As filed with the Securities and Exchange Commission on
January 9, 1995.
Registration No. 33-23563
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Post-Effective Amendment No. 2 To
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
BIRMINGHAM STEEL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 13-3213634
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
1000 Urban Center Drive
Suite 300
Birmingham, Alabama 35242
(205) 970-1200
(Address, including zip code, and telephone
number, including area code, of registrant's
principal executive offices and principal place of
business)
BIRMINGHAM STEEL CORPORATION NON-UNION
EMPLOYEES' 401(k) PLAN
(Full Title of Plan)
EMPLOYEE BENEFIT COMMITTEE
Birmingham Steel Corporation
1000 Urban Center Drive
Suite 300
Birmingham, Alabama 35242
(205) 970-1200
(Name, address, including zip code, and
telephone number, including area code, of
agent for service)
Copies to:
Helen T. Ferraro, Esq.
Smith, Gambrell & Russell
Suite 1800, East Tower
3343 Peachtree Road, N.E.
Atlanta, Georgia 30326
(404) 264-2620
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The documents listed below are hereby incorporated
by reference into this Registration Statement, and 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:
(a) the Company's Annual Report on Form 10-K for
the fiscal year ended June 30, 1994;
(b) the Plan's Annual Report on Form 11-K for
the fiscal year ended December 31, 1993;
(c) the Company's Quarterly Report on Form 10-Q
for the quarter ended September 30, 1994; and
(d) the description of the Company's Common
Stock contained in the Company's Registration Statement
on Form 8-A, as filed with the Securities and Exchange
Commission, pursuant to the Securities Exchange Act of
1934, on January 22, 1988.
Item 6. Indemnification of Officers and Directors.
The Registrant's By-Laws provide for
indemnification of directors and officers of the
Registrant to the full extent permitted by Delaware law.
Section 145 of the General Corporation Law of the
State of Delaware provides generally that a corporation
may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, 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 its
request in such capacity in another corporation or
business association, 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 he
acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests
of the corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe
his conduct was unlawful.
In addition, pursuant to the authority of Delaware
law, the Certificate of Incorporation of the Registrant
also eliminates the monetary liability of directors to
the fullest extent permitted by Delaware law.
An employment agreement between the Registrant and
James A. Todd, Jr., provides for indemnification of Mr.
Todd against expenses, judgments, fines and amounts paid
in settlement by reason of the fact that Mr. Todd is or
was an officer or director of the Registrant or any
subsidiary of the Registrant. The Registrant has
purchased directors' and officers' liability insurance
covering certain liabilities incurred by its officers
and directors in connection with the performance of
their duties.
Insofar as indemnification for liabilities arising
under the Securities Act of 1933 (the "Act") may be
permitted to directors, officers or persons controlling
the Registrant pursuant to the foregoing provisions, the
Registrant has been informed that in the opinion of the
Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is
therefore unenforceable.
Item 8. Exhibits.
The following exhibit is filed with or
incorporated by reference into this Registration
Statement.
Exhibit
Number Description of Exhibit
- ----------- -----------------------
4.1 Birmingham Steel Non-Union Employees' 401(k)
Plan (Restated as of January 1, 1995)
4.2 Amendment No. 1 to the Birmingham Steel
Non-Union Employees' 401(k) Plan (As Amended
and Restated Effective January 1, 1995)
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 the time shall be
deemed to be the initial bona fide offering thereof.
(h) 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 is, therefore, unenforceable.
In the event that a claim for indemnification against
such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person
in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel
the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against
public policy as expressed in the Act and will be
governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act
of 1933, the Registrant certifies that it has reasonable
grounds to believe that it meets all of the requirements
for filing on Form S-8 and has duly caused this Post-
Effective Amendment No. 2 to the Registration Statement
to be signed on its behalf by the undersigned, thereunto
duly authorized in the City of Birmingham, State of
Alabama, on this 4th day of January, 1995.
BIRMINGHAM STEEL CORPORATION
Date: 01/04/95 By: James A. Todd, Jr.
--------------------------
James A. Todd, Jr.,
Chairman of the Board and Chief
Executive Officer (Principal
Executive Officer)
Pursuant to the requirements of the Securities Act
of 1933, this registration statement (post-effective
amendment) has been signed below by the following
persons in the capacities and on the dates indicated.
Signature Title Date
James A. Todd, Jr. Chairman of the Board 01/04/95
- ----------------------- and
James A. Todd, Jr. Chief Executive Officer
Paul H. Ekberg Vice Chairman of the 01/04/95
- ----------------------- Board and Chief
Paul H. Ekberg Operating Officer
Thomas N. Tyrrell Vice Chairman of the 01/04/95
- ----------------------- Board and Chief
Thomas N. Tyrrell Operating Officer
John M. Casey Executive Vice 01/04/95
- ----------------------- President and Chief Financial
John M. Casey Officer
Robert E. Powell Vice President - 01/04/95
- ---------------------- Controller and Chief Accounting
Robert E. Powell Officer
William J. Cabaniss, Jr. Director 01/04/95
- ------------------------
William J. Cabaniss, Jr.
John M. Harbert III Director 01/04/95
- ------------------------
John M. Harbert III
Harry Holiday, Jr. Director 01/04/95
- ------------------------
Harry Holiday, Jr.
George A. Stinson Director 01/04/95
- ------------------------
George A. Stinson
Pursuant to the requirements of the Securities Act
of 1933, the trustee (or other persons who administer
the employee benefit plan) have duly caused this Post-
Effective Amendment No. 2 to the Registration Statement
to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Birmingham, State of
Alabama, on the 4th day of January, 1995.
BIRMINGHAM STEEL CORPORATION
NON-UNION EMPLOYEES' 401(k) PLAN
By: James Rogers
-------------------------------
James Rogers - Member of the Employee
Benefit Committee and Vice President -
Human Resources of the Company
EXHIBIT 4
Exhibit Index
Exhibit Description
4.1 Birmingham Steel Non-Union Employees' 401(k)
Plan (Restated as of January 1, 1995)
BIRMINGHAM STEEL CORPORATION
401(k) PLAN
Restated Effective January 1, 1995
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
1.01 "Account"
1.02 "Accounting Date"
1.03 "Accrued Benefit"
1.04 "Active Participant"
1.05 "AS&W"
1.06 "AS&W Plan"
1.07 "AS&W Account Balance or Balances"
1.08 "Beneficiary"
1.09 "Board of Directors"
1.10 "Code"
1.11 "Committee"
1.12 "Compensation"
1.13 "Disability"
1.14 "Effective Date"
1.15 "Employee"
1.16 "Employer"
1.17 Employer Basic Contributions
1.18 Employer Matching Contributions
1.19 Employer Qualified Nonelective Contributions
1.20 "Employer Securities"
1.21 "ERISA"
1.22 "Hardship Distribution"
1.23 "Highly Compensated Employee"
1.24 "Hour of Service"
1.25 "Investment Manager"
1.26 Leased Employees
1.27 Named Administrative Fiduciary
1.28 Named Fiduciary
1.29 Named Investment Fiduciary
1.30 "Nonforfeitable"
1.31 "Participant"
1.32 "Participating Employer"
1.33 "Plan"
1.34 "Plan Administrator"
1.35 Plan Maintained by More Than One Employer
1.36 "Plan Year"
1.37 Related Employers
1.38 "Separation from Service"
1.39 "Service"
1.40 Service for Predecessor Employer
1.41 Top Heavy Status
1.42 "Trust" or "Trust Agreement"
1.43 "Trust Fund"
1.44 "Trustee"
1.45 "Valuation Date"
ARTICLE II
ELIGIBILITY AND PARTICIPATION
2.01 Eligibility to participate
2.02 Excluded Employees
2.03 Rules pertaining to Excluded Employees
2.04 Participation upon Re-employment
ARTICLE III
CONTRIBUTIONS
3.01 Employee Deferral Contributions
3.02 Employer Matching Contributions
3.03 Employer Basic Contributions
3.04 Employer Qualified Nonelective Contributions
3.05 Forfeiture Allocation
3.06 Time of Payment of Deferral Contributions and
Employer Contributions
3.07 Return of Contributions
3.08 Top Heavy Minimum Allocation
3.09 Suspension of Active Participant Requirement
3.10 Employee After-Tax Contributions
3.11 Participant Rollover Contributions
3.12 Establishment of Participant Accounts
3.13 Limitations on Allocations to Participants'
Accounts
3.14 Definitions - Article III
ARTICLE IV
PROVISIONS RELATING TO CODE SUBSECTION 401(k) AND TO
CODE SUBSECTION 401(m)
4.01 SUBSECTION 401(k) Arrangement
4.02 Definitions
4.03 Annual Elective Deferral Limitation
4.04 Actual Deferral Percentage ("ADP") Test
4.05 Nondiscrimination Rules for Employer Matching
Contributions/Participant Nondeductible
Contributions
4.06 Multiple Use Limitation
ARTICLE V
DISTRIBUTIONS
5.01 Normal Retirement Age
5.02 Participant Disability or Death
5.03 Vesting Schedule
5.04 Cash-Out Distributions to Partially-Vested
Participants/ Restoration of Forfeited
Accrued Benefit
5.05 Segregated Account for Repaid Amount
5.06 Year of Service - Vesting
5.07 Break In Service - Vesting
5.08 Included Years of Service - Vesting
5.09 Forfeiture Occurs
5.10 Vesting for Special Classes of Participants
ARTICLE VI
TIME AND METHOD OF PAYMENT OF BENEFITS
6.01 Time of Payment of Accrued Benefit
6.02 Method of Payment of Accrued Benefit
6.03 Benefit Payment Elections after Separation from
Service
6.04 Form of Distribution
6.05 Optional Forms of Benefit under the AS&W Plan
6.06 Distributions under Domestic Relations Order
ARTICLE VII
DUTIES OF THE BOARD OF DIRECTORS AND THE EMPLOYER
7.01 Responsibilities of the Board of Directors
7.02 Responsibilities of the Employer
7.03 Information to Committee
7.04 No Liability
7.05 Indemnity of Certain Fiduciaries
7.06 Amendment to Vesting Schedule
ARTICLE VIII
PARTICIPANT ADMINISTRATIVE PROVISIONS
8.01 Beneficiary Designation
8.02 No Beneficiary Designation/Death of Beneficiary
8.03 Personal Data to Committee
8.04 Address for Notification
8.05 Assignment or Alienation
8.06 Notice of Change in Terms
8.07 Litigation against the Trust
8.08 Information Available
8.09 Appeal Procedure for Denial of Benefits
ARTICLE IX
EMPLOYEE BENEFITS COMMITTEE
9.01 Appointment and Term of Office
9.02 Named Administrative Fiduciary
9.03 Named Investment Fiduciary
9.04 Assistants and Advisors
9.05 Funding Policy
9.06 Manner of Action
9.07 Authorized Representative
9.08 Interested Member
9.09 Individual Accounts
9.10 Value of Participant's Accrued Benefit
9.11 Allocation and Distribution of Net Income Gain or
Loss
9.12 Individual Statement
9.13 Account Charged
9.14 Unclaimed Account Procedure
ARTICLE X
LOANS AND HARDSHIP DISTRIBUTIONS
10.01 Loans
10.02 Hardship Distributions
ARTICLE XI
TRUST AGREEMENT
11.01 Establishment of Trust Agreement
11.02 Removal of Trustee
11.03 Powers of the Trustee
ARTICLE XII
INVESTMENT OF THE TRUST FUND
12.01 Investment Funds
12.02 Company Stock Fund
12.03 Investment Manager
ARTICLE XIII
EXCLUSIVE BENEFIT, AMENDMENT, TERMINATION
13.01 Exclusive Benefit
13.02 Amendment by Employer
13.03 Discontinuance
13.04 Full Vesting on Termination
13.05 Merger/Direct Transfer
13.06 Termination
ARTICLE XIV
PARTICIPATING EMPLOYERS
14.01 Procedures for Adopting the Plan
14.02 Single Plan
14.03 Authority under the Plan
14.04 Termination of a Participating Employer from the
Plan
ARTICLE XV
MERGER OF THE AS&W PLAN INTO THIS PLAN
15.01 Merger of the AS&W Plan
15.02 Trustee and Plan Administrator
15.03 Participant Account Balances
15.04 Accrual of Future Benefits
15.05 Transfer of Assets
ARTICLE XVI
MISCELLANEOUS
16.01 Delegation of Authority
16.02 No Responsibility for Employer Action
16.03 Fiduciaries not Insurers
16.04 Waiver of Notice
16.05 Successors
16.06 Employment Not Guaranteed
16.07 Rules of Construction
16.08 Governing Law
BIRMINGHAM STEEL CORPORATION
401(k) PLAN
Restated Effective January 1, 1995
BIRMINGHAM STEEL CORPORATION, a Delaware
corporation, hereby adopts this amendment and
restatement of the BIRMINGHAM STEEL CORPORATION 401(k)
PLAN, effective as of January 1, 1995.
BACKGROUND:
Effective August 15, 1984, BIRMINGHAM STEEL
CORPORATION (the "Employer") established The Birmingham
Steel Corporation and Affiliated Companies Non-Union
Employees' Profit Sharing Plan and Trust Agreement (the
"Profit Sharing Plan").
Effective January 1, 1990, the Employer amended,
restated and continued the Profit Sharing Plan in the
form of The Birmingham Steel Corporation 401(k) Plan
(the "401(k) Plan"), and entered into a related 401(k)
Trust Agreement with Merrill Lynch Trust Company, as
Trustee. On May 30, 1994, the Employer amended and
restated the 401(k) Plan to comply with the Tax Reform
Act of 1986 and related pension reform legislation.
Effective January 1, 1995, the American Steel &
Wire Corporation Savings and Retirement Plan (the "AS&W
Plan") is merged into the Birmingham Steel Corporation
401(k) Plan. Article XV of this restated 401(k) Plan
sets forth certain terms and provisions of such merger.
Such merger is expressly permitted under Section 8.3 of
the AS&W Plan and under Section 13.05 of the Birmingham
Steel Corporation 401(k) Plan. On and after January 1,
1995, no further benefits shall accrue for a Participant
in the AS&W Plan, and the Birmingham Steel Corporation
401(k) Plan, as the survivor of the plan merger, shall
be the source of all accrued benefits for all
Participants of the two merged Plans. Immediately after
such merger, the Birmingham Steel Corporation 401(k)
Plan, being the surviving Plan, provides each
Participant in the AS&W Plan a benefit equal to or
greater than the benefit such AS&W Participant would
have received had the AS&W Plan terminated on December
31, 1994. Furthermore, on and after January 1, 1995,
the Birmingham Steel Corporation 401(k) Plan shall
preserve the Code Subsection 411(d)(6) protected
benefits of the January 1, 1995 account balances of
Participants in the AS&W Plan.
The 401(k) Plan permits Birmingham Steel
Corporation to adopt amendments or restatements without
the consent of any Participating Employer or
Participant. Birmingham Steel Corporation now wishes to
amend and restate the Birmingham Steel Corporation
401(k) Plan, effective January 1, 1995, to change
certain features of the 401(k) Plan and to incorporate
the protected benefits of the January 1, 1995 account
balances of Participants in the AS&W Plan.
The rights of an Employee who terminates
employment shall be governed by the provisions of the
401(k) Plan in effect on the Employee's termination
date.
THEREFORE, Birmingham Steel Corporation hereby
amends and restates the Birmingham Steel Corporation
401(k) Plan, effective January 1, 1995, as follows:
ARTICLE I
DEFINITIONS
The following terms, when used in this Plan with
an initial capital letter, have the meanings set forth
below, unless a different meaning is clearly required by
the context. Definitions of other terms are set forth
throughout the Plan.
1.01 "Account" means the separate account(s)
which the Committee or the Trustee maintains for a
Participant under the Plan.
1.02 "Accounting Date" is the last day of the
Plan Year. Unless otherwise specified in the Plan, the
Committee will make all Plan allocations for a
particular Plan Year as of the Accounting Date of that
Plan Year.
1.03 "Accrued Benefit" means the amount standing
in a Participant's Account(s) as of any date derived
from both Employer contributions and Employee
contributions, if any.
1.04 "Active Participant" means a Participant who
is entitled to an Employer Basic Contribution under
Section 3.03 and/or an Employer Qualified Nonelective
Contribution under Section 3.04.
1.05 "AS&W" means American Steel & Wire
Corporation, which is a wholly-owned subsidiary of
Birmingham Steel Corporation.
1.06 "AS&W Plan" means the American Steel & Wire
Corporation Savings and Retirement Plan, which was
merged into the Birmingham Steel Corporation 401(k)
Plan, effective January 1, 1995.
1.07 "AS&W Account Balance or Balances" means the
account balances of the Participants, Former
Participants, and Beneficiaries under the AS&W Plan as
of January 1, 1995 (and earnings on such account
balances after such date), which are merged into and
transferred to the Birmingham Steel Corporation 401(k)
Plan and Trust on or after January 1, 1995.
1.08 "Beneficiary" means a person designated by
a Participant who is or may become entitled to a benefit
under the Plan. A Beneficiary who becomes entitled to
a benefit under the Plan remains a Beneficiary under the
Plan until the Trustee has fully distributed his benefit
to him. A Beneficiary's right to (and the Plan
Administrator's, the Committee's or a Trustee's duty to
provide to the Beneficiary) information or data
concerning the Plan does not arise until he first
becomes entitled to receive a benefit under the Plan.
1.09 "Board of Directors" means the members of
the Board of Directors of Birmingham Steel Corporation.
1.10 "Code" means the Internal Revenue Code of
1986, as amended.
1.11 "Committee" means the Employee Benefits
Committee appointed by the Board of Directors to
administer the Plan, as provided in Article IX.
1.12 "Compensation" means wages as defined under
Code Subsection 3401(a) for purposes of federal income
tax withholding at the source, and all payments to an
Employee in the course of the Employer's trade or
business, for which the Employer must furnish the
Employee a written statement under Code Subsection
6041(d) and 6051(a)(3). As long as the instructions to
Form W-2, Box 10, are consistent with the instructions
for the 1990 or 1991 Form W-2, the Employer may treat
the amount reported in Box 10 as satisfying this
definition.
The Committee will determine Compensation by
disregarding any rules limiting the remuneration
included as wages based on the nature or location of the
employment or services performed. Compensation also
includes elective contributions made by the Employer on
the Employee's behalf. "Elective contributions" are
amounts excludible from the Employee's gross income
under Code Subsection 125, 402(a)(8), 402(h) or 403(b),
and contributed by the Employer, at the Employee's
election, to a Code Subsection 401(k) arrangement, a
Simplified Employee Pension, cafeteria plan or tax-
sheltered annuity. A Compensation payment includes
Compensation paid by the Employer to an Employee through
another person under the common paymaster provisions in
Code Subsection 3121(s) and 3306(p).
Any reference in this Plan to Compensation is a
reference to the definition in this Section 1.12 unless
the Plan reference specifies a modification to this
definition. The Committee will take into account only
Compensation actually paid for the relevant period.
Special definition for salary reduction
contributions. For purposes of determining the
Employee's salary reduction contributions under a salary
reduction agreement, "Compensation" means Compensation
as defined in this Section 1.12 determined prior to the
reduction authorized by that salary reduction agreement.
(A) Limitations on Compensation.
(1) Compensation dollar limitation. This Section
1.12(A)(1) limits Compensation as required by the
Omnibus Budget Reconciliation Act of 1993 ("OBRA 93").
In addition to other applicable provisions set forth in
the Plan and notwithstanding any other provision of the
Plan to the contrary, for the Plan years beginning on or
after January 1, 1994, the annual compensation of each
employee taken into account under the Plan shall not
exceed the OBRA 93 annual compensation limit. The OBRA
93 annual compensation limit is $150,000, as adjusted by
the Commissioner for increases in the cost of living in
accordance with Code Subsection 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 compensation is determined (determination period)
beginning in such calendar year. If a determination
period consists of fewer than 12 months, the OBRA 93
annual compensation limit will be multiplied by a
fraction, the numerator of which is the number of months
in the determination period, the denominator of which is
12.
For Plan years beginning on or after January 1,
1994, any reference in this Plan to the limitation under
Code Subsection 401(a)(17) shall mean the OBRA 93 annual
compensation limit set forth in this provision.
If compensation for any prior determination period
is taken into account in determining an employee's
benefits accruing in the current Plan year, the
compensation for that prior determination period is
subject to the OBRA 93 annual compensation limit in
effect for that prior determination period. For this
purpose, for determination period beginning before the
first day of the first Plan year beginning on or after
January 1, 1994, the OBRA 93 annual compensation limit
is $150,000.
(2) Application of compensation limitation to
certain family members. The $200,000 Compensation
limitation applies to the combined Compensation of the
Employee and of any family member aggregated with the
Employee under Section 1.23 who is either (i) the
Employee's spouse; or (ii) the Employee's lineal
descendant under the age of 19. If, for a Plan Year,
the combined Compensation of the Employee and such
family members who are Participants entitled to an
allocation for that Plan Year exceeds the $200,000 (or
adjusted) limitation, "Compensation" for each such
Participant, for purposes of the contribution and
allocation provisions of Article III, means his Adjusted
Compensation. Adjusted Compensation is the amount which
bears the same ratio to the $200,000 (or adjusted)
limitation as the affected Participant's Compensation
(without regard to the $200,000 Compensation limitation)
bears to the combined Compensation of all the affected
Participants in the family unit. If the Plan uses
permitted disparity, the Committee must determine the
integration level of each affected family member
Participant prior to the proration of the $200,000
Compensation limitation, but the combined integration
level of the affected Participants may not exceed
$200,000 (or the adjusted limitation). The combined
Excess Compensation of the affected Participants in the
family unit may not exceed $200,000 (or the adjusted
limitation) minus the affected Participants' combined
integration level (as determined under the preceding
sentence). If the combined Excess Compensation exceeds
this limitation, the Committee will prorate the Excess
Compensation limitation among the affected Participants
in the family unit in proportion to each such
individual's Adjusted Compensation minus his integration
level.
(B) Nondiscrimination. For purposes of
determining whether the Plan discriminates in favor of
Highly Compensated Employees, Compensation means
Compensation as defined in this Section 1.12 except any
exclusions from Compensation do not apply. The Employer
may also elect to use an alternate nondiscriminatory
definition, in accordance with the requirements of Code
Subsection 414(s) and the regulations issued under that
Code section. In determining Compensation under this
Section 1.12, the Employer may elect to include all
elective contributions made by the Employer on behalf of
the Employees. The Employer's election to include
elective contributions must be consistent and uniform
with respect to Employees. The Employer may make this
election to include elective contributions for
nondiscrimination testing purposes, irrespective of
whether this Section 1.12 includes elective
contributions in the general Compensation definition
applicable to this Plan.
1.13 "Disability" means the Participant, because
of a physical or mental disability, will be unable to
perform the duties of his customary position of
employment (or is unable to engage in any substantial
gainful activity) for an indefinite period which the
Committee considers will be of long continued duration.
The Plan considers a Participant Disabled on the date
the Committee determines the Participant satisfies the
definition of Disability. The Committee may require a
Participant to submit to a physical examination in order
to confirm Disability. The Committee will apply the
provisions of this Section 1.13 in a nondiscriminatory,
consistent and uniform manner.
1.14 "Effective Date" of the Plan, is August 15,
1984. The Effective Date of this amendment and
restatement of the Plan is January 1, 1995, except that
certain provisions of this amended and restated Plan are
effective on other dates, as provided herein.
1.15 "Employee" means any person who is
considered an employee of the Employer for purposes of
ERISA or the Code. In addition, the term "Employee"
includes each Leased Employee as defined in Section
1.26. A Leased Employee is not eligible to participate
in the Plan. Birmingham Steel Corporation may, to the
extent permitted by the Code or ERISA, exclude from
participation in the Plan any Employee or class of
Employee or any Related Employer (as defined in Section
1.37) or any division, department or distinct unit of an
Employer.
1.16 "Employer" means BIRMINGHAM STEEL
CORPORATION, a Delaware corporation, or its successor or
successors. The term "Employer" also includes each
Participating Employer that, with the consent of
BIRMINGHAM STEEL CORPORATION, adopts the Plan for its
eligible Employees. Birmingham Steel Corporation is the
Plan sponsor and has full authority to amend or
terminate the Plan, to appoint or to act as the Plan
Administrator, and to appoint or remove the Trustee or
Trustees.
1.17 Employer Basic Contributions. See Section
3.03.
1.18 Employer Matching Contributions. See
Section 3.02.
1.19 Employer Qualified Nonelective
Contributions. See Section 3.04.
1.20 "Employer Securities" means common stock
issued by Birmingham Steel Corporation, or by a
corporation that is a member of the same controlled
group of corporations.
1.21 "ERISA" means the Employee Retirement Income
Security Act of 1974, as amended.
1.22 "Hardship Distribution" means an in-Service
distribution by reason of a Participant's financial
hardship, as provided in Section 10.2.
1.23 "Highly Compensated Employee" means an
Employee who, during the Plan Year or during the
preceding 12-month period:
(a) Is a more than 5% owner of the Employer
(applying the constructive ownership rules of Code
Subsection 318, and applying the principles of Code
Subsection 318, for an unincorporated entity);
(b) Has Compensation in excess of $75,000 (as
adjusted by the Commissioner of Internal Revenue for the
relevant year);
(c) Has Compensation in excess of $50,000 (as
adjusted by the Commissioner of Internal Revenue for the
relevant year) and is part of the top-paid 20% group of
employees (based on Compensation for the relevant year);
or
(d) Has Compensation in excess of 50% of the
dollar amount prescribed in Code Subsection 415(b)(1)(A)
(relating to defined benefit plans) and is an officer of
the Employer.
If the Employee satisfies the definition in clause
(b), (c) or (d) in the Plan Year but does not satisfy
clause (b), (c) or (d) during the preceding 12-month
period and does not satisfy clause (a) in either period,
the Employee is a Highly Compensated Employee only if he
is one of the 100 most highly compensated Employees for
the Plan Year. The number of officers taken into
account under clause (d) will not exceed the greater of
3 or 10% of the total number (after application of the
Code Subsection 414 (q) exclusions) of Employees, but no
more than 50 officers. If no Employee satisfies the
Compensation requirement in clause (d) for the relevant
year, the Committee will treat the highest paid officer
as satisfying clause (d) for that year.
For purposes of this Section 1.23, "Compensation"
means Compensation as defined in Section 1.12, except
Compensation must include "elective contributions" (as
defined in Section 1.12). The Committee must make the
determination of who is a Highly Compensated Employee,
including the determinations of the number and identity
of the top paid 20% group, the top 100 paid Employees,
the number of officers includible in clause (d) and the
relevant Compensation, consistent with Code Subsection
414(q) and regulations issued under that Code section.
The Employer may make a calendar year election to
determine the Highly Compensated Employees for the Plan
Year, as prescribed by Treasury regulations. A calendar
year election must apply to all plans and arrangements
of the Employer. For purposes of applying any
nondiscrimination test required under the Plan or under
the Code, in a manner consistent with applicable
Treasury regulations, the Committee will treat a Highly
Compensated Employee and all family members (a spouse,
a lineal ascendant or descendant, or a spouse of a
lineal ascendant or descendant) as a single Highly
Compensated Employee, but only if the Highly Compensated
Employee is a more than 5% owner or is one of the 10
Highly Compensated Employees with the greatest
Compensation for the Plan Year. This aggregation rule
applies to a family member even if that family member is
a Highly Compensated Employee without family
aggregation.
The term "Highly Compensated Employee" also
includes any former Employee who separated from Service
(or has a deemed Separation from Service, as determined
under Treasury regulations) prior to the Plan Year,
performs no Service for the Employer during the Plan
Year, and was a Highly Compensated Employee either for
the separation year or any Plan Year ending on or after
his 55th birthday.
1.24 "Hour of Service" means:
(a) Each Hour of Service for which the Employer,
either directly or indirectly, pays an Employee, or for
which the Employee is entitled to payment, for the
performance of duties. The Committee credits Hours of
Service under this paragraph (a) to the Employee for the
computation period in which the Employee performs the
duties, irrespective of when paid;
(b) Each Hour of Service for back pay,
irrespective of mitigation of damages, to which the
Employer has agreed or for which the Employee has
received an award. The Committee credits Hours of
Service under this paragraph (b) to the Employee for the
computation period(s) to which the award or the
agreement pertains rather than for the computation
period in which the award, agreement or payment is made;
and
(c) Each Hour of Service for which the Employer,
either directly or indirectly, pays an Employee, or for
which the Employee is entitled to payment (irrespective
of whether the employment relationship is terminated),
for reasons other than for the performance of duties
during a computation period, such as leave of absence,
vacation, holiday, sick leave, illness, incapacity
(including disability), layoff, jury duty or military
duty. The Committee will credit no more than 501 Hours
of Service under this paragraph (c) to an Employee on
account of any single continuous period during which the
Employee does not perform any duties (whether or not
such period occurs during a single computation period).
The Committee credits Hours of Service under this
paragraph (c) in accordance with the rules of paragraphs
(b) and (c) of Labor Reg. Subsection 2530.200b-2, which
the Plan, by this reference, specifically incorporates
in full within this paragraph (c).
The Committee will not credit an Hour of Service
under more than one of the above paragraphs. A
computation period for purposes of this Section 1.24 is
the Plan Year, Year of Service period, Break in Service
period or other period, as determined under the Plan
provision for which the Committee is measuring an
Employee's Hours of Service. The Committee will resolve
any ambiguity with respect to the crediting of an Hour
of Service in favor of the Employee.
(A) Method of crediting Hours of Service. The
Employer will credit every Employee with Hours of
Service on the basis of the "actual" method. For
purposes of the Plan, "actual" method means the
determination of Hours of Service from records of hours
worked and hours for which the Employer makes payment or
for which payment is due from the Employer.
(B) Maternity/paternity leave. Solely for
purposes of determining whether the Employee incurs a
Break in Service under any provision of this Plan, the
Committee must credit Hours of Service during an
Employee's unpaid absence period due to maternity or
paternity leave. The Committee considers an Employee on
maternity or paternity leave if the Employee's absence
is due to the Employee's pregnancy, the birth of the
Employee's child, the placement with the Employee of an
adopted child, or the care of the Employee's child
immediately following the child's birth or placement.
The Committee credits Hours of Service under this
paragraph on the basis of the number of Hours of Service
the Employee would receive if he were paid during the
absence period or, if the Committee cannot determine the
number of Hours of Service the Employee would receive,
on the basis of 8 hours per day during the absence
period. The Committee will credit only the number (not
exceeding 501) of Hours of Service necessary to prevent
an Employee's Break in Service. The Committee credits
all Hours of Service described in this paragraph to the
computation period in which the absence period begins
or, if the Employee does not need these Hours of Service
to prevent a Break in Service in the computation period
in which his absence period begins, the Committee
credits these Hours of Service to the immediately
following computation period.
1.25 "Investment Manager" means a fiduciary (as
defined in ERISA Subsection 3(21)(A)), other than a
trustee or named fiduciary as defined in ERISA
Subsection 402(a)(2), who: (a) has the power to manage,
acquire or dispose of any asset of the Plan; (b) who is
(i) registered as an investment advisor under the
Investment Advisors Act of 1940, or (ii) is a bank as
defined in such Act, or (iii) is an insurance company
qualified to perform services referred to in (a) under
the laws of more than one state; and (c) who has
acknowledged in writing that he is a fiduciary with
respect to the Plan.
1.26 Leased Employees. Except as provided in
Subsection (A) below, the Plan treats a Leased Employee
as an Employee of the Employer, but a Leased Employee is
not eligible to participate in the Plan. A Leased
Employee is an individual (who otherwise is not an
Employee of the Employer) who, pursuant to a leasing
agreement between the Employer and any other person, has
performed services for the Employer (or for the Employer
and any persons related to the Employer within the
meaning of Code Subsection 144(a)(3)) on a substantially
full time basis for at least one year and who performs
services historically performed by employees in the
Employer's business field. If a Leased Employee is
treated as an Employee by reason of this Section 1.26,
"Compensation" includes Compensation from the leasing
organization which is attributable to services performed
for the Employer.
(A) Safe harbor plan exception. The Plan does
not treat a Leased Employee as an Employee if the
leasing organization covers the employee in a safe
harbor plan and, prior to application of this safe
harbor plan exception, 20% or less of the Employer's
Employees (other than Highly Compensated Employees) are
Leased Employees. A safe harbor plan is a money
purchase pension plan providing immediate participation,
full and immediate vesting, and a nonintegrated
contribution formula equal to at least 10% of the
employee's compensation without regard to employment by
the leasing organization on a specified date. The safe
harbor plan must determine the 10% contribution on the
basis of compensation as defined in Code Subsection
415(c)(3) plus elective contributions (as defined in
Section 1.12).
(B) Other requirements. The Committee must apply
this Section 1.26 in a manner consistent with Code
Subsection 414(n) and 414(o) and the regulations issued
under those Code sections. The Committee will reduce a
Leased Employee's allocation of Employer contributions
under this Plan by the Leased Employee's allocation
under the leasing organization's plan, but only to the
extent that allocation is attributable to the Leased
Employee's service provided to the Employer.
1.27 Named Administrative Fiduciary. See Section
9.02.
1.28 Named Fiduciary means a fiduciary within the
meaning of ERISA Subsection 402(a).
1.29 Named Investment Fiduciary. See Section
9.03.
1.30 "Nonforfeitable" means a Participant's or
Beneficiary's unconditional claim, legally enforceable
against the Plan, to the Participant's Accrued Benefit.
1.31 "Participant" is an Employee who is eligible
to be and becomes a Participant in accordance with the
provisions of Section 2.01.
1.32 "Participating Employer" means any business
organization that, with the consent of Birmingham Steel
Corporation, adopts the Plan as provided in Article XIV.
1.33 "Plan" means THE BIRMINGHAM STEEL
CORPORATION 401(k) PLAN as set forth herein, as it may
be amended from time to time.
1.34 "Plan Administrator" is Birmingham Steel
Corporation, unless Birmingham Steel Corporation
designates another person to hold the position of Plan
Administrator. In addition to its other duties, the
Plan Administrator has full responsibility for
compliance with the reporting and disclosure rules under
ERISA as respects this Plan.
1.35 Plan Maintained by More Than One Employer.
(A) Treatment of Employers. If more than one
Employer maintains this Plan, then for purposes of
determining Service and Hours of Service, the Committee
will treat all Participating Employers maintaining this
Plan as a single employer.
(B) Plan Allocations. The Committee must
allocate all Employer contributions and forfeitures to
each Participant in the Plan, in accordance with Article
III, without regard to which contributing Employer
employs the Participant. A Participant's Compensation
includes Compensation from all Participating Employers,
irrespective of which Employers are contributing to the
Plan.
1.36 "Plan Year" means the fiscal year of the
Plan, a 12 consecutive month period ending every
December 31.
1.37 Related Employers. A related group is a
controlled group of corporations (as defined in Code
Subsection 414(b)), trades or businesses (whether or not
incorporated) which are under common control (as defined
in Code Subsection 414(c)) or an affiliated service
group (as defined in Code Subsection 414(m) or in Code
Subsection 414(o)). If the Employer is a member of a
related group, the term "Employer" includes the related
group members for purposes of crediting Hours of
Service, determining Years of Service and Breaks in
Service under Articles II and V, applying the
Participation Test and the Coverage Test under Section
3.06(D), applying the limitations on allocations in Part
2 of Article III, applying the top heavy rules and the
minimum allocation requirements of Article III, the
definitions of Employee, Highly Compensated Employee,
Compensation and Leased Employee, and for any other
purpose required by the applicable Code section or by a
Plan provision. However, only an Employer described in
Section 1.16 may contribute to the Plan and only an
Employee employed by an Employer described in Section
1.16 is eligible to participate in this Plan. For Plan
allocation purposes, "Compensation" does not include
Compensation received from a Related Employer that is
not participating in this Plan.
1.38 "Separation from Service" means an
Employee's termination from the Service of Birmingham
Steel Corporation and all Participating Employers.
1.39 "Service" means any period of time the
Employee is in the employ of the Employer (or a
Participating Employer), including any period the
Employee is on an unpaid leave of absence authorized by
the Employer (or a Participating Employer) under a
uniform, nondiscriminatory policy applicable to all
Employees. The Service of an Employee of AS&W includes
all such Employee's Service with AS&W.
1.40 Service for Predecessor Employer. If the
Employer maintains the plan of a predecessor employer,
the Plan treats service of the Employee with the
predecessor employer as service with the Employer or a
Participating Employer. In this connection, it is
acknowledged and agreed that Birmingham Steel
Corporation maintains the AS&W Plan by reason of the
merger of the AS&W Plan into the Birmingham Steel
Corporation 401(k) Plan, effective January 1, 1995.
1.41 Top Heavy Status. If this Plan is the only
qualified plan maintained by the Employer, the Plan is
top heavy for a Plan Year if the top heavy ratio as of
the Determination Date exceeds 60%. The Top Heavy Ratio
is a fraction, the numerator of which is the sum of the
present value of Accrued Benefits of all Key Employees
as of the Determination Date and the denominator of
which is a similar sum determined for all Employees.
The Committee must include in the top heavy ratio, as
part of the present value of Accrued Benefits, any
contribution not made as of the Determination Date but
includible under Code Subsection 416 and the applicable
Treasury regulations, and distributions made within the
Determination Period. The Committee must calculate the
top heavy ratio by disregarding the Accrued Benefit (and
distributions, if any, of the Accrued Benefit) of any
Non-Key Employee who was formerly a Key Employee, and by
disregarding the Accrued Benefit (including
distributions, if any, of the Accrued Benefit) of an
individual who has not received credit for at least one
Hour of Service with the Employer during the
Determination Period. The Committee must calculate the
top heavy ratio, including the extent to which it must
take into account distributions, rollovers and
transfers, in accordance with Code Subsection 416 and
the regulations under that Code section.
If the Employer maintains other qualified plans
(including a simplified employee pension plan), or
maintained another such plan which now is terminated,
this Plan is top heavy only if it is part of the
Required Aggregation Group, and the top heavy ratio for
the Required Aggregation Group and for the Permissive
Aggregation Group, if any, each exceeds 60%. The
Committee will calculate the top heavy ratio in the same
manner as required by the first paragraph of this
Section 1.41, taking into account all plans within the
Aggregation Group. To the extent the Committee must
take into account distributions to a Participant, the
Committee must include distributions from a terminated
plan which would have been part of the Required
Aggregation Group if it were in existence on the
Determination Date. The Committee will calculate the
present value of accrued benefits under defined benefit
plans or simplified employee pension plans included
within the group in accordance with the terms of those
plans, Code Subsection 416 and the regulations under
that Code section. If a Participant in a defined
benefit plan is a Non-Key Employee, the Committee will
determine his accrued benefit under the accrual method,
if any, which is applicable uniformly to all defined
benefit plans maintained by the Employer or, if there is
no uniform method, in accordance with the slowest
accrual rate permitted under the fractional rule accrual
method described in Code Subsection 411(b)(1)(C). To
calculate the present value of benefits from a defined
benefit plan, the Committee will use the actuarial
assumptions (interest and mortality only) prescribed by
the defined benefit plan(s) to value benefits for top
heavy purposes. If an aggregated plan does not have a
valuation date coinciding with the Determination Date,
the Committee must value the Accrued Benefits in the
aggregated plan as of the most recent valuation date
falling within the twelve-month period ending on the
Determination Date, except as Code Subsection 416 and
applicable Treasury regulations require for the first
and second plan year of a defined benefit plan. The
Committee will calculate the top heavy ratio with
reference to the Determination Dates that fall within
the same calendar year.
Definitions. For purposes of applying the provisions of
this Section 1.41:
(a) "Key Employee" means, as of any Determination
Date, any Employee or former Employee (or Beneficiary of
such Employee) who, for any Plan Year in the
Determination Period: (i) has Compensation in excess of
50% of the dollar amount prescribed in Code Subsection
415(b)(1)(A) (relating to defined benefit plans) and is
an officer of the Employer; (ii) has Compensation in
excess of the dollar amount prescribed in Code
Subsection 415(c)(1)(A) (relating to defined
contribution plans) and is one of the Employees owning
the ten largest interests in the Employer; (iii) is a
more than 5% owner of the Employer; or (iv) is a more
than 1% owner of the Employer and has Compensation of
more than $150,000. The constructive ownership rules of
Code Subsection 318 (or the principles of that section,
in the case of an unincorporated Employer,) will apply
to determine ownership in the Employer. The number of
officers taken into account under clause (i) will not
exceed the greater of 3 or 10% of the total number
(after application of the Code Subsection 414(q)
exclusions) of Employees, but no more than 50 officers.
The Committee will make the determination of who is a
Key Employee in accordance with Code Subsection
416(i)(1) and the regulations under that Code section.
(b) "Non-Key Employee" is an employee who does
not meet the definition of Key Employee.
(c) "Compensation" means Compensation as
determined under Section 1.23 for purposes of
identifying Highly Compensated Employees.
(d) "Required Aggregation Group" means: (1) each
qualified plan of the Employer in which at least one Key
Employee participates at any time during the
Determination Period; and (2) any other qualified plan
of the Employer which enables a plan described in clause
(1) to meet the requirements of Code Subsection
401(a)(4) or of Code Subsection 410.
(e) "Permissive Aggregation Group" is the
Required Aggregation Group plus any other qualified
plans maintained by the Employer, but only if such group
would satisfy in the aggregate the requirements of Code
Subsection 401(a)(4) and of Code Subsection 410. The
Committee will determine the Permissive Aggregation
Group.
(f) "Employer" means the Employer that adopts
this Plan and any related employers described in Section
1.37.
(g) "Determination Date" for any Plan Year is the
Accounting Date of the preceding Plan Year or, in the
case of the first Plan Year of the Plan, the Accounting
Date of that Plan Year. The "Determination Period" is
the 5 year period ending on the Determination Date.
1.42 "Trust" or "Trust Agreement" means the
separate written declaration of trust entered into
between Birmingham Steel Corporation and the Trustee,
under which the Trust Fund is held.
1.43 "Trust Fund" means all property of every
kind held, invested and distributed in accordance with
the provisions of this Plan and of the Trust entered
into between Birmingham Steel Corporation and the
Trustee. This Plan creates a single Trust for all
employers participating under the Plan. However, the
Trustee will maintain separate records of account in
order to reflect properly each Participant's Accrued
Benefit derived from each Participating Employer.
1.44 "Trustee" means MERRILL LYNCH TRUST COMPANY,
a New Jersey corporation, or any successor in office who
in writing accepts the position of Trustee, as provided
in the Trust Agreement.
1.45 "Valuation Date" means the Accounting Date
and each other date on which the Trust Fund and/or
Participant Accounts are valued as provided under the
Plan or as designated by the Committee.
ARTICLE II
ELIGIBILITY AND PARTICIPATION
2.01 Eligibility to participate. Each Employee
(other than an Excluded Employee, as defined in Section
2.01) becomes a Participant in the Plan on the January
1, April 1, July 1 or October 1 (if employed on that
date) coinciding with or next following the date the
Employee first performs an Hour of Service for the
Employer. Each Employee who was a Participant in the
Plan on December 31, 1994 shall continue as a
Participant in this restated Plan, unless such
Participant has Separated from Service. The AS&W Plan
was merged into this Plan effective January 1, 1995, and
each Employee who was a Participant in the AS&W Plan on
January 1, 1995 shall become a Participant in this Plan
on January 1, 1995, unless such Employee has Separated
from Service.
2.02 Excluded Employees. An Excluded Employee
shall not participate in the Plan. An Excluded Employee
is defined as follows:
(a) A member of a collective bargaining unit,
unless the collective bargaining agreement provides
otherwise, or except as otherwise provided in this
Section 2.02(a). An Employee is a member of a
collective bargaining unit if he is included in a unit
of employees covered by an agreement which the Secretary
of Labor finds to be a collective bargaining agreement
between employee representatives and one or more
employers if there is evidence that retirement benefits
were the subject of good faith bargaining between such
employee representatives and such employer or employers.
The term "employee representatives" does not include an
organization more than one half of the members of which
are owners, officers or executives of the Employer.
Notwithstanding the foregoing provisions of this Section
2.02(a), an Employee of AS&W who is required by a
collective bargaining agreement to be covered under the
AS&W Plan, or a similar or successor qualified
retirement plan, is not an Excluded Employee, and is
eligible to participate in this Plan;
(b) A nonresident alien who does not receive any
earned income (as defined in Code Subsection 911(d)(2))
from the Employer which constitutes United States source
income (as defined in Code Subsection 861(a)(3)); or
(c) A Leased Employee.
2.03 Rules pertaining to Excluded Employees.
(a) If a Participant has not incurred a
Separation from Service but becomes an Excluded
Employee, then during the period such a Participant is
an Excluded Employee, the Committee will limit that
Participant's sharing in the allocation of Employer
contributions and Participant forfeitures, if any, under
the Plan by disregarding his Compensation paid by the
Employer for services rendered in his capacity as an
Excluded Employee. However, during such period of
exclusion, the Participant, without regard to employment
classification, continues to receive credit for vesting
under Article V for each included Year of Service and
the Participant's Account continues to experience its
pro rata share of Trust Fund investment performance.
(b) If an Excluded Employee who is not a
Participant becomes eligible to participate in the Plan
by reason of a change in employment classification, such
Employee shall participate in the Plan immediately if he
has satisfied the eligibility conditions of Section 2.01
and would have been a Participant had he not been an
Excluded Employee during his period of Service.
Furthermore, the Plan takes into account all of the
Participant's included Years of Service with the
Employer as an Excluded Employee for purposes of vesting
credit under Article V.
2.04 Participation upon Re-employment. A
Participant whose employment with the Employer
terminates will re-enter the Plan as a Participant on
the date of his re-employment. An Employee (who is not
an Excluded Employee) who satisfies the Plan's
eligibility conditions but who terminates employment
with the Employer prior to becoming a Participant will
become a Participant on the January 1, April 1, July 1
or October 1 coinciding with or next following the date
of his re-employment. An Employee (who is not an
Excluded Employee) who terminates employment prior to
satisfying the Plan's eligibility conditions becomes a
Participant in accordance with the provisions of Section
2.01.
ARTICLE III
CONTRIBUTIONS
3.01 Employee Deferral Contributions.
(A) Amount. Subject to the limitations of the
Plan, for each Plan Year, each Participant may elect to
make deferral contributions to his Account in an amount
equal to a whole percentage, not less than 1% nor
greater than 15%, of his Compensation (including
bonuses, if any) determined for the portion of the Plan
Year during which the Employee has entered the Plan and
is a Participant. A "deferral contribution" is a pre-
tax contribution of an amount which the Participant
authorizes his Employer to contribute to the Plan on his
behalf in lieu of current cash compensation, pursuant to
a salary reduction agreement which the Participant shall
file with the Committee. The contribution percentage
the Participant has elected under the salary reduction
agreement applies to the Participant's Compensation
(including increases in Compensation, and bonuses, if
any) which become currently available to the Participant
on and after the effective date of the Participant's
salary reduction agreement. The election shall remain
effective until the Participant (i) modifies or suspends
his election, or (ii) Separates from Service, or (iii)
becomes an Excluded Employee.
Each Participating Employer shall promptly advise
the Committee of the amount of deferral contributions
elected by Participants employed by such Participating
Employer.
(B) Enrollment dates for deferral contributions.
The Plan's enrollment dates for Participant deferral
contributions are January 1, April 1, July 1, and
October 1. A Participant who wishes to make deferral
contributions to his Deferral Contributions Account must
file a salary reduction agreement with the Committee no
later than the deadline established by the Committee
before the enrollment date on which the Participant's
deferral contributions will commence. A Participant who
fails to file salary reduction agreement within the
deadline for an enrollment date may file a salary
reduction agreement to take effect on any subsequent
enrollment date, provided the Participant's salary
reduction agreement has been timely filed with the
Committee.
(C) 100% vested. All deferral contributions and
earnings thereon are at all times 100% Nonforfeitable,
and are subject to all the terms, conditions and
limitations of the Plan.
(D) Suspension of Deferrals. A Participant may
completely discontinue his deferral contributions at any
time, effective as of the payroll period next following
the date the Participant files a new salary reduction
agreement, or other change form, with the Committee. A
Participant who has completely discontinued his deferral
contributions may resume deferral contributions
effective as of any January 1, April 1, July 1 or
October 1 enrollment date coinciding with or next
following the date such Participant files a new salary
reduction agreement, or other change form, with the
Committee.
(E) Change of Deferral Percentage. A Participant
may increase or decrease the amount of his deferral
contributions effective as of the January 1, April 1,
July 1 or October 1 enrollment date coinciding with or
next following the date the Participant files a new
salary reduction agreement, or other change form, with
the Committee.
(F) Limitations on amount. The Committee may on
a nondiscriminatory basis limit the amount of a
Participant's deferral contributions for any Plan Year
to avoid exceeding the annual elective deferral
limitation under Code Subsection 402(g), or the actual
deferral percentage tests under Code Subsection 401(k),
or the average contribution percentage tests under Code
Subsection 401(m), the annual additions limitations
under Code Subsection 415, or any other applicable
requirement of ERISA or the Code.
(G) Payroll deductions. Participant deferral
contributions shall generally be made through an
automatic payroll deduction arrangement; provided,
however, that the Committee may, in its discretion,
allow deferral contributions to be made in a manner
other than through regular payroll deductions if
consistent with applicable law. Participant deferral
contributions deducted from the Participants'
Compensation under a payroll deduction arrangement shall
be held by the Employer as the Participants' agent and
shall be deposited to the 401(k) Trust no later than the
deadline prescribed by applicable law.
(H) Committee rules. The Committee may from time
to time furnish the Participants a form of salary
reduction agreement, or other administrative forms,
which the Participants must use in order to make,
discontinue, change, or resume their deferral
contribution elections. The Committee may from time to
time establish and uniformly apply rules governing
Participant deferral contributions, including (without
limitation) deadlines for electing, changing or resuming
deferral contributions.
(I) Time of Allocation. The Committee shall
allocate Participant deferral contributions each payroll
period.
(J) Subject to Distribution Restrictions.
Participant deferral contributions are subject to the
distribution restrictions of Section 4.02(m).
3.02 Employer Matching Contributions.
(A) Amount of Employer Matching Contributions.
Subject to the limitations of the Plan, the Employer
shall make a Matching Contribution to the Matching
Contributions Account of a Participant who makes
deferral contributions, such Matching Contribution to be
an amount equal to 100% of the deferral contributions
made by such Participant, up to the first 3% of such
Participant's Compensation for the Plan Year.
(B) Time of Allocation. The Committee will,
each month, allocate Employer Matching Contributions to
the Matching Contributions Account of each Participant
who has made deferral contributions that month.
(C) Vesting. Employer Matching Contributions
shall be subject to the vesting schedule under Article
V.
(D) Form of Matching Contributions. Employer
Matching Contributions may be made in cash and/or
Employer Securities, as determined by the Board of
Directors.
3.03 Employer Basic Contributions.
(A) Amount. Subject to the limitations of the
Plan, the Board of Directors may, in its discretion,
authorize each Participating Employer to make an
Employer Basic Contribution to the Employer Basic
Contributions Account of each Active Participant in an
amount equal to 2% of the first $10,000 of Compensation
paid to each Active Participant for such Plan Year.
Moreover, the Board of Directors may, in its discretion,
authorize the Employer to make an additional Employer
Basic Contribution in an amount designated by the Board.
Such additional Employer Basic Contribution shall be
allocated to the Employer Basic Contributions account of
each Active Participant in the same ratio that the
Active Participant's Compensation for the Plan Year
bears to the total Compensation of all Active
Participants for such Plan Year. For purposes of this
Section 3.03, "Active Participant" means a Participant
who completes not less than 1,000 Hours of Service
during the Plan Year and is in Service on the last day
of the Plan Year.
(B) Compensation taken into Account. In
allocating an Employer Basic Contribution to the
Participant's Basic Contribution Account, the Committee,
except for purposes of determining the top heavy minimum
contribution under Section 3.08, shall take into account
only the Compensation determined for the portion of the
Plan Year during which the Employee has entered the Plan
and is a Participant.
(C) Vesting. Employer Basic Contributions shall
be subject to the vesting schedule under Article V.
(D) Form of Contribution. An Employer Basic
Contribution may be made in cash and/or Employer
Securities, as determined by the Board of Directors.
(E) Time of Allocation. The Committee shall allocate
Employer Basic Contributions to the Employer Basic
Contributions Account of each Active Participant as of
December 31 of each Plan Year.
3.04 Employer Qualified Nonelective
Contributions.
(A) Amount. For each Plan Year, the Employer may
make Qualified Nonelective Contributions (as defined in
Section 4.02(l)) to the Plan in such amount as the
Employer may determine to be necessary to comply with
ERISA and the Code.
(B) Allocation. The Committee shall allocate
Qualified Nonelective Contributions (if any) to the
Qualified Nonelective Contributions Account of each
Participant who is a Nonhighly Compensated Employee and
who is an Active Participant (as defined in this Section
3.04) in the same ratio that such Participant's
Compensation for the Plan Year bears to the total
Compensation of all such Nonhighly Compensated Employees
who meet the definition of an Active Participant. For
purposes of this Section 3.04, "Active Participant"
means a Participant who is a Nonhighly Compensated
Employee and who completes not less than 1,000 Hours of
Service during the Plan Year and is in Service on the
last day of the Plan Year.
(C) Compensation taken into Account. In
allocating an Employer Qualified Nonelective
Contribution to a Participant's Account, the Committee,
except for purposes of determining the top heavy minimum
contribution under Section 3.08, shall take into account
only the Compensation determined for the portion of the
Plan Year in which the Employee has entered the Plan and
is a Participant.
(D) Vesting. Qualified Nonelective Contributions
and earnings thereon are at all times 100%
Nonforfeitable.
(E) Form of Contribution. Employer Qualified
Nonelective Contributions may be made in cash and/or
Employer Securities, as determined by the Employer.
(F) Subject to Distribution Restrictions.
Participant Qualified Nonelective Contributions are
subject to the distribution restrictions of Section
4.02(m).
3.05 Forfeiture Allocation. The amount of a
Participant's Accrued Benefit forfeited under the Plan
is a Participant forfeiture. Subject to any restoration
allocation required under Sections 5.04 or 9.14 and the
special forfeiture allocation for certain excess
aggregate contributions described in Section 4.05, the
Committee will credit Participant forfeitures against
future Employer Matching Contributions or Employer Basic
Contributions. The Committee will continue to hold the
undistributed, non-vested portion of a terminated
Participant's Accrued Benefit in his Account solely for
his benefit until a forfeiture occurs at the time
specified in Section 5.09 or if applicable, until the
time specified in Section 9.14.
3.06 Time of Payment of Deferral Contributions
and Employer Contributions. Participant deferral
contributions and Employer Matching Contributions,
Employer Basic Contributions and Employer Qualified
Nonelective Contributions shall be deposited to the
Trust within the time prescribed by the Code or
applicable Treasury regulations. Employer contributions
may be made in one or more installments without
interest.
3.07 Return of Contributions. The Employer
contributes to this Plan on the condition its
contribution is not due to a mistake of fact and the
Revenue Service will not disallow the deduction for its
contribution. The Trustee, upon written request from
the Employer, must return to the Employer the amount of
the Employer's contribution made by the Employer by
mistake of fact or the amount of the employer's
contribution disallowed as a deduction under Code
Subsection 404. The Trustee will not return any portion
of the Employer's contribution under the provisions of
this paragraph more than one year after:
(a)The Employer made the contribution by mistake
of fact; or
(b) The disallowance of the contribution as a
deduction, and then, only to the extent of the
disallowance.
The Trustee will not increase the amount of the
Employer contribution returnable under this Section 3.07
for any earnings attributable to the contribution, but
the Trustee will decrease the Employer contribution
returnable for any losses attributable to it. The
Trustee may require the Employer to furnish it whatever
evidence the Trustee deems necessary to enable the
Trustee to confirm the amount the Employer has requested
be returned is properly returnable under ERISA.
3.08 Top Heavy Minimum Allocation.
(1) Minimum Allocation. If the Plan is top heavy
in any Plan Year:
(a) Each Non-Key Employee who is a Participant
and is employed by the Employer on the last day of the
Plan Year will receive a top heavy minimum allocation
for that Plan Year, irrespective of whether he satisfies
the Hours of Service condition under Sections 3.03 and
3.04; and
(b) The top heavy minimum allocation is the
lesser of 3% of the Non-Key Employee's Compensation for
the Plan Year or the highest contribution rate for the
Plan Year made on behalf of any Key Employee. However,
if a defined benefit plan maintained by the Employer
which benefits a Key Employee depends on this Plan to
satisfy the antidiscrimination rules of Code Subsection
401(a)(4) or the coverage rules of Code Subsection 410
(or another plan benefiting the Key Employee so depends
on such defined benefit plan), the top heavy minimum
allocation is 3% of the Non-Key Employee's Compensation
regardless of the contribution rate for the Key
Employees.
(2) Special Definitions. For purposes of this
Section 3.08, the term "Participant" includes any
Employee otherwise eligible to participate in the Plan
but who is not a Participant because of his failure to
make elective deferrals under a Code Subsection 401(k)
arrangement or because of his failure to make mandatory
employee contributions. For purposes of clause (b),
"Compensation" means Compensation as defined in Section
1.12 except: (i) Compensation does not include elective
contributions; (ii) any exclusions from Compensation
(other than the exclusion of elective contributions) do
not apply; and (iii) any modification to the definition
of Compensation in this Article III does not apply.
(3) Determining Contribution Rates. For purposes
of this Section 3.08, a Participant's contribution rate
is the sum of Employer contributions (not including
Employer contributions to Social Security) and
forfeitures allocated to the Participant's Account for
the Plan Year divided by his Compensation for the entire
Plan Year. However, for purposes of satisfying a
Participant's top heavy minimum allocation in Plan Years
beginning after December 31, 1988, a Participant's
contribution rate does not include any elective
contributions under a Code Subsection 401(k) arrangement
nor any Employer matching contributions necessary to
satisfy nondiscrimination requirements of Code
Subsection 401(k) or of Code Subsection 401(m). To
determine a Participant's contribution rate, the
Committee must treat all qualified top heavy defined
contribution plans maintained by the Employer (or by any
Related Employers described in Section 1.37) as a single
plan.
(4) No Allocations. If, for a Plan Year, there
are no allocations of Employer contributions or
forfeitures for any Key Employee, the Plan does not
require any top heavy minimum allocation for the Plan
Year, unless a top heavy minimum allocation applies
because of the maintenance by the Employer of more than
one plan.
(5) Method of Compliance. The Plan will satisfy
the top heavy minimum allocation in accordance with this
Section 3.08. The Committee first will allocate the
Employer contributions (and Participant forfeitures, if
any) for the Plan Year in accordance with the allocation
formula under Sections 3.02, 3.03 and 3.04. The Employer
then will contribute an additional amount for the
Account of any Participant entitled under this Section
3.08 to a top heavy minimum allocation and whose
contribution rate for the Plan Year, under this Plan and
any other plan aggregated under paragraph (3), is less
than the top heavy minimum allocation. The additional
amount is the amount necessary to increase the
Participant's contribution rate to the top heavy minimum
allocation. The Committee will allocate the additional
contribution to the Account of the Participant on whose
behalf the Employer makes the contribution.
3.09 Suspension of Active Participant
Requirements. The Plan suspends the Active Participant
requirements under Sections 3.03 and 3.04 if, for any
Plan Year beginning after December 31, 1989, the Plan
fails to satisfy the Participation Test or the Coverage
Test. A Plan satisfies the Participation Test if, on
each day of the Plan Year, the number of Employees who
benefit under the Plan is at least equal to the lesser
of 50 or 40% of the total number of Includible Employees
as of such day. A Plan satisfies the Coverage Test if,
on the last day of each quarter of the Plan Year, the
number of Nonhighly Compensated Employees who benefit
under the Plan is at least equal to 70% of the total
number of Includible Nonhighly Compensated Employees as
of such day. "Includible" Employees are all Employees
other than: (1) those Employees excluded from
participating in the Plan for the entire Plan Year by
reason of the collective bargaining unit exclusion or
the nonresident alien exclusion described in the Code or
by reason of the age and service requirements of Article
II; and (2) any Employee who incurs a Separation from
Service during the Plan Year and fails to complete at
least 501 Hours of Service for the Plan Year. A
"Nonhighly Compensated Employee" is an Employee who is
not a Highly Compensated Employee and who is not a
family member aggregated with a Highly Compensated
Employee pursuant to Section 1.23 of the Plan. For
purposes of the Participation Test and the Coverage
Test, an Employee is benefiting under the Plan on a
particular date if, under this Article III, he is
entitled to an allocation for the Plan Year. For any
portion of the Plan subject to the discrimination test
described in Section 4.05, an Employee is benefiting if
he is an Eligible Employee for purposes of Section 4.05
and the Coverage Test applies separately to that portion
of the Plan.
If this Section 3.09 applies for a Plan Year, the
Committee will suspend the accrual requirements for the
Includible Employees who are Participants, beginning
first with the Includible Employee(s) employed with the
Employer on the last day of the Plan Year, then the
Includible Employee(s) who have the latest Separation
from Service during the Plan Year, and continuing to
suspend in descending order the accrual requirements for
each Includible Employee who incurred an earlier
Separation from Service, from the latest to the earliest
Separation from Service date, until the Plan satisfies
both the Participation Test and the Coverage Test for
the Plan Year. If two or more Includible Employees have
a Separation from Service on the same day, the Committee
will suspend the accrual requirements for all such
Includible Employees, irrespective of whether the plan
can satisfy the Participation Test and the Coverage Test
by accruing benefits for fewer than all such Includible
Employees. If the Plan suspends the accrual requirements
for an Includible Employee, that Employee will share in
the allocation of Employer contributions and Participant
forfeitures, if any, without regard to the number of
Hours of Service he has earned for the Plan Year and
without regard to whether he is employed by the Employer
on the last day of the Plan Year.
3.10 Employee After-Tax Contributions. No
Participant may make an After-Tax Contribution to the
Plan for Compensation paid on or after January 1, 1990.
A Participant's After-Tax Contributions Account,
consisting of After-Tax Contributions made by such
Participant to the Plan prior to January 1, 1990, and
earnings thereon, is at all times 100% Nonforfeitable.
After-Tax Contributions Account shall be invested in the
same manner as the balance of the Participant's Account
is invested. After-Tax Contributions shall be
distributed in the same manner as the balance of the
Participant's Account is distributed, except that, as
provided in Article X, After-Tax Contributions shall
serve as the first source of funds for loans and
Hardship Distributions. A Participant's After-Tax
Contributions are at all times 100% Nonforfeitable. An
"After-Tax Contribution" is a voluntary, after-tax
contribution which the Plan permitted a Participant to
contribute prior to January 1, 1990.
3.11 Participant Rollover Contributions. An
Employee (who is not an Excluded Employee) may, either
prior to or after he has commenced participation in the
Plan as provided in Article II, and with the express
consent of the Committee and Trustee, contribute cash or
other property to the Trust under a "rollover
contribution" which the Code permits an Employee to
transfer either directly or indirectly from one
qualified plan to another qualified plan. Before
accepting a rollover contribution, the Committee and
Trustee may require the Participant to furnish
satisfactory evidence that the proposed transfer is in
fact a "rollover contribution" which the Code permits an
Employee to make to a qualified plan. A rollover
contribution is not an Annual Addition for purposes of
this Plan. A Participant's Rollover Contributions
Account, and earnings thereon, is at all times 100%
Nonforfeitable. A Participant's Rollover Contributions
Account shall be invested in the same manner as the
balance of his Account is invested. A Participant's
Rollover Contributions Account (including earnings) may
not be distributed to the Participant until the
Participant has incurred a Separation from Service.
3.12 Establishment of Participant Accounts. For
the purpose of Plan allocations and accounting, the
Committee shall establish and maintain separate Accounts
for each Participant. Such separate Accounts shall be
for accounting purposes only and shall not, unless the
Plan otherwise requires, involve a segregation of Plan
assets. The Committee shall establish such separate
Accounts as it deems necessary or advisable, and shall
allocate contributions, investment performance and
forfeitures to each such Account as required under the
Plan. Such separate Accounts may include (without
limitation) the following: a Deferral Contributions
Account; a Matching Contributions Account; an Employer
Basic Contributions Account; a Qualified Nonelective
Contributions Account, an After-Tax Contributions
Account and a Rollover Contributions Account. The
Committee shall maintain special Accounts and accounting
procedures as required under Code Subsection 401(k).
The Committee shall maintain adequate records of the
cost basis of Employer Securities allocated to
Participant Accounts. If the Committee determines that
the strict application of its accounting procedures will
not result in an equitable and nondiscriminatory
allocation among Participant Accounts, it may, to the
extent permitted by applicable law, modify its
accounting procedures, or direct that special valuations
of the Trust Fund shall be made, in order to achieve an
equitable and nondiscriminatory allocation of Account
balances as required by ERISA and the Code.
3.13 Limitations on Allocations to Participants'
Accounts. The amount of Annual Additions which the
Committee may allocate under this Plan on a
Participant's behalf for a Limitation Year may not
exceed the Maximum Permissible Amount. If the amount the
Employer otherwise would contribute to the Participant's
Account would cause the Annual Additions for the
Limitation Year to exceed the Maximum Permissible
Amount, the Employer will reduce the amount of its
contribution so the Annual Additions for the Limitation
Year will equal the Maximum Permissible Amount. If an
allocation of Employer contributions, pursuant to this
Article III, would result in an Excess Amount (other
than an Excess Amount resulting from the circumstances
described in Section 3.13(B)) to the Participant's
Account, the Committee will reallocate the Excess Amount
to the remaining Participants who are eligible for an
allocation of Employer contributions for the Plan Year
in which the Limitation Year ends. The Committee will
make this reallocation on the basis of the allocation
method under the Plan as if the Participant whose
Account otherwise would receive the Excess Amount is not
eligible for an allocation of Employer contributions.
(A) Estimation of Compensation. Prior to the
determination of the Participant's actual Compensation
for a Limitation Year, the Committee may determine the
Maximum Permissible Amount on the basis of the
Participant's estimated annual Compensation for such
Limitation Year. The Committee must make this
determination on a reasonable and uniform basis for all
Participants similarly situated. The Committee must
reduce any Employer contributions (including any
allocation of forfeitures) based on estimated annual
Compensation by any Excess Amounts carried over from
prior years. As soon as is administratively feasible
after the end of the Limitation Year, the Committee will
determine the Maximum Permissible Amount for such
Limitation Year on the basis of the Participant's actual
Compensation for such Limitation Year.
(B) Disposition of Excess Amount. If, pursuant
to Section 3.13(A), or because of the allocation of
forfeitures, there is an Excess Amount with respect to
a Participant for a Limitation Year, the Committee will
dispose of such Excess Amount as follows:
(a) The Committee will return any nondeductible
voluntary Employee contributions to the Participant to
the extent the return would reduce the Excess Amount.
(b) If, after the application of paragraph (a),
an Excess Amount still exists, and the Plan covers the
Participant at the end of the Limitation Year, then the
Committee will use the Excess Amount(s) to reduce future
Employer contributions (including any allocation of
forfeitures) under the Plan for the next Limitation Year
and for each succeeding Limitation Year, as is
necessary, for the Participant. The Participant may
elect to limit his Compensation for allocation purposes
to the extent necessary to reduce his allocation for the
Limitation Year to the Maximum Permissible Amount and
eliminate the Excess Amount.
(c) If, after the application of paragraph (a),
an Excess Amount still exists, and the Plan does not
cover the Participant at the end of the Limitation Year,
then the Committee will hold the Excess Amount
unallocated in a suspense account. The Committee will
apply the suspense account to reduce Employer
Contributions (including allocation of forfeitures) for
all remaining Participants in the next Limitation Year,
and in each succeeding Limitation Year if necessary.
Neither the Employer nor any Employee may contribute to
the Plan for any Limitation Year in which the Plan is
unable to allocate fully a suspense account maintained
pursuant to this paragraph (c).
(d) The Committee will not distribute any Excess
Amount(s) to Participants or to former Participants.
(C) Defined Benefit Plan Limitation. The Employer
does not maintain and never has maintained a defined
benefit plan covering any Participant in this Plan.
Accordingly, a special defined benefit plan limitation
does not apply under this Plan.
3.14 Definitions - Article III. For purposes of
Article III, the following terms mean:
(a) "Annual Addition" - The sum of the following
amounts allocated on behalf of a Participant for a
Limitation Year, of (i) all Employer contributions; (ii)
all forfeitures; and (iii) all Employee contributions.
Except to the extent provided in Treasury regulations,
Annual Additions include excess contributions described
in Code Subsection 401(k), excess aggregate
contributions described in Code Subsection 401(m) and
excess deferrals described in Code Subsection 402(g),
irrespective of whether the plan distributes or forfeits
such excess amounts. Annual Additions also include
Excess Amounts reapplied to reduce Employer
contributions under Section 3.13. Amounts allocated
after March 31, 1984, to an individual medical account
(as defined in Code Subsection 415(l)(2)) included as
part of a defined benefit plan maintained by the
Employer are Annual Additions. Furthermore, Annual
Additions include contributions paid or accrued after
December 31, 1985, for taxable years ending after
December 31, 1985, attributable to post-retirement
medical benefits allocated to the separate account of a
key employee (as defined in Code Subsection 419A(d)(3))
under a welfare benefit fund (as defined in Code
Subsection 419(e)) maintained by the Employer, but only
for purposes of the dollar limitation applicable to the
Maximum Permissible Amount.
(b) "Compensation" - For purposes of applying the
limitations of Sections 3.13 and 3.14, "Compensation"
means Compensation as defined in Section 1.12, except
Compensation does not include elective contributions and
any exclusion from Compensation (other than the
exclusion of elective contributions) does not apply.
(c) "Maximum Permissible Amount" - The lesser of
(i) $30,000 (or, if greater, one-fourth of the defined
benefit dollar limitation under Code Subsection
415(b)(1)(A)), or (ii) 25% of the Participant's
Compensation for the Limitation Year. If there is a
short Limitation Year because of a change in Limitation
Year, the Committee will multiply the $30,000 (or
adjusted) limitation by the following fraction:
Number of months in the short Limitation Year
12
(d) "Employer" - The Employer that adopts this
Plan and any related employers described in Article I.
Solely for purposes of applying the limitations of
Sections 3.13 and 3.14, the Committee will determine
related employers described in Article I by modifying
Code Subsection 414(b) and (c) in accordance with Code
Subsection 415(h).
(e) "Excess Amount" - The excess of the
Participant's Annual Additions for the Limitation Year
over the Maximum Permissible Amount.
(f) "Limitation Year" - The Plan Year. If the
Employer amends the Limitation Year to a different 12
consecutive month period, the new Limitation Year must
begin on a date within the Limitation Year for which the
Employer makes the amendment, creating a short
Limitation Year.
(g) "Defined contribution plan" - A retirement
plan which provides for an individual account for each
participant and for benefits based solely on the amount
contributed to the participant's account, and any
income, expenses, gains and losses, and any forfeitures
of accounts of other participants which the plan may
allocate to such participant's account. The Committee
must treat all defined contribution plans (whether or
not terminated) maintained by the Employer as a single
plan. Solely for purposes of the limitations of
Sections 3.13 and 3.14, the Committee will treat
employee contributions made to a defined benefit plan
maintained by the Employer as a separate defined
contribution plan. The Committee also will treat as a
defined contribution plan an individual medical account
(as defined in Code Subsection 415(l)(2)) included as
part of a defined benefit plan maintained by the
Employer and, for taxable years ending after December
31, 1985, a welfare benefit fund under Code Subsection
419(e) maintained by the Employer to the extent there
are post-retirement medical benefits allocated to the
separate account of a key employee (as defined in Code
Subsection 419A(d)(3)).
(h) "Defined benefit plan" - A retirement plan
which does not provide for individual accounts for
Employer contributions. The Committee must treat all
defined benefit plans (whether or not terminated)
maintained by the Employer as a single plan.
ARTICLE IV
PROVISIONS RELATING TO CODE SUBSECTION 401(k) AND TO
CODE SUBSECTION 401(m)
4.01 Subsection 401(k) Arrangement. The Employer
makes the deferral contributions described in Section
3.01 pursuant to a 401(k) arrangement, pursuant to
salary reduction agreements filed by the Participants
with the Committee. A salary reduction agreement may
not be effective earlier than the following date which
occurs last: (i) the Employee's date of participation in
the Plan (or, in the case of a reemployed Employee, his
reparticipation date under Article II); (ii) the
execution date of the Employee's salary reduction
agreement; (iii) the date the Employer adopts the Code
Subsection 401(k) arrangement by executing the Plan; or
(iv) the effective date of the Code Subsection 401(k)
arrangement. Deferral contributions are deemed to be
Employer contributions under the Code.
4.02 Definitions. For purposes of this Article
IV:
(a) "Highly Compensated Employee" means an
Eligible Employee who satisfies the definition in
Section 1.23 of the Plan. Family members aggregated as
a single Employee under Section 1.23 constitute a single
Highly Compensated Employee, whether a particular family
member is a Highly Compensated Employee or a Nonhighly
Compensated Employee without the application of family
aggregation.
(b) "Nonhighly Compensated Employee" means an
Eligible Employee who is not a Highly Compensated
Employee and who is not a family member treated as a
Highly Compensated Employee.
(c) "Eligible Employee" means, for purposes of
the ADP test described in Section 4.04, an Employee who
is eligible to participate in the Code Subsection 401(k)
arrangement, irrespective of whether the Employer
actually makes deferral contributions on behalf of the
Employee. For purposes of the ACP test described in
Section 4.05, an "Eligible Employee" means a Participant
who is eligible to receive an allocation of matching
contributions (or would be eligible if he made the type
of contributions necessary to receive an allocation of
matching contributions) and a Participant who is
eligible to make employee contributions, irrespective of
whether he actually makes employee contributions. An
Employee continues to be an Eligible Employee during a
period the Plan suspends the Employee's right to make
elective deferrals or nondeductible contributions
following a hardship distribution.
(d) "Highly Compensated Group" means the group of
Eligible Employees who are Highly Compensated Employees
for the Plan Year.
(e) "Nonhighly Compensated Group" means the group
of Eligible Employees who are Nonhighly Compensated
Employees for the Plan Year.
(f) "Compensation" means, except as specifically
provided under this Article IV, Compensation as defined
for nondiscrimination purposes in Section 1.23(B) of the
Plan. To compute an Employee's ADP or ACP, the Committee
may limit Compensation taken into account to
Compensation received only for the portion of the Plan
Year in which the Employee was an Eligible Employee and
only for the portion of the Plan Year in which the Plan
or the Code Subsection 401(k) arrangement was in effect.
(g) "Deferral contributions" means the sum of the
deferral contributions the Employer contributes to the
Trust on behalf of an Eligible Employee, pursuant to
Section 3.01.
(h) "Elective deferrals" are the deferral
contributions the Employer contributes to the Trust at
the election of an Eligible Employee. If the Code
Subsection 401(k) arrangement includes a cash or
deferred feature, any portion of a cash or deferred
contribution contributed to the Trust because of the
Employee's failure to make a cash election is an
elective deferral, but any portion of a cash or deferred
contribution over which the Employee does not have a
cash election is not an elective deferral. Elective
deferrals do not include amounts which have become
currently available to the Employee prior to the
election nor amounts designated as employee
contributions at the time of deferral or contribution.
(i) "Matching contributions" are contributions
made by the Employer on account of elective deferrals
under a Code Subsection 401(k) arrangement or on account
of employee contributions. Matching contributions also
include Participant forfeitures allocated on account of
such elective deferrals or employee contributions.
(j) "Nonelective contributions" are contributions
made by the Employer which are not subject to a deferral
election by an Employee and which are not matching
contributions.
(k) "Qualified matching contributions" are
matching contributions which are 100% Nonforfeitable at
all times and which are subject to the distribution
restrictions described in paragraph (m). Matching
contributions are not 100% Nonforfeitable at all times
if the Employee has a 100% Nonforfeitable interest
because of his Years of Service taken into account under
a vesting schedule.
(l) "Qualified nonelective contributions" are
nonelective contributions which are 100% Nonforfeitable
at all times and which are subject to the distribution
restrictions described in paragraph (m). Nonelective
contributions are not 100% Nonforfeitable at all times
if the Employee has a 100% Nonforfeitable interest
because of his Years of Service taken into account under
a vesting schedule. Any nonelective contributions
allocated to a Participant's Qualified Nonelective
Contributions Account under the Plan automatically
satisfy the definition of qualified nonelective
contributions.
(m) "Distribution restrictions" means the
Employee may not receive a distribution of the specified
contributions (nor earnings on those contributions)
except in the event of (1) the Participant's death,
disability, termination of employment, attainment of age
59 1/2, (2) financial hardship satisfying the
requirements of Code Subsection 401(k) and the
applicable Treasury regulations, (3) plan termination,
without establishment of a successor defined
contribution plan (other than an ESOP), (4) a sale of
substantially all of the assets (within the meaning of
Code Subsection 409(d)(2)) used in a trade or business,
but only to an employee who continues employment with
the corporation acquiring those assets, or (5) a sale by
a corporation of its interest in a subsidiary (within
the meaning of Code Subsection 409(d)(3)), but only to
an employee who continues employment with the
subsidiary. For Plan Years beginning after December 31,
1988, a distribution on account of financial hardship,
as described in clause (2), may not include earnings on
elective deferrals credited as of a date later than
December 31, 1988, and may not include qualified
matching contributions and qualified nonelective
contributions, nor any earnings on such contributions,
credited after December 31, 1988. A distribution
described in clauses (3), (4) or (5), if made after
March 31, 1988, must be a lump sum distribution, as
required under Code Subsection 401(k)(10).
(n) "Employee contributions" are contributions
made by a Participant on an after-tax basis, whether
voluntary or mandatory, and designated, at the time of
contribution, as an employee (or nondeductible)
contribution. Elective deferrals and deferral
contributions are not employee contributions.
Participant nondeductible contributions, made pursuant
to Article III, are employee contributions.
4.03 Annual Elective Deferral Limitation.
(A) Annual Elective Deferral Limitation. An
Employee's elective deferrals for a calendar year
beginning after December 31, 1986, may not exceed the
402(g) limitation. The 402(g) limitation is the greater
of $7,000 or the adjusted amount determined by the
Secretary of the Treasury. If the Employer determines
the Employee's elective deferrals to the Plan for a
calendar year would exceed the 402(g) limitation, the
Employer will not make any additional elective deferrals
with respect to that Employee for the remainder of that
calendar year, paying in cash to the Employee any
amounts which would result in the Employee's elective
deferrals for the calendar year exceeding the 402(g)
limitation. If the Committee determines an Employee's
elective deferrals already contributed to the Plan for
a calendar year exceed the 402(g) limitation, the
Committee will distribute the amount in excess of the
402(g) limitation (the "excess deferral"), as adjusted
for allocable income, no later than April 15 of the
following calendar year. If the Committee distributes
the excess deferral by the appropriate April 15, it may
make the distribution irrespective of any other
provision under this Plan or under the Code. The
Committee will reduce the amount of excess deferrals for
a calendar year distributable to the Employee by the
amount of excess contributions (as determined in Section
4.04), if any, previously distributed to the Employee
for the Plan Year beginning in that calendar year.
If an Employee participates in another plan under
which he makes elective deferrals pursuant to a Code
Subsection 401(k) arrangement, elective deferrals under
a Simplified Employee Pension, or salary reduction
contributions to a tax-sheltered annuity, irrespective
of whether the Employer maintains the other plan, he may
provide the Committee a written claim for excess
deferrals made for a calendar year. The Employee must
submit the claim no later than the March 1 following the
close of the particular calendar year and the claim must
specify the amount of the Employee's elective deferrals
under this Plan which are excess deferrals. If the
Committee receives a timely claim, it will distribute
the excess deferral (as adjusted for allocable income)
the Employee has assigned to this Plan, in accordance
with the distribution procedure described in the
immediately preceding paragraph.
(B) Allocable income. For purposes of making a
distribution of excess deferrals, allocable income means
net income or net loss allocable to the excess deferrals
for the calendar year in which the Employee made the
excess deferral, determined in a manner which is
uniform, nondiscriminatory and reasonably reflective of
the manner used by the Plan to allocate income to
Participant's accounts.
4.04 Actual Deferral Percentage ("ADP") Test.
For each Plan Year, the Committee must determine whether
the Plan's Code Subsection 401(k) arrangement satisfies
either of the following ADP tests:
(i) The average ADP for the Highly Compensated
Group does not exceed 1.25 times the average ADP of the
Nonhighly Compensated Group; or
(ii) The average ADP for the Highly Compensated
Group does not exceed the average ADP for the Nonhighly
Compensated Group by more than two percentage points (or
the lesser percentage permitted by the multiple use
limitation in Section 4.06) and the average ADP for the
Highly Compensated Group is not more than twice the
average ADP for the Nonhighly Compensated Group.
(A) Calculation of ADP. The average ADP for a
group is the average of the separate ADPs calculated for
each Eligible Employee who is a member of that group. An
Eligible Employee's ADP for a Plan Year is the ratio of
the Eligible Employee's deferral contributions for the
Plan Year to the Employee's Compensation for the Plan
Year. For aggregated family members treated as a single
Highly Compensated Employee, the ADP of the family unit
is the ADP determined by combining the deferral
contributions and Compensation of all aggregated family
members. A Nonhighly Compensated Employee's ADP does not
include elective deferrals made to this Plan or to any
other Plan maintained by the Employer, to the extent
such elective deferrals exceed the 402(g) limitation
described in Section 4.03.
The Committee may determine (in a manner
consistent with Treasury regulations) the ADPs of the
Eligible Employees by taking into account qualified
nonelective contributions or qualified matching
contributions, or both, made to this Plan or to any
other qualified Plan maintained by the Employer. The
Committee may not include qualified nonelective
contributions in the ADP test unless the allocation of
nonelective contributions is nondiscriminatory when the
Committee takes into account all nonelective
contributions (including the qualified nonelective
contributions) and also when the Committee takes into
account only the nonelective contributions not used in
either the ADP test or the ACP test described in Section
4.05. For Plan Years beginning after December 31, 1989,
the Committee may not include in the ADP test any
qualified nonelective contributions or qualified
matching contributions under another qualified plan
unless that plan has the same plan year as this Plan.
The Committee must maintain records to demonstrate
compliance with the ADP test, including the extent to
which the Plan used qualified nonelective contributions
or qualified matching contributions to satisfy the test.
(B) Special aggregation rule for Highly
Compensated Employees. To determine the ADP of any
Highly Compensated Employee, the deferral contributions
taken into account must include any elective deferrals
made by the Highly Compensated Employee under any other
Code Subsection 401(k) arrangement maintained by the
Employer, unless the elective deferrals are to an ESOP.
If the plans containing the Code Subsection 401(k)
arrangements have different plan years, the Committee
will determine the combined deferral contributions on
the basis of the plan years ending in the same calendar
year.
(C) Aggregation of certain Code Subsection 401(k)
arrangements. If the Employer treats two plans as a unit
for coverage or nondiscrimination purposes, the Employer
must combine the Code Subsection 401(k) arrangements
under such plans to determine whether either plan
satisfies the ADP test. This aggregation rule applies to
the ADP determination for all Eligible Employees,
irrespective of whether an Eligible Employee is a Highly
Compensated Employee or a Nonhighly Compensated
Employee. For Plan Years beginning after December 31,
1989, an aggregation of Code Subsection 401(k)
arrangements under this paragraph does not apply to
plans which have different plan years and, for Plan
Years beginning after December 31, 1988, the Committee
may not aggregate an ESOP (or the ESOP portion of a
plan) with a non-ESOP plan (or non-ESOP portion of a
plan).
(D) Characterization of excess contributions. If,
pursuant to this Section 4.04, the Committee has elected
to include qualified matching contributions in the
average ADP, the Committee will treat excess
contributions as attributable proportionately to
deferral contributions and to qualified matching
contributions allocated on the basis of those deferral
contributions. If the total amount of a Highly
Compensated Employee's excess contributions for the Plan
Year exceeds his deferral contributions or qualified
matching contributions for the Plan Year, the Committee
will treat the remaining portion of his excess
contributions as attributable to qualified nonelective
contributions. The Committee will reduce the amount of
excess contributions for a Plan Year distributable to a
Highly Compensated Employee by the amount of excess
deferrals (as determined in Section 4.03), if any,
previously distributed to that Employee for the
Employee's taxable year ending in that Plan Year.
(E) Distribution of excess contributions. If the
Committee determines the Plan fails to satisfy the ADP
test for a Plan Year, it must distribute the excess
contributions, as adjusted for allocable income, during
the next Plan Year. However, the Employer will incur an
excise tax equal to 10% of the amount of excess
contributions for a Plan Year not distributed to the
appropriate Highly Compensated Employees during the
first 2 1/2 months of that next Plan Year. The excess
contributions are the amount of deferral contributions
made by the Highly Compensated Employees which causes
the Plan to fail to satisfy the ADP test. The Committee
will distribute to each Highly Compensated Employee his
respective share of the excess contributions. The
Committee will determine the respective shares of excess
contributions by starting with the Highly Compensated
Employee(s) who has the greatest ADP, reducing his ADP
(but not below the next highest ADP), then, if
necessary, reducing the ADP of the Highly Compensated
Employee(s) at the next highest ADP level (including the
ADP of the Highly Compensated Employee(s) whose ADP the
Committee already has reduced), and continuing in this
manner until the average ADP for the Highly Compensated
Group satisfies the ADP test. If the Highly Compensated
Employee is part of an aggregated family group, the
Committee, in accordance with the applicable Treasury
regulations, will determine each aggregated family
member's allocable share of the excess contributions
assigned to the family unit.
(F) Allocable income. To determine the amount of
the corrective distribution required under this Section
4.04, the Committee must calculate the allocable income
for the Plan Year in which the excess contributions
arose. "Allocable income" means net income or net loss.
To calculate allocable income for the Plan Year, the
Committee will use a uniform and nondiscriminatory
method which reasonably reflects the manner used by the
Plan to allocate income to Participants' Accounts.
4.05 Nondiscrimination Rules for Employer
Matching Contributions/Participant Nondeductible
Contributions. For Plan Years
beginning after December 31, 1986, the Committee must
determine whether the annual Employer matching
contributions (other than qualified matching
contributions used in the ADP test), if any, and the
Employee contributions, if any, satisfy either of the
following average contribution percentage ("ACP") tests:
(i) The ACP for the Highly Compensated Group does
not exceed 1.25 times the ACP of the Nonhighly
Compensated Group; or
(ii) The ACP for the Highly Compensated Group
does not exceed the ACP for the Nonhighly Compensated
Group by more than two percentage points (or the lesser
percentage permitted by the multiple use limitation in
Section 4.06) and the ACP for the Highly Compensated
Group is not more than twice the ACP for the Nonhighly
Compensated Group.
(A) Calculation of ACP. The average contribution
percentage for a group is the average of the separate
contribution percentages calculated for each Eligible
Employee who is a member of that group. An Eligible
Employee's contribution percentage for a Plan Year is
the ratio of the Eligible Employee's aggregate
contributions for the Plan Year to the Employee's
Compensation for the Plan Year. "Aggregate
contributions" are matching contributions (other than
qualified matching contributions used in the ADP test)
and employee contributions. For aggregated family
members treated as a single Highly Compensated Employee,
the contribution percentage of the family unit is the
contribution percentage determined by combining the
aggregate contributions and Compensation of all
aggregated family members.
The Committee, in a manner consistent with
Treasury regulations, may determine the contribution
percentages of the Eligible Employees by taking into
account qualified nonelective contributions (other than
qualified nonelective contributions used in the ADP
test) or elective deferrals, or both, made to this Plan
or to any other qualified Plan maintained by the
Employer. The Committee may not include qualified
nonelective contributions in the ACP test unless the
allocation of nonelective contributions is
nondiscriminatory when the Committee takes into account
all nonelective contributions (including the qualified
nonelective contributions) and also when the Committee
takes into account only the nonelective contributions
not used in either the ADP test or the ACP test. The
Committee may not include elective deferrals in the ACP
test, unless the Plan which includes the elective
deferrals satisfies the ADP test both with and without
the elective deferrals included in this ACP test. For
Plan Years beginning after December 31, 1989, the
Committee may not include in the ACP test any qualified
nonelective contributions or elective deferrals under
another qualified plan unless that plan has the same
plan year as this Plan. The Committee must maintain
records to demonstrate compliance with the ACP test,
including the extent to which the Plan used qualified
nonelective contributions or elective deferrals to
satisfy the test.
(B) Special aggregation rule for Highly
Compensated Employees. To determine the contribution
percentage of any Highly Compensated Employee, the
aggregate contributions taken into account must include
any matching contributions (other than qualified
matching contributions used in the ADP test) and any
employee contributions made on his behalf to any other
plan maintained by the Employer, unless the other plan
is an ESOP. If the plans have different plan years, the
Committee will determine the combined aggregate
contributions on the basis of the plan years ending in
the same calendar year.
(C) Aggregation of certain plans. If the Employer
treats two plans as a unit for coverage or
nondiscrimination purposes, the Employer must combine
the plans to determine whether either plan satisfies the
ACP test. This aggregation rule applies to the
contribution percentage determination for all Eligible
Employees, irrespective of whether an Eligible Employee
is a Highly Compensated Employee or a Nonhighly
Compensated Employee. For Plan Years beginning after
December 31, 1989, an aggregation of plans under this
paragraph does not apply to plans which have different
plan years and, for Plan Years beginning after December
31, 1988, the Committee may not aggregate an ESOP (or
the ESOP portion of a plan) with a non-ESOP plan (or
non-ESOP portion of a plan).
(D) Distribution of excess aggregate
contributions. The Committee will determine excess
aggregate contributions after determining excess
deferrals under Section 4.03 and excess contributions
under Section 4.04. If the Committee determines the Plan
fails to satisfy the ACP test for a Plan Year, it must
distribute the excess aggregate contributions, as
adjusted for allocable income, during the next Plan
Year. However, the Employer will incur an excise tax
equal to 10% of the amount of excess aggregate
contributions for a Plan Year not distributed to the
appropriate Highly Compensated Employees during the
first 2 1/2 months of that next Plan Year. The excess
aggregate contributions are the amount of aggregate
contributions allocated on behalf of the Highly
Compensated Employees which causes the Plan to fail to
satisfy the ACP test. The Committee will distribute to
each Highly Compensated Employee his respective share of
the excess aggregate contributions. The Committee will
determine the respective shares of excess aggregate
contributions by starting with the Highly Compensated
Employee(s) who has the greatest contribution
percentage, reducing his contribution percentage (but
not below the next highest contribution percentage),
then, if necessary, reducing the contribution percentage
of the Highly Compensated Employee(s) at the next
highest contribution percentage level (including the
contribution percentage of the Highly Compensated
Employee(s) whose contribution percentage the Committee
already has reduced), and continuing in this manner
until the ACP for the Highly Compensated Group satisfies
the ACP test. If the Highly Compensated Employee is part
of an aggregated family group, the Committee, in
accordance with the applicable Treasury regulations,
will determine each aggregated family member's allocable
share of the excess aggregate contributions assigned to
the family unit.
(E) Allocable income. To determine the amount of
the corrective distribution required under this Section
4.05, the Committee must calculate the allocable income
for the Plan Year in which the excess aggregate
contributions arose. "Allocable income" means net income
or net loss. The Committee will determine allocable
income in the same manner as described in Section
4.04(F) for excess contributions.
(F) Characterization of excess aggregate
contributions. The Committee will treat a Highly
Compensated Employee's allocable share of excess
aggregate contributions in the following priority: (1)
first as attributable to his employee contributions
which are voluntary contributions, if any; (2) then as
matching contributions allocable with respect to excess
contributions determined under the ADP test; (3) then on
a pro rata basis to matching contributions and to the
deferral contributions relating to those matching
contributions which the Committee has included in the
ACP test; (4) then on a pro rata basis to Employee
contributions which are mandatory contributions, if any,
and to the matching contributions allocated on the basis
of those mandatory contributions; and (5) last to
qualified nonelective contributions used in the ACP
test. To the extent the Highly Compensated Employee's
excess aggregate contributions are attributable to
matching contributions, and he is not 100% vested in his
Accrued Benefit attributable to matching contributions,
the Committee will distribute only the vested portion
and forfeit the nonvested portion. The vested portion of
the Highly Compensated Employee's excess aggregate
contributions attributable to Employer matching
contributions is the total amount of such excess
aggregate contributions (as adjusted for allocable
income) multiplied by his vested percentage (determined
as of the last day of the Plan Year for which the
Employer made the matching contribution). The Plan will
allocate forfeited excess aggregate contributions to
reduce Employer matching contributions for the Plan Year
in which the forfeiture occurs.
4.06 Multiple Use Limitation. For Plan Years
beginning after December 31, 1988, if at least one
Highly Compensated Employee is includible in the ADP
test and in the ACP test, the sum of the Highly
Compensated Group's ADP and ACP may not exceed the
multiple use limitation.
The multiple use limitation is the sum of (i) and
(ii):
(i) 125% of the greater of: (a) the ADP of the
Nonhighly Compensated Group under the Code Subsection
401(k) arrangement; or (b) the ACP of the Nonhighly
Compensated Group for the Plan Year beginning with or
within the Plan Year of the Code Subsection 401(k)
arrangement.
(ii) 2% plus the lesser of (i)(a) or (i)(b), but
no more than twice the lesser of (i)(a) or (i)(b).
The Committee, in lieu of determining the multiple
use limitation as the sum of (i) and (ii), may elect to
determine the multiple use limitation as the sum of
(iii) and (iv):
(iii) 125% of the lesser of: (a) the ADP of the
Nonhighly Compensated Group under the Code Subsection
401(k) arrangement; or (b) the ACP of the Nonhighly
Compensated Group for the Plan Year beginning with or
within the Plan Year of the Code Subsection 401(k)
arrangement.
(iv) 2% plus the greater of (iii)(a) or (iii)(b),
but no more than twice the greater of (iii)(a) or
(iii)(b).
The Committee will determine whether the Plan
satisfies the multiple use limitation after applying the
ADP test under Section 4.04 and the ACP test under
Section 4.05 and after making any corrective
distributions required by those Sections. If, after
applying this Section 4.06, the Committee determines the
Plan has failed to satisfy the multiple use limitation,
the Committee will correct the failure by treating the
excess amount as excess contributions under Section 4.04
or as excess aggregate contributions under Section 4.05,
as it determines in its sole discretion. This Section
4.06 does not apply unless, prior to application of the
multiple use limitation, the ADP and the ACP of the
Highly Compensated Group each exceeds 125% of the
respective percentages for the Nonhighly Compensated
Group.
ARTICLE V
DISTRIBUTIONS
5.01 Normal Retirement Age. Except as
otherwise provided in Section 5.01(A), a Participant's
Normal Retirement Age is age 65; provided, however, that
Normal Retirement Age for an Employee who attained age
53 by July 1, 1989 is age 60. A Participant's Accrued
Benefit derived from Employer contributions is 100%
Nonforfeitable upon and after his attaining Normal
Retirement Age (if employed by the Employer on or after
that date).
(A) Special Rule for AS&W Plan. Notwithstanding
any contrary provisions of this Section 5.01, a
Participant who was also a Participant in the AS&W Plan
shall become 100% vested in his AS&W Account Balance on
the first day of the month coinciding with or following
the date on which such Participant attains age 55, if
such Participant is still employed on such date.
5.02 Participant Disability or Death. If a
Participant's employment with the Employer terminates as
a result of death or disability, the Participant's
Accrued Benefit derived from Employer contributions will
be 100% Nonforfeitable.
5.03 Vesting Schedule.
(A) Deferral Contributions Account, Qualified
Nonelective Contributions Account, After-Tax
Contributions Account, and Rollover Contributions
Account. A Participant has a 100% Nonforfeitable
interest at all times in his Deferral Contributions
Account, Qualified Nonelective Contributions Account,
After-Tax Contributions Account, and Rollover
Contributions Account.
(B) Matching Contributions Account and Employer
Basic Contributions. Except as provided in Sections
5.01 and 5.02, for each Year of Service, a Participant's
Nonforfeitable percentage of his Matching Contributions
Account and Employer Basic Contributions Account equals
the percentage in the following vesting schedule:
Percent of
Years of Service Nonforfeitable Interest
Less than 1. . . . . . . . . . . . . . . .. . . . 0%
1 . . . . . . . . . . . . . . . . . . . 20%
2 . . . . . . . . . . . . . . . . . . . . .40%
3 . . . . . . . . . . . . . . . . . . . . .60%
4 . . . . . . . . . . . . . . . . . . . . .80%
5 or more . . . . . . . . . . . . . . . . 100%
(C) Vesting of AS&W Account Balances.
Notwithstanding any contrary provisions of the Plan, the
Nonforfeitable interest of an AS&W Plan Participant in
his AS&W Account Balance shall be the greater of the
Nonforfeitable interest as determined under the AS&W
Plan or the Nonforfeitable interest as determined under
the vesting schedule set forth in Section 5.03(B).
(D) Vesting Prior to January 1, 1995. A
Participant who Separates from Service before January 1,
1995 shall have his Nonforfeitable interest determined
under the Birmingham Steel Corporation 401(k) Plan in
effect on December 31, 1994, except that a Participant
who was participating in the AS&W Plan and who Separated
from Service prior to January 1, 1995, shall have the
Nonforfeitable interest of his AS&W Account Balance
determined under the AS&W Plan as in effect on December
31, 1994.
5.04 Cash-Out Distributions to Partially-
Vested Participants/ Restoration of Forfeited Accrued
Benefit. If, pursuant to Article VI, a partially-
vested Participant receives a cash-out distribution
before he incurs a Forfeiture Break in Service (as
defined in Section 5.08), the cash-out distribution will
result in an immediate forfeiture of the nonvested
portion of the Participant's Accrued Benefit derived
from Employer contributions. See Section 5.09. A
partially-vested Participant is a Participant whose
Nonforfeitable Percentage determined under Section 5.03
is less than 100%. A cash-out distribution is a
distribution of the entire present value of the
Participant's Nonforfeitable Accrued Benefit.
(A) Restoration and Conditions upon Restoration.
A partially-vested Participant who is re-employed by the
Employer after receiving a cash-out distribution of the
Nonforfeitable percentage of his Accrued Benefit may
repay the Trustee the amount of the cash-out
distribution attributable to Employer contributions,
unless the Participant no longer has a right to
restoration by reason of the conditions of this Section
5.04(A). If a partially-vested Participant makes the
cash-out distribution repayment, the Committee, subject
to the conditions of this Section 5.04(A), must restore
his Accrued Benefit attributable to Employer
contributions to the same dollar amount as the dollar
amount of his Accrued Benefit on the Accounting Date, or
other valuation date, immediately preceding the date of
the cash-out distribution, unadjusted for any gains or
losses occurring subsequent to that Accounting Date, or
other valuation date. Restoration of the Participant's
Accrued Benefit includes restoration of all Code
Subsection 411(d)(6) protected benefits with respect to
that restored Accrued Benefit, in accordance with
applicable Treasury regulations. The Committee will not
restore a re-employed Participant's Accrued Benefit
under this paragraph if:
(1) 5 years have elapsed since the Participant's
first re-employment date with the Employer following the
cash-out distribution; or
(2) The Participant incurred a Forfeiture Break in
Service (as defined in Section 5.08). This condition
also applies if the Participant makes repayment within
the Plan Year in which he incurs the Forfeiture Break in
Service and that Forfeiture Break in Service would
result in a complete forfeiture of the amount the
Committee otherwise would restore.
(B) Time and Method of Restoration. If neither of
the two conditions preventing restoration of the
Participant's Accrued Benefit applies, the Committee
will restore the Participant's Accrued Benefit as of the
Plan Year Accounting Date coincident with or immediately
following the repayment. To restore the Participant's
Accrued Benefit, the Committee, to the extent necessary,
will allocate to the Participant's Account:
(1) First, the amount, if any, of Participant
forfeitures the Committee would otherwise allocate under
Section 3.05;
(2) Second, the amount, if any, of the Trust Fund
net income or gain for the Plan Year; and
(3) Third, the Employer contribution for the Plan
Year to the extent made under a discretionary formula.
To the extent the amounts described in clauses
(1), (2) and (3) are insufficient to enable the
Committee to make the required restoration, the Employer
must contribute, without regard to any requirement or
condition of Section 3.01, the additional amount
necessary to enable the Committee to make the required
restoration. If, for a particular Plan Year, the
Committee must restore the Accrued Benefit of more than
one re-employed Participant, then the Committee will
make the restoration allocations to each such
Participant's Account in the same proportion that a
Participant's restored amount for the Plan Year bears to
the restored amount for the Plan Year of all re-employed
Participants. The Committee will not take into account
any allocation under this Section 5.04 in applying the
limitation on allocations under Part 2 of Article III.
(C) 0% Vested Participant. The deemed cash-out
rule applies to a 0% vested Participant. A 0% vested
Participant is a Participant whose Accrued Benefit
derived from Employer contributions is entirely
forfeitable at the time of his Separation from Service.
Under the deemed cash-out rule,the Committee will treat
the 0% vested Participant as having received a cash-out
distribution on the date of the Participant's Separation
from Service or, if the Participant's Account is
entitled to an allocation of Employer contributions for
the Plan Year in which he separates from Service, on the
last day of that Plan Year. For purposes of applying the
restoration provisions of this Section 5.04, the
Committee will treat the 0% vested Participant as
repaying his cash-out "distribution" on the first date
of his re-employment with the Employer.
5.05 Segregated Account for Repaid Amount.
Until the Committee restores the Participant's Accrued
Benefit, as described in Section 5.04, the Trustee will
invest the cash-out amount the Participant has repaid in
a segregated Account maintained solely for that
Participant. The Trustee must invest the amount in the
Participant's segregated Account in Federally insured
interest bearing savings account(s) or time deposit(s)
(or a combination of both), or in other fixed income
investments. Until commingled with the balance of the
Trust Fund on the date the Committee restores the
Participant's Accrued Benefit, the Participant's
segregated Account remains a part of the Trust, but it
alone shares in any income it earns and it alone bears
any expense or loss it incurs. Unless the repayment
qualifies as a rollover contribution, the Committee will
direct the Trustee to repay to the Participant as soon
as is administratively practicable the full amount of
the Participant's segregated Account if the Committee
determines either of the conditions of Section 5.04(A)
prevents restoration as of the applicable Accounting
Date, notwithstanding the Participant's repayment.
5.06 Year of Service - Vesting. For purposes
of vesting under Section 5.03, Year of Service means any
Plan Year during which an Employee completes not less
than 1000 Hours of Service with the Employer.
5.07 Break In Service - Vesting. For purposes
of this Article V, a Participant incurs a "Break in
Service" if during any Plan Year he does not complete
more than 500 Hours of Service with the Employer.
5.08 Included Years of Service - Vesting.
(A) Included Years of Service. For purposes of
determining "Years of Service" under Section 5.06, the
Plan takes into account all Years of Service an Employee
completes with the Employer, except:
(1) Any Year of Service during the period the
Employer did not maintain this Plan or a predecessor
plan.
(2) Any Year of Service before a Break in Service
if the number of consecutive Breaks in Service equals or
exceeds the greater of 5 or the aggregate number of the
Years of Service prior to the Break. This exception
applies only if the Participant is 0% vested in his
Accrued Benefit derived from Employer contributions at
the time he has a Break in Service. Furthermore, the
aggregate number of Years of Service before a Break in
Service does not include any Years of Service not
required to be taken into account under this exception
by reason of any prior Break in Service.
(B) Forfeiture Break in Service. For the sole
purpose of determining a Participant's Nonforfeitable
percentage of his Accrued Benefit derived from Employer
contributions which accrued for his benefit prior to a
Forfeiture Break in Service, the Plan disregards any
Year of Service after the Participant first incurs a
Forfeiture Break in Service. The Participant incurs a
Forfeiture Break in Service when he incurs 5 consecutive
Breaks in Service.
5.09 Forfeiture Occurs. A Participant's
forfeiture, if any, of his Accrued Benefit derived from
Employer contributions occurs under the Plan on the
earlier of:
(a) The last day of the vesting computation
period in which the Participant first incurs a
Forfeiture Break in Service; or
(b) The date the Participant receives a cash-out
distribution.
The Committee determines the percentage of a
Participant's Accrued Benefit forfeiture, if any, under
this Section 5.09 solely by reference to the vesting
schedule of Section 5.03. A Participant will not
forfeit any portion of his Accrued Benefit for any other
reason or cause except as expressly provided by this
Section 5.09 or as provided under Section 9.14
5.10 Vesting for Special Classes of
Participants.
(A) Barbary Coast Participants. Notwithstanding
any contrary provisions of the Plan, the Account balance
of a Barbary Coast Participant (as defined in Section
3.02(E)) shall become 100% Nonforfeitable on the date
the closing of the Barbary Coast facility is announced
to the employees, and all Employer Contributions to such
Participant's Account shall be 100% vested when made.
(B) Norfolk Participants. Notwithstanding any
contrary provisions of the Plan, the Account balance of
a Norfolk Participant (as defined in Section 3.02(F))
shall be 100% vested on the date the Norfolk Steel
Corporation facility at which the Participant worked was
closed. Moreover, future Employer contributions for the
Account of a Norfolk Participant shall be 100%
Nonforfeitable when made; provided, however, that if a
Norfolk facility Participant Separates from the Service
of his Employer, remains absent from such Service for
more than 365 days and is then rehired by the Employer,
the vesting schedule under Section 5.03 shall apply to
Matching Contributions and Profit Sharing Contributions
to such Participant's Account on and after such
Participant's reemployment and reentry into the Plan.
(C) BSC Steel Inc., Klean Steel Division
(Prichard and Jackson) Participants. Notwithstanding
any contrary provisions of the Plan, the Account balance
of a BSC Steel Inc., Klean Steel Division (Prichard and
Jackson) Participant (as defined in Section 3.02(G))
shall be 100% vested on the date the BSC Steel Inc.,
Klean Steel Division (Prichard and Jackson) facility at
which the Participant worked is closed. Moreover,
future Employer contributions to the account of such a
Participant shall be 100% vested when made; provided,
however, that if such a Participant Separates from the
Service of his Employer, remains absent from such
Service for more than 365 days and is then rehired by
the Employer, the vesting schedule under Section 5.03
shall apply to Matching Contributions and Profit Sharing
Contributions to such Participant's Account on and after
such Participant's reemployment and reentry into the
Plan.
(D) Birmingham Bolt Company, Inc., Knoxville
Division Participants. Notwithstanding any contrary
provisions of the Plan, the Account balance of a
Birmingham Bolt Company, Inc., Knoxville Division
Participant (as defined in Section 3.02(H)) shall be
100% Nonforfeitable on the date the Birmingham Bolt
Company, Inc., Knoxville Division facility at which the
Participant worked is closed. Moreover, future Matching
Contributions and Profit Sharing Contributions to the
Account of such Participant shall be 100% Nonforfeitable
when made; provided, however, that if such a Participant
Separates from the Service of his Employer, remains
absent from such Service for more than 365 days and is
then rehired by the Employer, the vesting schedule under
Section 5.03 shall apply to Matching Contributions and
Profit Sharing Contributions to such Participant's
Account on and after such Participant's reemployment and
reentry into the Plan.
ARTICLE VI
TIME AND METHOD OF PAYMENT OF BENEFITS
6.01 Time of Payment of Accrued Benefit.
(A) Participant's Nonforfeitable Account balance
does not exceed $3,500. If the Nonforfeitable Account
balance of a Participant who has Separated from Service
does not exceed $3,500, the Committee shall direct the
Trustee to pay the Participant his Nonforfeitable
Account balance in a lump sum as soon as practicable
after the Valuation Date next following the
Participant's Separation from Service.
(B) Participant's Nonforfeitable Account balance
exceeds $3,500. Subject to the consent requirements
described below, the Committee shall direct the Trustee
to commence distribution of a Participant's
Nonforfeitable Account balance as soon as practicable
after the Valuation Date next following the
Participant's Separation from Service. The Participant
must consent in writing to a distribution of his
Nonforfeitable Account balance if the present value of
his Nonforfeitable Account balance has ever, at the time
of any distribution, exceeded $3,500 and the Participant
has not attained age 65. Notwithstanding any contrary
provisions of the Plan, the Committee shall direct the
Trustee to distribute the Participant's Nonforfeitable
Account balance in a lump sum not later than 60 days
following the close of the Plan Year in which the later
of the following events occurs: (1) the Participant
attains age 65; or (2) the Participant Separates from
Service.
(C) Deceased Participant. When the Committee has
received confirmation to its satisfaction of the
Participant's death, the Committee shall direct the
Trustee to distribute the Nonforfeitable Account balance
of the deceased Participant to such Participant's
Beneficiary in the form elected by the Participant, or
if applicable, by the Beneficiary. In the absence of
such an election, the Committee shall direct the Trustee
to distribute the Participant's Nonforfeitable Account
balance in a lump sum as soon as practicable after the
Valuation Date following the date the Committee receives
notification of or otherwise confirms the Participant's
death. The Nonforfeitable Account balance of a deceased
Participant shall be reduced by any security interest
the Plan has against such Nonforfeitable Account balance
by reason of an outstanding loan from the Plan to the
deceased Participant.
(D) Required Beginning Date. If any distribution
commencement date described in this Article VI, either
by Plan provision or by Participant election (or
nonelection), is later than the Participant's Required
Beginning Date, the Committee instead must direct the
Trustee to make distribution on the Participant's
Required Beginning Date. A Participant's Required
Beginning Date is the April 1 following the close of the
calendar year in which the Participant attains age 70
1/2. However, if the Participant, prior to incurring a
Separation from Service, attained age 70 1/2 by January
1, 1988, and, for the five Plan Year period ending in
the calendar year in which he attained age 70 1/2 and
for all subsequent years, the Participant was not a more
than 5% owner, the Required Beginning Date is the April
1 following the close of the calendar year in which the
Participant separates from Service or, if earlier, the
April 1 following the close of the calendar year in
which the Participant becomes a more than 5% owner.
Furthermore, if a Participant who was not a more than 5%
owner attained age 70 1/2 during 1988 and did not incur
a Separation from Service prior to January 1, 1989, his
Required Beginning Date is April 1, 1990. A mandatory
distribution at the Participant's Required Beginning
Date will be in lump sum, unless the Participant,
pursuant to the provisions of this Article VI, makes a
valid election to receive an alternative form of
payment.
6.02 Method of Payment of Accrued Benefit.
If the Participant's Nonforfeitable Account balance does
not exceed $3,500, it shall be distributed to the
Participant (or his Beneficiary) in a lump sum. If the
Participant's Nonforfeitable Account balance exceeds
$3,500, the Participant or Beneficiary may elect
distribution under one of the following methods: (a) by
payment in a lump sum; or (b) by payment in monthly,
quarterly or annual installments over a fixed period of
time not exceeding the life expectancy of the
Participant, or the joint and last survivor expectancy
of the Participant and his Beneficiary; provided,
however, that a Participant may not receive an
installment distribution unless the Participant's
Account balance is 100% Nonforfeitable.
(A) Minimum Distribution Requirements for
Participants. The Committee may not direct the Trustee
to distribute the Participant's Nonforfeitable Accrued
Benefit, nor may the Participant elect to have the
Trustee distribute his Nonforfeitable Accrued Benefit,
under a method of payment which, as of the Required
Beginning Date, does not satisfy the minimum
distribution requirements under Code Subsection
401(a)(9) and the applicable Treasury regulations. The
minimum distribution for a calendar year equals the
Participant's Nonforfeitable Accrued Benefit as of the
latest Valuation Date preceding the beginning of the
calendar year divided by the Participant's life
expectancy or, if applicable, the joint and last
survivor expectancy of the Participant and his
designated Beneficiary (as determined under Article
VIII, subject to the requirements of the Code Subsection
401(a)(9) regulations). The Committee will increase the
Participant's Nonforfeitable Accrued Benefit, as
determined on the relevant Valuation Date, for
contributions or forfeitures allocated after the
Valuation Date and by December 31 of the valuation
calendar year, and will decrease the Valuation by
distributions made after the Valuation Date and by
December 31 of the valuation calendar year. For
purposes of this valuation, the Committee will treat any
portion of the minimum distribution for the first
distribution calendar year made after the close of that
year as a distribution occurring in that first
distribution calendar year. In computing a minimum
distribution, the Committee must use the unisex life
expectancy multiples under Treas. Reg. Subsection
1.72-9. The Committee, only upon the Participant's
written request, will compute the minimum distribution
for a calendar year subsequent to the first calendar
year for which the Plan requires a minimum distribution
by redetermining the applicable life expectancy.
However, the Committee may not redetermine the joint
life and last survivor expectancy of the Participant and
a nonspouse designated Beneficiary in a manner which
takes into account any adjustment to a life expectancy
other than the Participant's life expectancy.
If the Participant's spouse is not his designated
Beneficiary, a method of payment to the Participant
(whether by Participant election or by Committee
direction) may not provide more than incidental benefits
to the Beneficiary. For Plan Years beginning after
December 31, 1988, the Plan must satisfy the Minimum
Distribution Incidental Benefit ("MDIB") requirement in
the Treasury regulations issued under Code Subsection
401(a)(9) for distributions made on or after the
Participant's Required Beginning Date and before the
Participant's death. To satisfy the MDIB requirement,
the Committee will compute the minimum distribution
required by this Section 6.02(A) by substituting the
applicable MDIB divisor for the applicable life
expectancy factor, if the MDIB divisor is a lesser
number. Following the Participant's death, the
Committee will compute the minimum distribution required
by this Section 6.02(A) solely on the basis of the
applicable life expectancy factor and will disregard the
MDIB factor. For Plan Years beginning prior to January
1, 1989, the Plan satisfies the incidental benefits
requirement if the distributions to the Participant
satisfied the MDIB requirement or if the present value
of the retirement benefits payable solely to the
Participant is greater than 50% of the present value of
the total benefits payable to the Participant and his
Beneficiaries. The Committee must determine whether
benefits to the Beneficiary are incidental as of the
date the Trustee is to commence payment of the
retirement benefits to the Participant, or as of any
date the Trustee redetermines the payment period to the
Participant.
The minimum distribution for the first
distribution calendar year is due by the Participant's
Required Beginning Date. The minimum distribution for
each subsequent distribution calendar year, including
the calendar year in which the Participant's Required
Beginning Date occurs, is due by December 31 of that
year.
(B) Minimum Distribution Requirements for
Beneficiaries. The method of distribution to the
Participant's Beneficiary must satisfy Code Subsection
401(a)(9) and the applicable Treasury regulations. If
the Participant's death occurs after his Required
Beginning Date, the method of payment to the Beneficiary
must provide for completion of payment over a period
which does not exceed the payment period which had
commenced for the Participant. If the Participant's
death occurs prior to his Required Beginning Date the
method of payment to the Beneficiary must provide for
completion of payment to the Beneficiary over a period
not exceeding: (i) 5 years after the date of the
Participant's death; or (ii) if the Beneficiary is a
designated Beneficiary, the designated Beneficiary's
life expectancy. The Committee may not direct payment
of the Participant's Nonforfeitable Accrued Benefit over
a period described in clause (ii) unless the Trustee
will commence payment to the designated Beneficiary no
later than the December 31 following the close of the
calendar year in which the Participant's death occurred
or, if later, and the designated Beneficiary is the
Participant's surviving spouse, December 31 of the
calendar year in which the Participant would have
attained age 70 1/2. If the Trustee will make
distribution in accordance with clause (ii), the minimum
distribution for a calendar year equals the
Participant's Nonforfeitable Accrued Benefit as of the
latest Valuation Date preceding the beginning of the
calendar year divided by the designated Beneficiary's
life expectancy. The Committee must use the unisex life
expectancy multiples under Treas. Reg. Subsection 1.72-9
for purposes of applying this paragraph. The Committee,
only upon the written request of the Participant or of
the Participant's surviving spouse, will recalculate the
life expectancy of the Participant's surviving spouse
not more frequently than annually, but may not
recalculate the life expectancy of a nonspouse
designated Beneficiary after the Trustee commences
payment to the designated Beneficiary. The Committee
will apply this paragraph by treating any amount paid to
the Participant's child, which becomes payable to the
Participant's surviving spouse upon the child's
attaining the age of majority, as paid to the
Participant's surviving spouse. Upon the Beneficiary's
written request, the Committee must direct the Trustee
to accelerate payment of all, or any portion, of the
Participant's unpaid Accrued Benefit, as soon as
administratively practicable following the effective
date of that request.
(C) Direct Rollover Option. This Subsection (C)
is necessary to comply with the Unemployment
Compensation Amendments Act of 1992 and is an integral
part of the Plan. This Subsection (C) 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 Article VI a distributee may elect,
at the time and in the manner prescribed by the
Committee, to have any portion of an eligible rollover
distribution paid directly to an eligible retirement
plan specified by the distributee in a direct rollover.
(1) Definitions.
(a) "Eligible rollover distribution." An eligible
rollover distribution is any distribution of all or any
portion of the balance to the credit of the distributee,
except that an eligible rollover distribution does not
include: any distribution that is one of a series of
substantially equal periodic payments (not less
frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or
joint expectancies) of the distributee and the
distributee's designated beneficiary, or for a specified
period of ten years or more; any distribution to the
extent such distribution is required under Code
Subsection 401(a)(9); and the portion of any
distribution that is not includible in gross income
(determined without regard to the exclusion of net
unrealized appreciation with respect to employer
securities).
(b) "Eligible retirement plan." An eligible
retirement plan is an individual retirement account
described in Code Subsection 408(a), an individual
retirement annuity described in Code Subsection 408(b),
an annuity plan described in Code Subsection 403(a), or
a qualified trust described in Code Subsection 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.
(c) "Distributee." A distributee includes 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 Subsection 414(p),
are distributees with regard to the interest of the
spouse or former spouse.
(d) "Direct rollover." A direct rollover is a
payment by the Plan to the eligible retirement plan
specified by the distributee.
6.03 Benefit Payment Elections after
Separation from Service. If the Participant's
Nonforfeitable Account balance exceeds $3,500, he may
elect to have the Trustee commence distribution as soon
as practicable after any Valuation Date following his
Separation from Service. Not earlier than 90 days, but
not later than 30 days, before the Participant's benefit
commencement date, the Committee must provide a benefit
notice to a Participant who is eligible to make an
election under this Section 6.03. The benefit notice
must explain the optional forms of benefit in the Plan,
including the material features and relative values of
those options, and the Participant's right to defer
distribution until he attains age 65.
If a Participant or Beneficiary makes an election
prescribed by this Section 6.03, the Committee will
direct the Trustee to distribute the Participant's
Nonforfeitable Account balance in accordance with that
election. Any election under this Section 6.03 is
subject to the requirements of Section 6.02 and of
Section 6.04. The Participant or Beneficiary must make
an election under this Section 6.03 by filing his
election with the Committee at any time before the
Trustee otherwise would commence to pay a Participant's
Accrued Benefit in accordance with the requirements of
Article VI.
If the Participant is partially-vested in his
Accrued Benefit, an election under this Paragraph (A) to
distribute prior to the Participant's incurring a
Forfeiture Break in Service (as defined in Section
5.08), must be in the form of a cash-out distribution
(as defined in Article V). A Participant may not receive
a cash-out distribution if, prior to the time the
Trustee actually makes the cash-out distribution, the
Participant returns to employment with the Employer.
6.04 Form of Distribution. Distribution of a
Participant's Account shall be made in cash; provided,
however, that a Participant has the right to demand that
his Account be distributed in the form of shares of
Birmingham Steel Corporation common stock to the extent
that his Account balance as of the date of such
distribution is invested in Birmingham Steel Corporation
common stock.
6.05 Optional Forms of Benefit under the AS&W
Plan. This Plan protects the distribution alternatives
(i.e., the "optional forms of benefit") available to the
AS&W Account Balances. However, the optional forms of
benefit, set forth in this Section 6.05, apply only to
the AS&W Account Balances, and not to other Account
balances under this Plan.
(A) AS&W Account Balance Available at Age 65. A
Participant in this Plan who was also a Participant
under the AS&W Plan has a continuing election to receive
his AS&W Account Balance on or after the first day of
the month coinciding with or next following such
Participant's attainment of age 65, even if such
Participant has not Separated from Service.
(B) AS&W Account Balance Available at Age 59 1/2.
A Participant in this Plan who was also a Participant
under the AS&W Plan has a continuing election to receive
his AS&W Account Balance on or after the first day of
the month coinciding with or next following such
Participant's attainment of age 59 1/2, even if such
Participant has not Separated from Service; provided,
however, that no such distribution shall be made unless
such Participant is 100% vested in his AS&W Account
Balance.
6.06 Distributions under Domestic Relations
Orders. Nothing contained in this Plan prevents the
Trustee, in accordance with the direction of the
Committee, from complying with the provisions of a
Qualified Domestic Relations Order (as defined in Code
Subsection 414(p)). This Plan specifically permits
distribution to an alternate payee under a qualified
domestic relations order at any time, irrespective of
whether the Participant has attained his earliest
retirement age (as defined under Code Subsection 414(p))
under the Plan. A distribution to an alternate payee
prior to the Participant's attainment of earliest
retirement age is available only if: (1) the order
specifies distribution at that time or permits an
agreement between the Plan and the alternate payee to
authorize an earlier distribution; and (2) if the
present value of the alternate payee's benefits under
the Plan exceeds $3,500, and the order requires, the
alternate payee consents to any distribution occurring
prior to the Participant's attainment of earliest
retirement age. Nothing in this Section 6.06 gives a
Participant a right to receive distribution at a time
otherwise not permitted under the Plan nor does it
permit the alternate payee to receive a form of payment
not otherwise permitted under the Plan.
The Committee must establish reasonable procedures
to determine the qualified status of a domestic
relations order. Upon receiving a domestic relations
order, the Committee promptly will notify the
Participant and any alternate payee named in the order,
in writing, of the receipt of the order and the Plan's
procedures for determining the qualified status of the
order. Within a reasonable period of time after
receiving the domestic relations order, the Committee
must determine the qualified status of the order and
must notify the Participant and each alternate payee, in
writing, of its determination. The Committee must
provide notice under this paragraph by mailing to the
individual's address specified in the domestic relations
order, or in a manner consistent with Department of
Labor regulations.
If any portion of the Participant's Nonforfeitable
Accrued Benefit is payable during the period the
Committee is making its determination of the qualified
status of the domestic relations order, the Committee
must make a separate accounting of the amounts payable.
If the Committee determines the order is a qualified
domestic relations order within 18 months of the date
amounts first are payable following receipt of the
order, the Committee will direct the Trustee to
distribute the payable amounts in accordance with the
order. If the Committee does not make its determination
of the qualified status of the order within the 18-month
determination period, the Committee will direct the
Trustee to distribute the payable amounts in the manner
the Plan would distribute if the order did not exist and
will apply the order prospectively if the Committee
later determines the order is a qualified domestic
relations order.
To the extent it is not inconsistent with the
provisions of the qualified domestic relations order,
the Committee may direct the Trustee to invest any
partitioned amount in a segregated subaccount or
separate account and to invest the account in Federally
insured, interest-bearing savings account(s) or time
deposit(s) (or a combination of both), or in other fixed
income investments. A segregated subaccount remains a
part of the Trust, but it alone shares in any income it
earns, and it alone bears any expense or loss it incurs.
The Trustee will make any payments or distributions
required under this Section 6.06 by separate benefit
checks or other separate distribution to the alternate
payee(s).
ARTICLE VII
DUTIES OF THE BOARD OF DIRECTORS AND THE EMPLOYER
7.01 Responsibilities of the Board of
Directors. The Board of Directors of the Birmingham
Steel Corporation is a Named Fiduciary under the Plan
with the following duties and responsibilities:
(a) To establish or terminate the Plan;
(b) To authorize or ratify Plan amendments that
materially change Plan costs or benefits;
(c) To appoint or remove the Trustee and to
monitor the Trustee's performance; and
(d) To appoint or remove members of the Employee
Benefits Committee and to monitor the performance of the
Committee.
7.02 Responsibilities of the Employer. The
Employer is the Named Fiduciary under the Plan which has
the duties and responsibilities set forth in the Plan,
including the following duties and responsibilities:
(a) To take actions and execute documents as
authorized and directed by the Board of Directors;
(b) To approve the appointment of one or more
Investment Managers by the Employee Benefits Committee,
as provided under Section 9.03(a); and
(c) To approve the Investment Funds selected from
time to time by the Employee Benefits Committee as
provided under Section 9.03(b).
7.03 Information to Committee. The Employer
(including each Participating Employer) must supply
current information to the Committee as to the name,
date of birth, date of employment, annual compensation,
leaves of absence, Years of Service and date of
termination of employment of each Employee who is, or
who will be eligible to become, a Participant under the
Plan, together with any other information which the
Committee considers necessary, including the Employee's
elected deferral contributions under his salary
reduction agreement. The Employer's records as to the
current information the Employer furnishes to the
Committee are conclusive as to all persons.
7.04 No Liability. The Employer assumes no
obligation or responsibility to any of its Employees,
Participants or Beneficiaries for any act of, or failure
to act, on the part of its Committee (unless the
Employer is the Committee).
7.05 Indemnity of Certain Fiduciaries. The
Employer indemnifies and saves harmless the Plan
Administrator and the members of the Committee, and each
of them, from and against any and all loss resulting
from liability to which the Plan Administrator and the
Committee, or the members of the Committee, may be
subjected by reason of any act or conduct (except
willful misconduct or gross negligence) in their
official capacities in the administration of this Trust
or Plan or both, including all expenses reasonably
incurred in their defense, in case the Employer fails to
provide such defense. The indemnification provisions of
this Section 7.05 do not relieve the Plan Administrator
or any Committee member from any liability he may have
under ERISA for breach of a fiduciary duty.
Furthermore, the Plan Administrator and the Committee
members and the Employer may execute a letter agreement
further delineating the indemnification agreement of
this Section 7.05, provided the letter agreement must be
consistent with and does not violate ERISA. The
indemnification provisions of this Section 7.05 extend
to the Trustee (or to a Custodian, if any) solely to the
extent provided by a letter agreement executed by the
Trustee (or Custodian) and the Employer.
7.06 Amendment to Vesting Schedule. Though
the Employer reserves the right to amend the vesting
schedule at any time, the Committee will not apply the
amended vesting schedule to reduce the Nonforfeitable
percentage of any Participant's Accrued Benefit derived
from Employer contributions (determined as of the later
of the date the Employer adopts the amendment, or the
date the amendment becomes effective) to a percentage
less than the Nonforfeitable percentage computed under
the Plan without regard to the amendment. An amended
vesting schedule will apply to a Participant only if the
Participant receives credit for at least one Hour of
Service after the new schedule becomes effective.
If the Employer makes a permissible amendment to
the vesting schedule, each Participant having at least
3 Years of Service with the Employer may elect to have
the percentage of his Nonforfeitable Accrued Benefit
computed under the Plan without regard to the amendment.
For Plan Years beginning prior to January 1, 1989, the
election described in the preceding sentence applies
only to Participants having at least 5 Years of Service
with the Employer. The Participant must file his
election with the Committee within 60 days of the latest
of (a) the Employer's adoption of the amendment; (b) the
effective date of the amendment; or (c) his receipt of
a copy of the amendment. The Committee, as soon as
practicable, must forward a true copy of any amendment
to the vesting schedule to each affected Participant,
together with an explanation of the effect of the
amendment, the appropriate form upon which the
Participant may make an election to remain under the
vesting schedule provided under the Plan prior to the
amendment and notice of the time within which the
Participant must make an election to remain under the
prior vesting schedule. The election described in this
Section 7.06 does not apply to a Participant if the
amended vesting schedule provides for vesting at least
as rapid at all times as the vesting schedule in effect
prior to the amendment. For purposes of this Section
7.06, an amendment to the vesting schedule includes any
Plan amendment which directly or indirectly affects the
computation of the Nonforfeitable percentage of an
Employee's rights to his Employer derived Accrued
Benefit.
ARTICLE VIII
PARTICIPANT ADMINISTRATIVE PROVISIONS
8.01 Beneficiary Designation. Any
Participant may from time to time designate, in writing,
any person or persons, contingently or successively, to
whom the Trustee will pay his Nonforfeitable Accrued
Benefit (including any life insurance proceeds payable
to the Participant's Account) in the event of his death
and the Participant may designate the form and method of
payment. The Committee will prescribe the form for the
written designation of Beneficiary and, upon the
Participant's filing the form with the Committee, the
form effectively revokes all designations filed prior to
that date by the same Participant.
A married Participant's Beneficiary designation is
not valid unless the Participant's spouse consents, in
writing, to the Beneficiary designation. The spouse's
consent must acknowledge the effect of that consent and
a notary public or the Plan Administrator (or his
representative) must witness that consent. The spousal
consent requirements of this paragraph do not apply if:
(1) the Participant and his spouse are not married
throughout the one year period ending on the date of the
Participant's death; (2) the Participant's spouse is the
Participant's sole primary beneficiary; (3) the Plan
Administrator is not able to locate the Participant's
spouse; (4) the Participant is legally separated or has
been abandoned (within the meaning of State law) and the
Participant has a court order to that effect; or (5)
other circumstances exist under which the Secretary of
the Treasury will excuse the consent requirement. If the
Participant's spouse is legally incompetent to give
consent, the spouse's legal guardian (even if the
guardian is the Participant) may give consent.
8.02 No Beneficiary Designation/Death of
Beneficiary. If a Participant fails to name a
Beneficiary in accordance with Section 8.01, or if the
Beneficiary named by a Participant predeceases him, then
the Trustee will pay the Participant's Nonforfeitable
Accrued Benefit in accordance with Section 6.02 in the
following order of priority to:
(a) The Participant's surviving spouse;
(b) The Participant's surviving children,
including adopted children, in equal shares;
(c) The Participant's surviving parents, in equal
shares; or
(d) The Participant's estate.
If the Beneficiary does not predecease the
Participant, but dies prior to distribution of the
Participant's entire Nonforfeitable Accrued Benefit, the
Trustee will pay the remaining Nonforfeitable Accrued
Benefit to the Beneficiary's estate unless the
Participant's Beneficiary designation provides
otherwise. The Committee will direct the Trustee as to
the method and to whom the Trustee will make payment
under this Section 8.02.
8.03 Personal Data to Committee. Each
Participant and each Beneficiary of a deceased
Participant must furnish to the Committee such evidence,
data or information as the Committee considers necessary
or desirable for the purpose of administering the Plan.
The provisions of this Plan are effective for the
benefit of each Participant upon the condition precedent
that each Participant will furnish promptly full, true
and complete evidence, data and information when
requested by the Committee, provided the Committee
advises each Participant of the effect of his failure to
comply with its request.
8.04 Address for Notification. Each
Participant and each Beneficiary of a deceased
Participant must file with the Committee from time to
time, in writing, his post office address and any change
of post office address. Any communication, statement or
notice addressed to a Participant, or Beneficiary, at
his last post office address filed with the Committee,
or as shown on the records of the Employer, binds the
Participant, or Beneficiary, for all purposes of this
Plan.
8.05 Assignment or Alienation. Subject to
Code Subsection 414(p) relating to qualified domestic
relations orders, neither a Participant nor a
Beneficiary may anticipate, assign or alienate (either
at law or in equity) any benefit provided under the
Plan, and the Trustee will not recognize any such
anticipation, assignment or alienation. Furthermore, a
benefit under the Plan is not subject to attachment,
garnishment, levy, execution or other legal or equitable
process.
8.06 Notice of Change in Terms. The Plan
Administrator, within the time prescribed by ERISA and
the applicable regulations, must furnish all
Participants and Beneficiaries a summary description of
any material amendment to the Plan or notice of
discontinuance of the Plan and all other information
required by ERISA to be furnished without charge.
8.07 Litigation against the Trust. A court
of competent jurisdiction may authorize any appropriate
equitable relief to redress violations of ERISA or to
enforce any provisions of ERISA or the terms of the
Plan. A fiduciary may receive reimbursement of expenses
properly and actually incurred in the performance of his
duties with the Plan.
8.08 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 and Trust, contract or
any other instrument under which the Plan was
established or is operated. The Plan Administrator will
maintain all of the items listed in this Section 8.08 in
his office, or in such other place or places as he may
designate from time to time in order to comply with the
regulations issued under ERISA, for examination during
reasonable business hours. Upon the written request of
a Participant or Beneficiary the Plan Administrator must
furnish him with a copy of any item listed in this
Section 8.08. The Plan Administrator may make a
reasonable charge to the requesting person for the copy
so furnished.
8.09 Appeal Procedure for Denial of Benefits.
A Participant or a Beneficiary ("Claimant") may file
with the Committee a written claim for benefits, if the
Participant or Beneficiary determines the distribution
procedures of the Plan have not provided him his proper
Nonforfeitable Accrued Benefit. The Committee must
render a decision on the claim within 60 days of the
Claimant's written claim for benefits. The Plan
Administrator must provide adequate notice in writing to
the Claimant whose claim for benefits under the Plan the
Committee has denied. The Plan Administrator's notice
to the Claimant must set forth:
(a) The specific reason for the denial;
(b) Specific references to pertinent Plan
provisions on which the Committee based its denial;
(c) A description of any additional material and
information needed for the Claimant to perfect his claim
and an explanation of why the material or information is
needed; and
(d) That any appeal the Claimant wishes to make
of the adverse determination must be in writing to the
Committee within 75 days after receipt of the Plan
Administrator's notice of denial of benefits. The Plan
Administrator's notice must further advise the Claimant
that his failure to appeal the action to the Committee
in writing within the 75-day period will render the
Committee's determination final, binding and conclusive.
If the Claimant should appeal to the Committee,
he, or his duly authorized representative, may submit,
in writing, whatever issues and comments he, or his duly
authorized representative, feels are pertinent. The
Claimant, or his duly authorized representative, may
review pertinent Plan documents. The Committee will
re-examine all facts related to the appeal and make a
final determination as to whether the denial of benefits
is justified under the circumstances. The Committee
must advise the Claimant of its decision within 60 days
of the Claimant's written request for review, unless
special circumstances (such as a hearing) would make the
rendering of a decision within the 60-day limit
unfeasible, but in no event may the Committee render a
decision respecting a denial for a claim for benefits
later than 120 days after its receipt of a request for
review.
The Plan Administrator's notice of denial of
benefits must identify the name of each member of the
Committee and the name and address of the Committee
member to whom the Claimant may forward his appeal.
member to whom the Claimant may forward his appeal.
ARTICLE IX
EMPLOYEE BENEFITS COMMITTEE
9.01 Appointment and Term of Office.
(a) The Board of Directors shall appoint an
Employee Benefits Committee to administer the Plan, the
members of which may or may not be Participants in the
Plan. If the Board of Directors fails to appoint an
Employee Benefits Committee, or if all members of the
Committee are on unable or unwilling to serve, the
Employer shall act as, and shall have all the powers,
duties and responsibilities of, the Employee Benefits
Committee. The members of the Committee will serve
without compensation for services as such, but the
Employer will pay all expenses of the Committee, except
to the extent the Trust properly pays for such expenses.
(b) The Board of Directors may remove any member
of the Committee at any time. A member may resign at
any time by written resignation delivered to the Board.
If a vacancy in the Committee occurs, a successor member
may be appointed by the Board of Directors.
(c) At the request of the Employer, the Committee
shall furnish the Employer or the Trustee a written
certification of all members of the Committee, together
with a specimen signature of each member.
9.02 Named Administrative Fiduciary. The
Employee Benefits Committee is the Named Administrative
Fiduciary responsible for administering the Plan. The
Committee has complete discretionary authority and
control over the administration of the Plan and has all
powers necessary to carry out its administrative duties,
including (without limitation) the following:
(a) To determine the eligibility of an Employee
to participate in the Plan, the value of a Participant's
Accrued Benefit and the Nonforfeitable percentage of
each Participant's Accrued Benefit;
(b) To adopt rules of procedure and regulations
necessary for the proper and efficient administration of
the Plan, provided the rules are not inconsistent with
the terms of the Plan;
(c) To construe and enforce the terms of the Plan
and the rules and regulations it adopts, including
interpretation of the Plan documents and documents
related to the Plan's operation;
(d) To direct the Trustee as respects the
crediting and distribution of the Trust;
(e) To review and render decisions respecting a
claim for (or denial of a claim for) a benefit under the
Plan;
(f) To furnish the Employer with information
which the Employer may require for tax or other
purposes; and
(g) To establish, in its discretion, written Loan
Guidelines, Hardship Guidelines, and Qualified Domestic
Relations Order Guidelines;
The Committee must exercise all of its powers,
duties and discretion under the Plan in a uniform and
nondiscriminatory manner.
9.03 Named Investment Fiduciary. The
Employee Benefits Committee is the Named Investment
Fiduciary solely with respect to the following
responsibilities:
(a) With the approval of the Employer, to engage
the services of one or more Investment Managers (as
defined in ERISA Subsection 3(38)), each of whom shall
have full power and authority to manage, acquire or
dispose (or direct the Trustee with respect to
acquisition or disposition) of any Plan asset under the
control of such Manager;
(b) To establish written Investment Guidelines
and, with the approval of the Employer, to select, and
change as appropriate, one or more Investment Funds for
use by the Participants in directing the investment of
their Account balances; and
(c) To study and monitor the financial status of
the Plan, the services of any Investment Manager, and
the investment performance of the Investment Funds, and
to make such reports and recommendations to the Employer
as the Committee may deem appropriate.
9.04 Assistants and Advisors. The Employee
Benefits Committee has the right to hire, at the expense
of the Employer or of the Plan, such professional
assistants and consultants as the Committee deems
necessary or advisable. To the extent the fees and
expenses of such assistants and advisors are not paid by
the Employer, they shall be paid at the direction of the
Committee as an expense of the Trust Fund.
9.05 Funding Policy. The Committee will
review, not less often than annually, all pertinent
Employee information and Plan data in order to establish
the funding policy of the Plan and to determine the
appropriate methods of carrying out the Plan's
objectives. The Committee must communicate
periodically, as it deems appropriate, to the Trustee
and to any Investment Manager the Plan's short-term and
long-term financial needs so that the Plan's investment
policy can be coordinated with Plan financial
requirements.
9.06 Manner of Action. Each action of the
Committee shall be taken by a majority vote of all
members then in office, except that the Committee may
establish procedures for taken written votes without a
meeting.
9.07 Authorized Representative. The
Committee may authorize any one of its members, or its
Secretary, to sign on its behalf any notices,
directions, applications, certificates, consents,
approvals, waivers, letters or other documents. The
Committee must evidence this authority by an instrument
signed by all members and filed with the Trustee.
9.08 Interested Member. No member of the
Committee may decide or determine any matter concerning
the distribution, nature or method of settlement of his
own benefits under the Plan, except in exercising an
election available to that member in his capacity as a
Participant, unless the Plan Administrator is acting
alone in the capacity of the Committee.
9.09 Individual Accounts. The Committee will
maintain, or direct the Trustee to maintain, a separate
Account or multiple Accounts, in the name of each
Participant to reflect the Participant's Accrued Benefit
under the Plan. If a Participant re-enters the Plan
subsequent to his having a Forfeiture Break in Service,
the Committee, or the Trustee, must maintain a separate
Account for the Participant's pre-Forfeiture Break in
Service Accrued Benefit and a separate Account for his
post-Forfeiture Break in Service Accrued Benefit, unless
the Participant's entire Accrued Benefit under the Plan
is 100% Nonforfeitable.
The Committee will make its allocations, or
request the Trustee to make its allocations, to the
Accounts of the Participants in accordance with the
provisions of Section 9.11. The Committee may direct the
Trustee to maintain a temporary segregated investment
Account in the name of a Participant to prevent a
distortion of income, gain or loss allocations under
Section 9.11. The Committee must maintain records of its
activities.
9.10 Value of Participant's Accrued Benefit.
The value of each Participant's Accrued Benefit
consists of that proportion of the net worth (at fair
market value) of the Trust Fund which the net credit
balance in his Account (exclusive of the cash value of
incidental benefit insurance contracts) bears to the
total net credit balance in the Accounts of all
Participants plus the cash surrender value of any
incidental benefit insurance contracts held by the
Trustee on the Participant's life.
For purposes of a distribution under the Plan, the
value of a Participant's Accrued Benefit is its value as
of the Valuation Date immediately preceding the date of
the distribution.
9.11 Allocation and Distribution of Net
Income Gain or Loss. A "Valuation Date" is each
quarterly Valuation Date, namely March 31, June 30,
September 30 and December 31, and each interim Valuation
Date directed by the Committee. As of each Valuation
Date the Committee must adjust Accounts to reflect net
income, gain or loss since the last Valuation Date. The
valuation period is the period beginning the day after
the last Valuation Date and ending on the current
Valuation Date.
(A) Trust Fund Accounts. The allocation
provisions of this paragraph apply to all Participant
Accounts other than segregated investment Accounts. The
Committee first will adjust the Participant Accounts, as
those Accounts stood at the beginning of the current
valuation period, by reducing the Accounts for any
forfeitures arising under Section 5.09 or under Section
9.14, and for amounts charged during the valuation
period to the Accounts in accordance with Section 9.13
(relating to distributions) The Committee then, subject
to the restoration allocation requirements of Section
5.04 or of Section 9.14, will allocate the net income,
gain or loss pro rata to the adjusted Participant
Accounts. The allocable net income, gain or loss is the
net income (or net loss), including the increase or
decrease in the fair market value of assets, since the
last Valuation Date.
(B) Segregated investment Accounts. A segregated
investment Account receives all income it earns and
bears all expense or loss it incurs. The Committee will
adopt uniform and nondiscriminatory procedures for
determining income or loss of a segregated investment
Account in a manner which reasonably reflects investment
directions relating to pooled investments and investment
directions occurring during a valuation period. As of
the Valuation Date, the Committee must reduce a
segregated Account for any forfeiture arising under
Section 5.09 after the Committee has made all other
allocations, changes or adjustments to the Account for
the Plan Year.
(C) Additional rules. An Excess Amount or
suspense account described in Sections 3.13 and 3.14
does not share in the allocation of net income, gain or
loss described in this Section 9.11. This Section 9.11
applies solely to the allocation of net income, gain or
loss of the Trust. The Committee will allocate the
Employer contributions and Participant forfeitures, if
any, in accordance with Article III.
9.12 Individual Statement. As soon as
practicable after December 31 of each Plan Year, but
within the time prescribed by ERISA and the regulations
under ERISA, the Plan Administrator will deliver to each
Participant (and to each Beneficiary) a statement
reflecting the condition of his Accrued Benefit in the
Trust as of that date and such other information ERISA
requires be furnished the Participant or Beneficiary.
The Plan Administrator may in its discretion furnish
benefit statements to the Participants at other times
during the Plan Year. No Participant, except a member
of the Committee, has the right to inspect the records
reflecting the Account of any other Participant.
9.13 Account Charged. The Committee will
charge a Participant's Account for all distributions
made from that Account to the Participant, to his
Beneficiary or to an alternate payee. The Committee
may, in its discretion, charge a Participant's Account
for any administrative expenses incurred by the Plan
directly related to that Account.
9.14 Unclaimed Account Procedure. The Plan
does not require either the Trustee or the Committee to
search for, or to ascertain the whereabouts of, any
Participant or Beneficiary. At the time the
Participant's or Beneficiary's benefit becomes
distributable under Article VI, the Committee, by
certified or registered mail addressed to his last known
address of record with the Committee or the Employer,
must notify any Participant, or Beneficiary, that he is
entitled to a distribution under this Plan. The notice
must quote the provisions of this Section 9.14 and
otherwise must comply with the notice requirements of
Article VI. If the Participant, or Beneficiary, fails to
claim his distributive share or make his whereabouts
known in writing to the Committee within 6 months from
the date of mailing of the notice, the Committee will
treat the Participant's or Beneficiary's unclaimed
payable Accrued Benefit as forfeited and will reallocate
the unclaimed payable Accrued Benefit in accordance with
Section 3.05. A forfeiture under this paragraph will
occur at the end of the notice period or, if later, the
earliest date applicable Treasury regulations would
permit the forfeiture. Pending forfeiture, the
Committee, following the expiration of the notice
period, may direct the Trustee to segregate the
Nonforfeitable Accrued Benefit in a segregated Account
and to invest that segregated Account in Federally
insured interest bearing savings accounts or time
deposits (or in a combination of both), or in other
fixed income investments.
If a Participant or Beneficiary who has incurred
a forfeiture of his Accrued Benefit under the provisions
of the first paragraph of this Section 9.14 makes a
claim, at any time, for his forfeited Accrued Benefit,
the Committee must restore the Participant's or
Beneficiary's forfeited Accrued Benefit to the same
dollar amount as the dollar amount of the Accrued
Benefit forfeited, unadjusted for any gains or losses
occurring subsequent to the date of the forfeiture. The
Committee will make the restoration during the Plan Year
in which the Participant or Beneficiary makes the claim,
first from the amount, if any, of Participant
forfeitures the Committee otherwise would allocate for
the Plan Year, then from the amount, if any, of the
Trust Fund net income or gain for the Plan Year and then
from the amount, or additional amount, the Employer
contributes to enable the Committee to make the required
restoration. The Committee must direct the Trustee to
distribute the Participant's or Beneficiary's restored
Accrued Benefit to him not later than 60 days after the
close of the Plan Year in which the Committee restores
the forfeited Accrued Benefit. The forfeiture provisions
of this Section 9.14 apply solely to the Participant's
or to the Beneficiary's Accrued Benefit derived from
Employer contributions.
ARTICLE X
LOANS AND HARDSHIP DISTRIBUTIONS
10.01 Loans. The Committee in its sole
discretion may direct the Trustee to make one or more
loans to a Participant who requests a loan from the
Plan, under the following terms and conditions:
(A) Administration. The Committee shall
administer Plan loans. All applications for loans shall
be given by the Participant to the Committee on forms
prescribed by the Committee. In addition to the rules
set forth in this Article X, the Committee may, in its
discretion promulgate such reasonable and
nondiscriminatory rules as it may deem advisable under
the circumstances.
(B) Participant Loan Application. A Participant
who wishes to borrow from the Plan must first submit a
written Participant Loan Application to the Committee.
For purposes of this Section 10.01, the term
"Participant" means any Participant or beneficiary who
is party in interest (as determined under ERISA
Subsection 3(14)) with respect to the Plan. Each loan
application shall be considered by the Committee within
a reasonable time after the Participant makes formal
application. To determine the Participant's credit-
worthiness and ability to repay the loan, the Committee
may require the Participant to furnish such financial
information as the Committee may deem necessary. Such
financial information may include (without limitation)
the Participant's personal financial statement, tax
returns for the past three years and credit reports on
the Participant.
(C) Committee's Decision on Loan Application.
The Committee shall determine whether a Participant
qualifies for a loan, applying such criteria as the
Committee deems appropriate, which may (but need not)
include such criteria as a commercial lender of funds
would apply in like circumstances with respect to the
Participant. Such criteria may include, but are not
limited to, the credit-worthiness of the Participant and
his general ability to repay the loan, whether adequate
security has been provided for the loan, and whether the
Participant agrees, as a condition for receiving the
loan, to make repayments through direct, after-tax
payroll deduction by the Employer.
(D) Limitation on Amount of Loan. The Committee
will not approve any loan to a Participant in an amount
which exceeds 50% of his or her nonforfeitable accrued
benefit (account balance), as reflected by the books and
records of the Plan. The maximum aggregate dollar amount
of loans outstanding to any Participant may not exceed
$50,000 as aggregated with all Participant loans from
other employer qualified plans, reduced by the excess of
the Participant's highest outstanding Participant loan
balance during the 12-month period ending on the date of
the loan over the Participant's current outstanding
Participant loan balance on the date of the loan.
(E) Term of Loan. The Committee shall fix the
term for repayment of the loan, but in no case may the
term of repayment be longer than 5 years, unless the
loan qualifies as a "home loan." A "home loan" is a
loan used to acquire a dwelling unit to be used within
a reasonable time as the principal residence of the
Participant. the Committee may fix the term for
repayment of a "home loan," provided such term does not
exceed 15 years or the borrower-Participant's attainment
of age 65.
(F) Minimum Loan Amount. No loan will be made
under this program of less than $1,000.
(G) Only One Loan Outstanding. No more than one
loan may be outstanding at any time for a Participant.
(H) Promissory Note and Terms of the Note. The
Committee will document every loan in the form of a
promissory note signed by the Participant for the face
amount of the loan, together with a commercially
reasonable rate of interest. The interest rate quote(s)
must take into account the term of the loan, the
security on that loan, the credit-worthiness of the
Participant, whether the interest rate is adjustable
during the term of the loan, and the intended use of the
loan proceeds, if known, and must reflect a commercially
reasonable rate for the geographical region in which the
Participant lives. If Participants in the Plan live in
different geographical regions, the Committee may
establish a uniform commercially reasonable interest
rate applicable to all regions based on information
obtained from at least one region in which Participants
live. The Committee must reevaluate interest rates for
loans made more than one month since the last loan made
by the Plan.
A loan may provide a fixed rate of interest or an
adjustable rate of interest, as negotiated between the
Committee and the Participant. If the loan carries a
fixed rate of interest, the Committee will at the time
it approves the loan determine whether the fixed
interest rate is commercially reasonable. If the
interest is adjustable, the Committee will determine at
the time of each scheduled adjustment whether the
interest rate is commercially reasonable. The loan must
provide at least quarterly payments under a level
amortization schedule.
The loan may permit a suspension of payments for
a period not exceeding one year which occurs during an
approved leave of absence. The Committee will fix the
term for repayments of any loan, however, in no instance
may the term of repayment be greater than five years.
Participants should note the law treats the amount
of a Plan loan not repaid five years after the date of
the loan as a taxable distribution on the last day of
the five year period or, if sooner, at the time the loan
is in default.
(I) Security for the Loan. The Plan shall
require that adequate security be provided by the
Participant before a loan is granted. For this purpose,
the Plan shall generally consider a Participant's
interest under the Plan to be adequate security.
However, in no event shall more than 50% of a
Participant's vested interest in the Plan (determined
immediately after the origination of the loan) be used
as security for the loan. The Plan's general policy is
not to make loans that require security other than the
Participant's vested interest in the Plan. However, if
additional security is necessary to adequately secure
the loan, then the Committee shall require that such
security be provided before the loan will be granted.
For this purpose, the Participant's principal residence
may serve as additional security.
(J) Events of Default. The Committee may (but is
not required to) treat a loan as in default upon:
(1) The Participant's failure to make timely
payments under the loan when due;
(2) The Participant's termination of employment
with the Employer which is providing coverage under the
Plan;
(3) The making or furnishing of any
representation or statement to the Plan by or on behalf
of the Participant proves to have been false in any
material respect when made or furnished;
(4) Loss, theft, damage, destruction, sale or
encumbrance to or of any of the collateral, or the
making of any levy seizure or attachment thereof;
(5) The Participant's assignment for the benefit
of creditors, or the commencement of any proceeding
under any bankruptcy or insolvency laws by or against
the Participant;
(6) A distribution is required to be made from
the Participant's account under a qualified domestic
relations order and the amount of such distribution
exceeds the non-loaned value of the account.
If an event of default occurs, the Committee may
instruct the Trustee to take such reasonable actions as
a prudent fiduciary in similar circumstances would take
to protect and preserve Plan assets, including
foreclosing on any collateral and commencing such other
legal action for collection as the Committee deems
advisable. However, the Committee is not required to
instruct the Trustee to commence such actions
immediately upon default. Instead, the Committee may
choose, in its discretion, to defer enforcement
proceedings, and may grant the Participant reasonable
rights to cure any default, provided such actions
constitute prudent conduct for a professional lender in
like circumstances and would not create an unreasonable
risk of loss of principal or income to the Plan.
Accordingly, if permitted by the Committee, the
Participant will have the opportunity to repay the loan,
resume current status of the loan by paying any missed
payment plus interest or, if distribution is available
under the plan, request distribution of the note.
However, if the loan remains in default, the Committee
may instruct the Trustee to foreclose on any other
security the Trustee holds. Further, if the qualified
status of the Plan is not jeopardized, the Committee may
treat a loan that has been defaulted upon and not cured
within a reasonable period of time as a deemed
distribution from the Plan. The Committee will treat
the note as repaid to the extent of any permissible
offset. Pending final disposition of the note, the
Participant remains obligated for any unpaid principal
and accrued interest.
(K) Participant-Directed Investment. The Plan
intends this loan program not to place other
Participants at risk with respect to their interests in
the Plan. In this regard, the Committee will administer
any Participant loan as a Participant-directed
investment of that portion of the Participant's vested
account balance equal to the outstanding principal
balance of the loan. The Plan will credit that portion
of the Participant's account with the interest earned on
the note and with principal payments received by the
Participant. The Plan also may charge that portion of
the Participant's account balance with a reasonable loan
set up fee, and with expenses directly related to the
maintenance and collection of the note.
(L) Domestic Relations Order. The Committee may
in its discretion refuse to grant a loan to a
Participant while the Committee is determining whether
a domestic relations order affecting the Participant's
account is a qualified domestic relations order.
(M) Source of Funds. The source of funds for a
loan shall be taken pro-rata from the contribution
sources and Investment Funds comprising the
Participant's Account.
10.02 Hardship Distributions. A Participant
may, while in Service, apply to the Committee for a
Hardship Distribution. If the Committee authorizes a
Hardship Distribution, the source of funds for such
distribution shall come first from the Participant's
After-Tax Contributions Account (comprised of his After-
Tax Contributions and earnings thereon) and next from
the principal amount of his deferral contributions. No
portion of earnings on the Participant's deferral
contributions and no portion of the Participant's
Matching Contributions Account or Employer Basic
Contributions Account is available for a Hardship
Distribution. Notwithstanding the foregoing provisions
of this Section 10.02, an officer or director of an
Employer, or a person having directly or indirectly
beneficial ownership of not more than 10% of any class
of equity securities of the Employer registered under
Section 12 of the Securities and Exchange Act of 1934 is
not eligible for a Hardship Distribution. The
determination of whether the Participant is entitled to
a Hardship Distribution shall be determined by the
Committee in accordance with the rules of this Section
10.02. A Participant who wishes to apply for a Hardship
Distribution shall submit a Hardship Distribution
Application Form to the Committee. The Committee may,
in administering Hardship Distributions, promulgate such
reasonable administrative procedures and deadlines as it
deems advisable. If the Committee approves a
Participant's Hardship Distribution request, the
Committee shall direct the Trustee to distribute the
approved amount to the Participant in a lump sum as soon
as practicable after the next Valuation Date.
(A) Definition of hardship. A hardship
distribution must be on account of one or more of the
following immediate and heavy financial needs: (1)
medical care described in Code Subsection 213(d)
incurred by the Participant, by the Participant's
spouse, or by any of the Participant's dependents or
necessary to obtain such medical care; (2) the purchase
(excluding mortgage payments) of a principal residence
for the Participant; (3) the payment of post-secondary
education tuition and related educational fees, for the
next 12-month period, for the Participant, for the
Participant's spouse, or for any of the Participant's
dependents (as defined in Code Subsection 152); (4) to
prevent the eviction of the Participant from his
principal residence or the foreclosure on the mortgage
of the Participant's principal residence; or (5) any
need prescribed by the Revenue Service in a revenue
ruling, notice or other document of general
applicability which satisfies the safe harbor definition
of hardship, provided such need is approved by the
Committee.
(B) Restrictions. The following restrictions
apply to a Participant who receives a hardship
distribution: (a) the Participant may not make elective
deferrals or employee contributions to the Plan for the
12-month period following the date of his hardship
distribution; (b) the distribution is not in excess of
the amount of the immediate and heavy financial need
(including any amounts necessary to pay any federal,
state or local income taxes or penalties reasonable
anticipated to result from the distribution); (c) the
Participant must have obtained all distributions, other
than hardship distributions, and all nontaxable loans
(determined at the time of the loan) currently available
under this Plan and all other qualified plans maintained
by the Employer; and (d) the Participant agrees to limit
elective deferrals under this Plan and under any other
qualified plan maintained by the Employer, for the
Participant's taxable year immediately following the
taxable year of the hardship distribution, to the 402(g)
limitation (as described in Section 4.03), reduced by
the amount of the Participant's elective deferrals made
in the taxable year of the hardship distribution. The
suspension of elective deferrals and employee
contributions described in clause (a) also must apply to
all other qualified plans and to all nonqualified plans
of deferred compensation maintained by the Employer,
other than any mandatory employee contribution portion
of a defined benefit plan, including stock option, stock
purchase and other similar plans, but not including
health or welfare benefit plans (other than the cash or
deferred arrangement portion of a cafeteria plan).
(C) Employee representation. The Committee will
treat the distribution as the amount necessary to
satisfy the immediate and heavy financial need, without
further determination of other available resources, if
the Participant represents, and the Committee determines
under the facts and circumstances it is reasonable to
rely on that representation, he is not able to relieve
his immediate and heavy financial need: (a) through
reimbursement or compensation by insurance or otherwise;
(b) by reasonable liquidation of the Participant's
assets (including the assets of the Participant's spouse
or of the Participant's minor children, if those assets
are reasonably available to the Participant); (c) by
cessation of elective deferrals or of employee
contributions under the Plan; (d) by other distributions
or nontaxable loans from this Plan or from any other
qualified Plan maintained by the Employer or by any
other Employer; or (e) by borrowing from commercial
sources on reasonable commercial terms.
ARTICLE XI
TRUST AGREEMENT
11.01 Establishment of Trust Agreement.
Birmingham Steel Corporation has entered into a Trust
Agreement with the Trustee to provide for the
management, investment and distribution of the Trust
Fund.
11.02 Removal of Trustee. The Trustee under
the Trust Agreement shall be appointed and may be
removed, and a successor may be appointed, in accordance
with the terms of the Trust Agreement. If the Trust
Agreement provides that the Employer has the power to
appoint and remove the Trustee, then the Employer shall
take such actions with the consent of the Board of
Directors of Birmingham Steel Corporation.
11.03 Powers of the Trustee. The Trustee
shall have such powers and responsibilities over the
Trust Fund as are provided under the Trust Agreement.
ARTICLE XII
INVESTMENT OF THE TRUST FUND
12.01 Investment Funds.
(A) Available Funds. Except as otherwise
provided in this Article XII, on and after January 1,
1990, a portion, or all, of the Trust Fund shall be
divided for investment purposes into such number and
type of Investment Funds as the Committee, with the
approval of the Employer, determines to be in the best
interest of the Participants. All income, earnings and
gains from the sale or other disposition of assets
comprising an Investment Fund shall be reinvested in
such Investment Fund.
(B) Information concerning Funds. The Committee
and the Trustee (or their delegates) shall timely
furnish the Participants such information about the
investment characteristics of the Investment Funds and
about the rules of this Plan's investment program as may
be required or advisable under ERISA.
(C) Liquidity. Each Investment Fund may hold
cash and other liquid investments in such amounts as the
Committee considers necessary to meet the Plan's
obligations to pay benefits and to pay administrative
expenses.
(D) Participant elections among the Investment
Funds. Except as otherwise provided, each Participant
may direct the investment and reinvestment of his
Account balance among the available Investment Funds in
accordance with written Investment Guidelines which the
Committee or its delegate will furnish to each
Participant. The Investment Guidelines shall be set
forth in prospectuses and other documents,
administrative forms and descriptive literature relating
to each Investment Fund. The Committee may from time to
time prescribe such administrative forms, election
procedures and deadlines for Participant investment
elections among the Investment Funds as the Committee
may deem appropriate. The Account balance of a
Participant who fails to elect any Investment Fund will
automatically be invested in the Investment Fund which
has the lowest risk of loss.
(E) Restrictions imposed on certain Participants.
Notwithstanding any contrary provisions of the Plan or
related Trust Agreement, no Participant who is a person
required to file reports with respect to securities
positions or transactions in Employer Securities
pursuant to Section 16 of the Securities Exchange Act of
1934 may give any direction to the Trustee which would
change the invested percentage or dollar amount of his
Account balance invested in the Company Stock Fund or
change the invested percentage or dollar amount
thereafter to be allocated to his Account in the Company
Stock Fund with respect to contributions and Forfeitures
otherwise than during a Permitted Election Period. For
the purposes of this Section 12.01, the term "Permitted
Election Period" means the period beginning on the third
business day and ending on the twelfth business day
following the public release by the Employer by means of
press release to a wire service, financial news service
or newspapers of general circulation, of a summary
statement of sales and earnings for the Employer for the
immediately preceding fiscal quarter, or, in respect of
the Employer's fiscal year end, the immediately
preceding fiscal year. No Participant who is a person
subject to the reporting requirements of Section 16 of
the Securities Exchange Act of 1934 shall direct the
Trustee as to investment of his Account balance,
contributions or Forfeitures in the Company Stock Fund
if he has issued any such direction to the Trustee
within the immediately preceding six-month period.
12.02 Company Stock Fund. As directed in
writing by the Committee, the Trustee may invest up to
100% of the Trust Fund (subject to the limits of the
Committee's direction) in Employer Securities. Moreover,
as directed in writing by the Committee, the Trustee may
establish a pooled Investment Fund comprised in whole or
in part of Employer Securities (the "Company Stock
Fund"). The Company Stock Fund and any shares of
Employer Securities acquired and held under the Trust
Fund or distributed to the Participants shall comply
with applicable State and/or Federal Securities laws.
Accordingly, notwithstanding the foregoing provisions of
this Section 12.02, the Trustee may, prior to
establishing the Company Stock Fund, or prior to
distributing shares of Employer Securities to a
Participant, (a) require the Company to register the
Employer Securities, the Company Stock Fund and/or
Participant interests in the Company Stock Fund with the
Securities and Exchange Commission, and/or (b) require
the Company to furnish the Trustee such opinions of
counsel and such rulings, letters or other permission in
a form satisfactory to the Trustee from the Securities
and Exchange Commission or any other governmental agency
which the Trustee in its discretion deems may have an
interest in the Employer Securities, the Company Stock
Fund and/or Participant interests in the Company Stock
Fund.
(A) Voting of Employer Securities. Each
Participant is entitled to direct the Trustee as to the
exercise of all voting rights of Employer Securities
then allocated to his Account, in accordance with
procedures set forth in the Trust Agreement. The
Committee shall direct the Trustee in writing (which may
be a continuing direction) to vote, tender or otherwise
act with respect to the Employer Securities held in the
Trust Fund in accordance with the votes of the
Participants to whose accounts the Employer Securities
have been allocated.
12.03 Investment Manager.
(A) Appointment. The Committee may, with the
Employer's approval, appoint in writing a person, or
more than one person, who either (i) is registered as an
investment advisor under the Investment Advisers Act of
1940 (the "Act"), (ii) is a bank, as defined in the Act,
or (iii) is an insurance company which, within the
meaning of ERISA Subsection 3(38), is qualified to
manage, acquire and dispose of the assets of an employee
benefit plan under the laws of more than one state, as
an Investment Manager for all or a specified portion of
the Trust Fund as designated by the Committee (the
"Manager's Account"). Upon the effective date of his
appointment as Investment Manager, as provided herein,
such person shall have the sole responsibility and duty
and the sole power to manage and direct the acquisition
and disposition of the Trust Fund assigned to the
Manager's Account. The Committee as the Named
Investment Fiduciary also may terminate the appointment
of any person as an Investment Manager and may cause
assets of the Trust Fund to be added to or deleted from
any Manager's Account.
(B) Manager's acknowledgement of Fiduciary
Status. The appointment of a person as an Investment
Manager shall not become effective until the later of:
(1) The date such person delivers to the Trustee
and the Company a written statement:
(i) Acknowledging that such person is a fiduciary
within the meaning of ERISA Subsection 3(2)(A) and has
assumed sole responsibility for the management and the
direction of the acquisition and disposition of the
Trust Fund assets in such Manager's Account; and
(ii) Certifying that such person either is
registered as an investment advisor under the Act, is a
bank as defined in the Act, or is an insurance company
which, within the meaning of ERISA Subsection 3(38), is
qualified under the laws of more than one state to
manage, acquire and dispose of the assets of an employee
benefit plan, whichever is appropriate; and
(iii) Containing the names and signatures of
individuals who are authorized to act on behalf of the
Investment Manager in connection with the management of
the Manager's Account (the "List"), which List may be
amended from time to time by the Investment Manager
delivering written Notice thereof to the Trustee and the
company and which List may be relied upon by them; or
(2) If deemed appropriate by the Committee, the
date the Company and such person enter into a contract
in connection with the appointment of such person as an
Investment Manager which contains such terms and
conditions as the Company, with the approval of the
Committee, deems appropriate, including, if applicable,
an agreement that such person will immediately notify
the Company of the commencement of any Securities and
Exchange Commission investigation of any of his
investment activities which may result either in a
censure under the Act or in the suspension or revocation
of his resignation as an investment advisor under the
Act.
(C) Investment Procedures. The Investment
Manager may exercise his power through written
directions to the Trustee or, at his option, may
communicate such directions orally and as soon as
practicable thereafter confirm them in writing,
providing all directions, written or oral, shall be
communicated by or, as applicable, signed, by one of the
individuals whose name and signature appear on the List.
In addition, and notwithstanding any other provision of
the Trust to the contrary, the Trustee and the
Investment Manager may establish such electronic
confirmation, acknowledgement and book entry settlement
procedures through a registered security depository as
the Investment Manager reasonably deems consistent with
the rules of the New York Stock Exchange, Inc. and of
such other securities exchanges on which securities
transactions are effected on behalf of the Trust Fund at
the direction of the Investment Manger. All securities
transactions made in accordance with such procedures
shall be deemed made at the direction of the Investment
Manager, and the Trustee shall be indemnified and held
harmless for acting in accordance with such procedures.
Finally, the Trustee and Investment Manager may
establish procedures consistent with any such stock
exchange rules under this paragraph on or after the date
such rules are adopted without regard to the effective
date of such rules. The Trustee shall follow all such
directions from the Investment Manager, (including all
directions deemed to be made by the Investment Manager),
as provided in this paragraph, and shall not be liable
in any respect to any person for acting in connection
with such directions or failing to act in the absence of
such directions. Pending receipt of directions from the
Investment Manager, any cash received by the Trustee
from time to time for the Manager's Account may be
retained by the Trustee in cash, unless the Trustee is
otherwise instructed.
(D) More than one Investment Manager. Nothing
herein contained shall prevent the Committee from
appointing two or more Investment Managers and assigning
the management of a separate Manager's account to each
such Investment Manager. If two or more Investment
Managers are appointed, the provisions of this Trust
relating to the duties and powers of the Investment
Manager shall be construed to govern the duties and
powers of each Investment Manager in the singular shall
be construed to include the plural number.
ARTICLE XIII
EXCLUSIVE BENEFIT, AMENDMENT, TERMINATION
13.01 Exclusive Benefit. Except as provided
under Article III, the Employer has no beneficial
interest in any asset of the Trust and no part of any
asset in the Trust may ever revert to or be repaid to an
Employer, either directly or indirectly; nor, prior to
the satisfaction of all liabilities with respect to the
Participants and their Beneficiaries under the Plan, may
any part of the corpus or income of the Trust Fund, or
any asset of the Trust, be (at any time) used for, or
diverted to, purposes other than the exclusive benefit
of the Participants or their Beneficiaries.
13.02 Amendment by Employer.
(A) Right to Amend. In accordance with
procedures described in (B), Birmingham Steel
Corporation reserves the right at any time and from time
to time to amend the Plan in whole or in part without
the consent of any Participating Employer or
Participant. Each Plan amendment shall be set forth in
a written instrument executed by duly authorized
officers of Birmingham Steel Corporation.
(B) Amendment procedures.
(1) The Board of Directors of Birmingham Steel
Corporation must authorize or ratify any amendment that
materially affects Plan costs or benefits;
(2) Duly authorized officers of Birmingham Steel
Corporation may, with Committee approval but without
Board authorization, adopt amendments that do not
materially affect Plan costs and do not materially
change Plan benefits.
(3) A Plan amendment may be retroactive as
permitted by applicable federal pension law to qualify
or maintain the qualified status of the Plan under Code
Section Subsection 401(a) and 501(a).
(C) Limitations on reversion of the Trust Fund.
No amendment may authorize or permit any of the Trust
Fund (other than the part which is required to pay taxes
and administration expenses) to be used for or diverted
to purposes other than for the exclusive benefit of the
Participants or their Beneficiaries or estates. No
amendment may cause or permit any portion of the Trust
Fund to revert to or become a property of the Employer.
The Employer may not make any amendment which affects
the rights, duties or responsibilities of the Trustee,
the Plan Administrator or the Committee without the
written consent of the affected Trustee, the Plan
Administrator or the affected member of the Committee.
The Employer must make all amendments in writing. Each
amendment must state the date to which it is either
retroactively or prospectively effective.
(D) Code Subsection 411(d)(6) Protected Benefits.
An amendment (including the adoption of this Plan as a
restatement of an existing plan) may not decrease a
Participant's Accrued Benefit, except to the extent
permitted under Code Subsection 412(c)(8), and may not
reduce or eliminate Code Subsection 411(d)(6) protected
benefits determined immediately prior to the adoption
date (or, if later, the effective date) of the
amendment. An amendment reduces or eliminates Code
Subsection 411(d)(6) protected benefits if the amendment
has the effect of either (1) eliminating or reducing an
early retirement benefit or a retirement-type subsidy
(as defined in Treasury regulations), or (2) except as
provided by Treasury regulations, eliminating an
optional form of benefit. The Committee must disregard
an amendment to the extent application of the amendment
would fail to satisfy this paragraph. If the Committee
must disregard an amendment because the amendment would
violate clause (1) or clause (2), the Committee must
maintain a schedule of the early retirement option or
other optional forms of benefit the Plan must continue
for the affected Participants.
(F) Effect on Participating Employers. Each
Participating Employer by its adoption of the Plan
delegates to Birmingham Steel Corporation the exclusive
authority to amend the Plan.
13.03 Discontinuance. The Plan has been
established by Birmingham Steel Corporation with the
intention that it shall be continued indefinitely.
However, of necessity, Birmingham Steel Corporation
reserves the right at any time, with the approval of its
Board of Directors, to terminate the Plan and the
related Trust. The Plan will terminate upon the first
to occur of the following:
(a) The date terminated by action of the
Employer, with the authority of the Board of Directors;
(b) The dissolution or merger of the Employer,
unless the successor makes provision to continue the
Plan, in which event the successor must substitute
itself as the Employer under this Plan. Any termination
of the Plan resulting from this paragraph (b) is not
effective until compliance with any applicable notice
requirements under ERISA.
(A) Effect on Participating Employers. Each
Participating Employer by its adoption of this Plan
delegates to Birmingham Steel Corporation the exclusive
authority to terminate the Plan.
13.04 Full Vesting on Termination. Upon
either full or partial termination of the Plan, or, if
applicable, upon complete discontinuance of profit
sharing plan contributions to the Plan, an affected
Participant's right to his Accrued Benefit is 100%
Nonforfeitable, irrespective of the Nonforfeitable
percentage which otherwise would apply under Article V.
13.05 Merger/Direct Transfer. The Trustee may
not consent to, or be a party to, any merger or
consolidation with another plan, or to a transfer of
assets or liabilities to another plan, unless
immediately after the merger, consolidation or transfer,
the surviving Plan provides each Participant a benefit
equal to or greater than the benefit each Participant
would have received had the Plan terminated immediately
before the merger or consolidation or transfer. The
Trustee possesses the specific authority to enter into
merger agreements or direct transfer of assets
agreements with the trustees of other retirement plans
described in Code Subsection 401(a), including an
elective transfer, and to accept the direct transfer of
plan assets, or to transfer plan assets, as a party to
any such agreement.
(A) Elective Transfers. The Trustee may accept
an elective transfer of assets from another qualified
plan in accordance with the provisions of this
Subsection (A). The Trustee will hold, administer and
distribute the transferred assets as a part of the Trust
Fund and the Trustee must maintain a separate Employer
contribution Account for the benefit of the Employee on
whose behalf the Trustee accepted the transfer in order
to reflect the value of the transferred assets. Unless
a transfer of assets to this Plan is an elective
transfer, the Plan will preserve all Code Subsection
411(d)(6) protected benefits with respect to those
transferred assets, in the manner described in Section
13.02. A transfer is an elective transfer if: (1) the
transfer satisfies the first paragraph of this Section
13.05; (2) the transfer is voluntary, under a fully
informed election by the Participant; (3) the
Participant has an alternative that retains his Code
Subsection 411(d)(6) protected benefits (including an
option to leave his benefit in the transferor plan, if
that plan is not terminating); (4) the transfer
satisfies the applicable spousal consent requirements of
the Code; (5) the transferor plan satisfies the joint
and survivor notice requirements of the Code, if the
Participant's transferred benefit is subject to those
requirements; (6) the Participant has a right to
immediate distribution from the transferor plan, in lieu
of the elective transfer; (7) the transferred benefit is
at least the greater of the single sum distribution
provided by the transferor plan for which the
Participant is eligible or the present value of the
Participant's accrued benefit under the transferor plan
payable at that plan's normal retirement age; (8) the
Participant has a 100% Nonforfeitable interest in the
transferred benefit; and (9) the transfer otherwise
satisfies applicable Treasury regulations. An elective
transfer may occur between qualified plans of any type.
(B) Distribution restrictions under Code
Subsection 401(k). If the Plan receives a direct
transfer (by merger or otherwise) of elective
contributions (or amounts treated as elective
contributions) under a Plan with a Code Subsection
401(k) arrangement, the distribution restrictions of
Code Section Subsection 401(k)(2) and (10) continue to
apply to those transferred elective contributions.
13.06 Termination.
(A) Distribution procedures. Upon termination of
the Plan, the Committee will direct the Trustee to
distribute each Participant's Nonforfeitable Accrued
Benefit, in lump sum, as soon as administratively
practicable after the termination of the Plan,
irrespective of the present value of the Participant's
Nonforfeitable Accrued Benefit and whether the
Participant consents to that distribution. This
paragraph applies only if: (1) the Plan does not provide
an annuity option; (2) the Plan is a profit sharing plan
at the time of its termination date; and (3) as of the
period between the Plan termination date and the final
distribution of assets, the Employer does not maintain
any other defined contribution plan (other than an
ESOP).
(B) Continuation of Trust. The Trust will
continue until the Trustee in accordance with the
direction of the Committee has distributed all of the
benefits under the Plan. On each Valuation Date, the
Committee will credit any part of a Participant's
Accrued Benefit retained in the Trust with its
proportionate share of the Trust's income, expenses,
gains and losses, both realized and unrealized. Upon
termination of the Plan, the amount, if any, in a
suspense account under Article III will revert to the
Employer, subject to the conditions of the Treasury
regulations permitting such a reversion. A resolution
or amendment to freeze all future benefit accrual but
otherwise to continue maintenance of this Plan, is not
a termination for purposes of this Section 13.06.
(C) Distribution restrictions under Code
Subsection 401(k). The portion of the Participant's
Nonforfeitable Accrued Benefit attributable to elective
contributions under a Code Subsection 401(k) arrangement
(or to amounts treated under the Code Subsection 401(k)
arrangement as elective contributions) is not
distributable on account of Plan termination, as
described in Section 13.06, unless: (a) the Participant
otherwise is entitled under the Plan to a distribution
of that portion of his Nonforfeitable Accrued Benefit;
or (b) the Plan termination occurs without the
establishment of a successor plan. A successor plan
under clause (b) is a defined contribution plan (other
than an ESOP maintained by the Employer (or by a related
employer) at the time of the termination of the Plan or
within the period ending twelve months after the final
disposition of assets. A distribution made after March
31, 1988, pursuant to clause (b), must be part of a lump
sum distribution to the Participant of his
Nonforfeitable Accrued Benefit.
ARTICLE XIV
PARTICIPATING EMPLOYERS
14.01 Procedures for Adopting the Plan. Any
business entity that is a "Related Employer" as defined
in Article I may become a Participating Employer with
the consent of the Board of Directors of Birmingham
Steel Corporation and the Board of Directors of the
Related Employer. The new Participating Employer shall
furnish the Employee Benefits Committee a certified copy
of the resolutions of the Board of Directors of the new
Participating Employer authorizing its adoption of this
Plan. The new Participating Employer must evidence its
adoption of the Plan either by becoming a signatory to
the execution page of the Plan document, or by entering
into a suitable adoption agreement with Birmingham Steel
Corporation, in either case specifying the effective
date of the new Participating Employer's adoption of the
Plan. If appropriate, the adoption agreement may also
amend this Plan as appropriate to the circumstances of
the new Participating Employer. Upon the adoption of
the Plan by a Participating Employer, the Employees of
such Participating Employer will be eligible to
participate in the Plan, subject to the terms of the
Plan and the adoption agreement.
14.02 Single Plan. The Plan, as adopted by
all Participating Employers, shall be considered a
single plan for purposes of Treasury Regulation
Subsection 1.414(a)-1(b)(1). All assets contributed to
the Plan by the Participating Employers shall be held in
a single Trust Fund and, as long as a participating
Employer continues to be designated as such, all assets
held in such fund shall be available to pay benefits to
all Participants and Beneficiaries irrespective of which
Participating Employer is the Employer of such
Participant. Nothing contained herein shall be
construed to prohibit the separate accounting for assets
contributed by the Participating Employers for purposes
of cost allocation, contributions, forfeitures and other
purposes, pursuant to the terms of the Plan and as
directed by the Employee Benefits Committee.
14.03 Authority under the Plan. As long as a
participating Employer's designation as such remains in
effect, such Participating Employer shall be bound by,
and subject to, all provisions of the Plan and the
Trust. Each Participating Employer shall make such
contributions to the Plan as Birmingham Steel
Corporation may determine.
14.04 Termination of a Participating Employer
from the Plan. Birmingham Steel Corporation, acting
through its Board of Directors, may terminate a
Participating Employer from the Plan, effective as of
any date. An organization's status as a Participating
Employer automatically shall cease as of the date it
ceases to be a Related Employer. No Participating
Employer other than Birmingham Steel Corporation has the
right to amend or terminate the Plan. The Birmingham
Steel Corporation, acting through its senior officers,
and the terminating Participating Employer, acting
through its senior officers, shall mutually agree as to
the handling of the portion of the Trust Fund allocable
to Employees of the Participating Employer.
ARTICLE XV
MERGER OF THE AS&W PLAN INTO THIS PLAN
15.01 Merger of the AS&W Plan. Effective
January 1, 1995, the AS&W Plan shall be merged into this
Plan. By executing this Plan, AS&W hereby adopts and
agrees to be bound by all the terms and conditions of
this Plan, and of the related Trust Agreement, as the
Plan and related Trust Agreement may from time to time
be amended by Birmingham Steel Corporation and the
Trustee.
15.02 Trustee and Plan Administrator. By
executing this Plan, AS&W hereby accepts the Plan
Administrator and Trustee appointed by Birmingham Steel
Corporation.
15.03 Participant Account Balances. By reason
of the merger of the AS&W Plan into this Plan, the
following rules shall, as required under the Internal
Revenue Code, apply:
(A) The sum of the account balances of the
Participants under the AS&W Plan and under this Plan
shall equal the fair market value of the entire assets
of this Plan immediately after the merger and transfer
of assets from the AS&W Plan to this Plan;
(B) Immediately after the merger, each
Participant shall have an Account balance in this Plan
equal to the sum of the Account balances such
Participant had in the AS&W Plan and in this Plan
immediately prior to the merger and transfer of assets;
(C) The merger shall not eliminate any Code
Subsection 411(d)(6) protected benefits provided by the
AS&W Plan, unless the transfer of assets, pursuant to
the merger, satisfies the definition of an "elective
transfer" under the applicable Treasury regulations.
15.04 Accrual of Future Benefits. On and
after January 1, 1995, no further benefits shall accrue
for a Participant in the AS&W Plan. This Plan, as the
survivor of the plan merger, shall be the source of all
accrued benefits for all Participants of the two merged
Plans.
15.05 Transfer of Assets. The assets of the
AS&W Plan shall be transferred to this Plan as soon as
administratively feasible after January 1, 1995. The
assets of the AS&W Plan transferred to this Plan shall
be held, invested, administered and distributed in
accordance with the terms of this Plan.
ARTICLE XVI
MISCELLANEOUS
16.01 Delegation of Authority. Any action to
be taken, or document to be executed, under the terms of
this Plan may be done or executed by a duly authorized
officer or individual of Birmingham Steel Corporation.
16.02 No Responsibility for Employer Action.
Neither the Trustee nor the Committee has any obligation
or responsibility with respect to any action required by
the Plan to be taken by the Employer, any Participant or
eligible Employee, or for the failure of any of the
above persons to act or make any payment or
contribution, or to otherwise provide any benefit
contemplated under this Plan. Furthermore, the Plan
does not require the Trustee or the Committee to collect
any contribution required under the Plan, or to
determine the correctness of the amount of any Employer
contribution. Neither the Trustee nor the Committee
need inquire into or be responsible for any action or
failure to act on the part of the others, or on the part
of any other person who has any responsibility regarding
the management, administration or operation of the Plan,
whether by the express terms of the Plan or by a
separate agreement authorized by the Plan or by the
applicable provisions of ERISA. Any action required of
a corporate Employer must be by its Board of Directors
or its designate.
16.03 Fiduciaries not Insurers. The Trustee,
the Committee, the Plan Administrator and the Employer
in no way guarantee the Trust Fund from loss or
depreciation. The Employer does not guarantee the
payment of any money which may be or becomes due to any
person from the Trust Fund. The liability of the
Committee and the Trustee to make any payment from the
Trust Fund at any time and all times is limited to the
then available assets of the Trust.
16.04 Waiver of Notice. Any person entitled
to notice under the Plan may waive the notice, unless
the Code or Treasury regulations prescribe the notice or
ERISA specifically or impliedly prohibits such a waiver.
16.05 Successors. The Plan is binding upon
all persons entitled to benefits under the Plan, their
respective heirs and legal representatives, upon the
Employer, its successors and assigns, and upon the
Trustee, the Committee, the Plan Administrator and their
successors.
16.06 Employment Not Guaranteed. Nothing
contained in this Plan, or with respect to the
establishment of the Trust, or any modification or
amendment to the Plan or Trust, or in the creation of
any Account, or the payment of any benefit, gives any
Employee, Employee-Participant or any Beneficiary any
right to continue employment, any legal or equitable
right against the Employer, or Employee of the Employer,
or against the Trustee, or its agents or employees, or
against the Plan Administrator, except as expressly
provided by the Plan, the Trust, ERISA or by a separate
agreement.
16.07 Rules of Construction.
(a) Gender and Number. Except where otherwise
clearly indicated by context, masculine and neuter shall
include feminine and neuter, singular shall include
plural and vice-versa.
(b) Headings and Captions. The Table of Contents
and section headings of the Plan are provided only for
convenience of reference; they are not a part of the
Plan and shall be ignored in its interpretation and
construction.
(c) Counterparts. This Plan may be executed in
any number of counterparts, each of which shall
be deemed an original and together shall
constitute one and the same Plan. The Plan may
be sufficiently evidenced by any one executed
counterpart.
16.08 Governing Law. This Plan shall be
administered, construed and enforced under the laws of
the State of Delaware except to the extent preempted by
federal law.
IN WITNESS WHEREOF, Birmingham Steel Corporation
has caused this amendment and restatement of the
Birmingham Steel Corporation 401(k) Plan to be executed,
sealed and attested by its duly authorized officers this
8th day of October, 1994.
"Employer"
[Corporate Seal] BIRMINGHAM STEEL CORPORATION
Attested by: By:
Catherine W. Pecher James S. Rogers
- -------------------- ---------------------
Catherine W. Pecher James S. Rogers
Title: Corporate Secretary Title: VP-Human Resources
"Employer"
[Corporate Seal] AMERICAN STEEL & WIRE
CORPORATION
Attested by: By:
Catherine W. Pecher James S. Rogers
- -------------------- ---------------------
Catherine W. Pecher James S. Rogers
Title: Corporate Secretary Title: VP-Human Resources
"Employer"
[Corporate Seal] BARBARY COAST STEEL
CORPORATION
Attested by: By:
Catherine W. Pecher James S. Rogers
- -------------------- ---------------------
Catherine W. Pecher James S. Rogers
Title: Corporate Secretary Title: VP-Human Resources
"Employer"
[Corporate Seal] NORFOLK STEEL CORPORATION
Attested by: By:
Catherine W. Pecher James S. Rogers
- -------------------- ---------------------
Catherine W. Pecher James S. Rogers
Title: Corporate Secretary Title: VP-Human Resources
"Employer"
[Corporate Seal] SALMON BAY STEEL CORPORATION
Attested by: By:
Catherine W. Pecher James S. Rogers
- -------------------- ---------------------
Catherine W. Pecher James S. Rogers
Title: Corporate Secretary Title: VP-Human Resources
ALPHABETICAL LISTING OF DEFINITIONS
Account
Accounting Date
Accrued Benefit
Active Participant
Actual Deferral Percentage ("ADP") Test
Annual Addition
AS&W
AS&W Account Balance or Balances
AS&W Plan
Average
Beneficiary
Board of Directors
Cash-Out Distribution
Code
Code Subsection 411(d)(6) Protected Benefits
Committee
Compensation
Deferral contributions
Defined benefit plan
Defined contribution plan
Determination Date
Disability
Effective Date
Elective contributions
Elective deferrals
Elective Transfer
Employee
Employer
Employer Basic Contributions
Employer Matching Contributions
Employer Nonqualified Nonelective Contributions
ERISA
Excess aggregate contributions
Excess Amount
Excess contributions
Forfeiture Break in Service
Highly Compensated Employee
Hour of Service
Key Employee
Leased Employees
Limitation Year
Maximum Permissible Amount
Minimum Distribution Incidental Benefit
Multiple Use Limitation
Named Administrative Fiduciary
Named Investment Fiduciary
Non-Key Employee
Nonelective contributions
Nonforfeitable
Normal Retirement Age
Participant
Participant Forfeiture
Participating Employer
Permissive Aggregation Group
Plan
Plan Administrator
Plan Year
Predecessor Employer
Qualified Domestic Relations Order
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AMENDMENT NO. 1 TO THE BIRMINGHAM STEEL CORPORATION
401(k) PLAN
(As Amended and Restated Effective January 1, 1995)
THIS AMENDMENT NO. 1 (the "Amendment") of the BIRMINGHAM
STEEL CORPORATION 401(k) PLAN (as amended and restated
effective January 1, 1995) (the "Plan") is adopted this
29th day of December, 1994, by BIRMINGHAM STEEL
CORPORATION, a Delaware corporation, as Plan sponsor
(the "Employer").
RECITALS:
The Employer established the Plan effective August 15,
1984 and restated the Plan effective January 1, 1995.
The Plan reserves to the Employer the right to amend the
Plan without the consent of any Participating Employer
or Participant.
The Employer now wishes to amend the Plan to provide
special rules for employees of Port Everglades Steel
Corporation.
NOW, THEREFORE, in consideration of those recitals, the
Employer hereby amends the Plan, effective as of January
1, 1995 as follows:
1. Section 5.10 (Vesting for Special Classes of
Participants) is amended by creating a new Subsection
5.10(E) reading as follows:
"(E) Port Everglades Steel Corporation Participants.
Notwithstanding any contrary provisions of the Plan, all
employment service of an employee of Port Everglades
Steel Corporation who becomes a Participant in this Plan
on January 1, 1995 shall be credited toward such
Participant's 'Years of Service' for vesting purposes as
defined in Section 5.08(A)."
2. Section 3.02(A) (Amount of Employer Matching
Contributions) is amended by adding a new sentence
reading as follows:
"Employer Matching Contribution shall be made each
month; provided, however, that the Committee may, in its
discretion, defer payment of an Employer Matching
Contribution for any Participant in order to ensure that
such Participant receives Matching Contributions during
the Plan Year in an amount equal to 100% of the deferral
contributions made by such Participant, up to the first
3% of such Participant's Compensation for the Plan
Year."
3. Section 3.02(B) (Time of Allocation) is amended to
read as follows:
"(B) (Time of Allocation). The Committee will, as of
December 31 of each Plan Year, allocate Employer
Matching Contributions to the Matching Contributions
Account of each Participant who has made deferral
contributions during the Plan Year."
4. Except as changed by this Amendment, the
provisions of the Plan are hereby ratified and confirmed
and shall remain in full force and effect. The Plan may
be restated to incorporate the provisions of this
Amendment.
IN WITNESS WHEREOF, the Employer has caused this
Amendment to be executed, attested and sealed as of the
date first above written.
"Employer"
(Corporate Seal) BIRMINGHAM STEEL CORPORATION
Attested by: By:
Catherine W. Pecher James S. Rogers
- ------------------------- --------------------------
Catherine W. Pecher James S. Rogers II
Title: Corporate Secretary Title: Vice President-
Human Resources
