As filed with the Securities and Exchange Commission
on November 25, 1998. File No.
- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
RELIV' INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Illinois 37-1172197
(State or other jurisdiction (IRS Employer Identification Number)
of incorporation)
136 Chesterfield Industrial Boulevard
Chesterfield, Missouri 63005
(314) 537-9715
(Address, including zip code, and telephone number, including area code of
registrant's principal executive offices)
RELIV' INTERNATIONAL, INC.
401(k)PLAN
(Full title of the Plan)
Robert L. Montgomery Copies of Communications to:
Chief Executive Officer
Reliv' International, Inc. Stephen M. Merrick, Esq.
136 Chesterfield Industrial Boulevard Scott P. Slykas, Esq.
Chesterfield, Missouri 63005 Fishman, Merrick, Miller, Genelly,
Phone: (314) 537-9715 Springer, Klimek & Anderson, P.C.
Fax: (314) 537-9753 125 South Wacker Drive, Suite 2800
(Name, address, including zip code, Chicago, Illinois 60606
and telephone number, Phone: (312) 726-1224
including area code, Fax: (312) 726-2649
of agent for service)
CALCULATION OF REGISTRATION FEE
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| | | Proposed | Proposed | |
| Title of | Amount | Maximum | Maximum | Amount of |
|Securities to be| to be |Offering Price| Aggregate | Registration|
| Registered |Registered(1) | Per Share(2) |Offering Price(2)| Fee(2) |
------------------------------------------------------------------------------
| Common Stock | | | | |
| no par value |600,000 Shares| $2.88 | $1,728,000 | $509.76 |
---------------- -------------------------------------------------------------
(1) In addition, pursuant to Rule 416(c) under the Securities Act of 1933,
this Registration Statement also covers an indeterminate amount of
interests to be offered or sold pursuant to the 401(k) Plan described
herein, including shares of Common Stock to be purchased from the
Company, if any, by the 401(k) Plan, and shares issued by the Company
upon the exercise of warrants issued under the 401(k) Plan.
(2) Represents shares to be issued upon exercise of options granted under
the Reliv' International, Inc. 401(k) Plan. Shares are to be issued at
prices currently undeterminable. Estimated solely for the purpose of
determining the registration fee pursuant to Rule 457(h), and is based
on the closing price of the Common Stock in the Nasdaq National Market
on November 16, 1998.
<PAGE>
PART I
Pursuant to Part I of Form S-8, information required under Items 1 and
2 of Form S-8 is omitted as part of this Registration Statement.
PART II
Item 3. Incorporation of Documents by Reference.
The following documents filed with the Securities and Exchange
Commission are hereby incorporated by reference:
(a) The Annual Report of the Company on Form 10-K for the
fiscal year ended December 31, 1997.
(b) The Company's Quarterly Reports on Form 10-Q, for the
fiscal quarters ended March 31, 1998, June 30, 1998,
and September 30, 1998.
(c) The Definitive Proxy Statement dated April 17, 1998,
for the Annual Meeting of Shareholders held on May 21,
1998.
(d) The description of the Company's capital stock as set
forth in the Company's Form 8A Registration Statement
(File No. 1-11768), filed by the registrant with the
Commission on February 25, 1993, including any
amendment or report filed for the purpose of updating
such description.
All documents subsequently filed by the Company pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934 prior
to the filing of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference in this Registration
Statement and to be a part hereof from the date of filing such documents.
Item 4. Description of Securities.
Not applicable.
1
<PAGE>
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Section 8.75 of the Illinois Business Corporation Act confers broad
powers upon corporations incorporated in that State with respect to
indemnification of any person against liabilities incurred by reason of the fact
that he is or was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation or other business entity. The
provisions of Section 8.75 are not exclusive of any other rights to which those
seeking indemnification may be entitled under bylaw, agreement or otherwise.
Article XII of the registrant's By-Laws provides that the registrant
shall have the power to indemnify any person who was or is party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the registrant) by reason of the
fact that he or she is or was a director, officer, employee or agent of the
registrant, or who is or was serving at the request of the registrant as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if such
person acted in good faith and in a manner he or she reasonably believed to be
in or not opposed to the best interests of the registrant, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his or her
conduct was unlawful.
Article XII also provides that the registrant shall have power to
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that such
person is or was a director, officer, employee or agent of the registrant, or is
or was serving at the request of the registrant as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually and reasonably
incurred by such person in connection with the defense or settlement of such
action or suit if such person acted in good faith and in a manner he or she
reasonably believed to be in, or not opposed to the best interests of the
registrant, provided that no indemnification shall be made in respect of any
claim, issue or matter as to which such persons shall have been adjudged to be
liable for negligence or misconduct in the performance of his or her duty to the
registrant, unless, and only to the extent that the
2
<PAGE>
court in which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all the circumstances
of the case, such person is fairly and reasonably entitled to indemnify for such
expenses as the court shall deem proper.
To the extent that a director, officer, employee, or agent of the
registrant has been successful, on the merits or otherwise, in defense of any
action, suit or proceeding referred to above, or in defense of any claim, issue
or matter therein, such person shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him or her in connection
therewith.
Any indemnification under Article XII (unless ordered by court) shall
be made by the registrant only as authorized in the specific case, upon
determination that indemnification of a director, officer, employee or agent is
proper in the circumstances because he or she has met the applicable standard of
conduct set forth above. Such determination shall be made:
(a) by the board of directors by a majority of a quorum
consisting of directors who were not parties to such
action, suit or proceeding, or
(b) if such a quorum is not obtainable, or, even if
obtainable, a quorum of disinterested directors so
directs, by independent legal counsel in a written
opinion, or
(c) by the shareholders.
Expenses incurred in defending a civil or criminal action, suit or
proceeding may be paid by the registrant in advance of the final disposition of
such action, suit or proceeding, as authorized by the board of directors in the
specific case, upon receipt of an undertaking by or on behalf of the director,
officer, employee or agent to repay such amount, unless it shall ultimately be
determined that he or she is entitled to be indemnified by the registrant as
authorized in Article XII.
The indemnification provided by Article XII is not exclusive of any
other rights to which those indemnified may be entitled under any contract,
agreement, vote of shareholders or disinterested directors, or otherwise, both
as to action in his or her official capacity and as to action in another
capacity while holding such office, and shall continue as to a person who has
ceased to be a director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person.
3
<PAGE>
Article XII provides that the registrant shall have power to purchase
and maintain insurance on behalf of any person who is or was a director,
officer, employee or agent of the registrant, or is or was serving at the
request of the registrant, as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against any
liability asserted against such person and incurred by such person in any such
capacity, or arising out of his status as such, whether or not the registrant
would have the power to indemnify him or her against such liability under the
provisions of this Article. The registrant has not obtained such insurance to
date.
If a registrant has paid indemnity or has advanced expenses to a
director, officer, employee or agent, the registrant shall report the
indemnification or advance in writing to the shareholders with or before the
notice of the next shareholders meeting.
Section 2.10(b)(3) of the Illinois Business Corporation Act enables a
corporation to eliminate or limit the personal liability of a director to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, provided that such provision does not eliminate or limit the
liability of a director (i) for any breach of the director's duty of loyalty to
the corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(iii) pursuant to Section 8.65 of the Illinois Business Act (regarding unlawful
dividends, stock purchases or stock redemptions) or (iv) for any other
transaction for which a director derived an improper personal benefit. The
Articles of Incorporation of the Company contain such a provision.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit
4 Reliv' International, Inc. Summary 401(k) Plan.
23.1 Consent of Ernst & Young LLP, independent auditors of
Reliv' International, Inc.
24 Power of Attorney (included on signature page).
The Registrant has submitted the Plan and any amendment thereto to the
Internal Revenue Service ("IRS") in a timely manner and has made or will make
all changes required by the IRS in order to qualify the Plan.
4
<PAGE>
Item 9. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers
or sales are being made, a post-effective
amendment to this registration statement to
include any material information with
respect to the plan of distribution not
previously disclosed in the registration
statement or any material change to such
information in the registration statement;
(2) That, for the purpose of determining any
liability under the Securities Act of 1933,
each such post-effective amendment shall be
deemed to be a new registration statement
relating to the securities offered therein,
and the offering of such securities at that
time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the
securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933, each filing of
the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers, and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and if, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer, or controlling
person of the registrant in the successful defense of any action, suit, or
proceeding) is asserted by such director, officer, or controlling person
connected with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
5
<PAGE>
SIGNATURES
----------
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Chesterfield, State of Missouri, on November 23,
1998.
RELIV INTERNATIONAL, INC.
By:/s/ Robert L. Montgomery
------------------------
Robert L. Montgomery, President
THE PLAN
--------
Pursuant to the requirement of the Securities Act of 1933, the Trustees
(or other persons who administer the Reliv International, Inc. 401(k) Plan) have
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Chesterfield, State of
Missouri on November 23, 1998.
PLAN:
RELIV' INTERNATIONAL, INC.
401(k) PLAN
By: /s/ Robert L. Montgomery
-----------------------------------
Robert L. Montgomery, Trustee
/s/ Stephen M. Merrick
-----------------------------------
Stephen M. Merrick, Trustee
/s/David G. Kreher
-----------------------------------
David G. Kreher, Trustee
POWER OF ATTORNEY
-----------------
The undersigned officers and directors of Reliv' International, Inc.
hereby constitute and appoint Robert L. Montgomery and David G. Kreher, or
either of them, with power to act one without the other, our true and lawful
attorney-in-fact and agent with full power of substitution and resubstitution,
for us and in our stead, in any and all capacities to sign any and all
amendments (including post-effective amendments) to this Registration Statement
and all documents relating thereto, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorney-in-fact and agent, full power
and authority to do and perform each and every act and thing necessary or
advisable to be done in and about the premises, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or his or her substitutes,
may lawfully do or cause to be done by virtue hereof.
6
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the dates indicated.
Date: November 23, 1998
By: /s/ Robert L. Montgomery
-------------------------------------------------------------------------
Robert L. Montgomery, Chairman of the Board of Directors,
President and Chief Executive Officer, Treasurer
Date: November 23, 1998
By: /s/ David G. Kreher
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David G. Kreher, Senior Vice President, Chief Operating Officer,
Assistant Secretary (principal financial and accounting officer)
Date: November 23, 1998
By: /s/ Carl W. Hastings
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Carl W. Hastings, Executive Vice President,
Assistant Secretary, Director
Date: November 23, 1998
By: /s/ Thomas W. Pinnock III
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Thomas W. Pinnock III, Director
Date: November 23, 1998
By: /s/ Stephen M. Merrick
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Stephen M. Merrick, Secretary, Director
Date: November 23, 1998
By: /s/ Donald L. McCain
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Donald L. McCain, Director
Date: November 23, 1998
By: /s/ John Akin
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John Akin, Director
Date: November 23, 1998
By: /s/ Sandra S. Montgomery
-------------------------------------------------------------------------
Sandra S. Montgomery, Director
Date: November 23, 1998
By: /s/ Thomas T. Moody
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Thomas T. Moody, Director
Date: November 23, 1998
By: /s/ Marvin W. Solomonson
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Marvin W. Solomonson, Director
7
EXHIBIT 4
Reliv International, Inc. 401(k) Plan
SUMMARY PLAN DESCRIPTION
NOVEMBER 14, 1997
<PAGE>
SUMMARY PLAN DESCRIPTION
TABLE OF CONTENTS
PAGE
----
I INTRODUCTION 1
II PLAN DATA 1
---------
Agent For Service Of Legal Process 1
Effective Date 1
Employer 1
Plan Administrator 1
Plan Year 1
Trustee 1
Type Of Administration 1
III DEFINITIONS 1
-----------
Break In Service 1
Compensation 2
Disability 2
Effective Date 2
Elective Deferral 2
Entry Date 2
Family Member 2
Highly Compensated Employee 2
Hour Of Service 3
Maternity/Paternity Leave 3
Normal Retirement Age 3
Spouse 3
Taxable Wage Base 3
Year Of Service 3
IV ELIGIBILITY REQUIREMENTS AND PARTICIPATION 4
------------------------------------------
V EMPLOYEE CONTRIBUTIONS 4
----------------------
Elective Deferrals 4
Rollover And Transfer Contributions 5
VI EMPLOYER CONTRIBUTIONS 5
----------------------
Contribution Formula 5
Eligibility For Allocation 6
<PAGE>
VII GOVERNMENT REGULATIONS 6
----------------------
VIII PARTICIPANT ACCOUNTS 7
--------------------
IX VESTING 7
-------
Determining Vested Benefit 7
Payment Of Vested Benefit 8
Loss Of Benefits 8
Timing Of Forfeiture 8
Reemployment 9
X TOP-HEAVY RULES 10
---------------
XI RETIREMENT BENEFITS AND DISTRIBUTIONS 10
-------------------------------------
Retirement Benefits 10
Distributions During Employment 10
Hardship Withdrawals 10
Beneficiary 11
Death Benefits 11
Form Of Payment 11
Rollover Of Payment 12
Time Of Payment 13
Joint And Survivor Annuity Rules 13
XII INVESTMENTS 13
-----------
Trust Fund 13
Investment Responsibility 14
Employee Investment Direction 14
Insurance Policies 14
Participant Loans 14
XIII ADMINISTRATION 14
--------------
Plan Administrator 14
Trustee 15
XIV AMENDMENT AND TERMINATION 16
-------------------------
XV LEGAL PROVISIONS 16
----------------
Rights Of Participants 16
Fiduciary Responsibility 16
Employment Rights 17
Benefit Insurance 17
Claims Procedure 17
Assignment 17
Questions 18
Conflicts With Plan 18
<PAGE>
I INTRODUCTION
Your Employer has established a retirement plan to help supplement your
retirement income. Under the program, the Employer makes contributions
to a Trust Fund which will pay you a benefit at retirement. Details
about how the Plan works are contained in this summary. While the
summary describes the principal provisions of the Plan, it does not
include every limitation or detail. If there is a discrepancy between
this booklet and the official Plan document, the Plan document shall
govern. You may obtain a copy of the Plan document from the Plan
Administrator. The Plan Administrator may charge a reasonable fee for
providing you with the copy.
II PLAN DATA
A. Agent For Service of Legal Process: Plan Administrator.
B. Effective Date: The Effective Date
of the original Plan was January 1,
1995; the Effective Date of the
amended Plan is January 1, 1997.
C. Employer: RELIV INTERNATIONAL, INC.
Address: 136 Chesterfield Industrial Boulevard
Chesterfield, MO 63005
Telephone No.: (314)537-9715
Tax I.D. No.: 37-1172197
Plan No.: 002
D. Plan Administrator: The Employer has designated the following
individual(s) to serve as Plan Administrator:
Reliv International, Inc.
E. Plan Year: The 12-month period beginning on January 1 and
ending on December 31.
F. Trustee(s): David G. Kreher, Stephen M. Merrick,
Robert L. Montgomery
Address: 136 Chesterfield Industrial Blvd.,
Chesterfield, MO 63005
Telephone No.: (314) 537-9715
G. Type Of Administration: Trust Fund
III DEFINITIONS
A. Break In Service. A 12 consecutive month period during which
you are not credited with or are not paid for more than 500
hours. If you go into the military service of the United
1
<PAGE>
States, you are not considered terminated as long as you
return to work within the time required by law. If you
separate from employment and incur a Break in Service, all
contributions to your various accounts are suspended. [See
special rules relating to maternity and paternity leave below.
Also, see Section VI(B) to determine your eligibility to share
in the Employer's Contribution if you separate from
employment, but do not incur a Break in Service.] If a Break
in Service occurs and you return to full time employment with
the Employer, your rights are explained in the section
entitled "Vesting".
B. Compensation. Your total salary, pay, or earned income from
the Employer, as reflected on tax Form W-2, which is subject
to withholding when earned. Compensation will include amounts
received by you during the Plan Year and earned while a
participant. Compensation shall include amounts deferred under
401(k) plans and Section 125 cafeteria plans. Compensation
shall be limited to $200,000 as adjusted for inflation. For
Plan Years beginning in 1994, Compensation shall be limited to
$150,000 as adjusted for inflation.
C. Disability. A potentially permanent illness or injury, as
certified to by a physician who is approved by the Employer,
which prevents you from engaging in work for which you are
qualified for a period of at least 12 months.
D. Effective Date. The date on which the Plan starts or an
amendment is effective.
E. Elective Deferral. Employer contributions made to the Plan at
your election, instead of being given to you in cash as part
of your salary. You can elect to defer a portion of your
salary, instead of receiving it in cash, and your Employer
will contribute it to the Plan on your behalf.
F. Entry Date. Your Entry Date will be the earlier of the first
day of the Plan Year or the first day of the seventh month of
the Plan Year coinciding with or following the date on which
you satisfy the eligibility requirements.
G. Family Member. The Spouse or lineal ascendant or descendant
(or Spouse there) of either a more than 5 % owner of the
Employer or one of the ten highest compensated Highly
Compensated Employees of the Employer.
H. Highly Compensated Employee. Any Employee who during the
current or prior Plan Year (1) was a 5% owner, (2) received
more than $75,000 in compensation as adjusted for inflation
(3) received more than $50,000 in compensation as adjusted for
inflation and was in the top 20% of Employees when ranked by
compensation,
2
<PAGE>
or (4) was an officer receiving more than $45,000 in
compensation as adjusted for inflation. Family members of any
5 % owner, or Highly Compensated Employee in the group of the
ten Employees with the greatest Compensation, will be combined
as if they were one person for purposes of Compensation and
contributions. If you are not currently or never were Highly
Compensated, or a family member of a Highly Compensated
Employee, you are a Non-highly Compensated Employee.
I. Hour Of Service. You will receive credit for each hour you are
(1) paid for being on your job, (2) paid even if you are not
at work(vacation, sickness, leave of absence, or disability),
or (3) paid for back pay if hours were not already counted. A
maximum of 501 hours will be credited for any year you are not
at work but are paid. Hours of Service will be calculated
based on actual hours you are entitled to payment.
J. Maternity/Paternity Leave. You may be eligible for additional
Hours of Service if you leave employment, even if temporarily,
due to childbirth or adoption. If this is the case, you will
be credited with enough hours (up to 501) of service to
prevent a Break in service, either in the year you leave
employment or the following year. For example, if you have 750
Hours of Service when your child is born, you would not get
any more hours credited for that plan Year since you do not
have a Break in Service. Therefore, if you do not return to
employment the following year, you will get 501 Hours of
Service so you will not have a Break in Service in that year.
Alternatively, if you do return the following year, but work
only 300 hours, you will receive an additional 201 hours in
order to prevent a break. These Hours of Service for maternity
or paternity leave must all be used in one Plan Year. They are
used only to prevent a Break in Service and not for
calculating your Years of Service for eligibility, vesting or
benefits.
K. Normal Retirement Age. The attainment of age 65.
L. Spouse. The person to whom you are or were legally married, or
your common law Spouse if common law marriage is recognized by
the state in which you live. A former Spouse may be treated as
a "Spouse" under this definition if recognized as such under a
Qualified Domestic Relations Order as explained at Section
XV(F) of this Summary Plan Description.
M. Taxable Wage Base.
The amount of your Compensation subject to FICA tax on the
first day of each Plan Year.
N. Year Of Service
Eligibility:
For purposes of determining your eligibility to participate in the
Plan, a Year of Service is a 12-consecutive month period beginning on
your date of hire during which you are credited with at least 1000
Hours of Service.
3
<PAGE>
Contribution:
For purposes of determining whether or not you are entitled to have a
contribution allocated to your account, a Year of Service is a
12-consecutive month period, which is the same as the Plan Year, during
which you are credited with a least 1000 Hours of Service.
Vesting:
For purposes of determining whether or not you are vested in your
account balance, a Year of Service is a 12-consecutive month period,
which is the same as the Plan Year, during which you are credited with
1000 Hours of Service.
IV. ELIGIBILITY REQUIREMENTS AND PARTICIPATION
The Service requirement for Elective Deferrals and Employer
Contribution is ] Year of Service. You must also attain age 21 to be
eligible to participate in the Plan.
You are considered to have completed 1 Year of Service for purposes of
eligibility on the anniversary of your first day of employment,
provided that you worked at least 1000 hours during that 12-month
period. The second and subsequent measuring periods, if applicable,
shall be the Plan Year.
The plan shall exclude Employees included in a unit of Employees
covered by a collective bargaining agreement between the Employer and
Employee Representatives, if the exclusion of such retirement benefits
were the subject of good faith bargaining. For this purpose, the term
"Employee Representative" does not include any organization more than
half of whose members are Employees who are owners, officers, or
executives of the Employer. Your participation in the Plan will begin
on the Entry Date defined at Section III.
V. EMPLOYEE CONTRIBUTIONS
A. Elective Deferrals
You, as an eligible Employee, may authorize the Employer to
withhold from 1% up to 15% of your Compensation and to deposit
such amount in the Plan fund. However, the total amount
withheld by the Employer for your taxable year shall not
exceed $7,000 as adjusted for inflation. If you participate in
a similar plan of an unrelated employer and your Elective
Deferrals under this Plan and the other plan exceed the $7,000
limit for a given year, you must designate one of the Plans as
receiving an excess amount. If you choose this Plan as the one
receiving the excess, you must notify the Plan Administrator
by March 1 of the following year so that the excess and any
income thereon may be returned to you by April 15. You may
increase, decrease, or terminate your Elective Deferral
percentage on the anniversary date of the Plan and on the
first day following any Valuation Date. If you terminate
contributions, you may not reinstate payroll withholding until
the first day of the next valuation period. The Employer may
also reduce or terminate your withholding if required to
maintain the Plan's qualified status.
4
<PAGE>
B. Rollover And Transfer Contributions
Rollover and Transfer Contributions are permitted. You may
make a Rollover or Transfer Contribution prior to becoming a
Participant.
A rollover or transfer of your retirement benefits may
originate from another qualified retirement plan or special
individual retirement arrangement (known as a "conduit" IRA)
to this Plan. If you have already received a lump-sum payment
from another qualified retirement plan, or if you received
payment from another qualified plan and placed it in a
separate "conduit" IRA, you may be eligible to redeposit that
payment to this Plan. The last day you may make a Rollover
Contribution to this Plan is the 60th day after you receive
the distribution from the other plan or IRA. A transfer occurs
when the trustee of the old plan transfers your assets to this
Plan. If you believe you qualify for a transfer or rollover,
see the Plan Administrator for more details.
VI EMPLOYER CONTRIBUTIONS
A. Contribution Formula
Elective Deferrals:
The Employer will contribute all Compensation which you elect to defer
to the Plan within the limits outlined in Section V(A).
Matching Contributions:
The Employer may make a Matching Contribution to each Participant based
on his or her Elective Deferrals in a percentage set by the Employer
prior to the end of each Plan Year.
The Employer has the right to designate all or a portion of the
Matching Contributions as "Qualified". To the extent Matching
Contributions are so designated, they are nonforfeitable and may not be
withdrawn from the Plan prior to separation from Service.
Employer Matching Contributions will only be made on Elective Deferrals
made to the Plan. The time period which will be used for determining
the amount of Matching Contributions owed shall be monthly.
Qualified Non-Elective Contributions:
The Employer may also contribute an additional amount determined in its
sole judgement. This additional contribution, if any, will be allocated
to only Non-highly Compensated Participants, in proportion to each
eligible Employee's Compensation as a ratio of all eligible Employees'
Compensation. These Contributions will be nonforfeitable and subject to
withdrawal restrictions.
5
<PAGE>
Discretionary:
The Employer may also contribute an additional amount determined in its
sole judgement. Such additional contribution, if any, shall be
allocated to each Participant in proportion to his or her Compensation
for the Plan Year while a Participant. A Participant will also receive
an allocation with respect to his or her Compensation in excess of the
Taxable Wage Base.
B. Eligibility For Allocation
Except for top-heavy minimum contributions, which are allocated in
accordance with Section X, the Employer's Contribution will be made to
all Participants who are employed at the end of the Plan Year provided
that the Participant has completed a Year of Service during the Plan
Year. The Employer shall also make matching and other related
contributions as indicated below to Employees who terminate during the
Plan Year as a result of:
Matching Other
X X (i) Retirement.
X X (ii) Disability.
X X (iii) Death.
X (iv) Other termination of
employment provided that
the Participant has
completed 1000 Hours of
Service.
X (v) Other termination of
employment even though the
Participant has not
completed a Year of
Service.
(vi) Termination of employment
(for any reason) provided
that the Participant has
completed 1000 Hours of
Service.
VII GOVERNMENT REGULATIONS
The federal government sets certain limitations on the level of
contributions which may be made to a Plan such as this. There is also a
"percentage" limitation which means that the percentage of Compensation
which you may contribute (Elective Deferrals) depends on the average
percentage of Compensation that the other Participants are
contributing. Simply stated, all Participants are divided into 2
categories: Highly Compensated and Non-highly Compensated and the
average for each group is calculated. The average contribution that the
Highly Compensated may make is based on the average contribution that
the Non-highly Compensated make. If a Highly Compensated Participant is
contributing more than he or she is allowed, the excess, plus or minus
any gain or loss, will be returned. Keep in mind that if you are a 5 %
owner of the business or one of the ten highest paid Highly Compensated
employees, certain family members' contribution percentages and
Compensations will be combined with yours for purposes of determining
your contributions under the Plan.
6
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VIII PARTICIPANT ACCOUNTS
The Employer will set up a record keeping account in your name to show
the value of your retirement benefit. The Employer will make the
following additions to your account:
A. your allocated share of the Employer's Contribution (including
your Elective Deferrals),
B. the amount of your personal Transfer Contributions and
Rollover Contributions, if any, and
C. your share of investment earnings and appreciation in the
value of investments.
The Employer will make the following subtractions from your account:
D. any withdrawals or distributions made to you,
E. your share of investment losses and depreciation in the value
of investments, and
F. your share of administrative fees and expenses paid out of the
Plan, if applicable.
The Employer will value the following types of contributions in your
account as indicated below:
Type of Contribution Valuation Date(s)
(1) Elective Deferrals v
(2) Matching v
(3) Qual. Non-Elective v
(4) Non-Elective v
(5) Minimum Top-Heavy v
Valuation Periods: (i) Daily (ii) Weekly (iii) Monthly (iv) Bi-Monthly (v)
Quarterly (vi) Semi-Annually (vii) Annually
The Employer will provide you with a statement of account activity at least once
annually.
IX VESTING
A. Determining Vested Benefit
Vesting refers to your earning or acquiring a nonforfeitable right to
the full amount of your account. Any Elective Deferrals, Qualified
Non-Elective Contributions, Qualified Matching Contributions, Rollover
Contributions, Transfer Contributions, plus or minus any earnings or
losses, are always 100% vested and cannot be forfeited for any reason.
7
<PAGE>
Any Employer contribution not listed in the previous sentence, and the
earnings or losses thereon, will vest in accordance with the following
table:
Years of Service
1 2 3 4 5 6 7
0% 20% 40% 60% 80% 100%
You are considered to have completed 1 Year of Service for purposes of
vesting upon the completion of 1000 Hours of Service at any time during
a Plan Year. Service prior to the Effective Date of the Plan is not
counted for purposes of vesting.
You automatically become fully vested, regardless of the vesting table,
upon attainment of Normal Retirement Age, upon retirement due to
disability, upon death, or upon termination of the Plan.
B. Payment Of Vested Benefit
If you separate from Service before your retirement, death or
Disability, you may request early payment of your vested benefit by
submitting a written request to the Plan Administrator. If your vested
account balance at the time of termination exceeds $3,500, you may
defer the payment of your benefit until April 1 of the calendar year
following the calendar year during which you attain age 70. The
portion of your account balance to which you are not vested is called a
"forfeiture" and remains in the Plan Forfeitures of Employer
Discretionary and Top-Heavy contributions shall be given
C. Loss Of Benefits
There are only two events which can cause the loss of all or a portion
of your account. One is termination of employment before you are 100%
vested according to the vesting provisions described at IX(A) and the
other is a decrease in the value of your account from investment losses
or administrative expenses and other costs of maintaining the Plan.
D. Timing Of Forfeiture
If you receive the vested portion of your account upon separation from
service, the Employer will forfeit your account as of the Plan Year
end, immediately following the date of payment of your Vested Account
Balance. If you have not received a distribution of your vested
balance, your nonvested portion will be forfeited at the end of the
Plan Year during which you incur your fifth consecutive 1-year Break in
Service.
8
<PAGE>
E. Reemployment
If you terminate service with your Employer, then are later reemployed,
you will become a Participant as of the earlier of the next Valuation
Date or the next Entry Date [see Section III] following your return to
employment. If you are not a member of a class of employees eligible to
participate in the Plan and later become a member of the eligible
class, you will participate immediately if you have satisfied the
minimum age and service requirements. Should you become ineligible to
share in future Contributions and forfeitures because you are no longer
a member of an eligible class, you shall again share upon your return
to an eligible class. All years of prior Service will be counted when
calculating your vested percentage in your new account balance. The
following rules apply in connection with reemployed Participants.
(a) Terminated Partially Vested Participants. If you terminate
employment and receive payment of your partially vested
interest and are reemployed prior to incurring five
consecutive one-year Breaks in Service, you have the right to
buy back the nonvested portion of your account if it was
forfeited. If your nonvested balance was not forfeited it will
still be part of your account and the buy back is not
necessary. If a buy back is necessary to regain the
forfeiture, you must redeposit the amount paid to you without
interest within five years of your date of reemployment. If
you do not repay the amount you received, the nonvested
portion of your Employer account will be permanently
forfeited. Whether you repay or not, your prior Service will
count toward vesting service for future Employer
contributions.
For example, assume that you terminate your job with your
current Employer. At the time of termination you had accrued a
total benefit of $10,000 under the retirement' Plan. Although
this amount had been allocated to your account, you were only
40% vested in that amount when you left. You decided to take a
distribution of your vested account balance (40 % of $ 10,000,
or $4,000) when you quit. The nonvested balance of your
account ($6,000) was forfeited. Three years later, you became
reemployed by the same Employer. Since you were reemployed
within 5 years, you have the right to repay the $4,000
distribution you received when you quit. You would have to
repay the $4,000 within 5 years of being rehired. If you do
so, the nonvested portion of your account ($6,000) will be
restored to your account. After restoration, you will be
vested in 40% of this account, but your vested percentage will
increase based on your Years of Service after your
reemployment. Your prior Service will always count towards
vesting of Employer Contributions which you receive after
reemployment, whether or not you decide to repay and restore
your prior account.
(b) Terminated Nonvested Participants. If you were not vested in
any portion of your Employer Contribution account prior to
your separation from service and are reemployed before
incurring five consecutive one-year Breaks in Service, you
will be credited for vesting with all pre-break and post-break
service. Your prior unpaid account balance will automatically
be restored and you will continue to vest in that account. If
you are reemployed after incurring five consecutive one-year
Breaks in Service, you will lose your prior account balance,
but your pre-break Years of Service will count towards vesting
in your new account balance.
9
<PAGE>
X TOP-HEAVY RULES
A "top-heavy" plan is one in which more than 60% of the contributions or
benefits are attributable to "key employees", such as owners, officers and
stockholders. The Plan Administrator is responsible for determining each year if
the Plan is "top-heavy". If the Plan becomes top-heavy, special rules apply to
the allocation of the Employer's contribution. These special rules require that
only Participants who are not key employees will generally receive an allocation
of the Employer's contribution equal to 3% of compensation, or if less, the
greatest percentage allocated to the account of any key employee. All
Participants are entitled to receive this minimum allocation upon completing at
least one Hour of Service in the top-heavy Plan Year provided they are employed
on the last day of the Plan Year. The Employer's minimum contribution can be
satisfied by another Employer sponsored retirement plan, if so elected by the
Employer.
XI RETIREMENT BENEFITS AND DISTRIBUTIONS
A. Retirement Benefits
The full value of your account balance is payable at your Normal
Retirement Age, even if you continue to work, or you may defer payment
until April 1 following the year you reach age 70-1/2. If you work
beyond your Normal Retirement Age, you will continue to fully
participate in the Plan.
B. Distributions During Employment
Benefits attributable to Employer Contributions are not payable prior
to your separation from Service, except as indicated above.
If applicable, benefits attributable to your rollovers are available
for withdrawal upon request to the Plan Administrator. Transfers
Contributions may be withdrawn only if they originate from plans
meeting certain safe harbor provisions.
C. Hardship Withdrawals
You may file a written request for a hardship withdrawal of the portion
of your account balance attributable to Elective Deferrals and certain
Employer Contributions to the extent vested. Earnings on Elective
Deferrals up to the last day of the Plan Year prior to July 1, 1989 may
be included in any hardship withdrawal, but earnings on Elective
Deferrals after that date may not be included. You must generally have
your Spouse's written consent for a hardship withdrawal unless you are
advised otherwise by the Plan Administrator. Prior to receiving a
hardship distribution, you must take any other distribution and borrow
the maximum non-taxable loan amount allowed under this and any other
plans of the Employer. Note, however, that if the effect of the loan
would be to increase the amount of your financial need, you are not
required to take the loan. For example, if you need funds to purchase a
principal residence, and a plan loan would disqualify you from
obtaining other necessary financing, you do not have to take the loan.
Hardship withdrawals may be authorized by the Employer for the
following reasons:
10
<PAGE>
(a) to assist you in purchasing a personal residence which is your
primary place of residence (not including mortgage payments),
(b) to assist you in paying tuition and related educational
expenses for you, your Spouse, or your dependents, for the
next twelve months of post-secondary education,
(c) to assist you in paying expenses incurred or necessary on
behalf of you, your Spouse, or your dependents for
hospitalization, doctor or surgery expenses which are not
covered by insurance, or
(d) to prevent your eviction from or foreclosure on your principal
residence.
Any hardship distribution is limited to the amount needed to meet the financial
need. Hardship withdrawals must be approved by the Employer and will be
administered in a non-discriminatory manner. Such withdrawals will not affect
your eligibility to continue to participate in Employer Contributions to the
Plan, although, your right to make Elective Deferrals shall be suspended for
twelve months. Any withdrawals you receive under these rules may not he
recontributed to the Plan and may be subject to taxation, as well as an
additional 10% penalty tax if the withdrawal is received before you reach age
59-1/2. These payments shall also be subject to a mandatory 20% withholding for
income tax purposes.
D. Beneficiary
Every Participant or former Participant with plan benefits may designate a
person or persons who are to receive benefits under the Plan in the event of his
or her death. The designation must be made on a form provided by and returned to
the Plan Administrator. You may change your designation at any time. If you are
married, your beneficiary will automatically be your Spouse. If you and your
Spouse wish to waive this automatic designation, you must complete a beneficiary
designation form. The form must be signed by you and your Spouse in front of a
Plan representative or a Notary Public.
E. Death Benefits
In the event of your death, the full value of your account is payable to your
beneficiary in a lump sum, or if permitted, in installments payable over any
period which does not exceed the life expectancy of your beneficiary. The
benefit may also be paid in the form of an annuity. If you die after benefit
payments have started under an installment option and after the attainment of
age 70-1/2, your beneficiary will continue to receive payments in accordance
with the payment option you selected.
F. Form Of Payment
When benefits become due, you or your representative should apply to the
Employer requesting payment of your account and specifying the manner of
payment. If you are married and your account balance exceeds $3,500, the normal
or automatic form of payment is a joint and survivor annuity with a percentage
of your benefit continuing to your Spouse upon your death. If you are not
11
<PAGE>
married, the normal form of benefit is a life annuity based on your life
expectancy. If you do not wish to receive the normal form of payment when your
payments are due to start, you may request to receive your benefit in any of the
optional forms indicated:
lump sum.
installment payments.
a life annuity.
A joint and 50 75 100% survivor annuity
In some cases, election of one of the optional forms of payment will require the
written consent of your Spouse. Also, payments may not be made over a period
which exceeds the life expectancy of you and your beneficiary. The Plan
Administrator will advise you if any special rules apply in connection with the
payments of your benefits.
G. Rollover Of Payment
If your benefits qualify as eligible rollovers, you have the option of
having them paid directly to you, when they become due, or having
them directly rolled over to another qualified plan or an IRA. If
you do not choose to have the benefits directly rolled over, the Plan
is required to automatically withhold 20% of your payment for tax
purposes. If you do choose to have the payment made to you, you still
have the option of rolling over the payment yourself to a qualified
plan or an IRA within sixty days (first check with a tax advisor to
make sure it is an eligible rollover). However, 20% of your payment
will still be withheld. The following example illustrates how this
works: If you have $100,000 in your vested account balance and choose
to have the payment of your benefits made directly to an IRA or another
qualified plan, the entire $100,000 will be transferred to the trustee
of the other plan or the IRA, and you will treat the entire amount as a
rollover on your tax return so that you will not pay taxes on the
entire amount. If you choose not to have the account transferred
directly to an IRA or qualified plan, 20% or $20,000 will automatically
be withheld from your payment. Thus, you will receive only $80,000 as a
distribution of your benefits. In order to roll the entire amount over
into your IRA, you would have to come up with $20,000 out of your own
pocket to make up the difference. If this is done, the $20,000 which
was withheld may be returned when you file your taxes at the end of the
year. However, if you are unable to produce the extra cash, the
rollover amount will only be $80,000, and the other $20,000 which was
withheld will be treated as taxable income to you. If you are under age
591/2 when you receive your benefit payment, the withheld amount will
also be subject to the 10% early distribution penalty. However, if you
receive your benefit payment due to a separation of service, after
attainment of age 55, there will be no 10% early distribution penalty.
Certain benefit payments are not eligible for rollover and therefore
will also not be subject to the 20% mandatory withholding. They
are as follows:
l. annuities paid over life;
2. installments for a period of at least 10 years; and
3. minimum required distributions at age 701/2.
There are also several operational exceptions and a "de minimis"
exception for payments of less than $200. Also Employee Voluntary
contributions are not eligible for rollover.
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<PAGE>
H. Time Of Payment
If you retire, become disabled, or die, payments will start as
soon as administratively feasible following the end of the
Plan Year in which a distribution is requested by you or is
otherwise payable.
If you terminate for a reason other than death, Disability, or
retirement, payments will start as soon as administratively feasible
following the end of the Plan Year in which a distribution is requested
by you or is otherwise payable.
I. Joint And Survivor Annuity Rules
Retirement Benefits
If the benefit under the Plan is payable in the form of an
annuity, the Plan is subject to the joint and survivor annuity
rules. Under these rules, there are two automatic methods of
payment for vested Participants depending on your marital
status. If you do not choose another form of payment (such as
a lump sum or installments), the normal form of payment is a
straight life annuity if you are not married at your
retirement date, or a qualified joint and survivor annuity if
you are married. Under a straight life annuity, you will
receive equal monthly payments for as long as you live. No
further payments will be made after your death. Under a
qualified joint and survivor annuity, you will receive a
reduced benefit each month for your lifetime. After you die,
50% of that amount will be paid each month to your Spouse for
his or her lifetime. The amount of your monthly benefit is
reduced under a joint and survivor annuity because it is
expected that payments will be made over two lifetimes instead
of one. You may choose another form of payment by filling out
the proper form and returning it to the Plan Administrator. In
order to choose another form of payment or a beneficiary,
other than your Spouse, you must make a proper election, with
your Spouse's written consent. Such election must be witnessed
by a Notary Public. Written notice of these rules will be
provided to you on a timely basis.
Death Benefits
If you die while still employed by the Employer, or die after
you retire or terminate employment but before benefit payments
start, your surviving Spouse will be entitled to a life
annuity based on one half of the value of your account. These
payments will continue for your spouse's lifetime unless he or
she chooses to accelerate such payments. Again, you and your
Spouse can waive this coverage by obtaining the proper form
from the Plan Administrator and completing it. For the other
half of your account, that is not entitled to be paid in the
form of a life annuity, you may designate another beneficiary
and/or allowable form of payment under the Plan without
obtaining a waiver from your spouse.
If you are not married, you may designate any beneficiary or
allowable form of payment under the Plan.
XII INVESTMENTS
A. Trust Fund
The monies contributed to the Plan may be invested in
any security or form of property considered prudent
for a retirement plan. Such investments include, but
are not limited to, common and preferred stocks,
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<PAGE>
exchange traded put and call options, bonds, money
market instruments, mutual funds, savings accounts,
certificates of deposit, Treasury bills, or insurance
contracts. An institutional Trustee may invest in its
own deposits or those of affiliates which bear a
reasonable interest rate, or in a group or collective
trust maintained by such Trustee.
B. Investment Responsibility
The Plan's assets are held by the Trustee who is
identified in Section II of this Summary. The Trustee
is responsible for the safekeeping of plan assets and
for the investment management of such assets unless
the Employer elects to direct investments, appoints
an outside investment manager or permits Participants
to direct the investment of their individual
accounts.
C. Employee Investment Direction
Participants may direct the investments of their
accounts among alternative investment funds provided
under the Plan. All contributions are available for
making an investment election. The procedures for
making an election are shown in a separate Investment
Election Form which can be obtained from the Plan
Administrator. You may change your investment
selection and move monies from one fund to another in
accordance with the rules established by the Plan
Administrator.
D. Insurance Policies
You may elect to apply a portion of your account
balance for the purchase of insurance, If you are
interested in this option, you may obtain an
Insurance Form from the Plan Administrator. The Form
provides the information you will need to arrange for
the purchase of insurance.
E. Participant Loans
Participant loans are permitted under the Plan. In
order to get a loan from the Plan, you must make
application to the Plan Administrator. Loans must be
approved by the Plan Administrator and are subject to
a strict set of rules established by law. The rules
are covered in a separate Loan Application Form and
Promissory Note Form. These Forms are available from
the Plan Administrator.
XIII ADMINISTRATION
The Plan will be administered by the following parties:
A. Plan Administrator
The Employer is the party who has established the Plan and who
has overall control and authority over administration of the
Plan. The Employer's duties as Plan Administrator include:
14
<PAGE>
(a) appointing the Plan's professional advisors needed to
administer the Plan including, but not limited to, an
accountant, attorney, actuary, or administrator,
(b) directing the Trustee with respect to payments from
the Fund,
(c) communicating with Employees regarding their
participation and benefits under the Plan, including
the administration of all claims procedures and
domestic relations orders,
(d) filing any returns and reports with the Internal
Revenue Service, Department of Labor, or any other
governmental agency,
(e) reviewing and approving any financial reports,
investment reviews, or other reports prepared by any
party appointed by the Employer,
(f) establishing a funding policy and investment
objectives consistent with the purposes of the Plan
and the Employee Retirement Income Security Act of
1974, and
(g) construing and resolving any question of Plan
interpretation. The Plan Administrator's
interpretation and application thereof is final.
B. Trustee
The Trustee shall be responsible for the administration of investments
held in the Fund. These duties shall include:
(a) receiving contributions under the terms of the Plan,
(b) investing Plan assets unless investment
responsibility is delegated to another party by the
Employer,
(c) making distributions from the Fund in accordance with
written instructions received from the Plan
Administrator,
(d) keeping accounts and records of the financial
transactions of the Fund, and
(e) rendering an annual report of the Fund showing the
financial transactions for the Plan Year.
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<PAGE>
XIV AMENDMENT AND TERMINATION
The Employer may amend the Plan at any time, provided that no amendment
will divert any part of the Plan's assets to any purpose other than for
the exclusive benefit of you and the other Participants in the Plan or
eliminate an optional form of distribution. The Employer may also
terminate the Plan. In the event of a full termination, all amounts
credited to your account will be
fully vested and will be paid to you. Depending on the facts and
circumstances, a partial termination may be found to occur where a
significant number of Employees are terminated by the Employer or
excluded from Plan participation. In case of a partial termination,
only those affected will become 100% vested.
XV LEGAL PROVISIONS
A. Rights Of Participants
As a Plan Participant, you have certain rights and protection
under the Employee Retirement Income Security Act of 1974
(ERISA).
The law says that you are entitled to:
(a) Examine, without charge, all documents relating to
the operation of the Plan and any documents filed
with the U.S. Department of Labor. These documents
are available for review in the Employer's offices
during regular business hours.
(b) Obtain copies of all Plan documents and other Plan
information upon written request to the Employer. The
Employer may make a reasonable charge for producing
the copies.
(c) Receive from the Employer at least once each year a
summary of the Plan's annual financial report.
(d) Obtain, at least once a year, a statement of the
total benefits accrued for you, and your
nonforfeitable (vested)benefits, if any. The Plan
provides that you will receive this statement
automatically, If you are not vested, you may request
a statement showing the date when your account will
begin to become nonforfeitable.
(e) File suit in a federal court, if any materials
requested are not received within 30 days of your
request, unless the materials were not sent because
of matters beyond the control of the Employer. If you
are improperly denied access to information you are
entitled to receive, the employer may be required to
pay up to $100 for each day's delay until the
information is provided to you.
B. Fiduciary Responsibility
ERISA imposes obligations upon the persons who are responsible
for the administration of the Plan. These persons are referred
to as "fiduciaries." Fiduciaries must act solely in your
interest as a Plan Participant and they must exercise prudence
in the performance of their duties. Fiduciaries who violate
ERISA may be removed and required to reimburse any losses they
have caused you or your Plan.
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<PAGE>
C. Employment Rights
Participation in the Plan is not a guarantee of employment.
However, the Employer may not fire you or discriminate against
you to prevent you from becoming eligible for the Plan or from
obtaining a benefit or exercising your rights under ERISA.
D. Benefit Insurance
Your benefits under this Plan are not insured by the Pension
Benefit Guaranty Corporation since the law does not provide
plan termination insurance for this type of Plan.
E. Claims Procedure
If you feel you are entitled to a benefit under the Plan, mail
or deliver your written claim to the Plan Administrator. The
Plan administrator will notify you, your beneficiary, or
authorized representative of the action taken within 60 days
of receipt of the claim. If you believe that you are being
improperly denied a benefit in full or in part, the
Administrator must give you a written explanation of the
reason for the denial. If the Administrator denies your claim,
you may, within 60 days after receiving the denial, submit a
written request asking the Administrator to review your claim
for benefits. Any such request should be accompanied by
documents or records in support of your appeal. You, your
beneficiary, or your authorized representative may review
pertinent documents and submit issues and comments in writing.
If you get no satisfaction from the Administrator, you have
the right to request assistance from the U.S. Department of
Labor or you can file suit in a state or federal court.
Service of legal process may be made on the Plan Administrator
at the address of the Employer.
If you are successful in your lawsuit, the court may require
the employer to pay your legal costs, including your
attorney's fees. If you lose, and the court finds that your
claim is frivolous, you maybe required to pay the Employer's
legal fees.
F. Assignment
Your rights and benefits under this Plan cannot be assigned,
sold, transferred or pledged by you or reached by your
creditors or anyone else except under a qualified domestic
relations order or as provided by state law. A qualified
domestic relations order (QDRO) is a court order issued under
state domestic relations law relating to divorce, legal
separation, custody, or support proceedings. The QDRO
recognizes the right of someone other than you to receive your
Plan benefits. You will be notified if a QDRO on your Plan
benefits is received. Receipt of a qualified domestic
relations order shall allow for an earlier than normal
distribution to the person(s) other than the Participant
listed in the order.
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G. Questions
If you have any questions about this statement of your rights
under ERISA, please contact the Employer or the Pension and
Welfare Benefits Administration, Room N5644, U.S. Department
of Labor, 200 Constitution Ave., N.W.,Washington, D.C. 20210.
H. Conflicts With Plan
This booklet is not the Plan document, but only a Summary Plan
Description of its principal provisions and not every
limitation or detail of the Plan is included. Every attempt
has been made to provide concise and accurate information.
However, if there is a discrepancy between this booklet and
the official Plan document, the Plan document shall prevail.
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SUMMARY OF PLAN FEATURES
Reliv International, Inc. 401(k) Plan
RELIV INTERNATIONAL, INC.
136 Chesterfield Industrial Boulevard
Chesterfield, MO 63005
Telephone: (314)537-9715 Tax I.D. No.: 37-1172197
<TABLE>
<CAPTION>
GENERAL INFORMATION:
<S> <C>
Business Form: Corporation Vesting: 1000 hours
Plan Number: 002 Eligibility Requirements:
Effective Dates: Age: 21 Years
Original Plan: January 1, 1995 Service: Elective Deferrals & other
Amended Plan: January 1, 1997 Contributions unless listed: 1 Year(s)
Compensation: Exclusions:
Code Sec. 3401(a) Comp. Union Employees are excluded
Based on Plan Year.
Entry Date: For Profit-Sharing Contr. RETIREMENT DATES:
the earlier of the first day of the Plan
Year or the first day of the seventh Normal: 65 years old
month of the Plan year coinciding with or Early: Not Applicable
following.
For Contr. other than Profit-Sharing - the CONTRIBUTIONS:
earlier of the first day of the Plan Year
or the first day of the seventh month. Elective Deferrals: Any % from 1% to
Hours of Service: Based on actual 15 %.
Limitation Year: From January 1 to Changes allowed on Plan's Anniversary
December 31. Date & 1st day after Valuation Dates.
Net Profits: Not Required. Deferrals may be reinstated on the 1st
No Net Profits required for: day of next Valuation Period.
Matching Contributions Matching Contributions:
Qualified Non-Elective Contributions Discretionary: Will be set prior to the
Discretionary Contributions end of Plan Year and shall not exceed
Plan Year: From January 1 to December Qualified Matching Contributions will be
31 None.
Qualified Early Retirement Age: Shall be Qualified Non-Elective Contributions:
when order is qualified Amount to meet both tests will be used.
Qualified Joint and Survivor Annuity: Qualified Non-Elective Conts will be
50% made to: Non-Highly Compensated EE's
Taxable Wage Base: Matching Computation Period:
Maximum Monthly.
Valuation Dates: Profit-Sharing Contributions shall be
Voluntary - n/a allocated as follows: Integrated with
Deferrals - v Social Security.
Matching - v Excess Amounts shall be placed in a
QNECs - v suspense account.
Non-Elective - v Return of Excess Contributions: A
19
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Top-Heavy - v Participant's excess shall reduce either
Key: (i) daily: (ii) weekly; (iii) monthly test.
(iv) bi-monthly; (v) quarterly; (vi) semi- Allocations: Only made to Participants
annually; (vii) annually employed at Plan Year end with a Year
Year of Service: of Service.
Eligibility: 1000 hours Also made to Employees who terminate
Allocation Accrual: 1000 hours because of:
Matching/Other Available.
For employed Participants who have
X X Retirement. attained NRA:Available.
X X Disability. Upon termination, benefits shall be paid
X X Death. following close of Plan Year.
X Term with Year of Service. Upon termination for death, Disability,
X Term w/o Year of Service. or retirement, benefits shall be paid
Term for any reason w/ Year of following close of Plan Year.
Service. Optional Forms of Payment:
Lump Sum
Matching Contributions will be made to Installment Payments
Participants who make deferrals and do Life Annuity
not withdraw them prior to the Joint and Survivor Annuity
Normal Form of Payment: Joint and
Rollovers: Permitted. Survivor Annuity.
Transfers: Permitted. Life Expectancies: May not be
recalculated.
FORFEITURES: PLAN OFFICIALS:
Reallocation:
Date for Reallocation: At Plan Year Trustee: David G. Kreher, Stephen M.
end. Merrick, Robert L. Montgomery
Restored from: Plan Administrator: Reliv International,
1 Current Forfeitures. Inc.
2 Employer Contribution.
3 Plan Income.
</TABLE>
VESTING:
Computation Period: Plan Year.
Disregarded Service: Prior to Plan.
Schedule:
Contributions, other than those fully vested, will vest as below:
0%(lst Yr),20%(2nd),40%(3rd),
60 % (4th),80 % (5th), 100 % (6th)
20
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TOP-HEAVY MINIMUM CONTRIBUTIONS:
Satisfied by this Plan. Made to only eligible non-key Employees.
INVESTMENTS:
Participant Loans: Permitted.
Insurance Policies: Permitted.
Employer Investment Direction: Not Permitted.
Employee Investment Direction: Permitted.
DISTRIBUTIONS:
Hardship Withdrawals: Permitted.
For separated Participants: Available.
For employed Participants: Not
November 14, 1997
21
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference into the Registration Statement
(Form S-8, No. 33- ) pertaining to the Reliv' International, Inc. 401(k) Plan
of our report dated March 17, 1998, with respect to the consolidated financial
statements and schedule of RELIV' International, Inc., included in its annual
Report (Form 10-K) for the year ended December 31, 1997, filed with the
Securities and Exchange Commission.
/s/ ERNST & YOUNG, LLP
--------------------------
ERNST & YOUNG, LLP
St. Louis, Missouri
November 20, 1998