As filed with the Securities and Exchange Commission on June 29, 1994
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11 - K
|X| ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1993
Commission File Number 33-60124
COLONIAL COMPANIES, INC.
SECURITY SAVER PLAN, AS AMENDED
1200 Colonial Life Boulevard
Columbia, South Carolina 29210
(Full title of the plan and the address of the plan)
UNUM CORPORATION
2211 CONGRESS STREET
PORTLAND, MAINE 04122
(Name of issuer of the securities held pursuant to the
plan and the address of its principal executive office)
Exhibit Index Appears on Page 2 of 24
<PAGE>
CONTENTS
Audited Financial Statements, Supplemental Schedules Consecutive
and Exhibits Page Number
a) Financial Statements
1. Report of Independent Accountants Form SE
2. Statement of Net Assets Available for Form SE
Plan Benefits
3. Statements of Changes in Net Assets Form SE
Available for Plan Benefits
4. Notes to Financial Statements Form SE
b) Schedules
1. Schedule of Assets Held for Investment Form SE
Purposes
2. Schedule of Reportable Transactions Form SE
c) Exhibits
1. Consent of Coopers & Lybrand 4
2. Consent of Ernst & Young 5
3. Amendment dated May 12, 1993 to the Colonial 6
Companies, Inc. Security Saver Plan, as
Amended and Restated
4. Amendment dated August 12, 1993 to the Colonial 8
Companies, Inc. Security Saver Plan, as
Amended and Restated
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Retirement Committee of the Colonial Companies, Inc. Security
Saver Plan, As Amended, has duly caused this annual report to be signed
on its behalf by the undersigned hereunto duly authorized.
COLONIAL COMPANIES, INC.
SECURITY SAVER PLAN, AS AMENDED
June 29, 1994 By: /s/ Robert E. Staton
Robert E. Staton
Member of the Retirement Committee
<PAGE>
Consent of Coopers & Lybrand
We consent to the incorporation by reference in the Registration Statement
(Form S-8, No. 33-60124) pertaining to the Colonial Companies, Inc.
Security Saver Plan, as amended, of our report dated June 20, 1994, with
respect to the financial statements and schedules of the Colonial Companies,
Inc. Security Saver Plan, as amended, included in this Annual Report
(Form 11-K) for the year ended December 31, 1993.
/s/ Coopers & Lybrand
Charlotte, North Carolina
June 24, 1994
<PAGE>
Consent of Ernst & Young
We consent to the incorporation by reference in the Registration
Statement (Form S-8, No. 33-60124) pertaining to the Colonial
Companies, Inc. Security Saver Plan, as amended, of our report dated
May 11, 1993, with respect to the financial statements of the Colonial
Companies, Inc. Security Saver Plan, as amended, for the year ended
December 31, 1992, included in this Annual Report (Form 11-K) for the year
ended December 31, 1993.
/s/ Ernst & Young
Greenville, South Carolina
June 20, 1994
<PAGE>
STATE OF SOUTH CAROLINA )
) THIRD AMENDMENT
COUNTY OF RICHLAND )
THIS AMENDMENT, made as of the 12th day of May, 1993, by
COLONIAL COMPANIES, INC., a South Carolina Corporation (the "Company"),
WITNESSETH:
WHEREAS, the Company maintains the Colonial Companies, Inc.
Security Saver Plan as amended and restated as of January 1, 1989
(the "Plan") for the benefit of its eligible employees; and
WHEREAS, in Section 12.1 of the Plan, the Company has
reserved the right by action of its Board of Directors to amend the Plan.
NOW, THEREFORE, for the purposes aforesaid, the Company covenants
and agrees that the Plan shall be amended as follows:
1. Effective March 1, 1993, Section 2.1(l) shall be deleted
and the following inserted in its place:
(l) Company. Colonial Companies, Inc. and the
following participating Affiliates: (1) Colonial Life
and Accident Insurance Company, (2) Bush River Service
Company, Inc., and (3) BenefitAmerica, Inc. Upon
approval of the Board, additional Affiliates may
be designated as a participating Affiliate under
this Plan.
2. Effective March 1, 1993, Section 2.1(nn) shall be
deleted and the following inserted in its place.
(nn) Shares. The Shares are the Class B nonvoting
shares of Colonial Companies, Inc. In the event
Colonial Companies, Inc. Class B nonvoting common stock
is changed into or exchanged for a different number or
kind of shares or securities by reason of a merger, sale of
stock, consolidation, liquidation, reclassification,
recapitalization, stock split, combination of shares,
stock dividend or reorganization, Shares shall mean shares or
securities into which the Class B nonvoting shares
were changed or exchanged (the "Successor Shares").
In the event the Successor Shares are changed into or
exchanged for different number or kind of shares or
securities by reason of a merger, sale of stock,
consolidation, liquidation, reclassification,
recapitalization, stock split up, combination of shares,
stock dividend or reorganization, Shares shall mean shares
or securities into which the Successor Shares were
changed or exchanged.
<PAGE>
IN WITNESS WHEREOF, the Company has caused this amendment to be
executed by their duly authorized officer as of the date and year first
above written.
WITNESS: COLONIAL COMPANIES, INC.
/s/ Michael I. Leet By: /s/ Robert E. Staton
/s/ Edna L. Brown Sr. Vice President & Corporate Secretary
(Title)
<PAGE>
STATE OF SOUTH CAROLINA )
) FOURTH AMENDMENT
COUNTY OF RICHLAND )
THIS AMENDMENT, made as of the 12th day of August, 1993, by
COLONIAL COMPANIES, INC., a South Carolina Corporation (the
"Company").
W I T N E S S E T H:
WHEREAS, the Company maintains the Colonial Companies, Inc.
Security Saver Plan, as amended and restated as of January 1, 1989
(the "Plan") for the benefit of its eligible employees; and
WHEREAS, the Plan has been submitted to the Internal Revenue
Service for a favorable determination letter and the Company has
been advised that certain changes are necessary in order to receive
a favorable determination letter; and
WHEREAS, in Section 12.1 of the Plan, the Company has reserved
the right by action of its Board of Directors to amend the Plan.
NOW, THEREFORE, for the purposes aforesaid, the Company covenants
and agrees that the Plan shall be amended as follows:
1. Effective January 1, 1989, Section 2.1(f) shall be deleted
and the following inserted in its place:
(f) Average Contribution Percentage. Average
Contribution Percentage means, with respect to the
Highly Compensated Employee group and the Non-Highly
Compensated Employee group, the average of the ratios,
calculated separately for each Participant in each
group (the actual contribution ratio), of the Company
Matching Contributions each such Participant receives
pursuant to Section 4.8, to the Participant's
Adjusted Compensation for such Plan Year. The
actual contribution ratio for each Participant and
the Average Contribution Percentage for each group
shall be calculated to the nearest onehundredth of
one percent. The Highly Compensated Employee
group and the Non-Highly Compensated Employee
group shall include any Employee eligible to make
a deferral election pursuant to Section 4.1,
whether or not such deferral election was made or
suspended pursuant to Section 4.3. The actual
contribution ratio of an eligible Employee who
makes no deferral election is zero.
2. Effective January 1, 1989, Section 2.1(g) shall be
deleted and the following inserted in its place:
<PAGE>
(g) Average Deferral Percentage. Average
Deferral Percentage means, with respect to the
Highly Compensated Employee group and Non-Highly
Compensated Employee group for a Plan Year, the
average of the ratios, calculated separately for
each Participant in such group (the actual
deferral ratio), of the amount of Tax Deferred
Contributions to such Participant's Adjusted
Compensation for such Plan Year. The actual
deferral ratio for each Participant and the
Average Deferral Percentage for each group shall
be calculated to the nearest one-hundredth of one
percent. The Highly Compensated Employee group
and the Non-Highly compensated Employee group
shall include any Employee eligible to make a
deferral election pursuant to Section 4.1, whether
or not such deferral election was made or
suspended pursuant to Section 4.3. The actual
deferred ratio of an eligible Employee who
makes no deferral election is zero.
3. Effective January 1, 1989, Section 2.1(n) shall be deleted
and the following inserted in its place:
(n) Compensation. Compensation shall mean
the total earnings paid to a Participant by the
Company during a Plan Year reported or reportable
on U.S. Treasury Department Wage and Tax Statement
Form W-2 or other similar form required for such
purposes, together with the salary reduction
contributions made pursuant to Section 4.1 and
salary reductions which are not included in gross
income under Section 125 of the Code, but
excluding cash and non-cash fringe benefits,
amounts otherwise allocated or benefits paid under
this Plan or any other pension or benefit plan of
the Company and amounts identified by the Company
as payment toward business expenses incurred by
the Employee without direct reimbursement. In the
case of a Highly Compensated Employee,
Compensation shall exclude director's fees,
payments of renewals and commissions.
Compensation for each Employee in excess of
the limit prescribed in Section 401(a)(17) of the
Code ($200,000 as adjusted by any cost of living
adjustment) shall not be recognized.
4. Effective January 1, 1989, Section 2.1(x) shall be deleted
and the following inserted in its place:
(x) Highly Compensated Employee. A Highly
Compensated Employee is any Employee who, during the
determination year or during the look-back year:
<PAGE>
(1) was an indirect or direct owner
or more than five percent of the
outstanding stock of the Company or more
than five percent of the total combined
voting power of all stock of the Company;
or
(2) received compensation in excess
of $75,000; or
(3) received compensation in excess
of $50,000 and was in the Top Paid Group; or
(4) was an officer as defined in
Section 2.1(ee).
An Employee who is described in (2), (3), or (4)
above shall be deemed to be not described in
this section for the look-back year unless such
Employee is a member of the group consisting of
the 100 Employees paid the greatest compensation
during the Plan Year for which such determination
is made. A former Employee shall be treated as a
Highly Compensated Employee if either such
Employee was a Highly Compensated Employee when he
separated from service or if such Employee was a
Highly Compensated Employee any time after age 55.
For purposes of this paragraph and Section 2.1(ee),
the "determination year" shall be the Plan Year, the
"look-back year" shall be the twelve-month period
immediately preceding the determination year and
"compensation" is defined in Section 415(c)(3) of the
Code including amounts contributed by the Company
pursuant to a salary reduction agreement and which is
not included in gross income under Sections 125,
402(a)(8), 402(h) or 403(b) of the Code. The amounts
described in subparagraph (x)(2) and (x)(3) shall be
adjusted annually by any cost of living adjustment
announced by the Internal Revenue Service. For
purposes of this paragraph and Section 2.1(ee),
the determination of Highly Compensated Employee
and Officer shall include all employees of
employers that are treated as a single employer
pursuant to Section 414(b), (c), (m), or (o) of
the Code.
5. Effective January 1, 1989, Section 2.1(ee) shall be deleted
and the following inserted in its place:
(ee) Officer. Officer shall mean only such
Employees who were administrative executives who
regularly and continuously served as such and
whose compensation during the determination year
or look-back year is in excess of 50% of the
<PAGE>
amounts set forth in Section 415(b)(1)(A) of the
Code. The amount described above shall be
adjusted annually by any cost of living adjustment
announced by the Internal Revenue Service. Title
shall not be determinative of officer status, and
the maximum number of employees considered
officers may not exceed (1) three if the Company
employs less than 30 Employees; (2) 10% of all
Employees if the Company employs more than 29
Employees and less than 500 Employees, or (3) 50
if the Company employs more than 500 Employees.
If no officer has satisfied the compensation
requirement during either a determination year or
lookback year, the highest paid officer for such
year shall be treated as an Officer.
6. Effective January 1, 1989, Section 2.1(mm) shall be deleted
and the following inserted in its place:
(mm) Severance from Service or Severance
from Service Date. Severance from Service or the
Severence from Service Date shall mean the date
the Employee severs from service with the Company,
and shall be the earliest of the date the Employee
quits, retires, is discharged, or dies, or the
first anniversary of the first date he is absent
from work for any reason. Notwithstanding the
foregoing, an Employee will not be deemed to have
a Severance from Service during a period of an
approved leave of absence as described in Section
7.3(c)(5).
7. Effective January 1, 1989, Section 2.1(uu) shall be deleted
and the following inserted in its place:
(uu) Year of Eligibility Service. Except
for regular part-time employees and regional,
managing regional and zone directors, a Year of
Eligibility Service shall mean the completion of a
12 consecutive month period ending with the first
anniversary of the date an Employee first earns an
Hour of Service and has not had a Severance from
service.
A Year of Eligibility Service for an
employee classified as a regular part-time
employee, that is, an employee with an expected
average of 20 hours of service or less per week,
shall mean the completion of 12 consecutive months
of employment. A Year of Eligibility Service for
regional, managing regional and zone directors
shall mean the completion of 12 consecutive months
of employment from the date of appointment as a
regional, managing regional or zone director.
<PAGE>
In addition, if an Employee severs from
service and is re-employed within twelve
consecutive months, his service shall also include
all days between his termination of employment and
his subsequent reemployment.
8. Effective January 1, 1989, Section 2.1(vv) shall be deleted
and the following inserted in its place:
(vv) Year of Service. Except as otherwise
provided and qualified in the applicable sections
of the Plan, Year of Service shall mean any Plan
Year during which an Employee is employed and does
not incur a Severance from Service. In addition,
if an Employee severs from service and is re-
employed within twelve consecutive months, his
service shall also include all days between his
termination of employment and his subsequent re
employment.
9. Effective January 1, 1989, Section 4.5 shall be deleted
and the following inserted in its place:
4.5 Restrictions on Elections.
(a) Average Deferral Percentage Test.
Notwithstanding any provision herein to the contrary,
the Average Deferral Percentage for the Highly
Compensated Employee group for each Plan Year must not
exceed the Average Deferral Percentage for the Non-
Highly Compensated Employee group by more than the
greater of:
(1) The Average Deferral Percentage
of the Non-Highly Compensated Employee group
multiplied by 1.25; or
(2) the Average Deferral Percentage
of the Non-Highly Compensated Employee group
multiplied by 2.0, but in no event more than
two (2) percentage points greater than the
Average Deferral Percentage of the Non-
Highly Compensated Employee group.
For purposes of determining the Average Deferral Percentage Test,
Tax Deferred Contributions must be made before the last day of the
twelve month period immediately following the Plan Year to which the
contributions relate.
(b) Special Rules.
<PAGE>
(1) For the purpose of determining the actual deferral
ratio of a Highly Compensated Employee who is subject to
the Family Member aggregation rules of Section 414(q)(6)
of the Code because such Participant is either a "five
percent owner" of the Company or one of the ten (10) Highly
Compensated Employees paid the greatest Adjusted Compensation
during a year, the following shall apply:
(A) The combined actual deferral ratio for the
family group (which shall be treated as one
Highly Compensated Employee) shall be
determined by aggregating Tax-Deferred
Contributions and Adjusted Compensation of
all eligible Family Members (including
Highly Compensated Employees). However, in
applying the $200,000 limit to Adjusted
Compensation, Family Members shall include
only the affected Employee's spouse and any
lineal descendants who have not attained age
19 before the close of the Plan Year.
(B) The Tax-Deferred Contributions and
Adjusted Compensation of all Family Members
shall be disregarded for purposes of determining the
actual deferral ratio of the Non-Highly
Compensated Employee group except to the
extent taken into account in paragraph (A)
above.
(C) If a Participant is required to be
aggregated as a member of more than one
family group in a plan, all Participants who
are members of those family groups that
include the Participant are aggregated as
one family group in accordance with
paragraphs (A) and (B) above.
(2) If a Highly Compensated Employee is a
Participant under two or more cash or deferred
arrangements (other than a cash or deferred
arrangement which is part of an employee stock
ownership plan as defined in Code Section
4975(e)(7)) of the Company, all such cash or
deferred arrangements shall be treated as one cash
or deferred arrangement for the purpose of
determining the actual deferral ratio with respect
to such Highly Compensated Employee.
(3) For the purpose of this Section and Code
Sections 401(a)(4), 410(b) and 401(k), if two or
more plans which include cash or deferred
arrangements are considered one plan for the
<PAGE>
purposes of Code Section 410(a)(4) or 410(b)
(other than Code Section 410(b)(2)(A)(ii)), the
cash or deferred arrangements included in such
plans shall be treated as one arrangement. In
addition, two or more cash or deferred
arrangements may be considered as a single
arrangement for purposes of determining whether or
not such arrangements satisfy Code Sections
401(a)(4), 410(b) and 401(k). In such case, the
cash or deferred arrangements included in such
plans and the plans including such arrangements
shall be treated as one arrangement and as one
plan for purposes of this Section and Code Section
401(a)(4), 410(b) and 410(k). For Plan Years
beginning after December 31, 1989, plans may be
aggregated under this paragraph only if they have
the same plan year.
Notwithstanding the above, an employee stock
ownership plan described in Code Section
4975(e)(7) may not be combined with this Plan for
purposes of determining whether the employee stock
ownership plan or this Plan satisfies this Section
and Code Sections 401(a)(4), 410(b) and 401(k).
(c) Distribution of Excess Tax-Deferred
Contributions. Notwithstanding any other provision of
this Plan, Excess TaxDeferred Contributions, plus any
income and minus any loss allocable thereto, shall be
distributed no later than the last day of each Plan
Year to Participants to whose Accounts such Excess Tax-
Deferred Contributions were allocated for the preceding
Plan Year. If such excess amounts are distributed more
than 2 1/2 months after the last day of the Plan Year in
which such excess amounts arise, a ten percent (10%)
excise tax will be imposed on the Company maintaining
this Plan with respect to such amounts. Such
distributions shall be reduced by any Excess Tax-Deferred
Contributions previously distributed to such Participant
for the taxable year ending with or within such Plan Year.
The Excess Tax-Deferred Contributions shall be determined
as follows: the Company shall rank the Participants who are
Highly Compensated Employees by Average Deferral Percentage
("actual deferral ratio") in descending order. The
Company shall then reduce the amount of Tax-Deferred
Contributions made on behalf of the Highly Compensated
Employee with the highest average deferral ratio until
the first of the following occurs:
(1) The Plan and any other qualified plans
that are maintained by the Company which are
aggregated with this Plan satisfies the Average
Deferral Percentage Test Contained in Section
4.5(a) of this Plan; or (2) the actual deferral
ratio for such Highly Compensated Employee is
reduced to a percentage which equals the actual
deferral ratio of the Highly Compensated Employees
with the next highest actual deferral ratio. The
Company shall then repeat this procedure until the
Plan and any other qualified plans that are
maintained by the Company which are aggregated
with this Plan satisfies the Average Deferral
Percentage Test contained in Section 4.5(a).
<PAGE>
If the determination and correction of Excess Tax-Deferred
Contributions of a Highly Compensated Employee whose actual
deferral ratio is determined under the family aggregation rules,
then the actual deferral ratio shall be reduced as required
herein and the Excess Tax-Deferred Contributions shall be
allocated among the family members in proportion to the Tax-
Deferred Contributions of each family member that were combined
to determine the group actual deferral ratio.
(d) Additional Restriction on Elections. Prior to the
beginning of each Plan Year, and at such other time or times
throughout the Plan Year as the Retirement Committee may determine,
the Retirement Committee shall test elections under Section 4.1 in
order to determine whether the interim Average Deferral Percentage
for the group of Highly Compensated Employees exceeds the interim
Average Deferral Percentage of the Non-Highly Compensated Employees
by more than the greater of:
(1) One and one quarter times, or
(2) The lesser of (i) two percentage points or (ii) two times.
The interim testing made under this Section 4.5(d) shall be based
on a Participant's Adjusted Compensation during the month preceding
the date on which such Participant made his election, and corrections
to be made in order to reduce the amount in excess of the maximum
permissible deferral percentage shall be made from Compensation to
be earned for the remainder of the Plan Year.
In the event that the interim percentage of Tax-Deferred
Contributions elected by the Highly Compensated Employees would
(if not reduced) cause the interim Average Deferral Percentage
of such Participants to exceed the maximum deferral percentage
permitted under this Section 4.5(d), then the Retirement
Committee may reduce the maximum deferral percentage in effect
for the group of Highly Compensated Employees to the highest
lower percentage which causes the group to comply with the maximum
deferral percentage permitted under this Section 4.5(d). The pay
of a Highly Compensated Employee shall be increased by the amount
by which his deferral percentage is reduced in order to comply with
the limitations set forth in this Section 4.5(d).
(e) In addition, the Retirement Committee and/or the Company
may take any additional steps as permitted by law to bring the Plan
into compliance with these provisions.
<PAGE>
10. Effective January 1, 1989, Section 4.10 shall be deleted
and the following inserted in its place:
4.10 Restrictions on Company Matching Contributions.
(a) Average Contribution Percentage Test.
Notwithstanding any provision herein to the contrary,
the Actual Contribution Percentage for the Highly
Compensated Employee group for each Plan Year must not
exceed the Average Contribution Percentage for the Non-
Highly Compensated Employee group by more than the
greater of:
(1) The Average Contribution Percentage
of the Non-Highly Compensated Employee group
multiplied by 1.25; or
(2) the Average Contribution
Percentage of the Non-Highly
Compensated Employee group multiplied
by 2.0, but in no event more than two
(2) percentage points greater than the
Average Contribution Percentage of the
NonHighly Compensated Employee group.
In addition, to prevent the multiple use of the alternative method
described in this paragraph and Section 4.5, the provisions of
Section 401(m) of the Code and Treas. Reg. 1.401(m)-2 are incorporated
herein by reference. For purposes of determining the Average Contribution
Percentage Test, Company Matching Contributions must be made before the
last day of the twelve month period immediately following the Plan Year
to which the contributions relate.
(b) Special Rules.
(1) For the purpose of determining the actual
contribution ratio of a Highly Compensated
Employee who is subject to the Family Member
aggregation rules of Section 414(q)(6) of the Code
because such Participant is either a "five percent
owner" of the Employer or one of the ten (10)
Highly-Compensated Employees paid the greatest
Adjusted Compensation during the year, the
following shall apply:
(A) The combined actual contribution ratio for
the family group (which shall be treated as one
Highly Compensated Participant) shall be
determined by aggregating Company Matching
Contributions and Adjusted Compensation of all
eligible Family Members (including Highly Compensated
Employees). However, in applying the $200,000 limit
to Adjusted Compensation, Family Members shall include
only the affected Employee's spouse and any lineal
descendants who have not attained age 19 before the close
of the Plan Year.
<PAGE>
(B) The Company Matching Contributions and
Adjusted Compensation of all Family Members
shall be disregarded for purposes of
determining the actual contribution ratio
of the Non-Highly Compensated Employee group
except to the extent taken into account in
paragraph (A) above.
(C) If a Participant is required to be
aggregated as a member of more than one
family group in a plan, all Participants
who are members of those family groups that
include the Participant are aggregated as
one family group in accordance with
paragraphs (A) and (B) above.
(2) If a Highly Compensated Employee is a
Participant under two or more plans (other than a
plan which is an employee stock ownership plan as
defined in Code Section 4975(e)(7)) of the Company
to which matching contributions are made, all such
contributions on behalf of such Highly-Compensated
Employee shall be aggregated for purposes of
determining such Highly-Compensated Employees
actual contribution ratio.
(3) For the purpose of this Section and Code
Sections 401(a)(4), 410(b) and 401(m), if two or
more plans which include matching contributions
are considered one plan for the purposes of Code
Section 410(a)(4) or 410(b) (other than Code
Section 410(b)(2)(A)(ii)), such plans shall be
treated as one plan. In addition, two or more
plans may be considered as a single plan for
purposes of determining whether or not such plans
satisfy Code Sections 401(a)(4), 410(b) and
401(m). In such case, the aggregated plan shall
be treated as one plan for purposes of this
Section and Code Section 401(a)(4), 410(b) and
410(m). For Plan Years beginning after December
31, 1989, plans may be aggregated under this
paragraph only if they have the same plan year.
Notwithstanding the above, an employee stock
ownership plan described in Code Section
4975(e)(7) may not be combined with this Plan for
purposes of determining whether the employee stock
ownership plan or this Plan satisfies this Section
and Code Sections 401(a)(4), 410(b) and 401(m).
<PAGE>
(c) Distribution of Excess Company Matching
Contributions. Notwithstanding any other provision of
this Plan, Excess Company Matching Contributions, plus
any income and minus any loss allocable thereto, shall
be distributed no later than the last day of each Plan
Year to Participants to whose Accounts such Company
Matching Contributions were allocated for the preceding
Plan Year. If such excess amounts are distributed more
than 2 1/2 months after the last day of the Plan Year in
which such excess amounts arise, a ten percent (10%)
excise tax will be imposed on the Company maintaining
this Plan with respect to such amounts. Such
distributions shall be reduced by any excess Company
Matching Contributions previously distributed to such
Participant for the taxable year ending with or within
such Plan Year. The excess Company Matching
Contributions shall be determined as follows: the
Company shall rank the Participants who are Highly-
Compensated Employees by Average Contribution
Percentage ("average contribution ratio") in descending
order. The Company shall then reduce the amount of
Contributions made on behalf of the Highly Compensated
Employee with the highest average contribution ratio
until the first of the following occurs:
(1) The Plan and any other qualified plans that
are maintained by the Company which are aggregated with
this Plan satisfies the Average Contribution Percentage Test
Contained in Section 4.10(a) of this Plan; or
(2) The actual contribution ratio for such Highly
Compensated Employee is reduced to a percentage which
equals the actual contribution ratio of the Highly
Compensated Employees with the next highest actual
contribution ratio. The Company shall then repeat this
procedure until the Plan and any other qualified plans
that are maintained by the Company which are aggregated
with this Plan satisfies the Average Contribution
Percentage Test contained in Section 4.10(a).
If the determination and correction of excess
Company Matching Contributions of a Highly Compensated
Employee whose actual contribution ratio is determined
under the family aggregation rules, then the actual
contribution ratio shall be reduced as required herein
and the excess Company Matching Contributions shall be
allocated among the family members in proportion to the
Company Matching Contributions of each family member
that were combined to determine the group actual
contribution ratio.
(d) Additional Restriction on Elections. Prior
to the beginning of each Plan Year, and at such other
time or times throughout the Plan Year as the
Retirement Committee may determine, the Retirement
Committee shall test estimated Company Matching
Contributions under Section 4.8 in order to determine
whether the interim Average Contribution Percentage for
the group of Highly Compensated Employees exceeds the
interim Average Contribution Percentage of the Non-
Highly Compensated Employees by more than the greater
of:
<PAGE>
(1) One and one quarter times, or
(2) The lesser of (i) two percentage points or
(ii) two times.
The interim testing made under this Section 4.10(d)
shall be based on a Participant's Adjusted Compensation
during the month preceding the date on which such
Participant made his election.
In the event that the interim percentage of
Company Matching Contributions received by the Highly
Compensated Employees would (if not reduced) cause the
interim Average Contribution Percentage of such
Participants to exceed the maximum contribution
percentage permitted under this Section 4.10(d), then
the Retirement Committee may reduce the maximum
contribution percentage in effect for the group of
Highly Compensated Employees to the highest lower whole
percentage which causes the group to comply with the
maximum contribution percentage permitted under this
Section 4.10(d). Any excess amounts then in the Plan
shall be used to offset future Company Matching
Contributions all in accordance with the applicable
laws and regulations and as determined by the
Retirement Committee.
11. Effective August 1, 1993, Section 6.2(a) shall be deleted
and the following inserted in its place:
(a) Participants shall be eligible to make an
application for a loan upon completion of one or more
Years of Service as a Participant in the Plan.
Upon the application of any eligible Participant,
the Retirement Committee may direct the Trustee
to make a loan or loans to such Participant. Subject
to the limitations in this Section 6.2(a) and (b), the
loans shall be made available to all Participants and
Beneficiaries on a reasonably equivalent basis.
12. Effective January 1, 1989, Section 7.3 shall be deleted
and the following inserted in its place:
7.3 Termination of Employment.
(a) If a Participant terminates employment for
reasons other than death or Disability before he
reaches Normal Retirement Age, he shall remain fully
vested in his Tax-Deferred Contributions and shall have a
<PAGE>
vested interest in his Company Matching
Contributions in accordance with Section 7.3(b).
Said Participant shall be entitled to have his
Account paid to him or his Beneficiary to the
extent he is vested therein in a lump sum on or
within a reasonable period following the
Valuation Date coincident with or next following
such termination of employment, said Account
being valued as of the Valuation Date coincident
with or next following such termination of
employment. If the value of a Participant's
vested Account exceeds $3,500, the Participant
and spouse must give written consent to any
distribution of such Account.
(b) Subject to the provisions of Section
7.1 and Section 7.3(a), a Participant shall be
vested in the following applicable percentage of
Company Matching Contributions, depending upon
the number of Years of Service as further defined
in Section 2.1(vv).
Number of Years of Service Percentage
Less than one year 0%
One Year 20%
Two Years 40%
Three Years 60%
Four years 80%
Five years or more 100%
(c) The following are special rules applicable to vesting:
(1) Credit for Years of Service shall
be given to employees of companies merged
with Colonial Companies, Inc. and/or
subsidiaries beginning with the last
employment date with such companies only if
agreed to by Colonial Companies, Inc.
pursuant to the merger or acquisition.
(2) Hours of Service with the Company
will include the service with any Affiliate
for the period in which the companies are
related. Service will also be counted for
organizations that are part of an affiliated
service group under Section 414(m) of the
Code. For purposes of vesting, subject to
the exceptions of Section 411(a)(4) of the
Code, any service with a predecessor company
will be credited toward an Employee's Years
of Service.
(3) Service of a person who is a
leased Employee of the Company or any
Affiliate aggregated under Sections 414(b),
(c), (m) or (n) of the Code will be credited
for vesting purposes whether or
not such Employee is eligible to participate
in the Plan.
<PAGE>
(4) Years of Service for vesting
purposes that accrue after five consecutive
one-year Breaks in Service shall not be
taken into account for purposes of
determining the vested portion of the
Company Matching Contributions which had
accrued prior to the first Break in Service.
(5) In the case of an Employee who is
on a leave of absence by reason of the
pregnancy of the Employee, the birth of a
child of the Employee or the adoption of a
child by such Employee, or for purposes of
caring for such child for a period
immediately following such birth or
placement, solely for purposes of
determining whether such Employee has
incurred a Break of Service, such Employee
shall be credited with Hours of Service on
the basis of eight hours for each normal
business day of the Company, provided that
the Hours of Service taken into account
pursuant to this Section 7.3(c)(5) shall be
taken into account in the year the leave of
absence begins and are necessary to prevent
a Break in Service, or in any other case, in
the immediately following year. The maximum
number of Hours of Service taken into
account pursuant to this Section 7.3(c)(5)
shall not exceed 501.
(d) When a Participant receives a
distribution of the vested portion of his Company
Matching Contributions under this Section 7.3,
the portion of the Company Matching Contributions
which are not vested as of his termination of
employment shall become a Forfeiture in the
quarter of the Plan Year in which such
distribution occurs. If the Participant resumes
service with the Company the amount of the
Forfeiture shall be reinstated to the
Participant's Account, provided the Participant
repays to the Plan the full amount of the
distribution attributable to Company Matching
Contributions before the earlier of the fifth
anniversary of the date of such resumption of
employment or the date the Participant incurs
five consecutive one year Breaks in Service
following the date of distribution. The distributed
amount repaid to the Trust and the restored Forfeitures
shall be credited to the Account from which was distributed
or forfeited as of the Valuation Date coincident
or next following the date of repayment. The
Retirement Committee, in its sole discretion, may
restore Forfeitures of a Participant by either
charging such restored Forfeitures against other
Forfeitures or additional Company Matching
Contributions specially allocated to such accounts
(without regard to the existence of net or
accumulated profits), and except as provided in
this section, the accounts of other Participants
shall not be adjusted on account of such
reinstatement.
<PAGE>
(e) In the case of in-service withdrawals in
which the Participant is not 100% vested in his
Account or a Participant who does not receive a
distribution in connection with his Severance from
Service, the nonvested portion of his Accounts
(which is not distributed) will remain in separate
Accounts under the Plan and will become a
Forfeiture after five consecutive one-year
breaks in service. If the Participant is
reemployed prior to the occurrence of a
Forfeiture, such Accounts will be maintained
separately until he becomes 100% vested. His
vested interests attributable to such separate
Accounts ("X") shall be determined (prior to 100%
vesting), at the time his participation in the
Plan subsequently terminates, in accordance with
the following formula:
X = P(AB + (R X D)) - (R X D)
For purposes of applying the formula:
P = the vested percentage at the time of termination of
employment; AB is the Account balance at such time; D is
the amount of the distribution; R is the ratio of the Account
balance at such time to the Account balance after distribution.
13. Effective January 1, 1989, Section 12.1 shall be deleted
and the following inserted in its place:
12.1 Reserved Power to Modify, Suspend or
Terminate. (a) The Company through action of its
Board reserves the right to amend, modify, suspend or
terminate the Plan. The Company shall promptly
give notice of such amendment, modification,
suspension or termination to all Participants and
Beneficiaries affected thereby.
(b) Notwithstanding any other provision of
the Plan to the contrary, upon the date of either
full or partial termination of the Plan, or, if
applicable, the date of complete discontinuance of
contributions to the Plan, an affected
Participant's right to his benefits shall be fully
vested and 100% non-forfeitable. Payment of such
amounts to each Participant or Beneficiary upon
termination of the Plan or upon the complete
discontinuance of contributions under the Plan,
shall be made by the Trustee at such time and in
such manner as directed by the Retirement
Committee, in such manner and in such form as the
Retirement Committee may prescribe through uniform
and non-discriminatory rules.
<PAGE>
(c) If the vesting schedule of the Plan is
amended, then the following special rules will
apply:
(1) Every Employee who is a Participant on
the date the amendment is adopted, or the
date the amendment is effective, if later,
will have a nonforfeitable percentage
(determined as of such date) of such
Participant's Account balance derived from
Company Matching Contributions of not less
than his percentage computed under the Plan
without regard to such amendment.
(2) Each Participant whose non-forfeitable
percentage of his Account from Company
Matching Contributions is determined under
the new schedule and who has completed at
least three Years of Service with the
Company, may elect, during the election
period, to have the non-forfeitable
percentage of his Accounts derived from
Company Matching Contributions determined
without regard to such amendment. For
purposes of this paragraph,
the term "election period" means the period
beginning with the date on which the Plan
amendment is adopted and ending on the later
of:
(A) the date which is sixty days after
the day the Plan amendment is
adopted;
(B) the date which is sixty days after
the day the Plan amendment becomes
effective, or
(C) the date which is sixty days after
the day the Participant is issued
written notice of the Plan
amendment by the Company or Plan
Administrator.
(d) No amendment shall be made to this Plan
which shall reduce the accrued benefit of a
Participant within the meaning of Section
411(d)(6) of the Code, except to the extent
permitted under Section 412(c)(8) of the Code.
An amendment which has the effect of decreasing a
Participant's account balance or eliminating an
optional form of benefit with respect to benefits
attributable to service before the amendment shall
be treated as reducing an accrued benefit.
<PAGE>
IN WITNESS WHEREOF, the Company has caused the amendment to be
executed by their duly authorized officer as of the date and year
first above written.
WITNESSES: COLONIAL COMPANIES, INC.
/s/ Paulette S. Barrs By: /s/ Robert E. Staton
/s/ Michael I. Leet Sr. Vice President/Corporate Secretary
(Title)
