
discharge any Employee.
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SECTION 9.06--RIGHTS TO PLAN ASSETS.
No Employee shall have any right to or interest in any assets of the
Plan upon termination of his employment or otherwise except as specifically
provided under this Plan, and then only to the extent of the benefits payable to
such Employee in accordance with Plan provisions.
Any final payment or distribution to a Participant or his legal
representative or to any Beneficiaries, spouse or Contingent Annuitant of such
Participant under the Plan provisions shall be in full satisfaction of all
claims against the Plan, the Named Fiduciary, the Plan Administrator, the
Trustee, the Insurer, and the Employer arising under or by virtue of the Plan.
SECTION 9.07--BENEFICIARY.
Each Participant may name a Beneficiary to receive any death benefit
(other than any income payable to a Contingent Annuitant) that may arise out of
his participation in the Plan. The Participant may change his Beneficiary from
time to time. Unless a qualified election has been made, for purposes of
distributing any death benefits before Retirement Date, the Beneficiary of a
Participant who has a spouse who is entitled to a Qualified Preretirement
Survivor Annuity shall be the Participant's spouse. The Participant's
Beneficiary designation and any change of Beneficiary shall be subject to the
provisions of the ELECTION PROCEDURES SECTION of Article VI. It is the
responsibility of the Participant to give written notice to the Insurer of the
name of the Beneficiary on a form furnished for that purpose.
With the Employer's consent, the Plan Administrator may maintain
records of Beneficiary designations for Participants before their Retirement
Dates. In that event, the written designations made by Participants shall be
filed with the Plan Administrator. If a Participant dies before his Retirement
Date, the Plan Administrator shall certify to the Insurer the Beneficiary
designation on its records for the Participant.
If, at the death of a Participant, there is no Beneficiary named or
surviving, any death benefit under the Group Contract shall be paid under the
applicable provisions of the Group Contract.
SECTION 9.08--NONALIENATION OF BENEFITS.
Benefits payable under the Plan are not subject to the claims of any
creditor of any Participant, Beneficiary, spouse or Contingent Annuitant. A
Participant, Beneficiary, spouse or Contingent Annuitant does not have any
rights to alienate, anticipate, commute, pledge, encumber or assign any of such
benefits, except in the case of a loan as provided in the LOANS TO PARTICIPANTS
SECTION of Article V. The preceding sentences shall also apply to the creation,
assignment, or recognition of a right to any benefit payable with respect to a
Participant according to a domestic relations order, unless such order is
determined by the
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Plan Administrator to be a qualified domestic relations order, as defined in
Code Section 414(p), or any domestic relations order entered before January 1,
1985.
SECTION 9.09--CONSTRUCTION.
The validity of the Plan or any of its provisions is determined under
and construed according to Federal law and, to the extent permissible, according
to the laws of the state in which the Employer has its principal office. In case
any provision of this Plan is held illegal or invalid for any reason, such
determination shall not affect the remaining provisions of this Plan, and the
Plan shall be construed and enforced as if the illegal or invalid provision had
never been included.
In the event of any conflict between the provisions of the Plan and the
terms of any contract or policy issued hereunder, the provisions of the Plan
control the operation and administration of the Plan.
SECTION 9.10--LEGAL ACTIONS.
The Plan, the Plan Administrator, the Trustee and the Named Fiduciary
are the necessary parties to any action or proceeding involving the assets held
with respect to the Plan or administration of the Plan or Trust. No person
employed by the Employer, no Participant, former Participant or their
Beneficiaries or any other person having or claiming to have an interest in the
Plan is entitled to any notice of process. A final judgment entered in any such
action or proceeding shall be binding and conclusive on all persons having or
claiming to have an interest in the Plan.
SECTION 9.11--SMALL AMOUNTS.
If the Vested Account of a Participant has never exceeded $5,000, the
entire Vested Account shall be payable in a single sum as of the earliest of his
Retirement Date, the date he dies, or the date he ceases to be an Employee for
any other reason. This is a small amounts payment. If a small amount is payable
as of the date the Participant dies, the small amounts payment shall be made to
the Participant's Beneficiary (spouse if the death benefit is payable to the
spouse). If a small amount is payable while the Participant is living, the small
amounts payment shall be made to the Participant. The small amounts payment is
in full settlement of all benefits otherwise payable.
No other small amounts payments shall be made.
SECTION 9.12--WORD USAGE.
The masculine gender, where used in this Plan, shall include the
feminine gender and the singular words as used in this Plan may include the
plural, unless the context indicates otherwise.
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SECTION 9.13--TRANSFERS BETWEEN PLANS.
If an Employee previously participated in another plan of the Employer
which credited service under the elapsed time method for any purpose which under
this Plan is determined using the hours method, then the Employee's service
shall be equal to the sum of (a), (b) and (c) below:
(a) The number of whole years of service credited to him under the
other plan as of the date he became an Eligible Employee under
this Plan.
(b) One year or a part of a year of service for the applicable
service period in which he became an Eligible Employee if he
is credited with the required number of Hours-of-Service. If
the Employer does not have sufficient records to determine the
Employee's actual Hours-of-Service in that part of the service
period before the date he became an Eligible Employee, the
Hours-of-Service shall be determined using an equivalency. For
any month in which he would be required to be credited with
one Hour-of-Service, the Employee shall be deemed for purposes
of this section to be credited with 190 Hours-of-Service.
(c) The Employee's service determined under this Plan using the
hours method after the end of the applicable service period in
which he became an Eligible Employee.
If an Employee previously participated in another plan of the Employer
which credited service under the hours method for any purpose which under this
Plan is determined using the elapsed time method, then the Employee's service
shall be equal to the sum of (d), (e) and (f) below:
(d) The number of whole years of service credited to him under the
other plan as of the beginning of the applicable service
period under that plan in which he became an Eligible Employee
under this Plan.
(e) The greater of (1) the service that would be credited to him
for that entire service period using the elapsed time method
or (2) the service credited to him under the other plan as of
the date he became an Eligible Employee under this Plan.
(f) The Employee's service determined under this Plan using the
elapsed time method after the end of the applicable service
period under the other plan in which he became an Eligible
Employee.
Any modification of service contained in this Plan shall be applicable
to the service determined pursuant to this section.
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If the Employee previously participated in the plan of a Controlled
Group member which credited service under a different method than is used in
this Plan, for purposes of determining eligibility and vesting the provisions
above shall apply as though the plan of the Controlled Group member were a plan
of the Employer.
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ARTICLE X
TOP-HEAVY PLAN REQUIREMENTS
SECTION 10.01--APPLICATION.
The provisions of this article shall supersede all other provisions in
the Plan to the contrary.
For the purpose of applying the Top-heavy Plan requirements of this
article, all members of the Controlled Group shall be treated as one Employer.
The term Employer as used in this article shall be deemed to include all members
of the Controlled Group unless the term as used clearly indicates only the
Employer is meant.
The accrued benefit or account of a participant which results from
deductible voluntary contributions shall not be included for any purpose under
this article.
The minimum vesting and contribution provisions of the MODIFICATION OF
VESTING REQUIREMENTS and MODIFICATION OF CONTRIBUTIONS SECTIONS of Article X
shall not apply to any Employee who is included in a group of Employees covered
by a collective bargaining agreement which the Secretary of Labor finds to be a
collective bargaining agreement between employee representatives and one or more
employers, including the Employer, if there is evidence that retirement benefits
were the subject of good faith bargaining between such representatives. For this
purpose, the term "employee representatives" does not include any organization
more than half of whose members are employees who are owners, officers, or
executives.
SECTION 10.02--DEFINITIONS.
The following terms are defined for purposes of this article.
Aggregation Group means
(a) each of the Employer's retirement plans in which a Key
Employee is a participant during the Year containing the
Determination Date or one of the four preceding Years,
(b) each of the Employer's other retirement plans which allows the
plans) described in (a) above to meet the nondiscrimination
requirement of Code Section 401(a)(4) or the minimum coverage
requirement of Code Section 410, and
(c) any of the Employer's other retirement plans not included in
(a) or (b) above which the Employer desires to include as part
of the Aggregation Group. Such a
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retirement plan shall be included only if the Aggregation
Group would continue to satisfy the requirements of Code
Section 401(a)(4) and Code Section 410.
The plans in (a) and (b) above constitute the "required" Aggregation
Group. The plans in (a), (b) and (c) above constitute the "permissive"
Aggregation Group.
Compensation means, as to an Employee for any period, compensation as
defined in the CONTRIBUTION LIMITATION SECTION of Article III. For
purposes of determining who is a Key Employee, Compensation shall
include, in addition to compensation as defined in the CONTRIBUTION
LIMITATION SECTION of Article III, elective contributions. Elective
contributions are amounts excludable from the Employee's gross income
under Code Sections 125, 402(e)(3), 402(h) or 403(b), and contributed
by the Employer, at the Employee's election, to a Code Section 401(k)
arrangement, a simplified employee pension, cafeteria plan or
tax-sheltered annuity.
For purposes of Compensation as defined in this section, Compensation
shall be limited to the maximum dollar amount, as adjusted, in the same
manner and in the same time as the Compensation defined in the
DEFINITION SECTION of Article I.
Determination Date means as to this Plan for any Year, the last day of
the preceding Year. However, if there is no preceding Year, the
Determination Date is the last day of such Year.
Key Employee means any Employee or former Employee (including
Beneficiaries of deceased Employees) who at any time during the
determination period was
(a) one of the Employer's officers (subject to the maximum below)
whose Compensation (as defined in this section) for the Year
exceeds 50 percent of the dollar limitation under Code Section
415(b)(1)(A),
(b) one of the ten Employees who owns (or is considered to own,
under Code Section 318) more than a half percent ownership
interest and one of the largest interests in the Employer
during any Year of the determination period if such person's
Compensation (as defined in this section) for the Year exceeds
the dollar limitation under Code Section 415(c)(1)(A),
(c) a five-percent owner of the Employer, or
(d) a one-percent owner of the Employer whose Compensation (as
defined in this section) for the Year is more than $ 150,000.
Each member of the Controlled Group shall be treated as a separate
employer for purposes of determining ownership in the Employer.
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The determination period is the Year containing the Determination Date
and the four preceding Years. If the Employer has fewer than 30
Employees, no more than three Employees shall be treated as Key
Employees because they are officers. If the Employer has between 30 and
500 Employees, no more than ten percent of the Employer's Employees (if
not an integer, increased to the next integer) shall be treated as Key
Employees because they are officers. In no event will more than 50
Employees be treated as Key Employees because they are officers if the
Employer has 500 or more Employees. The number of Employees for any
Plan Year is the greatest number of Employees during the determination
period. Officers who are employees described in Code Section 414(q)(8)
shall be excluded. If the Employer has more than the maximum number of
officers to be treated as Key Employees, the officers shall be ranked
by amount of annual Compensation (as defined in this section), and
those with the greater amount of annual Compensation during the
determination period shall be treated as Key Employees. To determine
the ten Employees owning the largest interests in the Employer, if more
than one Employee has the same ownership interest, the Employee(s)
having the greater annual Compensation shall be treated as owning the
larger interest(s). The determination of who is a Key Employee shall be
made according to Code Section 416(i)(1) and the regulations
thereunder.
Non-key Employee means a person who is a non-key employee within the
meaning of Code Section 416 and regulations thereunder.
Present Value means the present value of a participant's accrued
benefit under a defined benefit plan as of his normal retirement age
(attained age if later) or, if the plan provides non-proportional
subsidies, the age at which the benefit is most valuable. The accrued
benefit of any Employee (other than a Key Employee) shall be determined
under the method which is used for accrual purposes for all plans of
the Employer or if there is no one method which is used for accrual
purposes for all plans of the Employer, as if such benefit accrued not
more rapidly than the slowest accrual rate permitted under Code Section
411(b)(1)(C). For purposes of establishing Present Value, any benefit
shall be discounted only for 7.5% interest and mortality according to
the 1971 Group Annuity Table (Male) without the 7% margin but with
projection by Scale E from 1971 to the later of (a) 1974, or (b) the
year determined by adding the age to 1920, and wherein for females the
male age six years younger is used. If the Present Value of accrued
benefits is determined for a participant under more than one defined
benefit plan included in the Aggregation Group, all such plans shall
use the same actuarial assumptions to determine the Present Value.
Top-heavy Plan means a plan which is a top-heavy plan for any plan year
beginning after December 31, 1983. This Plan shall be a Top-heavy Plan
if
(a) the Top-heavy Ratio for this Plan alone exceeds 60 percent and
this Plan is not part of any required Aggregation Group or
permissive Aggregation Group.
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(b) this Plan is a part of a required Aggregation Group, but not
part of a permissive Aggregation Group, and the Top-heavy
Ratio for the required Aggregation Group exceeds 60 percent.
(c) this Plan is a part of a required Aggregation Group and part
of a permissive Aggregation Group and the Top-heavy Ratio for
the permissive Aggregation Group exceeds 60 percent.
Top-heavy Ratio means the ratio calculated below for this Plan or for
the Aggregation Group.
(a) If the Employer maintains one or more defined contribution
plans (including any simplified employee pension plan) and the
Employer has not maintained any defined benefit plan which
during the five-year period ending on the determination date
has or has had accrued benefits, the Top-heavy Ratio for this
Plan alone or for the required or permissive Aggregation Group
as appropriate is a fraction, the numerator of which is the
sum of the account balances of all Key Employees as of the
determination date and the denominator of which is the sum of
all account balances of all employees as of the determination
date. Both the numerator and denominator of the Top-heavy
Ratio are adjusted for any distribution of an account balance
(including those made from terminated plan(s) of the Employer
which would have been part of the required Aggregation Group
had such plan(s) not been terminated) made in the five-year
period ending on the determination date. Both the numerator
and denominator of the Top-heavy Ratio are increased to
reflect any contribution not actually made as of the
Determination Date, but which is required to be taken into
account on that date under Code Section 416 and the
regulations thereunder.
(b) If the Employer maintains one or more defined contribution
plans (including any simplified employee pension plan) and the
Employer maintains or has maintained one or more defined
benefit plans which during the five-year period ending on the
determination date has or has had accrued benefits, the
Top-heavy Ratio for any required or permissive Aggregation
Group as appropriate is a fraction, the numerator of which is
the sum of the account balances under the defined contribution
plan(s) of all Key Employees and the Present Value of accrued
benefits under the defined benefit plan(s) for all Key
Employees, and the denominator of which is the sum of the
account balances under the defined contribution plan(s) for
all employees and the Present Value of accrued benefits under
the defined benefit plans for all employees. Both the
numerator and denominator of the Top-heavy Ratio are adjusted
for any distribution of an account balance or an accrued
benefit (including those made from terminated plan(s) of the
Employer which would have been part of the required
Aggregation
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<PAGE> 89
Group had such plan(s) not been terminated) made in the
five-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 valuation date that falls
within or ends with the 12-month period ending on the
determination date, except as provided in Code Section 416 and
the regulations thereunder for the first and second plan years
of a defined benefit plan. The account balances and accrued
benefits of an employee who is not a Key Employee but who was
a Key Employee in a prior year will be disregarded. The
calculation of the Top-heavy Ratio and the extent to which
distributions, rollovers and transfers during the five-year
period ending on the determination date are to be taken into
account, shall be determined according to the provisions of
Code Section 416 and regulations thereunder. The account
balances and accrued benefits of an individual who has
performed no service for the Employer during the five-year
period ending on the determination date shall be excluded from
the Top-heavy Ratio until the time the individual again
performs service for the Employer. Deductible employee
contributions will not be taken into account for purposes of
computing the Top-heavy Ratio. When aggregating plans, the
value of account balances and accrued benefits will be
calculated with reference to the determination dates that fall
within the same calendar year.
Account, as used in this definition, means the value of an employee's
account under one of the Employer's retirement plans on the latest
valuation date. In the case of a money purchase plan or target benefit
plan, such value shall be adjusted to include any contributions made
for or by the employee after the valuation date and on or before such
determination date or due to be made as of such determination date but
not yet forwarded to the insurer or trustee. In the case of a profit
sharing plan, such value shall be adjusted to include any contributions
made for or by the employee after the valuation date and on or before
such determination date. During the first Year of any profit sharing
plan such adjustment in value shall include contributions made after
such determination date that are allocated as of a date in such Year.
The nondeductible employee contributions which an employee makes under
a defined benefit plan of the Employer shall be treated as if they were
contributions under a separate defined contribution plan.
Valuation Date means, as to this Plan, the last day of the last
calendar month ending in a Year.
Year means the Plan Year unless another year is specified by the
Employer in a separate written resolution in accordance with
regulations issued by the Secretary of the Treasury or his delegate.
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SECTION 10.03--MODIFICATION OF VESTING REQUIREMENTS.
If a Participant's Vesting Percentage determined under Article I is not
at least as great as his Vesting Percentage would be if it were determined under
a schedule permitted in Code Section 416, the following shall apply. During any
Year in which the Plan is a Top-heavy Plan, the Participant's Vesting Percentage
shall be the greater of the Vesting Percentage determined under Article I or the
schedule below.
<TABLE>
<CAPTION>
VESTING SERVICE NONFORFEITABLE
(whole years) PERCENTAGE
<S> <C>
Less than 2 0
2 20
3 40
4 60
5 80
6 or more 100
</TABLE>
The schedule above shall not apply to Participants who are not credited
with an Hour-of-Service after the Plan first becomes a Top-heavy Plan. The
Vesting Percentage determined above applies to all of the Participant's Account
resulting from Employer Contributions, including Contributions the Employer
makes before the TEFRA Compliance Date or when the Plan is not a Top-heavy Plan.
If, in a later Year, this Plan is not a Top-heavy Plan, a Participant's
Vesting Percentage shall be determined under Article I. A Participant's Vesting
Percentage determined under either Article I or the schedule above shall never
be reduced and the election procedures of the AMENDMENTS SECTION of Article IX
shall apply when changing to or from the schedule as though the automatic change
were the result of an amendment.
The part of the Participant's Vested Account resulting from the minimum
contributions required pursuant to the MODIFICATION OF CONTRIBUTIONS SECTION of
Article X shall not be forfeited because of a period of reemployment after
benefit payments have begun.
SECTION 10.04--MODIFICATION OF CONTRIBUTIONS.
During any Year, the Employer shall make a minimum contribution or
allocation on the last day of the Year for each person who is a Non-key Employee
on that day and who either was or could have been an Active Participant during
the Year. A Non-key Employee is not required to have a minimum number of
hours-of-service or minimum amount of Compensation, or to have had any Elective
Deferral Contributions made for him in order to be entitled to this minimum. The
minimum contribution or allocation for such person shall be equal to the lesser
of (a) or (b) below:
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(a) Three percent of such person's Compensation (as defined in
this article).
(b) The "highest percentage" of Compensation (as defined in this
article) for such Year at which the Employer's contributions
are made for or allocated to any Key Employee. The highest
percentage shall be determined by dividing the Employer
Contributions made for or allocated to each Key Employee
during such Year by the amount of his Compensation (as defined
in this article), which is not more than the maximum set out
above, and selecting the greatest quotient (expressed as a
percentage). To determine the highest percentage, all of the
Employer's defined contribution plans within the Aggregation
Group shall be treated as one plan. The provisions of this
paragraph shall not apply if this Plan and a defined benefit
plan of the Employer are required to be included in the
Aggregation Group and this Plan enables the defined benefit
plan to meet the requirements of Code Section 401(a)(4) or
Code Section 410.
If the Employer's contributions and allocations otherwise required
under the defined contribution plan(s) are at least equal to the minimum above,
no additional contribution or reallocation shall be required. If the Employer's
contributions and allocations are less than the minimum above and Employer
Contributions under this Plan are allocated to Participants, any Employer
Contributions (other than those which are allocated on the basis of the amount
made for such person) shall be reallocated to provide the minimum. The remaining
Contributions shall be allocated as provided in the preceding articles of this
Plan taking into account any amount which was reallocated to provide the
minimum. If the Employer's total contributions and allocations are less than the
minimum above after any reallocation provided above, the Employer shall
contribute the difference for the Year.
The minimum contribution or allocation applies to all of the Employer's
defined contribution plans in the aggregate which are Top-heavy Plans. If an
additional contribution or allocation is required to meet the minimum above, it
shall be provided in this Plan.
A minimum allocation under a profit sharing plan shall be made without
regard to whether or not the Employer has profits.
If a person who is otherwise entitled to a minimum contribution or
allocation above is also covered under a defined benefit plan of the Employer's
which is a Top-heavy Plan during that same Year, the minimum benefits for him
shall not be duplicated. The defined benefit plan shall provide an annual
benefit for him on, or adjusted to, a straight life basis of the lesser of (c)
two percent of his average pay multiplied by his years of service or (d) twenty
percent of his average pay. Average pay and years of service shall have the
meaning set forth in such defined benefit plan for this purpose.
For purposes of this section, any employer contribution made according
to a salary reduction or similar arrangement shall not apply before the first
Yearly Date in 1985. On and
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after the first Yearly Date in 1989, any such employer contributions and
employer contributions which are matching contributions, as defined in Code
Section 401(m), shall not apply in determining if the minimum contribution
requirement has been met, but shall apply in determining the minimum
contribution required. Forfeitures credited to a Participant's Account are
treated as employer contributions.
The requirements of this section shall be met without regard to
contributions under Chapter 2 of the Code (relating to tax on self-employment),
Chapter 21 of the Code (relating to Federal Insurance Contributions Act), Title
II of the Social Security Act or any other Federal or state law.
SECTION 10.05--MODIFICATION OF CONTRIBUTION LIMITATION.
If the provisions of subsection (e) of the CONTRIBUTION LIMITATION
SECTION of Article III are applicable for any Limitation Year during which this
Plan is a Top-heavy Plan, the benefit limitations shall be modified. The
definitions of Defined Benefit Plan Fraction and Defined Contribution Plan
Fraction in the CONTRIBUTION LIMITATION SECTION of Article III shall be modified
by substituting "1.0" in lieu of "1.25." The optional denominator for
determining the Defined Contribution Plan Fraction shall be modified by
substituting "$41,500" in lieu of "$51,875." In addition, an adjustment shall be
made to the numerator of the Defined Contribution Plan Fraction. The adjustment
is a reduction of that numerator similar to the modification of the Defined
Contribution Plan Fraction described in the CONTRIBUTION LIMITATION SECTION of
Article III, and shall be made with respect to the last Plan Year beginning
before January 1, 1984.
The modifications in the paragraph above shall not apply with respect
to a Participant so long as employer contributions, forfeitures or nondeductible
employee contributions are not credited to his account under this or any of the
Employer's other defined contribution plans and benefits do not accrue for such
Participant under the Employer's defined benefit plan(s), until the sum of his
Defined Contribution and Defined Benefit Plan Fractions is less than 1.0.
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By executing this Plan, the Primary Employer acknowledges having
counseled to the extent necessary with selected legal and tax advisors regarding
the Plan's legal and tax implications.
Executed this 26th day of September, 2000.
LANCER CORPORATION
By: /s/ STONEWALL J. FISHER, III
-------------------------------------
Stonewall J. Fisher, III
Vice President-Legal Affairs and
Chief Legal Officer
-------------------------------------
Title
Defined Contribution Plan 7.7
92
