As filed with the Securities and Exchange Commission on October 2, 1997
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________________
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
BIOJECT MEDICAL TECHNOLOGIES INC.
(Exact name of Registrant as specified in its charter)
Oregon
(State or other jurisdiction
of incorporation or organization)
93-1099680 7620 SW Bridgeport Road
(I.R.S. Employer Portland, Oregon 97224
Identification No.) (503) 639-7221
(Address of principal executive offices)
Bioject Inc. 401(k) Retirement Benefit Plan
(Full title of the plan)
Peggy J. Miller
Chief Financial Officer
7620 SW Bridgeport Road
Portland, Oregon 97224
(Name and address of agent for service)
(503) 639-7221
(Telephone number, including area code, of agent for service)
Title of Securities Amount to be Proposed Maximum Proposed Amount of
to be Registered Registered Offering Price Maximum Registration
Per Share(1) Aggregate Fee(1)
Offering Price
Common Stock,no par 100,000 $1.00 $100,000.00 $30.30
value shares
(1)The proposed maximum offering price per share and the registration fee
were calculated in accordance with rule 457(c) and (h) based on the average of
the high and low prices for shares of the registrant's Common Stock on
September 29, 1997, as quoted by the Nasdaq National Market, which was $1.00
per share.
In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
registration statement also covers an indeterminate amount of interests to be
offered or sold pursuant to the employee benefit plan described herein.
<PAGE> 1 OF
PART II.INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
Bioject Medical Technologies Inc. (the "Registrant") and the Bioject Inc.
401(k) Retirement Benefit Plan (the "Plan") hereby incorporate by reference
into this Registration Statement the documents listed in (a) through (d)
below.
(a)The Registrant's latest Annual Report on Form 10-K filed pursuant
to Section 13(a) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), for the Company's fiscal year
ended March 31, 1997.
(b)The Plan's latest annual report on Form 11-K filed pursuant to
Section 15(d) of the Exchange Act for the Plan's fiscal year ended December
31, 1997.
(c)All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the filings, referred to in (a) and (b) above.
(d)The description of the Registrant's Common Stock contained in the
Registrant's registration statement under Section 12 of the Exchange Act,
dated January 29, 1987, and any amendment or report updating such description,
including without limitation, Amendment No. 1 thereto dated October 5, 1987,
Amendment No. 2 thereto dated October 26, 1987, Amendment No. 3 thereto dated
December 23, 1987, Amendment No. 4 thereto dated January 27, 1988 and
Amendment No. 5 thereto dated February 9, 1988, the Company's Current Reports
on Form 8-K dated December 17, 1992, November 29, 1995 and December 14, 1995.
All documents filed by the Registrant pursuant to Section 13(a), 14, or 15(d)
of the Exchange Act after the date hereof and prior to the filing of a post-
effective amendment which indicates that all securities offered have been sold
or which deregisters all securities then remaining unsold shall be deemed to
be incorporated by reference herein and to be part hereof from the date of
filing of such documents.
Item 4.Description of Securities
Not applicable.
Item 5.Interests of Named Experts and Counsel.
None.
Item 6.Indemnification of Directors and Officers.
Generally, Sections 60.387 through 60.414 of the Oregon Business
Corporation Act (the "Act") authorize a court to award, or a corporation's
board of directors to grant, indemnification to directors and officers in
circumstances where the officer or director acted in good faith, in a manner
that the director or officer reasonably believed to be in (or at least not
opposed to) the best interests of the corporation and, if in a criminal
proceeding, if the director or officer had no reasonable cause to believe his
conduct was unlawful. Article IX of the Registrant's Bylaws provides for
indemnification to the greatest extent permitted by the Oregon Act.
Section 60.047 of the Oregon Act authorizes a corporation to limit a
director's liability to the corporation or its shareholders for monetary
damages resulting from conduct as a director, except in certain circumstances
involving breach of the director's duty of loyalty to the corporation or its
shareholders, intentional misconduct or knowing violation of the law, self
dealing or approval of illegal corporate loans or distributions, or any
transaction from which the director personally receives a benefit in money,
property or services to which the director is not legally entitled.
Article VII of the Company's Articles of Incorporation contains provisions
implementing, to the fullest extent allowed, limitations on a director's
liability to the Registrant or its shareholders. The Registrant currently
maintains officers' and directors' liability insurance.
<PAGE> II-1
Item 7.Exemption from Registration Claimed.
Not applicable.
Item 8.Exhibits.
Exhibit
Number
4.1 Bioject Inc. 401(k) Retirement Benefit Plan
5.1 Opinion of Bogle & Gates P.L.L.C.
23.1 Consent of Bogle & Gates P.L.L.C. (included in Exhibit 5.1)
23.2 Consent of Independent Public Accountants
24.1 Power of Attorney (See page II-6 of this Registration
Statement)
The Registrant hereby undertakes to submit the Plan and any amendment
thereto to the Internal Revenue Service ("IRS") in a timely manner and will
make all changes required by the IRS to qualify the Plan.
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:
(i)To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii)To reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range may
be reflected in the form of prospectus filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the changes in volume and price represent no
more than 20 percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective registration
statement;
(iii)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; rovided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the registration statement is on Form S-3, Form S-8 or Form F-3 and
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant
to Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in this 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.
<PAGE> II-2
(b)The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Exchange Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act, (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be deemed to be
a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(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 of
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.
<PAGE> II-3
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Act of 1933,
the Plan Administrator has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the
city of Portland, Oregon on this 2nd day of October, 1997.
BIOJECT MEDICAL TECHNOLOGIES INC., Plan
Administrator of the Bioject Inc. 401(k) Retirement Benefit Plan
By:/s/ Peggy J. Miller
Peggy J. Miller
Chief Financial Officer
<PAGE> II-4
The Registrant. Pursuant to the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the city of Portland, Oregon on this 2nd day
of October, 1997.
BIOJECT MEDICAL TECHNOLOGIES INC.
By:/s/ Peggy J. Miller
Peggy J. Miller
Chief Financial Officer
<PAGE> II-5
Power of Attorney
Each person whose signature appears below constitutes and appoints James
C. O'Shea and Peggy J. Miller, or either of them, his attorney-in-fact, with
the power of substitution, for him in any and all capacities, to sign any
amendments to this Registration Statement, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, hereby ratifying and confirming all that said attorneys-
in-fact, or their substitute or substitutes, may do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
/s/James C. O'Shea Chairman of the Board, October 1, 1997
James C. O'Shea Chief Executive Officer
and President (Principal
Executive Officer)
/s/Peggy J. Miller Vice President, Chief October 1, 1997
Peggy J. Miller Financial Officer and
Secretary/Treasurer
(Principal Accounting and
Financial Officer)
/s/William A. Gouveia Director September 30, 1997
William A. Gouveia
/s/John Ruedy, M.D. Director October 1, 1997
John Ruedy, M.D.
Grace Keeney Fey Director
/s/Eric T. Herfindal Director September 30, 1997
Eric T. Herfindal
/s/Richard J. Plestina Director September 30, 1997
Richard J. Plestina
/s/David H. de Weese Director September 30, 1997
David H. de Weese
<PAGE> II-6
Exhibit
Number Exhibit
4.1 Bioject Inc. 401(k) Retirement Benefit Plan
5.1 Opinion of Bogle & Gates P.L.L.C.
23.1 Consent of Bogle & Gates P.L.L.C. (included in
Exhibit 5.1)
23.2 Consent of Independent Public Accountants
24.1 Power of Attorney (See page II-6 of this
Registration Statement)
<PAGE> II-7
Exhibit 5.1
OPINION OF BOGLE & GATES P.L.L.C.
October 2, 1997
Bioject Medical Technologies Inc.
7620 S.W. Bridgeport Road
Portland, OR 97224
Gentlemen and Ladies:
We are delivering this opinion in connection with the Registration
Statement on Form S-8 (the "Registration Statement") of Bioject
Medical Technologies Inc. (the "Company") to be filed with the
Securities and Exchange Commission under the Securities Act of 1933,
as amended (the "Securities Act"), with respect to an aggregate of
100,000 shares, without par value, of common stock of the Company
(the "Shares") to issued by the Company as plan administrator of the
Bioject, Inc. 401(k) Retirement Benefit Plan (the "Plan").
We have examined and are familiar with originals or copies, certified
or otherwise identified to our satisfaction, of such documents,
corporate records and other instruments relating to the incorporation
of the Company and to the authorization and issuance of the Shares,
and have made such investigations of law, as we have deemed necessary
and advisable.
Based upon the foregoing and having due regard for such legal
questions as we have deemed relevant, we are of the opinion that the
Shares have been duly authorized, and, when issued,
constitute or will constitute duly authorized, legally issued, fully
paid and nonassessable shares of common stock of the Company.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement referred to above, and to the reference to our firm
in the Prospectus constituting a part of the Registration Statement.
Very truly yours,
/s/ Bogle & Gates P.L.L.C.
Exhibit 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Form S-8 Registration Statement of our report dated
May 2, 1997 included in the Bioject Medical Technologies, Inc. Annual Report
on Form 10-K for the fiscal year ended March 31, 1997 and to all references to
our Firm included in this Registration Statement.
/S/ ARTHUR ANDERSEN LLP
Portland, Oregon
September 29, 1997
EXHIBIT 4.1
BIOJECT, INC.
RETIREMENT BENEFIT PLAN
AND TRUST AGREEMENT
COPYRIGHT 1996
BENNER & ASSOCIATES P.C.
ALL RIGHTS RESERVED
BIOJECT, INC.
RETIREMENT BENEFIT PLAN
AND TRUST AGREEMENT
INDEX
Section 1 ESTABLISHMENT OF PLAN AND TRUST
Establishment of Plan and Trust
Establishment of Trust
Named Fiduciaries
Allocation of Responsibilities
Funding Policy
Related Employers
Section 2 DEFINITIONS
Act and ERISA
Account
Accrued Benefit
Administrator
Anniversary Date
Annual Compensation
Beneficiary
Benefit Commencement Date
Break in Service
Code
Company Stock and Employer Securities
Disability
Early Retirement Date
Eligible Employee
Employee
Employee Elective Deferrals
Employer
Forfeiture
Highly Compensated Employee
Hour of Service
Non-Highly Compensated Employee
Normal Retirement Date
Participant
Plan Benefit
Plan Year
Qualified Matching Contributions
Qualified Nonelective Contributions
Related Employer(s)
Trustee
Year of Service
Section 3 ADMINISTRATION
Assignment of Administrative Authority
Organization and Operation
Powers and Duties
Records and Reports
Payment of Expenses
Agent for Service of Process
Indemnity
Personal Data to Administrator
Address for Notification
Section 4 ELIGIBILITY
Eligibility
Active Participation
Continued Participation
Reemployment
Bargaining Unit Employees
Nonresident Aliens
Section 5 CONTRIBUTIONS
Employee Elective Deferrals
Employer Matching Contributions
Employer Supplemental Contributions
Top-Heavy Minimum Contributions
ACP Test for Employee and Matching Contributions
Excess Employer Contributions
Conditional Employer Contributions
Time of Payment
Single Plan for Employees of Related Employers
Profit Sharing Contributions
Section 6 ALLOCATION OF CONTRIBUTIONS AND FORFEITURES
Participant Elective Deferrals
Employer Matching Contributions
Employer Supplemental Contributions
Partial Year Allocation of Employer Supplemental
Contributions
Top-Heavy Minimum Contributions
500 Hour Rule Adjustments
ADP Booster Allocation
Related Employers
Overall Limitation on Allocations
Section 7 PARTICIPANTS' ACCOUNTS
Participants' Accounts
Valuation of Assets
Nonreversion
Adjustment of Accounts
Segregated Accounts
Participant-Directed Accounts
Valuation of Accounts
Transferred Accounts
Section 8 VESTING
Participant Elective Deferrals
Employer Contributions
Retirement, Death and Disability
Vesting Years of Service
Forfeitures
Allocation of Forfeitures
Separate Accounts For Post- and Pre-Break Benefits of
Rehired Participants
Treatment of Forfeitures on Rehire
Special Account--Rehire Prior to Forfeiture
Amendment of Vesting Schedule
Transferred or Rollover Accounts
Forfeiture Due to Inability to Locate
Section 9 BENEFITS
Retirement
Death
Disability
Termination of Employment
Minimum Required Distributions
Income Tax Withholding and Reporting
Spendthrift Clause
Missing Participants or Beneficiaries
Segregated Accounts
Section 10 FORM AND TIME OF PAYMENT
Benefit Elections
Benefit Options
Time of Payment of Benefits
Latest Benefit Commencement Date
Time of Payment of Death Benefits
Distributions Upon Sale of Assets
Distributions Upon Sale of Subsidiary
Waiver of 30 Day Notice
Section 11 INVESTMENT OF TRUST FUND
Investment Authority
Investment Standard
Participants' Accounts
Investments in Bank Deposits, Common Trust Funds and
Insurance Contracts
Prohibited Transactions
Bonding of Fiduciary
Indemnity of Trustee
Proxy Voting by Investment Managers
Investment in Company Stock
Section 12 TRUSTEE
Powers of Trustee
Payments From the Trust
Trustee's Compensation, Expenses and Taxes
Certification of Instructions
Accounting
Settlement of Accountings
Determination of Duties
Removal, Resignation and Appointment of Successor
Trustee
Co-Trustee Actions
Receipt of Contributions
Section 13 INSURANCE
Purchase of Insurance not Permitted
Section 14 PARTICIPANT LOANS
General
Section 15 HARDSHIP WITHDRAWALS
Employer Contributions
Participants' Elective Deferrals
Additional Limitations on Hardship Withdrawals
In-Service Distributions From Rollover Contribution
Account
Multiple Fund
Withholding on Withdrawals
Section 16 ROLLOVERS AND PLAN TRANSFERS
Rollovers
Transfers--Qualified Plans
Prohibited Transfers From Defined Benefit Pension Plans
Accounting for Transferred Funds
Mergers, Consolidations and Transfers of Plan Assets
Section 17 AMENDMENT AND TERMINATION
Amendment
Restrictions on Amendment
Effective Date of Amendments
Termination and Discontinuance of Contributions
Distribution of Trust
Liquidation of Trust
Dissolution of Employer
Section 18 QUALIFIED DOMESTIC RELATIONS ORDER
General
Distributions under QDRO
Time and Manner of Payment
Procedures
Section 19 OVERALL LIMITATION ON ALLOCATIONS
No Participation in any Other Plan
Participation in Another Defined Contribution Plan
Definitions
Participation in Defined Benefit Plan
Section 20 TOP-HEAVY PROVISIONS
General
Top-Heavy Year
Definitions
Top-Heavy Provisions
Section 21 CLAIMS PROCEDURE
Filing of Claim
Notification of Decision
Request for Review
Review
Section 22 MISCELLANEOUS PROVISIONS
No Contractual Relationship
Liability for Benefits
Inability to Perform
Participant's Rights
Plan and Trust Binding on all Parties
Conflict of Law Provisions
Waiver of Notice
Third Party
Use of Terms
USERRA Provisions
BIOJECT, INC.
RETIREMENT BENEFIT PLAN
AND TRUST AGREEMENT
This Restated Plan and Trust Agreement is hereby
adopted by Bioject, Inc., an Oregon corporation with its
principal place of business at Portland, Oregon.
The Employer has heretofore adopted the Bioject, Inc.
Retirement Benefit Plan and Trust.
Employer has amended and restated the Plan and Trust in
order to comply with the Tax Reform Act of 1986 and subsequent
legislation.
The Effective Date of the amendment and restatement of
this Plan and Trust shall be January 1, 1996.
For Plan Years beginning before the Effective Date set
forth above, the terms of the Plan prior to its restatement shall
control for purposes of the designated provision.
The amendment of any plan provision which liberalizes a
protected benefit under Section 411(d)(6) of the Code shall apply
on the later of the adoption date or the Effective Date of this
Restated Plan. Any provision which liberalizes the eligibility,
vesting or benefit accrual provisions of the Plan shall only
apply to Employees who are credited with at least one Hour of
Service after the Effective Date or the Effective Date specified
for a particular provision.
Section 1
ESTABLISHMENT OF PLAN AND TRUST
Establishment of Plan and Trust . Each
Participating Employer (collectively referred to as "Employer")
has adopted this Plan and the Trust for the exclusive benefit of
its Employees and their Beneficiaries with the intention that the
Plan and Trust qualify under Sections 401 and 501 of the Code and
comply with the Act. A Participating Employer shall be a Related
Employer which adopts the Plan through the execution of a
Participating Employer's Agreement. All of the plan assets are
available to pay benefits to all Employees of Employer who are
covered by the Plan and their Beneficiaries.
Establishment of Trust . Each Employer adopting
this Plan agrees to make the contributions required by the terms
of the Plan. All amounts received from an Employer, together
with the income therefrom (hereinafter called the "Trust Fund"),
shall be held, managed and administered IN TRUST pursuant to the
terms of this Plan and any separate Trust Agreement. The assets
of the Trust Fund shall be held under one Trust, except as
otherwise provided herein. Trustee, by executing the separate
Trust Agreement, accepts the Trust created under the separate
Trust Agreement and agrees to perform its duties hereunder with
respect to the Trust Fund.
Named Fiduciaries . Trustee, Employer and
Administrator shall be the named fiduciaries under the Plan.
Allocation of Responsibilities .
Administration of Plan. Administrator shall
have the authority to manage and control the operation and
administration of the Plan pursuant to Section 3.
Custody of Assets. Trustee shall have the
custody of the assets of the Trust Fund pursuant to
Section 12.
Management of Assets. The authority to
manage and control the assets of the Trust Fund shall be
vested in the Trustee and the Participants pursuant to
Section 11.
Funding Policy . The funding policy of the Plan
shall be to make contributions to the Trust and investments
thereof to provide for retirement benefits for the Participants
and their Beneficiaries.
Related Employers . For purposes of determining
eligibility, continued participation, Employer Contributions and
limitations thereto, accrual of benefits, Forfeitures and
vesting, all Employees of all Related Employers shall be treated
as employed by a single Employer to the extent and in the manner
provided herein.
Section 2
DEFINITIONS
When used herein, the following words shall have the
following meanings, unless the context clearly indicates
otherwise:
"Act" and "ERISA " shall mean the Employee
Retirement Income Security Act of 1974, as amended.
"Account " shall mean the records maintained by
the Administrator pursuant to this Plan for the purpose of
determining the accrued benefit of a Participant or Beneficiary.
The Administrator may maintain one or more subaccounts for a
Participant as necessary to accurately reflect the interest of
the Participant. Each Participant's accrued benefit under the
Plan shall be equal to the combined balance of all the
subaccounts maintained for the Participant.
"Accrued Benefit " shall mean the balance in a
Participant's Account.
"Administrator " shall mean the Employer.
"Anniversary Date " shall mean the last day of the
Plan Year.
"Annual Compensation " shall mean wages as defined
in Section 3401(a) for the purposes of income tax withholding at
the source, but determined without regard to any rules that limit
the remuneration included in wages based on the nature or
location of the employment or the services performed (such as the
exception for agricultural labor in Section 3401(a)(2)).
The Annual Compensation of each Participant taken into
account under the Plan for any year 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 Section 401(a)(17)(B) of
the Code. 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, and the denominator of which
is 12.
In determining the compensation of a Participant for
purposes of this limitation, the rules of Section 414(q)(6) of
the Code shall apply, except that in applying such rules, the
term "family" shall include only the spouse of the Participant
and any lineal descendants of the Participant who have not
attained age 19 before the close of the year. If, for a Plan
Year, the combined Annual Compensation of the Employee and such
family members who are Participants entitled to an allocation for
that Plan Year exceeds the adjusted $150,000 limitation, "Annual
Compensation" for each such Participant for purposes of the
contribution and allocation provisions means his Adjusted Annual
Compensation. Adjusted Annual Compensation is the amount which
bears the same ratio to the adjusted $150,000 limitation as the
affected Participant's Annual Compensation (without regard to the
Annual Compensation limitation) bears to the combined
Annual Compensation of all the affected Participants in the
family unit.
"Beneficiary " shall mean any individual, trustee
or other entity who, by the terms of any contract, the terms of
the Plan or because of the designation by the Participant
pursuant to the terms of the Plan, is entitled to receive any
amount or benefit in the event of a Participant's death.
"Benefit Commencement Date " shall mean the first
date of the first period for which Plan Benefits become payable
to a Participant, Alternative Payee or Beneficiary. The Benefit
Commencement Date shall be the date benefits first become
payable. A payment shall not be considered to occur after the
Benefit Commencement Date merely because actual payment is
reasonably delayed for administrative reasons including delay for
calculation of the benefit amount.
"Break in Service " means a Plan Year during which
an Employee has not completed more than 500 Hours of Service.
One-Year Break in Service means a Plan Year
during which an Employee has not completed more than 500
Hours of Service.
Five-year Break in Service means 5
consecutive 1 year Breaks in Service.
With respect to any short Plan Year, the required
number of hours shall be a prorated number of hours based upon
the number of months less than 12 in the period. However, a
Participant shall not incur a 1-year Break in Service because of
any authorized leave of absence granted by the Employer pursuant
to a uniform nondiscriminatory policy in which the Participant
returns to employment within the prescribed time.
Solely for purposes of determining whether a Break in
Service for participation and vesting purposes has occurred in a
computation period, an Employee who is absent from work for
maternity or paternity reasons shall receive credit for the Hours
of Service which would otherwise have been credited to such
Employee but for such absence. In any case in which such hours
cannot be determined, eight Hours of Service per day of such
absence shall be credited. An absence from work for maternity or
paternity reasons means an absence (a) by reason of the pregnancy
of the Employee, (b) by reason of a birth of a child of the
Employee, (c) by reason of the placement of a child with the
Employee in connection with the adoption of such child by such
Employee, or (d) for purposes of caring for such child for a
period beginning immediately following such birth or placement.
The Hours of Service credited under this paragraph shall be
credited (a) in the computation period in which the absence
begins if the crediting is necessary to prevent a Break in
Service in that period, or (b) in all other cases, in the
following computation period.
The "Code " shall mean the Internal Revenue Code
of 1986, as amended, and any succeeding statute of substantially
similar effect.
"Company Stock " and "Employer Securities" shall
mean Qualified Employer Securities as defined in and limited by
ERISA and the Code.
"Disability " shall mean the inability to engage
in the further performance of the Participant's normal employment
activity with the Employer by reason of any medically
determinable physical or mental impairment that can be expected
to result in death or which has lasted or can be expected to last
for a continuous period of not less than 12 months, or by reason
of a permanent loss of a member or function of the body or
permanent disfigurement. The above definition shall apply to any
"Disability" occurring on or after the later of the Effective
Date or the date this Restated Plan is executed by Employer. The
definition in the old plan shall apply to any disability
occurring prior to said date. The permanence and degree of such
impairment shall be supported by medical evidence.
"Early Retirement Date ." The Plan shall have no
Early Retirement Date.
"Eligible Employee " means an Employee who has
satisfied the eligibility requirements of Section 4 herein. An
Eligible Employee shall be a Participant in the Plan.
"Employee " shall mean any individual considered
to be a common law employee who is either actually employed or
available to accept an assignment under the normal employment
practice of Employer or of any Related Employer required to be
aggregated with Employer under Sections 414(b), (c), (m) or (o)
of the Code.
The term Employee shall also include any Leased
Employee deemed to be an Employee of any Employer described in
the previous paragraph as provided in Sections 414(n) or (o) of
the Code.
The term "Leased Employee" means any person (other than
an Employee of the recipient) who pursuant to an agreement
between the recipient and any other person ("leasing
organization") has performed services for the recipient (or for
the recipient and related persons determined in accordance with
Section 414(n)(6) of the Code) on a substantially full time basis
for a period of at least 1 year, and such services are of a type
historically performed by Employees in the business field of the
recipient Employer. Contributions or benefits provided a Leased
Employee by the leasing organization which are attributable to
services performed for the recipient Employer shall be treated as
provided by the recipient Employer.
A Leased Employee shall not be considered an Employee
of the recipient if: (a) such Employee is covered by a money
purchase pension plan providing: (i) a nonintegrated Employer
Contribution rate of at least 10 percent of compensation, as
defined in Section 415(c)(3) of the Code, but including amounts
contributed by the Employer pursuant to a salary reduction
agreement which are excludable from the Employee's gross income
under Section 125, Section 402(e)(3), Section 402(h) or Section
of the Code, (ii) immediate participation, and (iii) full
and immediate vesting; and (b) Leased Employees do not constitute
more than 20 percent of the recipient's non-highly compensated
work force.
"Employee Elective Deferrals " shall mean the
contributions made by active Participants pursuant to Section 5
herein.
"Employer " shall include:
Bioject, Inc.;
Any "Participating Employer" which is a
Related Employer, executes a Participating Employer
Agreement and has Employees who are required to be
aggregated with Employer under Sections 414(b), (c), (m), or
of the Code; and
Any successor business to a Participating
Employer which shall adopt and maintain the Plan.
"Forfeiture " shall mean the non-vested portion of
a Participant's Account which shall not become part of the Plan
Benefit.
"Highly Compensated Employee " shall include
highly compensated active Employees and highly compensated former
Employees.
A highly compensated active Employee includes any
Employee who performs service for the Employer during the
determination year and who, during the look-back year:
received compensation from the Employer in excess of $75,000
(as adjusted pursuant to Section 415(d) of the Code);
received compensation from the Employer in excess of $50,000
(as adjusted pursuant to Section 415(d) of the Code) and was a
member of the top-paid group for such year; or (c) was an officer
of the Employer and received compensation during such year that
is greater than 50 percent of the dollar limitation in effect
under Section 415(b)(1)(A) of the Code. The term Highly
Compensated Employee also includes: (i) Employees who are both
described in the preceding sentence if the term "determination
year" is substituted for the term "look-back year" and the
Employee is one of the 100 Employees who received the most
compensation from the Employer during the determination year; and
Employees who are 5 percent owners at any time during the
look-back year or determination year.
If no officer has satisfied the compensation
requirement of (c) above during either a determination year or
look-back year, the highest paid officer for such year shall be
treated as a Highly Compensated Employee.
For this purpose, the determination year shall be the
Plan Year. The look-back year shall be the 12-month period
immediately preceding the determination year.
For purposes of this section, "compensation" means
compensation as defined in Section 2.6, without any exclusions,
and compensation must include "Elective Deferrals" (as defined in
Section 2.16). The Administrator must make the determination of
who is a Highly Compensated Employee, including the
determinations of the number and identity of the top paid
percent group, the top 100 paid Employees, the number of
officers includible and the relevant compensation, consistent
with Section 414(q) of the Code 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.
A highly compensated former Employee includes any
Employee who separated from service (or was deemed to have
separated) prior to the determination year, performs no service
for the Employer during the determination year, and was a highly
compensated active Employee for either the separation year or any
determination year ending on or after the Employee's 55th
birthday.
If an Employee is, during a determination year or
look-back year, a family member of either a 5 percent owner who
is an active or former Employee or a Highly Compensated Employee
who is one of the 10 most Highly Compensated Employees ranked on
the basis of compensation paid by the Employer during such year,
then the family member and the 5 percent owner or top-ten Highly
Compensated Employee shall be aggregated. In such case, the
family member and 5 percent owner or top-ten Highly Compensated
Employee shall be treated as a single Employee receiving
compensation and Plan contributions or benefits equal to the sum
of such compensation and contributions or benefits of the family
member and 5 percent owner or top-ten Highly Compensated
Employee. For purposes of this section, family member includes
the spouse, lineal ascendants and descendants of the Employee or
former Employee and the spouses of such lineal ascendants and
descendants.
The family aggregation rule applies to a family member
even if that family member is a Highly Compensated Employee
without family aggregation.
The determination of who is a Highly Compensated
Employee, including the determinations of the number and identity
of Employees in the top-paid group, the top 100 Employees, the
number of Employees treated as officers and the compensation that
is considered, will be made in accordance with Section 414(q) of
the Code and the regulations thereunder.
"Hour of Service " shall be:
Each hour for which an Employee is paid or
entitled to payment by Employer for the performance of
duties during the applicable period; and
Each hour for which an Employee is paid, or
entitled to payment, by the Employer on account of a period
of time during which no duties are performed (irrespective
of whether the employment relationship has terminated) due
to vacation, holiday, illness, incapacity (including
Disability), layoff, jury duty, military duty or leave of
absence. For purposes of determining Hours of Service, a
payment shall be deemed to be made by or due from the
Employer regardless of whether such payment is made by or
due from the Employer directly, or indirectly through, among
others, a trust fund, or insurer, to which the Employer
contributes or pays premiums and regardless of whether
contributions made or due to the trust fund, insurer, or
other entity are for the benefit of particular Employees or
are on behalf of a group of Employees in the aggregate. No
more than 501 Hours of Service will be credited under this
paragraph for any single continuous period (whether or not
such period occurs in a single computation period). Hours
under this paragraph will be calculated and credited
pursuant to Section 2530.200b-2 of the Department of Labor
Regulations which is incorporated herein by this reference;
and
Each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to by the
Employer.
The same Hours of Service will not be credited
both under paragraph (a) or paragraph (b), as the case may
be, and under this paragraph (c). These hours will be
credited to the Employee for the computation period or
periods to which the award or agreement pertains rather than
the computation period in which the award, agreement or
payment is made.
Hours of Service will be credited for employment
with other members of an affiliated service group (under
Section 414(m) of the Code), a controlled group of
corporations (under Section 414(b) of the Code), or a group
of trades or businesses under common control (under Section
of the Code) of which the adopting Employer is a
member, and any other entity required to be aggregated with
the Employer pursuant to Section 414(o) of the Code and the
regulations thereunder. Such hours will be credited
hereunder regardless of whether such other member or entity
has adopted this Plan; excluding, however, service during
periods when Employer was not a member of the group or
required to be aggregated.
Hours of Service will also be credited for any
individual considered an Employee for purposes of this Plan
under Section 414(n) of the Code covering Leased Employees
or Section 414(o) of the Code and the regulations
thereunder.
Hours of Service will be determined on the
basis of actual hours worked for which an Employee is paid
or entitled to payment as provided herein.
"Non-Highly Compensated Employee " shall mean an
Eligible Employee who is not a Highly Compensated Employee and
who is not a family member of a Highly Compensated Employee as
defined in Section 2.19.
"Normal Retirement Date " shall mean the date the
Participant attains age 65.
"Participant " shall mean an Eligible Employee.
"Plan Benefit " shall mean the nonforfeitable
interest in a Participant's Account(s) other than the amount of
any corrective distributions of excess deferrals or excess
contributions and any earnings attributable thereto.
"Plan Year " shall mean the year on which the Plan
records are kept, which shall be the 12-month period beginning on
the first day of January of each year and ending on the last day
of December.
"Qualified Matching Contributions " means Employer
Matching Contributions which are 100 percent fully vested when
made and are distributed only in accordance with the distribution
provisions applicable to Employee Elective Deferrals.
"Qualified Nonelective Contributions " means
Employer Supplemental and Employer Booster Contributions which
are 100 percent fully vested when made and are distributable only
in accordance with the distribution provisions applicable to
Employee Elective Deferrals.
"Related Employer(s) " shall include all
corporations which are members of a controlled group of
corporations (as defined in Section 414(b) of the Code), all
trades or businesses (whether or not incorporated) which are
under common control (as defined in Section 414(c) of the Code)
and all members of an affiliated service group (as defined in
Section 414(m) and (o) of the Code) with the Employer.
"Trustee " shall mean Jim O'Shea and Peggy J.
Miller, or any successor designated herein.
"Year of Service " shall mean the computation
period during which the Employee has performed at least 1,000
Hours of Service with Employer. The computation period shall be
a 12 consecutive month period except less than 12 months may
result from a change in computation period.
For accrual of benefit purposes, the period
shall be Plan Years.
For vesting purposes, the computation period
shall be the Plan Year
If an Employer maintains the plan of a
predecessor employer, service with the predecessor employer
shall be treated as service with Employer for purposes of
eligibility and vesting under this Plan.
Section 3
ADMINISTRATION
Assignment of Administrative Authority . The
Employer shall be the "Administrator" of the Plan and shall be
responsible for the administration of the Plan. The
Administrator may delegate, from time to time, by written
instrument, all or any part of its administrative
responsibilities and duties hereunder to a person, persons or
organization (including Trustee). If no such written delegation
of authority is made, the Board of Directors of Employer shall
act on behalf of Employer as the Administrator. Any such person,
persons or organization may resign by delivery of a written
resignation to Employer. Vacancies arising by resignation,
death, removal or otherwise shall be filled by Employer. The
reasonable expenses of such person, persons or organization in
carrying out its authority shall be an expense of the
administration of the Trust, unless an Employer elects to pay
such expenses.
Organization and Operation . Administrator shall
act by a majority of its members at the time in office, and such
action may be taken either by a vote at a meeting or by unanimous
consent in writing without a meeting.
Administrator may authorize any one or more of its
members to execute any document or documents on behalf of
Administrator, in which event Administrator shall notify Trustee
in writing of such action and the name or names of its member or
members so designated. Trustee shall thereafter accept and rely
upon any document executed by such member or members as
representing action by Administrator until Administrator shall
file with Trustee a written revocation of such designation.
Administrator may adopt such bylaws and regulations as
it deems desirable for the conduct of its affairs, and may
appoint such accountants, counsel, specialists and other persons
as it deems necessary or desirable in connection with the
administration of the Plan. Administrator shall be entitled to
rely conclusively upon and shall be fully protected in any action
taken by it in good faith in relying upon any opinions or reports
which shall be furnished to it by such accountant, counsel or
other specialist.
Powers and Duties . Administrator shall have the
primary responsibility for the administration and operation of
the Plan and shall have all powers necessary to carry out the
provisions of the Plan. The Administrator shall have the
discretionary authority to determine all questions arising in the
administration, interpretation and application of the Plan and
the interpretation of the Administrator shall be final and
binding on all parties unless such interpretation is found to be
arbitrary and capricious, made in bad faith or erroneous as a
matter of law.
The Administrator under its discretionary authority
shall:
Determine the eligibility of each Employee
for participation in the Plan.
Establish and maintain Participants' Accounts
under the Plan.
Determine the benefits hereunder to which
Participants and their Beneficiaries are entitled.
Authorize all disbursements by Trustee from
the Trust.
Set down uniform and nondiscriminatory rules
of interpretation and administration to the extent necessary
or appropriate, which may be modified from time to time in
light of Administrator's experience.
Publish and file or disclose or cause to be
published and filed or disclosed all reports and disclosures
required by ERISA.
Direct or assist Trustee in notifying
Participants and their Beneficiaries of their elections with
respect to withholding requirements applicable to benefit
payments and to withhold from such payments, unless
Administrator has directed Trustee to withhold.
Obtain from Participants and their
Beneficiaries elections with respect to forms of payment of
benefits and obtain spousal consent and waivers where
required.
Hear and decide Participant claims pursuant
to the Plan's claims procedure.
Regulate participant loans.
Records and Reports . Administrator shall keep
records of its proceedings and acts, and shall keep such books of
account, records and other data as may be necessary or
appropriate for proper administration of the Plan. Administrator
shall maintain records with respect to each Participant
sufficient to determine the benefits due or which may become due
to such Participant. Administrator shall report to each
Participant with respect to accrued benefits if such Participant
requests such a report in writing pursuant to the Act. Said
report shall be sufficient, based upon the latest information
available, to inform the Participant of his Plan Benefit under
the Plan and the percentage of such benefits which are
nonforfeitable under the Plan. Administrator shall be
responsible for reporting and disclosure requirements under the
Act relating to the Plan, unless another fiduciary of the Plan
has agreed to undertake responsibility for one or more specific
requirements.
Payment of Expenses . Unless otherwise determined
by the Employer, or if Administrator is a full-time Employee of
an Employer or an affiliated Employer, Administrator shall serve
without compensation for services as such. Employer may elect to
pay all expenses of Administrator. Such expenses shall include
any expenses incident to the functioning of Administrator,
including, but not limited to, fees of accountants, counsel and
other specialists, and other costs of administering the Plan. If
an Employer does not elect to pay such expenses, they shall be
paid from the Trust Fund.
Agent for Service of Process . The agent for
service of process for the Plan and Trust shall be the Plan
Administrator. No Participant or Beneficiary is entitled to any
notice of process unless required by the Act.
Indemnity . If the Administrator is an officer,
director or employee of an Employer, Employer agrees to indemnify
Administrator against any and all claims, loss, damage, expense
or liability arising from any action or failure to act, except
when the same is judicially determined to be due to the gross
negligence or willful misconduct of Administrator or such member.
Personal Data to Administrator . Each Participant
and each Beneficiary of a deceased Participant must furnish to
the Administrator such evidence, data or information as the
Administrator 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
Administrator, provided the Administrator advises each
Participant of the effect of his failure to comply with its
request.
Address for Notification . Each Participant and
each Beneficiary of a deceased Participant must file with the
Administrator 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
Administrator, or as shown on the records of the Employer, binds
the Participant, or Beneficiary, for all purposes of this Plan.
Section 4
ELIGIBILITY
Eligibility .
All Employees who have attained age 21 shall
be eligible to participate on their date of hire. Any
Employees who have not attained age 21 on their date of hire
shall be eligible to participate when they attain age 21.
An Employee who satisfies the eligibility
requirement shall become an Eligible Employee on the first
Entry Date which occurs after the date the eligibility
requirement is satisfied. Entry Dates shall be January 1
and July 1 of each Plan Year.
Active Participation .
An Eligible Employee shall become an active
Participant in the cash or deferred portion of the Plan when
he has agreed in writing to have Elective Deferrals to the
Plan deducted from his earnings in accordance with
Section 5. Participation shall commence on the
Participant's Entry Date and shall continue until modified
or terminated.
An active Participant may elect in writing at
any time to suspend his Elective Deferrals and to become an
inactive Participant. Any such election shall be effective
as of the pay period designated by the Employee, but not
earlier than the first pay period of the following month.
Continued Participation . Temporary layoffs and
leaves of absence granted by Employer shall not be deemed to be a
termination of employment. Any Participant who fails to return
to active employment at or before the expiration of his leave of
absence shall be deemed to have terminated his employment as of
the date of expiration of his leave of absence, except that
should he fail to return because of death or Disability, his
service shall be deemed to have continued until the date of his
death or the termination of his employment for Disability.
Employer, in granting leaves of absence, shall follow uniform
rules which shall be consistently applied so that all
Participants similarly situated shall be treated alike.
Reemployment . If a Participant is rehired after
termination of employment with Employer, his Years of Service
prior to termination of employment shall be counted for purposes
of eligibility and he shall be eligible to participate in the
Plan on his reemployment commencement date.
If a Participant becomes ineligible to participate
because he is no longer a member of an eligible class of
Employees, such Employee shall participate immediately upon his
return to an eligible class of Employees.
If an Employee who is not a member of the eligible
class of Employees becomes a member of the eligible class, such
Employee shall participate immediately if such Employee has
satisfied the eligibility requirements and would have previously
become a Participant had he been in the eligible class.
Bargaining Unit Employees . If an Employee is or
shall become included in a unit of Employees covered by a
collective bargaining agreement between Employee representatives
and Employer, and if retirement benefits were the subject of
good-faith bargaining between such Employee representatives and
Employer, and if 2 percent or less of the Employees who are
covered pursuant to the collective bargaining agreement are
professionals as defined in Section 1.410(b)-9(g) of the
regulations, then any Employee included in such a unit shall not
be eligible to participate or to continue to participate in this
Plan unless the Employee's coverage under this Plan was provided
for in the collective bargaining agreement. The term "employee
representatives" does not include any organization of which more
than one-half of whose members are Employees who are owners,
officers or executives of an Employer.
Nonresident Aliens . Those Employees who are
nonresident aliens and who receive no earned income from the
Employer which constitutes income from sources within the United
States shall not be eligible to participate in the Plan.
Section 5
CONTRIBUTIONS
Employee Elective Deferrals .
Salary Reduction Arrangement. Each Eligible
Employee may elect to enter into a Salary Reduction
Agreement with the Employer to reduce Annual Compensation
earned, including cash bonuses. This amount shall be
contributed to the Plan by the Employer on the Employee's
behalf and shall be considered an Elective Deferral.
Limitations on Elective Deferrals. Elective
Deferrals for Eligible Employees to the Plan are subject to
the following limitations:
Elective Deferrals for any
Eligible Employee shall not exceed the $7,000 (adjusted
for cost of living increases) annual limit described in
Section 5.1(d) or shall be adjusted as set forth in
Section 5.1(d)(ii);
Elective Deferrals shall
not violate the ADP test described in Section 5.1(e)
without being adjusted as provided in
Section 5.1(e)(iii); and
Elective Deferrals shall be
subject to the overall limitation on contributions and
benefits set forth in Section 19, and the maximum
amount allowable as a deduction under the provisions of
Section 404 of the Code, as amended.
Employee Elective Deferral Procedures.
Employer shall contribute Elective Deferrals for Eligible
Employees as follows:
Each Eligible Employee
shall be entitled to elect to reduce his Annual
Compensation by a scheduled percentage or amount and to
have Employer contribute the elected amount to the Plan
instead of paying such amount to the Eligible Employee
in cash.
The elective amounts or
percentages shall be limited to 15 percent of the
Eligible Employee's Annual Compensation.
Salary Reduction type
Elective Deferrals shall be withheld from the
applicable Employee's compensation each pay period by
means of payroll deductions and shall be credited to
the Employee's Elective Deferral Account.
An election to make
Elective Deferrals must be made by the Employee in
writing and shall be effective as of the pay period
designated by the Employee. Administrator may
establish rules and procedures regarding the method,
frequency, notice and adjustments required for Elective
Deferrals which will allow a Participant a reasonable
period at least once each calendar year during which a
Participant may terminate or modify the amount or
frequency of Elective Deferrals.
If a Participant desires to
increase the total to be withheld for a Plan Year
within the overall limits permitted by the Plan, the
Participant may authorize the withholding of a
supplemental amount up to 100 percent of his or her
Annual Compensation for one or more subsequent pay
periods.
$7,000 Annual Limit on Elective Deferrals.
Annual Limit. The total
amount of Elective Deferrals made on behalf of any
Eligible Employee during a calendar year shall not
exceed the applicable limit contained in Section 402(g)
of the Code. The limit shall be $7,000 as adjusted for
increases in cost of living as of the beginning of each
calendar year (hereinafter referred to as the $7,000
(indexed) limit). The $7,000 (indexed) limit shall be
determined after any corrective distributions which
have been previously made to comply with or within the
applicable calendar years. In determining the $7,000
(indexed) limit, the following Elective Deferrals must
be taken into account with respect to each Eligible
Employee: (a) Elective Deferrals under this Plan and
any other Employer Contributions made on behalf of such
Participant pursuant to an election to defer under any
qualified cash or deferred arrangement (CODA) as
described in Section 401(k) of the Code; (b) any
employer contribution pursuant to a salary reduction
arrangement under a simplified employee pension cash or
deferred arrangement as described in Section
(1)(B); (c) any employee contribution under a
plan as described under Section 501(c)(18), any
employer contributions made on the behalf of a
Participant for the purchase of an annuity contract
pursuant to a salary reduction agreement under Section
of the Code. The $7,000 (indexed) limit may be
adjusted (but not to exceed $9,500) for deferrals to a
annuity to the extent permitted by Treasury
Regulations.
Corrective Distribution of
Excess Elective Deferrals. If Administrator determines
that a Participant's Elective Deferrals scheduled to be
contributed to the Plan for a calendar year would
exceed the $7,000 (indexed) limitation in a calendar
year, Administrator may reduce or suspend the
Participant's Elective Deferrals for the remainder of
the calendar year. If a Participant has participated
in or is participating in any other cash or deferred
arrangement which is taken into account in determining
the $7,000 (indexed) limitation, Participant may submit
a written claim to Administrator for any excess
Elective Deferrals made under this Plan for a calendar
year. The claim must be submitted by the March 1
following the close of the calendar year for which the
deferral was made and the claim must specify the amount
of Employee's Elective Deferrals made under this Plan
which are in excess of the aggregate $7,000 (indexed)
limit. To the extent administratively feasible, a
corrective distribution of any claimed Excess Deferral
amounts (and earnings attributable thereto) or any such
amounts designated by the Administrator may be made to
the Participant prior to the April 15 following the
calendar year for which the deferral was made.
Determination of Earnings.
Any corrective distribution of Excess Deferrals which
are caused by the $7,000 (indexed) annual limitation
shall be adjusted for any earnings allocable to such
Excess Deferrals. Earnings includes all income (or
loss) and any realized or unrealized appreciation or
depreciation in the value of applicable plan assets.
The earnings attributable to the Excess Deferrals
is the income or loss allocable to the Participant's
Elective Deferrals Account for the taxable year.
The earnings attributable to the Excess Deferrals
shall not include the income attributable for the period
from the end of such Plan Year to the date of distribution.
The determination of attributable income shall be made under
a reasonable method used consistently for all Participants
and all corrective distributions, is used for allocating
income to Participant's accounts under Section 7 herein, and
does not result in discrimination in favor of Highly
Compensated Employees. Income and loss allocable for the
period from the end of such Plan Year to the date of
distribution shall not be included.
ADP Test for Elective Deferrals.
General. The Actual
Deferral Percentage (hereinafter "ADP") for
Participants who are Highly Compensated Employees for
each Plan Year and the ADP for Participants who are
Non-Highly Compensated Employees for the same Plan Year
must satisfy one of the following tests:
The ADP for Participants
who are Highly Compensated Employees for the Plan
Year shall not exceed the ADP for Participants who
are Non-Highly Compensated Employees for the same
Plan Year multiplied by 1.25; or
The ADP for Participants
who are Highly Compensated Employees for the Plan
Year shall not exceed the ADP for Participants who
are Non-Highly Compensated Employees for the same
Plan Year multiplied by 2.0, provided that the ADP
for Participants who are Highly Compensated
Employees does not exceed the ADP for Participants
who are Non-Highly Compensated Employees by more
than 2 percentage points.
Non-Highly Compensated Highly Compensated
Less than 2% 2.0 multiplied by Non-HCE's
Percentage
to 8% 2% plus Non-HCE's Percentage
or more 1.25% multiplied by Non-
HCE's Percentage
Actual Deferral
Percentage. "Actual Deferral Percentage" shall
mean, for a specified group of Participants for a
Plan Year, the average of the ratios (calculated
separately for each Participant in such group) of
the amount of Elective Deferrals actually paid
over to the Trust on behalf of such Participant
for the Plan Year to (b) the Participant's
Compensation for such Plan Year. For purposes of
the Participant's initial Plan Year of
participation, Compensation shall only be counted
from the Participant's Entry Date.
For purposes of determining the
Actual Deferral Percentage, "Compensation" shall mean
Compensation as defined for purposes of Section 415 of
the Code in Section 19.3-2 herein increased by any
Elective Deferrals made under a Cash or Deferred
Arrangement under Section 401(k) of the Code.
Participant Elective Deferrals shall
include: (a) any Elective Deferrals made pursuant to
the Participant's deferral election, including excess
Elective Deferrals; and (b) at the election of
Administrator, Qualified Nonelective Contributions.
For purposes of computing Actual Deferral Percentages,
an Eligible Employee shall be taken into account as a
Participant even if no Elective Deferrals are made on
behalf of the Employee. Administrator may determine
the Actual Deferral Percentages by taking into account
Qualified Nonelective Contributions made to this Plan.
Deferral Adjustments.
Administrator may make periodic reviews of the deferral
percentages during the Plan Year, and if in the opinion
of the Administrator, it appears that the actual
deferral percentage for the Highly Compensated
Employees is going to exceed the limits set forth
above, Administrator may limit the rate of Elective
Deferrals for Highly Compensated Employees during the
Plan Year in any reasonable manner designed to comply
with the ADP test.
Excess Deferrals and
Corrective Distributions Under ADP Test. A corrective
distribution of any Excess Deferrals (adjusted for any
income or loss allocable thereto) shall be made to
Highly Compensated Employees no later than the end of
the Plan Year following the Plan Year for which the
Excess Deferrals were made. In determining the amount
of any Excess Deferrals and the Employees to whom
corrective distributions of Excess Deferrals are to be
made, the Elective Deferrals of Highly Compensated
Employees are reduced in the order of the actual
deferral percentages beginning with those Highly
Compensated Employees with the highest actual deferral
percentages. If the ADP test has not been satisfied
when the actual deferral rates of the Highly
Compensated Employee with the highest ratio has been
reduced to equal the ratio of the Highly Compensated
Employee with the next highest actual deferral ratio,
then the process shall be repeated until the ADP test
has been satisfied. The Excess Deferrals are to be
distributed to those Highly Compensated Employees for
whom a reduction is made in order to satisfy the ADP
test.
To the extent administratively
feasible, corrective distributions of excess
contributions shall be made within 2 1/2 months after the
end of the Plan Year with respect to which the
contribution was made in order to avoid a 10 percent
penalty tax on the Employer. The amount of Excess
Deferrals to be distributed pursuant to this section
shall be reduced by the amount of: (a) any Excess
Deferrals previously distributed to such Employee for
the Employee's taxable year ending with or within the
Plan Year; and (b) any Excess Deferral previously
distributed.
Determination of Allocable
Income or Loss. Any distribution of Excess Deferrals
which are caused by the application of the ADP test
shall be adjusted for any income or loss allocable to
such Excess Deferrals. The allocable income or loss
shall be determined in the same manner as provided
herein for determining the income or loss allocable to
excess Elective Deferrals caused by the $7,000
(indexed) limit. If Qualified Nonelective
Contributions are taken into account in the ADP test,
then the Participant's Qualified Nonelective
Contribution Account, if applicable, shall be combined
with the Participant's Elective Deferral Account in
making the determination. A reasonable method shall be
used for computing the income allocable to Excess
Deferrals which is used consistently for all
Participants and for all corrective distributions for
such year, which is used for allocating income and
earnings to Participant's accounts under Section 7
herein, and does not result in discrimination in favor
of Highly Compensated Employees. Income and loss
allocable for the period from the end of such Plan Year
to the date of distributions shall not be included.
Accounting for Excess
Deferrals. Excess Deferrals which are caused by the
application of the ADP test shall be distributed from
the Participant's Elective Deferral Account in
proportion to the Participant's Elective Deferrals.
Excess Deferrals shall be distributed from the
Participant's Qualified Nonelective Contribution
Account only to the extent that such Excess Deferrals
exceed the balance in the Participant's Elective
Deferral Account and Qualified Matching Contribution
Account.
Employer Booster
Contributions. Employer may elect to make a Booster
Contribution for all Non-Highly Compensated Employees
who are Eligible Participants under the Plan, in lieu
of distributing Excess Deferrals as provided in
paragraph (iv) above or Excess Aggregate Contributions
as provided in Section 5.6(b). The Employer Booster
Contribution must meet the requirements of a Qualified
Nonelective Contribution as defined in Section 2.27 and
shall be allocated only to the accounts of Non-Highly
Compensated Employees who are Eligible Participants.
The amount of the contribution shall be such amounts as
are sufficient to satisfy either the ADP test or ACP
test, or both, pursuant to regulations under the Code.
The allocation will be based on the ratio of the
Non-Highly Compensated Employee Participant's Annual
Compensation to the Total Annual Compensation of all
Non-Highly Compensated Participants for the Plan Year.
Special Rules for ADP Test.
More Than One Plan--Same
Employee. The ADP for any Participant who is a
Highly Compensated Employee for the Plan Year and
who is eligible to make Elective Deferrals under
two or more arrangements described in
Section 401(k) of the Code, that are maintained by
the Employer, shall be determined as if such
Elective Deferral were made under a single
arrangement. If a Highly Compensated Employee
participates in two or more cash or deferred
arrangements that have different Plan Years, all
cash or deferred arrangements ending with or
within the same calendar year shall be treated as
a single arrangement.
More Than One Plan--
Combined Testing. In the event that this Plan
satisfies the requirements of Sections 401(k),
(4) or 410(b) of the Code only if aggregated
with one or more other plans, or if one or more
other plans satisfy the requirements of such
sections of the Code only if aggregated with this
Plan, then this section shall be applied by
determining the ADP of Employees as if all such
plans were a single plan. Plans may be aggregated
in order to satisfy Section 401(k) of the Code
only if they have the same Plan Year. An Employee
Stock Ownership Plan may not be aggregated with
this Plan.
Family Unit Rule. For
purposes of determining the ADP of a Participant
who is a 5 percent owner or one of the 10 most
highly-paid Highly Compensated Employees, the
Elective Deferrals of and Compensation of such
Participant shall include Elective Deferrals and
Compensation for the Plan Year of family members
(as defined in Section 414(q)(6) of the Code).
Family members, with respect to such Highly
Compensated Employees shall be disregarded as
separate Employees in determining the ADP both for
Participants who are Non-Highly Compensated
Employees and for Participants who are Highly
Compensated Employees. A single ADP shall be
calculated for the family members as if the family
members were one Participant. The ADP of the
family unit is determined by combining the
Elective Deferrals and Compensation of all family
members, including those who are Non-Highly
Compensated Employees.
Time for Correcting
Excess. For purposes of determining if the ADP
test has been satisfied, corrective distributions
of Elective Deferrals must be made before the last
day of the 12-month period immediately following
the Plan Year to which contributions relate.
Maintain Records.
Employer shall maintain records sufficient to
demonstrate satisfaction of the ADP test used in
such test.
Rounding. Actual
deferral ratios and percentages shall be
calculated to the nearest one-hundredth of
percent of Annual Compensation.
Employer Matching Contributions .
Employer may make Matching Contributions in
such amounts as may be determined by the Employer each year.
Matching Contributions shall not violate the
ACP test described herein without being adjusted as provided
in Section 5.5.
Matching Contributions shall be subject to
the overall limitation on contributions and benefits set
forth in Section 19, and the maximum amount allowable as a
deduction under the provisions of Section 404 of the Code,
as amended.
Matching Contributions which are 100 percent
nonforfeitable and comply with the distribution restrictions
applicable to Employee Elective Deferrals may be considered
to be Qualified Matching Contributions.
Employer Supplemental Contributions .
General. The Employer may make Supplemental
Contributions in such amounts as may be determined by the
Employer each Plan Year.
Supplemental Contributions shall be subject
to the overall limitation on contributions and benefits set
forth in Section 19 and the maximum amount allowable as a
deduction under the provisions of Section 404 of the Code,
as amended.
Supplemental Contributions which are
percent nonforfeitable and comply with the distribution
restrictions applicable to Employee Elective Deferrals may
be considered as Qualified Nonelective Contributions.
Top-Heavy Minimum Contributions . If the Plan is
a top-heavy plan for a Plan Year, the Employers shall contribute
to the Plan for the benefit of and allocate to all Non-Key
Employee Participants who have not separated from service at the
end of the Plan Year, a Top-Heavy Minimum Contribution pursuant
to Section 20.4(b) herein.
ACP Test for Employee and Matching Contributions .
General. Employer Matching Contributions and
the allocation thereof must meet the Actual Contribution
Percentage test (the "ACP" test). The ACP test is the same
as the ADP test in Section 5.1(e) except that Employer
Matching Contributions are tested instead of Employee
Elective Deferrals and Qualified Employer Matching
Contributions taken into account under the ADP test shall
not be counted under the ACP test.
Multiple Use Limitation. If one or more
Highly Compensated Employees is included in the ADP test and
in the ACP test, then the sum of the ADP and the ACP for
those Highly Compensated Employees may not exceed the
multiple use limitation. The multiple use limitation is the
sum of:
125 percent of the greater
of (a) the ADP of the Non-Highly Compensated Employees
for the Plan Year, or (b) the ACP of Non-Highly
Compensated Employees under the Plan subject to Section
of the Code for the Plan Year beginning with or
within the Plan Year of the CODA; and
2 percent plus the lesser
of (i)(a) or (i)(b), but no more than twice the lesser
of such ADP or ACP.
For Plan Years beginning prior to the
later of January 1, 1992, or 60 days after the Treasury
issues final regulations under Section 401(m) of the
Code, the Administrator, in lieu of determining the
multiple use limitation as the sum of (i) and (ii)
above, may elect to determine the multiple use
limitation as the sum of (iii) and (iv) below.
125 percent of the lesser
of: (a) the ADP of the Non-Highly Compensated
Employees under the Plan; or (b) the ACP of the
Non-Highly Compensated Employees for the Plan Year
beginning with or within the Plan Year of the Plan.
2 percent plus the greater
of (iii)(a) or (iii)(b), but no more than twice the
greater of (iii)(a) or (iii)(b).
Special Rules for ACP Test.
Definitions. For purposes
of the ACP test, the following definitions shall apply.
"Average Contribution
Percentage" shall mean the average of the
Contribution Percentages of the Eligible
Participants in a group.
"Contribution Percentage"
shall mean the ratio (expressed as a percentage)
of the Participant's Contribution Percentage
Amounts to the Participant's Compensation for the
Plan Year. For purposes of the Participant's
initial Plan Year of participation, Compensation
shall only be counted from the Participant's Entry
Date.
"Compensation" shall mean
Compensation as defined for purposes of Section
of the Code in Section 19.3-2 herein increased
by any Elective Deferrals made under a Cash or
Deferred Arrangement under Section 401(k) of the
Code.
"Contribution Percentage
Amounts" shall mean the sum of the Employee
Elective Deferrals, Employer Matching
Contributions and Qualified Matching Contributions
(to the extent not taken into account for purposes
of the ADP test) made under the Plan on behalf of
the Participant for the Plan Year. Such
Contribution Percentage Amounts shall include
Forfeitures of Excess Aggregate Contributions or
Matching Contributions allocated to the
Participant's Account which shall be taken into
account in the year in which such Forfeiture is
allocated. Administrator may include Qualified
Nonelective Contributions in the Contribution
Percentage Amounts. Administrator also may elect
to use Elective Deferrals in the Contribution
Percentage Amounts so long as the ADP test is met
before the Elective Deferrals are used in the ACP
test and continues to be met following the
exclusion of those Elective Deferrals that are
used to meet the ACP test.
"Eligible Participant"
shall mean any Employee who is eligible to make an
Employee Contribution, or an Elective Deferral (if
the Employer takes such contributions into account
in the calculation of the Contribution
Percentage), or to receive a Matching Contribution
(including Forfeitures) or a Qualified Matching
Contribution. If an Employee Contribution is
required as a condition of participation in the
Plan, any Employee who would be a Participant in
the Plan if such Employee made such a contribution
shall be treated as an Eligible Participant on
behalf of whom no Employee Contributions are made.
"Employee Contribution"
shall mean any contribution made to the Plan by or
on behalf of a Participant that is included in the
Participant's gross income in the year in which
made and that is maintained under a separate
account to which earnings and losses are
allocated.
"Matching Contribution"
shall mean an Employer Contribution made to this
or any other defined contribution plan on behalf
of a Participant on account of an Employee
Contribution made by such Participant, or on
account of a Participant's Elective Deferral,
under a plan maintained by the Employer.
For purposes of the ACP
test, the Contribution Percentage for any Participant
who is a Highly Compensated Employee and who is
eligible to have Contribution Percentage Amounts
allocated to his or her account under two or more plans
described in Section 401(a) of the Code, or
arrangements described in Section 401(k) of the Code
that are maintained by the Employer, shall be
determined as if the total of such Contribution
Percentage Amounts was made under each Plan.
The special rules
applicable to the ADP test under Section 5.1(e)(vii)
shall apply to the ACP test.
Excess Employer Contributions .
General. Excess Aggregate Contributions,
plus any income and minus any loss allocable thereto, shall
be forfeited, if forfeitable, or if not forfeitable,
distributed no later than the last day of each Plan Year to
Participants to whose accounts such Excess Aggregate
Contributions were allocated for the preceding Plan Year.
If such Excess Aggregate Contributions are distributed more
than 2 1/2 months after the last day of the Plan Year in which
such excess amounts arose, a 10 percent excise tax will be
imposed on the Employer maintaining the Plan with respect to
those amounts.
"Excess Aggregate Contributions" shall mean, with
respect to any Plan Year, the excess of:
The aggregate Contribution
Percentage Amounts taken into account in computing the
numerator of the Contribution Percentage actually made
on behalf of Highly Compensated Employees for such Plan
Year, over
The maximum Contribution
Percentage Amounts permitted by the ACP test
(determined by reducing contributions made on behalf of
Highly Compensated Employees in order of their
Contribution Percentages beginning with the highest of
such percentages).
Such determination shall be made after first
determining excess Elective Deferrals and then determining
excess Employer Contributions.
Excess Aggregate Contributions shall be allocated
to Participants who are subject to the family member
aggregation rules of Section 414(q)(6) of the Code in the
manner prescribed by the regulations. Excess Aggregate
Contributions shall be treated as annual additions under the
Plan.
Disposition of Excess Employer Contributions.
Excess Employer Contributions and attributable earnings
shall be distributed and forfeited as follows:
The vested portion of the
excess amount shall be distributed to the Participant
on whose behalf the contribution was made within the 2 1/2
months after the end of the Plan Year with respect to
which the contribution was made in order to avoid a
percent penalty tax imposed on the Employer.
The non-vested portion of
the excess amount shall be forfeited and allocated in
the same manner as Forfeitures of Employer Matching
Contributions that gave rise to the excess amount are
allocated. No such Forfeiture shall be allocated to
the account of any Highly Compensated Employee who
incurred the Forfeiture.
Accounting for Excess Aggregate
Contributions. Excess Aggregate Contributions shall be
forfeited, if forfeitable, or distributed in the following
priority:
First as attributable to
the Participant's Employee Nondeductible Contribution
Account, if any;
Then, as Employer Matching
Contributions allocable with respect to Excess
Deferrals determined under the ADP test described in
Section 5.1(e), then on a pro rata basis to Employer
Matching Contributions and to the Employee Elective
Deferrals relating to those Matching Contributions
which have been included in the ACP test; and
Last, to the Participant's
Qualified Nonelective Contributions used in the ACP
test.
Determination of Income or Loss. Excess
Aggregate Contributions shall be adjusted for any income or
loss. The income or loss allocable to Excess Aggregate
Contributions is the income or loss allocable to the
Participant's Employee Contribution Account, Matching
Contribution Account (if any, and if all amounts therein are
not used in the ADP test) and, if applicable, Qualified
Nonelective Contribution Account and Elective Deferral
Account for the Plan Year, and shall be determined under a
reasonable method used consistently for all Participants and
all corrective distributions, which is used for allocating
income to Participant's accounts under Section 7 herein, and
does not result in discrimination in favor of Highly
Compensated Employees. Income and loss allocable for the
period from the end of such Plan Year to the date of
distribution shall not be included.
Conditional Employer Contributions .
Conditional Contributions. All Employer
Contributions made by Employer under this Plan to this Trust
are conditioned upon the deductibility of such contributions
under Section 404 of the Code.
Return to Employer. Upon Employer's request,
an Employer Contribution may be returned to Employer if the
surrounding facts and circumstances indicate that:
The contribution is
attributable to a good-faith mistake of fact; or
In the case of a
disallowance of a deduction of a contribution
conditioned on its deductibility under the Code, a good
faith mistake is made in determining the deductibility
of the contribution.
The return to Employer of the amount of the
contribution involved must be made within 1 year of the
mistaken payment of the contribution, or the date of
disallowance of the deduction, as the case may be. The
return to Employer may occur even if a resulting adjustment
is made to the accounts of Participants which are partially
or entirely nonforfeitable under Section 8 herein. The
amount which may be returned shall be the excess of (a) the
amount contributed over (b): (i) the amount that would have
been contributed had there not occurred a mistake of fact,
or (ii) the amount that would have been contributed had the
deduction been limited to the amount that is deductible
after any disallowance. Earnings attributable to the
contribution to be returned may not be returned to Employer,
but losses attributable thereto must reduce the amount to be
returned. If the withdrawal of the amount attributable to
the mistaken or nondeductible contribution would cause the
balance of the individual account balance of any Participant
to be reduced to less than the balance which would have been
in the account had the mistaken or nondeductible amount not
been contributed, then the amount to be returned shall be
limited so as to avoid such reduction.
Time of Payment . Employer shall pay to Trustee
its contribution for each year on or before the time prescribed
by law for such year, and such contribution shall be treated as
though it was paid on the last day of such year unless otherwise
designated.
Single Plan for Employees of Related Employers .
Contributions made by each Participating Employer shall be made
to and considered to be a contribution to a single plan and used
to pay benefits for all Participants under the Plan except as
otherwise provided in Employer's Plan.
Profit Sharing Contributions . All Employer
Contributions shall be considered to be made to a Profit Sharing
Plan and shall be made without regard to current or accumulated
earnings and profits for the taxable year or years ending with or
within such Plan Year. The Profit Sharing Plan shall continue to
be designed to qualify as a Profit Sharing Plan for purposes of
Sections 401(a), 402, 412 and 417 of the Code.
Section 6
ALLOCATION OF CONTRIBUTIONS AND FORFEITURES
Participant Elective Deferrals . Participant
Elective Deferrals shall be credited to the accounts of the
Participants making such contributions.
Employer Matching Contributions . Administrator,
as of each Anniversary Date, shall allocate Employer Matching
Contributions for the year to each Participant who has made an
Elective Deferral during the Plan Year. subject to the following
conditions:
The Participant must have performed at least
Hours of Service during the Plan Year;
The allocation shall be based only upon the
first 6 percent of the Participant's Annual Compensation
received during the Plan Year;
If the contribution is made in Company Stock
the allocation shall be whole shares of Company Stock, with
fractional shares rounded up to the nearest whole share; and
Annual allocations of Employer Matching
Contributions shall be subject to the ACP test set forth in
Section 5.
Employer Supplemental Contributions .
Administrator, as of each Anniversary Date, shall allocate
Employer's Supplemental Contribution and any Forfeitures for the
year to the account of each Participant as follows:
Restoration of Forfeitures. First, any
amounts required to be allocated pursuant to Section 8.8
(relating to the buy-back of previously forfeited amounts)
or Section 9.8 (relating to the restoration of amounts
forfeited which occurred because the Participant could not
be located) to restore previously forfeited amounts shall be
so allocated.
Second, the balance, if any, shall be
allocated to the Accounts of those active Participants who
have performed at least 1,000 Hours of Service during the
Plan Year in proportion to the ratio which each
Participant's Annual Compensation for the year bears to the
Annual Compensation of all Participants for the year.
Partial Year Allocation of Employer Supplemental
Contributions .
Initial Year of Participation. With respect
to the Plan Year in which an Employee initially commences
participation, Employer Supplemental Contributions shall be
based upon the Participant's Annual Compensation from the
Participant's Entry Date to the end of the Plan Year.
Termination Year Allocation. With respect to
whether a Participant shall share in an allocation of Employer
Supplemental Contributions and Forfeitures, if any, for the Plan
Year during which the Participant terminates employment, a
Participant shall not share in such an allocation for the Plan
Year during which the Participant terminates employment, unless
the Participant completes at least 1,000 Hours of Service during
the Plan Year of termination and Participants who are not
employed on the last day of the Plan Year shall not receive an
allocation of Employer Contributions and Forfeitures.
Top-Heavy Minimum Contributions . Employer
Top-Heavy Minimum
Contributions shall be allocated as provided under Section 20.4
herein.
500 Hour Rule Adjustments . If more than 500
Hours of Service are required to be performed or if employment on
the last day of the Plan Year is required in order for a
Participant to share in an Employer Contribution (other than a
Top-Heavy Minimum Contribution) then the following shall apply.
If either or both of the above requirements would result in the
Plan not being able to satisfy the coverage requirements under
Section 410(b) of the Code and the regulations thereunder, then
an allocation shall be made to a sufficient number of otherwise
Eligible Employees as is necessary to comply with the
Section 410(b) requirements. The selection of the Eligible
Employees who shall share in the allocation shall be made as
follows. Those with the latest date of termination of employment
with Employer and continuing in descending order from the latest
to the earliest termination date, until the Plan satisfies the
Section 410(b) tests for the Plan Year.
ADP Booster Allocation . Administrator may elect
to make an ADP Booster Allocation to all Non-Highly Compensated
Employees who are Eligible Participants under the Plan from
Employer's Supplemental Contribution before making the regular
allocation set forth in Section 6.3 above. The ADP Booster
allocation must meet the requirements of a Qualified Nonelective
Contribution as defined in Section 2.27 and shall be allocated
only to the accounts of Non-Highly Compensated Employees who are
Eligible Employees. The amount of the allocation shall be such
amounts as are sufficient to satisfy either the ADP test or ACP
test, or both, pursuant to regulations under the Code. The
allocation will be based on the ratio of the Non-Highly
Compensated Employee Participant's Annual Compensation to the
Total Annual Compensation of all Non-Highly Compensated
Participants for the Plan Year.
Related Employers . If two or more Related
Employers (members of a controlled or affiliated service group)
contribute to this Plan, Employer Contributions and Forfeitures
shall be allocated to each Participant in the Plan without regard
to which contributing group member employs the Participant.
For purposes of determining and allocating a
Participating Employer's Contribution, a Participant's
compensation includes compensation from all Participating
Employers. If a Participant receives compensation from more than
one Participating Employer during a Plan Year, Administrator
shall determine Employer's Contribution and allocations to
Participant by prorating the Participant's compensation among the
Participating Employers.
Overall Limitation on Allocations . The
allocation made to a Participant's Account(s) each Plan Year
shall be subject to the additional limitations contained in
Section 19 herein.
Section 7
PARTICIPANTS' ACCOUNTS
Participants' Accounts . The Administrator shall
maintain a separate account for each Participant, separately
recording the Participant's interest in:
Employee Elective Deferrals;
Employer Matching Contributions;
Employer Supplemental Contributions;
Employer Top-Heavy Minimum Contributions;
Rollover Contributions.
The Trustee shall hold all assets of the Plan in a
single, commingled fund and no Participant shall have any
interest in an individual asset of the Trust Fund, except as
otherwise provided in Section 11.
Valuation of Assets . Trustee, as of the last day
of each calendar quarter of the Plan Year (the Valuation Date)
and at such other time or times as Administrator shall direct in
order to avoid material distortion or otherwise to administer the
Trust Assets, which time shall be the "interim Valuation Date,"
shall determine the net worth of the assets of the Trust Fund and
report such value to Administrator in writing. In determining
such net worth, Trustee shall evaluate the assets of the Trust
Fund at their fair market value as of such Valuation Date and
shall deduct all expenses for which the Trustee has not yet
obtained reimbursement from Employer or from the Fund. Such
valuation shall not include any Employer Contributions made for
the Plan Year ending as of such Valuation Date.
Nonreversion . Under no circumstances shall any
part of the corpus or income of the Trust (including Forfeitures)
ever revert to or inure to the benefit of Employer or be used for
any purpose whatsoever other than for the exclusive purposes of
providing benefits to Participants in the Plan and their
beneficiaries and defraying reasonable expenses of administering
the Plan, except as provided in Section 5.7.
Adjustment of Accounts . As of each Valuation
Date (and at such interim Valuation Date as Administrator shall
direct), and before crediting the amount of any contributions and
Forfeitures for the year allocated to the Participants,
Administrator shall adjust and make allocations to the accounts
of Participants, as follows:
Each account shall be adjusted for payments
made to the Participant or Beneficiary or for his benefit
during the period including withdrawals under Section 9.
A Participant's Elective Deferral Account
shall be credited with any deferrals made by that
Participant during the period and not previously credited to
his accounts.
Each Participant shall be credited with the
appropriate portion of the Employer Contributions during the
period which have not previously been credited to his
account.
In the case of a Forfeiture during the Plan
Year, there shall be subtracted the amount of the
Forfeiture.
The net realized income or loss of the
account for the period and any net increase or decrease in
the fair market value of the account shall be credited to or
charged to each account.
In the case of Participants whose accounts
have been segregated, no allocation shall be made to their
account.
The time determined by Administrator for
adjustment hereunder shall be the "Valuation Date" which
shall be at least once each Plan Year.
Segregated Accounts . Segregated accounts shall
be separately adjusted for increases or decreases in the value of
the segregated account since the last Valuation Date and shall
not be adjusted for assets not specifically earmarked to the
segregated account.
Participant-Directed Accounts . A Participant-
Directed Account, to the extent authorized by the Administrator,
shall be treated as a segregated account for purposes of
accounting for increases or decreases in the value of the
account.
Valuation of Accounts . Should a Participant
terminate employment, retire, become disabled or die, his
accounts shall be valued on the Valuation Date preceding or
coinciding with such occurrence adjusted for any payments to or
withdrawals made by the Participant and further adjusted for
Elective Deferrals made by the Participant and any Employer
Contributions subsequent to the preceding Valuation Date. If the
terminated Participant's Account is not fully distributed to him
or segregated prior to a subsequent Valuation Date, the valuation
shall be made as of the Valuation Date preceding or coinciding
with the date of distribution or segregation.
Transferred Accounts . Assets received on behalf
of a Participant as rollovers and assets transferred from other
plans shall be accounted for in a separate account. Transfers
from other plans and rollovers may be combined with the
Participant's Account(s) under this Plan when the Participant's
Account(s) under this Plan becomes fully vested, unless required
to be separately accounted for.
Section 8
VESTING
Participant Elective Deferrals . A Participant's
interest in his Elective Deferral Account shall be fully vested
regardless of his Years of Service upon becoming a Participant
under the Plan.
Employer Contributions . Except as provided in
Section 5.7 with respect to Conditional Employer Contributions
and Section 8.3, a Participant's interest in his Employer
Contribution Accounts shall be subject to graduated vesting in
accordance with the following schedule:
Plan Years of Service Vested Interest
Less than 2 years 0%
years but less than 3 50%
years or more 100%
Retirement, Death and Disability . A
Participant's interest in his Employer Contribution Account(s)
shall be fully vested regardless of his Years of Service upon the
occurrence of (a) attainment of Normal Retirement Date; (b) death
while still employed by Employer; or (c) Disability.
Vesting Years of Service . For the purpose of
determining Years of Service for vesting purposes:
The vesting computation period shall be the
Plan Year. The Employee need not be employed at the
beginning or the end of the vesting computation period if at
least the required number of Hours of Service have been
performed during the period.
In determining vesting Years of Service, all
Years of Service with the Employer shall be counted.
Years of Service after a 1-year Break in
Service shall not be taken into account to increase a
Participant's vested percentage in an Account balance
accrued prior to the 1-year Break in Service if the
Participant incurs a 5-year Break in Service. Separate
accounts shall be established to account for pre-break and
post-break Accrued Benefits.
Forfeitures . A Forfeiture will be deemed to
occur when the Participant terminates employment with Employer
and has received a cash-out distribution upon termination of
participation in the Plan, or terminated employment with Employer
without any vested interest under the Plan.
A Forfeiture can only occur at the designated time if
the terminated Participant previously received a cash-out
distribution following termination of employment with Employer.
A cash-out distribution made to a terminated Participant not
later than the end of the second Plan Year following the Plan
Year in which the termination occurred is deemed to be made on
termination and qualifies as a cash-out distribution. A cash-out
distribution must consist of the Participant's entire vested
account balance(s). If the vested value of the Participant's
account balance(s) is zero upon termination (due to a 100 percent
Forfeiture), the Participant shall be deemed to have received a
cash-out distribution of the accrued benefit and the Forfeiture
of the non-vested account balance(s) shall occur at the end of
the Plan Year in which the Participant's termination occurs.
Allocation of Forfeitures . Any amount in a
Participant's Account which is not vested upon the Participant's
termination of employment in accordance with the Plan's vesting
schedule shall be held in an unallocated account in accordance
with the following procedure:
If the Participant resumes employment prior
to the time when a Forfeiture occurs, the Account shall be
credited back to his Participant Account.
If the Participant does not resume employment
prior to the time when a Forfeiture occurs, the account
shall be forfeited and shall be reallocated and applied on
the last day of the Plan Year during which the Forfeiture
occurs in accordance with the provisions of the Plan
applicable at that time.
The account shall share in allocations of
Trust income and losses and market value adjustments and
shall be treated as a part of the Participant's Account for
such purposes.
In the event of a discontinuance of
contributions or a termination of Employer's Plan which
requires full vesting of the affected Participant's Account,
and if such event occurs at a time before a Forfeiture
occurs with respect to an affected terminated Participant's
non-vested account balance(s), then the unallocated accounts
of such terminated Participants shall be credited back to
the Participant's Account(s) and shall be fully vested and
nonforfeitable.
Forfeitures of Employer Contributions shall
be allocated as follows:
Employer Matching
Contribution Forfeitures shall be added to and
allocated with Employer Discretionary Matching
Contributions for the Plan Year; provided, however, the
Employee receiving the forfeiture allocation must be
employed by Employer on the last day of the Plan Year
and the allocation shall be made in whole shares of
Company Stock to each Participant's account, with
fractional shares rounded up or down to the nearest
whole share.
Employer Supplemental Contribution
Forfeitures shall be added to and allocated in the same manner as
Employer's Supplemental Contributions are allocated for the Plan
Year.
Employer Minimum
Contribution Forfeitures shall be added to and
allocated in the same manner as Employer's Supplemental
Contributions are allocated for the Plan Year.
Participating Employers. If two
or more Related Employers (members of a controlled or
affiliated service group) contribute to this Plan,
Employer Contributions and Forfeitures shall be
allocated to each Participant in the Plan without
regard to which contributing group member employs the
Participant
For purposes of determining and allocating a
Participating Employer's Contribution, a Participant's
compensation includes compensation from all Participating
Employers. If a Participant receives compensation from more
than one Participating Employer during a Plan Year,
Administrator shall determine Employer's Contribution and
allocations to Participant by prorating the Participant's
compensation among the Participating Employers.
Separate Accounts For Post- and Pre-Break Benefits
of Rehired Participants . If a Participant who was not fully
vested resumes employment after incurring a 5-year Break in
Service, and has not received a cash-out distribution, the
following accounts shall be established:
A new account shall be created for the
Participant for allocations of Employer Contributions and
Forfeitures made after resumption of employment. The
account shall be subject to the vesting schedule under
Employer's Plan, taking into account Years of Service before
and after the 5-year Break in Service occurred.
The undistributed balance of the
Participant's old account shall be carried as a separate
account which shall be fully vested.
At such time as the post-break account
established under (a) becomes fully vested, the two accounts
shall be combined.
In the event the Participant is rehired
before incurring a 5-year Break in Service, repays the
amount of the distribution as provided herein and has the
Forfeiture restored, then the accounts established hereunder
shall be combined with the paid back and restored amounts
and shall be subject to the vesting schedule under
Employer's Plan, taking into account Years of Service before
and after the Break in Service.
Treatment of Forfeitures on Rehire . If a
Participant incurs a Forfeiture and is subsequently rehired, the
Forfeiture shall remain forfeited or shall be restored as
follows:
After 5 Years. If the Participant is rehired
after incurring a 5-year Break in Service, Years of Service
after such 5 year Break in Service period shall not be
counted for purposes of determining the Participant's vested
interest in pre-break benefits, and the Forfeiture incurred
shall remain forfeited.
Before 5 Years.
If the Participant is
rehired before incurring a 5-year Break in Service and
received or is deemed to have received a cash-out
distribution before being rehired, any Forfeiture which
occurred prior to rehire shall be restored if the
Participant repays to the Plan the full amount of the
cash-out distribution and the repayment is made on or
before the earlier of the following times: (a) five
years after the first date on which the Participant is
subsequently rehired or (b) the close of the 5-year
Break in Service period commencing after the
distribution.
The restored amount shall be the same
dollar amount which was forfeited, unadjusted for gains
or losses occurring subsequent to the date of the
Forfeiture. The restored amount shall be made first
from the Forfeitures occurring during the Plan Year in
which the repayment is made, and if necessary the
Employer(s) shall contribute an amount to make the
required restoration. If the Participant does not
repay as provided above, the Forfeiture shall remain
forfeited.
If the Participant's entire
Account was forfeited, and no actual distribution of
any Plan Benefit was distributed before rehire, then
any Forfeiture which occurred prior to rehire will be
restored if the Participant is rehired within the 5-
year period prescribed above. For purposes of applying
the repayment and restoration provisions above, the
rehired Participant shall be treated as repaying his
deemed cash-out distribution on the date of rehire.
Special Account--Rehire Prior to Forfeiture . If
a distribution is made to a partially vested Participant and the
Participant is rehired before a forfeiture occurs, the following
provisions shall apply:
A separate account shall be established for
the Participant's interest in the Plan as of the time of
distribution; and
At any relevant time, the Participant's
vested portion of the separate account shall not be less
than the amount ("X") determined by the formula:
X = P (AB + D) - D. For purposes of applying the formula:
P is the vested percentage at the relevant time; AB is the
account balance at the relevant time; and D is the amount of
distribution.
Amendment of Vesting Schedule . No amendment of
the vesting schedule shall directly or indirectly deprive a
Participant of nonforfeitable rights to benefits accrued to the
date of the amendment. Further, if the vesting schedule of the
Plan is amended, or the Plan is amended in any way that directly
or indirectly affects the computation of any Participant's
nonforfeitable percentage, or if the Plan is deemed amended by an
automatic change to or from a top-heavy vesting schedule, each
Participant with at least 3 Years of Service with the Employer
may elect, within a reasonable period after the adoption of the
amendment or the change, to have the nonforfeitable percentage
computed under the Plan without regard to such 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.
The period during which the election may be made shall
commence with the date the amendment is adopted or deemed to be
made and shall end on the latest of:
60 days after the amendment is adopted;
60 days after the amendment becomes
effective; or
60 days after the Participant is issued
written notice of the amendment by Employer or
Administrator.
Transferred or Rollover Accounts . If Employer's
Plan shall receive any accounts as a result of a rollover or a
plan transfer, such accounts shall be fully vested and
nonforfeitable.
Forfeiture Due to Inability to Locate . If a
Participant's Plan Benefit becomes payable and the Administrator,
after a reasonable search cannot locate the Participant (or his
Beneficiary who is entitled to payment), the Plan Benefit shall
be forfeited as provided in Section 9.8 herein. If the
Participant or his Beneficiary subsequently presents a valid
claim for benefits, the Administrator shall reinstate the Plan
Benefit in the manner provided in Section 9.8.
Section 9
BENEFITS
Retirement . When a Participant attains the
applicable retirement date and terminates employment with
Employer, Administrator shall direct Trustee to distribute the
Plan Benefit to the Participant pursuant to the provisions of
this Plan.
Normal retirement shall occur when a
Participant reaches the Normal Retirement Date and
terminates employment with Employer.
Deferred retirement may occur if a
Participant continues employment with Employer beyond the
Normal Retirement Date. During any period of continued
employment, the Participant shall continue to participate in
the Plan until actual retirement, when participation shall
cease.
Death .
Benefits. Upon the death of a Participant,
Administrator shall direct Trustee to distribute the
Participant's Plan Benefit to the Beneficiaries designated
pursuant to the applicable provisions of this Plan. The
Plan Benefit shall be equal to the value of the deceased
Participant's Account(s) which have not been distributed at
the time of death or the survivor's portion of any annuity
which has been purchased for the Participant. The deceased
Participant's Account(s) shall include the proceeds of any
life insurance policies on the life of the Participant
earmarked for such accounts and the proceeds shall be
distributed to the Beneficiary. Any key man life insurance
acquired as a general asset of the Trust and not earmarked
for the deceased Participant's Account shall be treated as a
gain to the Trust and allocated proportionately, based upon
account balances to all Trust Accounts (except segregated
accounts) as of the date of death.
Proof of Death. Administrator may require
such proper proof of death and such evidence of the right of
any person to receive payment of the account value of a
deceased Participant or former Participant as Administrator
may deem desirable.
Designation of Beneficiary. Each Participant
may designate a Beneficiary of the Participant's Plan
Benefit which becomes payable on account of the death of the
Participant. Such designation shall be made in a form
satisfactory to Administrator and in accordance with the
requirements of Section 401(a)(9) of the Code and the
applicable regulations. The designation shall name a
specific Beneficiary or Beneficiaries. A valid irrevocable
trust with identifiable trust beneficiaries may be
designated if a copy of the trust instrument is provided to
Administrator prior to the date of Participant's death. Any
Participant may, at any time, revoke or change the
designation of Beneficiary by filing written notice of such
revocation or change with Administrator. Any change
requires a new designation made in accordance with these
provisions and shall automatically revoke all prior
designations.
A designation or change of a designation by a
married Participant of a Beneficiary other than the
surviving spouse shall not be effective unless one of the
following applies:
The spouse (or the spouse's
legal guardian if the spouse is legally incompetent)
executes a consent in writing that acknowledges the
identity of the specific non-spouse Beneficiary
(including any class of Beneficiaries or any contingent
Beneficiaries) who will receive the benefit. If the
designation is a trust, the Participant's spouse need
only consent to the trust and need not consent to the
specific trust Beneficiaries or changes to
Beneficiaries.
The spouse (or the spouse's
legal guardian if the spouse is legally incompetent)
executes a general consent which permits the
Participant to change the beneficiary designation
without any requirement of further consent by the
spouse. A general consent executed after October 21,
must state that the spouse has the right to limit
consent to a specific Beneficiary (or a specific
optional form of benefit where applicable) and that the
spouse voluntarily elects to relinquish such right.
The consent cannot be
obtained because (a) the spouse cannot be located, (b)
the Participant obtains a court order (in the absence
of a Qualified Domestic Relations Order) that the
Participant is legally separated or has been abandoned
by his or her spouse (within the meaning of local law),
or (c) because of other circumstances provided by
applicable regulations.
Any consent must be in writing and be
witnessed by a plan representative or a notary public.
The consent may, by its terms, preclude the spouse from
revoking the consent after it has been given.
Effect of Divorce. If the Participant's
marital status changes after the Participant has designated
a Beneficiary, the following shall apply subject to any
applicable qualified domestic relations order:
If the Participant is
married at death but was unmarried when the designation
was made, the designation shall be void unless the
spouse had consented to it in the manner prescribed
above.
If the Participant is
unmarried at death but was married when the designation
was made, any designation of the ex-spouse as a
Beneficiary shall be void but a designation of a
non-spouse Beneficiary shall remain valid.
If the Participant was
married when the designation was made and is married to
a different spouse at death, the designation shall be
void unless the new spouse has consented to it in the
manner prescribed above.
Failure to Designate a Beneficiary. If any
Participant shall fail to designate a Beneficiary, if all
designated beneficiaries shall have predeceased the
Participant, or if the beneficiary designation on file with
Administrator is not valid at the time of Participant's
death, then Administrator shall distribute the Participant's
Plan Benefits as follows:
To the Participant's
surviving spouse, or if there be none surviving,
To the Participant's
children, in equal shares, or if there be none
surviving,
To the estate of the
Participant.
Disability . In the event of a Participant's
Disability, Administrator shall direct Trustee to distribute his
Plan Benefit to him pursuant to the provisions of the Plan. The
determination of Disability shall be made by Administrator in
accordance with uniform principles consistently applied, upon the
basis of a written opinion of at least one licensed physician,
and such other evidence as Administrator deems necessary and
desirable. Participation shall cease upon termination of
employment because of Disability.
Termination of Employment . If a Participant
shall terminate employment with Employer for any reason other
than those specified in the preceding paragraphs of this section,
participation in the Plan shall cease, the Participant's
Account(s) shall be subject to the vesting schedule in Section 8,
and the Participant's Plan Benefit shall be distributed pursuant
to the following provisions of the Plan.
Minimum Required Distributions . Any distribution
provisions which are required in order to comply with
Section 401(a)(9) of the Code and the regulations thereunder
shall override any inconsistent distribution provisions in the
Plan. The distribution of a Participant's interest in the Plan
must begin by the Required Beginning Date defined in Section 10.
The amount of the distribution must satisfy the minimum
distribution requirements under Section 401(a)(9) of the Code and
the applicable Treasury Regulations, including the minimum
distribution incidental benefit requirement ("MDIB") of Section
(9)-2 of the Treasury Regulations.
The minimum distribution to be made each year will be
an amount equal to the quotient obtained by dividing the
Participant's adjusted account balance by the life expectancy of
the Participant (or the joint life and last survivor's expectancy
of such Participant and his or her designated Beneficiary). Life
expectancy and joint and last survivor expectancy are computed by
the use of the return multiples contained in Section 1.72-9 of
the Treasury Regulations. For purposes of this computation, a
Participant's life expectancy may be recalculated (but not more
frequently than annually) upon the written election of the
Participant (or his spouse - Beneficiary, if Participant has
died) made no later than the time of the first required minimum
distribution under this election. The election shall be
irrevocable and shall apply with respect to the Participant (or
spouse) and to all subsequent years. The life expectancy of a
non-spouse Beneficiary shall not be recalculated.
The Participant's adjusted account balance for purposes
of this section shall be the account balance as of the latest
valuation date in the valuation calendar year (the calendar year
immediately preceding the distribution calendar year for which a
minimum distribution is being made) increased by any
contributions or Forfeitures allocated to the account and
decreased by any distributions made from the account subsequent
to such valuation date and by the December 31 of the valuation
calendar year. Any portion of the minimum distribution for the
first distribution calendar year is made after the close of that
year shall be treated as a distribution made in the first
distribution calendar year.
The minimum required distribution for the first
distribution calendar year must be made by the Required Beginning
Date. The minimum required distribution for each subsequent
distribution calendar year, including the calendar year in which
the Participant's Required Beginning Date falls, is due by
December 31 of that year. If the Participant receives
distribution in the form of a Nontransferable Annuity Contract,
the distribution satisfies this section if the contract complies
with the requirements of Section 401(a)(9) of the Code and the
applicable Treasury Regulations.
If the Participant's spouse is not his designated
Beneficiary, the method of payment to the Participant (beginning
on or after the Participant's required beginning date and before
his death) shall not provide more than incidental benefits to the
Beneficiary. For Plan Years beginning after December 31, 1988, a
Participant's benefit shall satisfy the minimum distribution
incidental benefit ("MDIB") requirements described in Treasury
Regulation Section 1.401(a)(9)-2 and shall be computed using the
lesser of the applicable life expectancy factor set forth in
Treasury Regulation Section 1.401(a)(9)-1 or the applicable MDIB
divisor set forth in Treasury Regulation Section 1.401(a)(9)-2.
The MDIB divisor shall be disregarded following the Participant's
death.
Income Tax Withholding and Reporting . Prior to
making any distribution to Participants or Beneficiaries,
Administrator shall require the recipient to complete the
applicable income tax withholding certificate for distributions
from qualified retirement plans (IRS Form W-4P). Administrator
shall also complete and file with the appropriate agencies, if
required by law, the Statement for Income Recipients (IRS Form
W-2P) or the Statement for Recipients of Total Distributions (IRS
Form 1099-R) and any other reports required by law.
Administrator shall also comply with any similar requirements
applicable for state income tax purposes.
Spendthrift Clause . The provisions hereof are
intended as personal protection for the Participants. No
Participant shall have any right to assign, anticipate or
hypothecate his account, nor shall any such assets be subject to
seizure by legal process or be in any way subject to the claims
of any creditor of such Participant; provided, however, a
Participant may pledge his vested interest under this Plan herein
as security for a loan made from the Trust to the Participant
which is exempt from the tax imposed by Section 4975 of the Code
by reason of Section 4975(d)(1) of the Code, and provided
further, Administrator may direct trustee to comply with a
Qualified Domestic Relations Order, as defined in Section 414(p)
of the Code and in compliance with the procedures set forth in
Section 414(p) of the Code and any applicable regulations issued
thereunder. Administrator may disregard any assignment of an
interest in the Plan to the extent the assignment is security for
a participant loan which is not exempt under Section 4975(d)(1)
of the Code.
Missing Participants or Beneficiaries . In the
event a distribution is to be made to a Participant or a
Beneficiary who cannot be located within 3 years after the
benefit becomes payable and the Administrator has made reasonably
diligent attempts to ascertain the whereabouts of the Participant
or Beneficiary, the account shall be forfeited and allocated to
those Participant's entitled to an allocation of Forfeitures
pursuant to Section 6 as of the last day of the Plan Year
coinciding with or following the date of expiration of the
three-year period. In the event the Participant or Beneficiary
is located subsequent to the Forfeiture and makes a claim for
benefits, the forfeited benefit shall be reinstated and restored
to the same dollar amount of the benefit forfeited, unadjusted
for any gains or losses occurring subsequent to the date of the
Forfeiture. Administrator shall make the restoration during the
Plan Year in which the Participant or Beneficiary makes the
claim. The restoration shall be made first from the amount, if
any, of Forfeitures occurring during the Plan Year in which the
reinstatement occurs and then from the amount, or additional
amount, Employer shall contribute to enable Administrator to make
the required restoration. Administrator shall direct Trustee to
distribute the Participant's or Beneficiary's restored account to
him not later than 60 days after the close of the Plan Year in
which the Administrator restores the forfeited benefit.
Segregated Accounts . If Administrator is
directed by a Participant upon termination of service, then the
assets representing the Participant's Plan Benefit may be
segregated and earmarked for the Participant's Account. The time
of segregation shall be as of the valuation date following the
date Administrator is directed to segregate such account.
Segregated accounts shall be invested in short term liquid low
risk interest bearing deposits or securities or other comparable
investments. Segregated accounts shall be accounted for
separately for the benefit of such Participants or Beneficiaries
and shall not participate in the annual revaluation of Trust
Assets or in subsequent Employer Contributions unless
specifically provided otherwise herein. In the event the account
is not segregated, it shall continue to be invested with the
assets of the Trust Fund and shall be adjusted for earnings and
losses.
Section 10
FORM AND TIME OF PAYMENT
Benefit Elections . If the Participant is
eligible to receive a Plan Benefit in excess of $3,500, the
Administrator shall provide a benefit election notice to a
Participant at least 30 days (unless waived as provided in
Section 10.8) and not more than 90 days prior to the Benefit
Commencement Date. The notice shall explain the optional forms
of benefit under the Plan, including the material features and
relative values of the options, and the Participant's right to
defer distribution until the Participant attains the later of age
or the Normal Retirement Date. A benefit election shall not
be made before the Participant receives the benefit election
notice and shall not be made prior to the Benefit Commencement
Date. Optional forms of benefit may not be conditioned upon the
discretion of Employer, Administrator, Trustee, fiduciary,
independent third party or any other person (other than the
Participant) except for such administrative discretion as may be
permitted by regulations.
Benefit Options . Distributions shall be made as
follows:
Lump-sum Payment. The Plan Benefit may be
distributed in the form of a single lump-sum payment with
the written consent of the Participant.
Small Amounts. If the value of the
Participant's Plan Benefit does not exceed $3,500 (and at
the time of any prior distribution has not exceeded $3,500),
the Plan Benefit shall be distributed in the form of a
single lump-sum without the requirement of the consent of
the Participant.
Restrictions on Immediate Distributions.
If the value of the Participant's Plan Benefit is more
than $3,500 (or at the time of any prior distribution was
more than $3,500), the Plan Benefit may only be distributed
prior to the Participant's attaining the later of the Normal
Retirement Date under the Plan or age 62 if the Participant
consents in writing within 90 days of being provided with a
benefit election notice.
Neither the consent of the Participant nor the
Participant's spouse shall be required to the extent that a
distribution is required to satisfy Section 401(a)(9) or
Section 415 of the Code. In addition, upon termination of
this Plan if the Plan does not offer an annuity option
(purchased from a commercial provider), the Participant's
account balance may, without the Participant's consent, be
distributed to the Participant or transferred to another
defined contribution plan (other than an employee stock
ownership plan as defined in Section 4975(e)(7) of the Code)
within the same controlled group.
Distribution Payments. Any method of
distribution designated prior to January 1, 1984, to the
extent permitted by Section 242 of the Tax Equity and Fiscal
Responsibility Act of 1982 (TEFRA).
Protected Benefits. Any optional form of
protected benefit required to be continued pursuant to
Section 411(d)(6) of the Code for affected Participants.
Direct Rollovers.
General. This Section
applies to distributions made on or after January 1,
Notwithstanding any provisions of the Plan to
the contrary that would otherwise limit a Distributee's
election under this part, a Distributee may elect, at
the time and in the manner prescribed by the
Administrator, to have any portion of an Eligible
Rollover Distribution paid directly to an Eligible
Retirement Plan specified by the Distributee in the
form of a Direct Rollover.
Definitions.
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 life expectancies) of the
Distributee and the Distributee's designated
beneficiary, or for a specified period of 10 years
or more; any distribution to the extent such
distribution is required under Section 401(a)(9)
of the Code; and the portion of any distribution
that is not includible in gross income (determined
without regard to the exclusion for the net
unrealized appreciation with respect to Employer
Securities).
Eligible Retirement Plan.
An Eligible Retirement Plan is an individual
retirement account described in Section 408(a) of
the Code, an individual retirement annuity
described in Section 408(b) of the Code, an
annuity plan described in 403(a) of the Code, or a
qualified trust described in Section 401(a) of the
Code 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.
Distributee. A
Distributee includes a Participant, 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
Section 414(p) of the Code, are Distributees with
regard to the interest of the spouse or former
spouse.
Direct Rollover. A
Direct Rollover is a payment by the Plan to the
Eligible Retirement Plan specified by the
Distributee.
Time of Payment of Benefits . The time of payment
of a Participant's benefits under the Plan shall be as follows:
Initial Distribution Date.
Elective Deferral and
Rollover Contribution Accounts. The Participant may
elect to receive distribution of his Elective Deferral
and Rollover Contribution Accounts as soon as
administratively feasible after the Participant's
termination of employment, or may elect to defer the
time of distribution of his Elective Deferral and
Rollover Contribution Accounts until the time when his
Employer Contribution Accounts will be distributed.
Employer Contribution
Accounts. Employer Contribution Accounts shall be
distributed as soon as administratively feasible after
the 30th day of the calendar quarter following the
Participant's termination of employment.
Deferred Distribution. If distribution is
not consented to by the Participant at the time designated
above (when such consent is required), or if distributions
do not otherwise commence within 90 days of the date
Participant is provided with the benefit election notice,
then the deferred time of payment shall be as soon as
administratively feasible after the Participant requests
that a distribution be made.
Latest Benefit Commencement Date . In the event
of a Participant's termination of employment, the terminated
Participant's Plan Benefit shall be paid as provided above;
provided, however, the latest time that payment must begin shall
not be later than the Required Beginning Date, unless otherwise
provided below:
The payment of a Participant's benefit shall
begin not later than 60 days after the end of the Plan Year
in which the latest of the following occurs unless the
Participant otherwise elects:
The Participant reaches the
Normal Retirement Date under the Plan; or
The date the Participant
terminates employment if subsequent to the Normal
Retirement Date.
Notwithstanding the foregoing, the failure of a
Participant and spouse to consent to a distribution while a
benefit is immediately distributable, within the meaning of
Section 10.2 of the Plan, shall be deemed to be an election
to defer commencement of payment of any benefit sufficient
to satisfy this section.
The Required Beginning Date.
General Rule. The
Required Beginning Date is the first day of April of
the calendar year following the calendar year in which
the Participant attains age 70 1/2, unless otherwise
provided below.
The Required Beginning Date
of a Participant who attains age 70 1/2 before January 1,
shall be determined in accordance with a. or b.
below:
Non-5 percent owners.
The Required Beginning Date of a Participant who
is not a 5 percent owner is the first day of April
of the calendar year following the calendar year
in which the later of retirement or attainment of
age 70 1/2 occurs.
5 percent owners. The
Required Beginning Date of a Participant who is a
percent owner during any year beginning after
December 31, 1979, is the first day of April
following the later of:
The calendar year
in which the Participant attains age 70 1/2; or
The earlier of
the calendar year with or within which ends
the Plan Year in which the Participant
becomes a 5 percent owner, or the calendar
year in which the Participant retires.
The Required Beginning Date
of a Participant who is not a 5 percent owner who
attains age 70 1/2 during 1988 and who has not retired as
of January 1, 1989, is April 1, 1990.
5 percent owner. A
Participant is treated as a 5 percent owner for
purposes of this section if such Participant is a
percent owner as defined in Section 416(i) of the
Code (determined in accordance with Section 416 but
without regard to whether the Plan is top-heavy) at any
time during the Plan Year ending with or within the
calendar year in which such owner attains age 66 1/2 or
any subsequent Plan Year.
Once distributions have
begun to a 5 percent owner under this section, they
must continue to be distributed, even if the
Participant ceases to be a 5 percent owner in a
subsequent year.
Time of Payment of Death Benefits . The payment
of Plan Benefits due to death must be distributed to the
Participant's Beneficiaries as follows:
If the distribution of a Participant's Plan
Benefit has commenced in a form other than a life annuity
and the Employee dies before his entire interest has been
distributed, the remaining portion of such interest shall be
distributed at least as rapidly as under the method of
distributions being used as of the date of death.
If distribution of the Participant's Plan
Benefit has commenced in the form of a life annuity, then
the amount and payment of the death benefit shall be based
upon the form of the survivor's portion of the annuity
option selected.
If a Participant dies before any distribution
of the Participant's interest has commenced, the Benefit
Commencement Date shall be as of December 31 of the calendar
year which contains the fifth anniversary of the date of the
Participant's death, unless a designated Beneficiary elects
one of the exceptions set forth below. The election must be
made no later than the earlier of December 31 of the
calendar year which contains the fifth anniversary of the
Participant's death, or December 31 of the calendar year in
which the Participant would have attained age 70 1/2. The
election may be made on an individual basis by each
Beneficiary and shall be made in writing to the
Administrator. The election shall be irrevocable with
respect to the Beneficiary (an all subsequent Beneficiaries)
and shall apply to all subsequent years.
If any portion of the
deceased Employee's interest is payable to (or for the
benefit of) a designated Beneficiary, such portion may
be distributed over a period not extending beyond the
life expectancy of the Beneficiary and the Benefit
Commencement Date must be on or before December 31 of
the calendar year following the calendar year in which
Participant dies.
If the designated
Beneficiary is the surviving spouse of the Employee,
the Benefit Commencement Date must be not later than
the date on which the Employee would have attained age
. If the surviving spouse dies before the
distributions to such spouse commence, then the
distributions shall be made pursuant to this
subparagraph as if the surviving spouse were the
Employee.
Distributions Upon Sale of Assets . Participant
Elective Deferrals, Qualified Employer Matching Contributions,
Qualified Employer Nonelective Contributions and income
attributable thereto, may be distributed to Participants upon the
disposition by Employer to an unrelated corporation of
substantially all of the assets (within the meaning of Section
(2) of the Code) used in a trade or business of such
corporation if such corporation continues to maintain this Plan
after the disposition, but only with respect to Employees who
continue employment with the corporation acquiring such assets
and if otherwise provided for in this Plan.
Distributions Upon Sale of Subsidiary .
Participant Elective Deferrals, Qualified Employer Matching
Contributions, Qualified Employer Nonelective Contributions and
income attributable thereto, may be distributed to Participants
upon the disposition by Employer to an unrelated entity of such
corporation's interest in a subsidiary (within the meaning of
Section 409(d)(3) of the Code) if such corporation continues to
maintain this Plan, but only with respect to Employees who
continue employment with such subsidiary and if otherwise is
provided for in this Plan.
Waiver of 30 Day Notice . If the Plan does not
provide a Joint and Survivor Annuity form of payment of benefits,
then the following provisions shall apply:
If a distribution is one to which Sections 401(a)(11)
and 417 of the Code do not apply, such distribution may commence
less than 30 days after the notice required under Section
- -11(c) of the Income Tax Regulations and Section 10.1
herein, provided that:
The Plan Administrator clearly informs the
Participant that the Participant has a right to a period of
at least 30 days after receiving the notice to consider the
decision of whether or not to elect a distribution (and, if
applicable, a particular distribution option), and
The Participant, after receiving the notice,
affirmatively elects a distribution.
Section 11
INVESTMENT OF TRUST FUND
Investment Authority .
Employee Elective Deferral Accounts and
Rollover Contribution Accounts shall be invested as follows:
Administrator shall select
and offer to the Participants groups of investments
(Investment Funds).
Each Participant shall
direct, by written direction to the Plan Administrator,
the investment of the assets in the Participant's
Account(s) to be invested in and among the Investment
Funds made available to them.
Investment directions shall
be made in writing on or before the Participant's Entry
Date and shall be effective for the balance of that
Plan Year and each Plan Year thereafter, until
modified. A Participant may change an investment
election to be applicable to future contributions and
to funds then credited in his account, if so
designated, by giving written notice to the Plan
Administrator. The Plan Administrator shall prescribe
and modify from time to time uniform and
nondiscriminatory procedures for making and changing
investment elections, including minimum multiples for
allocation of investments among the Investment Funds,
frequency, deadlines and effective dates for elections
and changes in elections.
Employer Contribution Accounts shall be
invested by Trustee. The authority to control and manage
such accounts shall be vested exclusively in Trustee. The
assets of such accounts may be invested in Company Stock as
provided in Section 11.9 herein. Trustee may appoint one or
more Investment Managers for the investment of the assets of
the Employer Supplemental and Minimum Contribution Accounts
which are not invested in Company Stock. Subject to the
following provisions, any such manager shall have exclusive
responsibility for and control over the investment of the
assets for which responsibility is allocated to the manager
by Administrator, including the power to acquire or dispose
of such assets.
Trustee may, as to any Investment Manager, reserve any
or all of the following rights:
To fix investment objectives and
guidelines;
To limit permissible investments;
To require consultation by the Investment
Manager at regular intervals or with respect to certain
kinds of transactions.
With respect to assets for which investment
responsibility is allocated to the Investment Manager, the
Investment Manager shall act in a fiduciary capacity. The
Investment Manager must be a person who is a registered
investment advisor under the Investment Advisor's Act of 1940, a
bank as defined under such Act or an insurance company qualified
to perform such services under the laws of more than one state.
The Investment Manager must acknowledge in writing that it is a
fiduciary with respect to the plan.
Trustee may rely upon the continued authority of an
appointed Investment Manager until notified of resignation or
removal. Each Investment Manager shall, on request, give Trustee
the names and specimen signatures of persons authorized to act
for the Investment Manager.
In the event all or a part of the Trust Fund shall be
managed by a duly appointed Investment Manager, the
responsibility for voting proxies appurtenant to corporate stock
(other than employer securities) being so managed by the
appointed Investment Manager shall be the responsibility of the
Investment Manager, and such Investment Manager shall have sole
responsibility for making the decision as to how to vote such
proxies and the power and authority to vote such proxies. The
Trustee shall not be responsible for the acts or omissions of the
Investment Manager or be under an obligation to invest or
otherwise manage any assets of the Plan which are subject to the
management of the Investment Manager.
Investment Standard . The Trust Fund shall be
managed and controlled solely in the interest of the Participants
and their Beneficiaries and shall be invested and reinvested with
the care, skill, prudence and diligence under the circumstances
then prevailing that a prudent man acting in a like capacity and
familiar with such matters would use in the conduct of an
enterprise of like character and with like aims.
Such investments may include preferred or common
stocks, bonds, mortgages, debentures, real estate, contracts,
notes or any other form of security or evidence of indebtedness.
Investments and reinvestments of Employer Supplemental
and Minimum Contribution Accounts shall be diversified so as to
minimize the risk of large losses, unless under the circumstances
it is clearly not prudent to do so.
Participants' Accounts . The amount to the credit
of each Participant may be invested and reinvested separately or
as a pooled investment fund, without any regard for any
proportionate share of the individual Participants in the Trust.
The accounts for Participants which may have been segregated or
are subject to Participant Directed Investments shall be held and
invested as otherwise provided herein.
Investments in Bank Deposits, Common Trust Funds
and Insurance Contracts . Investments of all or a part of the
Trust Fund in the following are hereby expressly authorized:
Deposits with any savings bank or in the
savings department of any bank, including any such
institution serving as Trustee, provided such deposits bear
a reasonable rate of return.
Investments in any collective investment fund
maintained by a plan fiduciary under which employee benefit
trusts qualified under Section 401(a) of the Code and tax
exempt under Section 501(a) of the Code are eligible to
participate. The instrument establishing any such fund, as
amended from time to time is incorporated in this Agreement
and shall control the administration of any such assets of
the Trust Fund which are invested in the collective
investment fund.
Administrator may direct Trustee to deposit
all or part of the Trust Fund for investment with one or
more insurance companies under a group annuity, deposit
administration or similar contract. The insurance company
shall, subject to the contract, have exclusive
responsibility for and control over all assets deposited
with it.
Prohibited Transactions . Unless otherwise
specifically permitted by law or unless an exemption has been
granted pursuant to Section 408(a) of the Act and Section
(2) of the Code, any of the following transactions
directly or indirectly between a plan and a party in interest (as
defined by Section 3(14) of the Act) or a disqualified person (as
defined by Section 4975(e)(2) of the Code constitutes a
prohibited transaction:
A sale or exchange or leasing of any
property;
The lending of money or other extension of
credit;
The furnishing of goods, services, or
facilities;
The transfer to, or use by or for the benefit
of a party in interest of any assets of the plan; or
The acquisition on behalf of a plan of any
employer security or employer real property in violation of
Section 407 of the Act.
Unless excepted or exempt, a fiduciary, with respect to
a plan shall not (1) deal with the assets of the plan in his own
interest or for his own account; (2) act in any transaction
involving the plan on behalf of a party (or represent a party)
whose interests are adverse to the interest of the plan or its
Participants or beneficiaries; or (3) receive any consideration
for his own personal account from any person dealing with such
plan in connection with a transaction involving the assets of the
plan.
Bonding of Fiduciary . To the extent required by
Section 412 of the Act, each fiduciary of a plan and every person
who handles funds or other property of a plan shall be bonded for
an amount not less than 10 percent of the amount of funds
handled, but not less than $1,000 nor more than $500,000.
Indemnity of Trustee . If the Trustee or any
other fiduciary is an officer, director or employee of the
Employer or an affiliate of the Employer, then the Employer shall
indemnify Trustee against any and all claims, loss, damage,
expense or liability arising from any action or failure to act,
except when the same is determined to be due to the gross
negligence or willful misconduct of Trustee.
Proxy Voting by Investment Managers . In the
event all or a part of the Trust Fund shall be managed by a duly
appointed Investment Manager (other than the Trustee), the
responsibility for voting proxies appurtenant to corporate stock
(other than Employer Securities) being so managed by the
appointed Investment Manager shall be the responsibility of the
Investment Manager and such Investment Manager shall have sole
responsibility for making the decision how to vote such proxies
and the power and authority to vote such proxies.
Investment in Company Stock . The investment
options in this section include the ability to invest Employer
Contributions in Company Stock as defined in Section 2.11 herein.
The aggregate investments of Employer Contributions in Company
Stock shall not exceed 100 percent of the value of Plan Assets.
Section 12
TRUSTEE
Powers of Trustee . Trustee shall have the
following powers and authority in the administration and
investment of the Trust Fund to be exercised in accordance with
written direction, as provided in Section 11.1.
With respect to any and all securities or property at
any time purchased, received or held in the Trust Fund, the
Trustee shall have the power and authority to do all necessary
acts, undertake all necessary proceedings specifically referred
to or not, as could be done, taken or exercised by the absolute
owner thereof. The Trustee's powers and investments may include,
but are not limited to, the following:
Purchase of Property. To purchase or
subscribe for any securities or other property and to retain
the same in Trust.
Sale, Exchange, Conveyance and Transfer of
Property. To sell, exchange, convey, transfer, or otherwise
dispose of any securities or other property held by it by
private contract or at public auction. No person dealing
with Trustee shall be bound to see to the application of the
purchase money or to inquire into the validity, expediency
or propriety of any such sale or other disposition.
Exercise of Owner's Rights. To vote upon any
stocks, bonds or other securities; to give general power of
substitution; to exercise any conversion privileges,
subscription rights or other options, and to make any
payments incidental thereto; to oppose or to consent to, or
otherwise participate in, corporate reorganizations or other
changes affecting corporate securities; to delegate
discretionary powers and to pay any assessments or charges
in connection therewith; and generally to exercise any of
the powers of an owner with respect to stocks, bonds,
securities or other property held as part of the Trust Fund.
Registration of Investments. To cause any
securities or other property held as part of the Trust Fund
to be registered in its own name or in the name of one or
more of its nominees, and to hold any investments in bearer
form, but the books and records of Trustee shall at all
times show that all such investments are part of the Trust
Fund.
Borrowing. To borrow or raise money for the
purpose of the Trust in such amount and upon such terms and
conditions as Trustee shall deem advisable and, for any sum
so borrowed, to issue its promissory note as Trustee, and to
secure the repayment thereof by pledging all or any part of
the Trust Fund, save and except that segregated accounts
shall not be pledged. No person lending money to Trustee
shall be bound to see to the application of the money loaned
or to inquire into the validity, expediency or propriety of
any such borrowing.
Retention of Cash. To keep such portion of
the Trust Fund in cash or cash balances as Trustee may from
time to time deem to be in the best interests of the Trust
created hereby, without liability for interest thereon.
Retention of Property Acquired. To accept
and retain for such time as it may deem advisable any
securities or other property received or acquired by it as
Trustee hereunder.
Execution of Instruments. To make, execute,
acknowledge and deliver any and all documents of transfer
and conveyance and any and all other instruments that may be
necessary or appropriate to carry out the powers herein
granted.
Settlement of Claims and Debts. To settle,
compromise or submit to arbitration any claims, debts or
damages due or owing to or from the Trust Fund; to commence
or defend suits or legal or administrative proceedings; and
to represent the Trust Fund in all suits and legal and
administrative proceedings.
Interest Bearing Obligations. To invest
funds of the Trust in time deposits or savings accounts
bearing a reasonable rate of interest.
Government Obligations. To invest in
Treasury Bills and other forms of United States government
obligations.
Agency Appointments. To appoint agents to
act on behalf of Trustee in all matters of investment,
retention of funds and all other acts as may be directed by
Trustee. Such agency appointments shall be effective upon
entering into such agency agreements as may be deemed
necessary by Trustee and the agents in order to carry out
the purposes of such agency appointment.
Bank Deposits. To hold such portion of the
Trust as it may deem necessary for the orderly
administration of the Trust and disbursement of funds as
provided herein in cash, without liability for interest, or
by depositing the same in any bank subject to the rules and
regulations governing such deposits, and without regard to
the amount of any such deposit.
Deposits with Fiduciary Bank. To invest all
or part of the funds of the Trust in deposits which bear a
reasonable rate of interest in accounts maintained by a
fiduciary which is a bank or similar financial institution
supervised by the United States or a State.
Common or Pooled Fund Transactions. To
engage in any transaction between a plan and (1) a common or
collective trust fund or pooled investment fund maintained
by a fiduciary which is a bank or trust company supervised
by a State or Federal agency or (2) a pooled investment fund
of an insurance company qualified to do business in a State,
if:
the transaction is a sale
or purchase of an interest in the fund, and
the bank, trust company, or
insurance company receives not more than reasonable
compensation.
To pool all or any of the Trust Fund, from
time to time, with assets belonging to any other qualified
employee pension benefit trust created by the Employer or an
affiliated company of the Employer, and to commingle such
assets and make joint or common investments and carry joint
accounts on behalf of this Plan and such other trust or
trusts, allocating undivided shares or interests in such
investments or accounts or any pooled assets of the two or
more trusts in accordance with their respective interests;
Payments From the Trust . Trustee shall from time
to time, on the written direction of Administrator, make payments
out of the Trust Fund to such persons, in such manner, in such
amounts, and for such purposes as may be specified in the written
direction of Administrator, and upon any such payment being made,
the amount thereof shall no longer constitute a part of the Trust
Fund. Trustee shall not be responsible for the application of
such payments or for the adequacy of the Trust Fund to meet and
discharge any and all liabilities under the Plan, except for
failure to properly withhold, when the responsibility for
withholding has been properly delegated to Trustee.
Trustee's Compensation, Expenses and Taxes .
Trustee (if not a full-time Employee of Employer) shall be paid
such reasonable compensation as shall from time to time be agreed
upon in writing by Employer and Trustee. In addition, Trustee
shall be reimbursed for any reasonable expenses, including
reasonable counsel fees, incurred by Trustee in the
administration of the Trust Fund. Such compensation and expenses
may be paid by Employer, but if not paid by Employer, shall be
paid from the Trust Fund. Administration expenses of the Trust
Fund attributable to individual Participant's direction of the
investment of their accounts may be charged to the respective
Participant's Accounts under uniform nondiscriminatory rules
adopted by Administrator. All taxes of any and all kinds
whatsoever that may be levied or assessed under existing or
future laws upon or in respect to the Trust Fund or the income
thereof shall be paid from the Trust Fund, except those assessed
personally upon fiduciaries.
Certification of Instructions . Trustee may rely
upon a certification of a member of Administrator or a
Participant with respect to any instruction or direction of
Administrator or a Participant or an appointed Investment
Manager, and may also rely upon the certification as it then
exists, and in continuing to rely upon such certification until a
subsequent certification is filed with Trustee. Trustee may act
upon any instrument, certificate or paper believed by it to be
genuine and to be signed or presented by the proper person or
persons, and Trustee shall be under no duty to make any
investigation or inquiry as to any statement contained in any
such writing, but may accept the same as conclusive evidence of
the truth and accuracy of the statements therein contained.
Accounting . Trustee shall keep complete and
accurate accounts of all investments, receipts, disbursements and
other transactions hereunder. All accounts, books and records
relating to such transactions shall be open to inspection and
audit at all reasonable times by any person designated by
Administrator.
Within 60 days following the close of each Trust Year,
and within 90 days following the effective date of the removal or
resignation of Trustee, Trustee shall file with Administrator a
written statement of account setting forth the assets and
liabilities, receipts and disbursements and other transactions
during such year or during the period from the close of the last
Trust Year, to the date of such removal or resignation. The form
and content of the account shall be sufficient for Administrator
to comply with reporting and disclosure requirements under
applicable law.
Settlement of Accountings . Administrator may
object to an accounting and require that it be settled by audit
by a qualified, independent certified public accountant. The
auditor shall be chosen by Trustee from a list of at least three
such accountants furnished by Administrator at the time the audit
is requested. Either Administrator or Trustee may require that
the account be settled by a court of competent jurisdiction in
lieu of or in conjunction with the audit. All expenses of any
audit or court proceedings including reasonable attorneys' fees
shall be allowed as administrative expenses of the Trust.
When an account has been accepted by the Administrator,
it shall be final and binding on all parties, including Employer
and all Participants and persons claiming through them.
Determination of Duties . In the event any
controversy shall arise between Trustee and any other person,
including but not limited to Administrator, Employer or any
Employees under the Plan, with respect to the payment or delivery
by Trustee of any moneys or other property held by it hereunder,
or with respect to the proper construction of this Agreement or
of any amendment thereto, or with respect to the management of
the Trust Fund, Trustee may require that its duties be determined
by a court of competent jurisdiction.
Removal, Resignation and Appointment of Successor
Trustee . Any Trustee may be removed by Employer at any time
upon 60 days' notice in writing to Trustee and Administrator.
Any Trustee may resign at any time upon 60 days' notice in
writing to Administrator and Employer. Upon such removal or
resignation of a Trustee, Employer may appoint a successor
Trustee, who shall have the same powers and duties as those
conferred upon the Trustee resigning.
Co-Trustee Actions . Trustees shall act by a
majority of their number at the time in office, and such action
may be taken either by a vote at a meeting or in writing without
a meeting. If there shall be two Trustees, their actions shall
be by unanimous vote. Trustees may authorize any one or more of
them to execute any document or documents on their behalf, in
which event Employer and Administrator shall be notified in
writing of such action and the name or names of the Trustee or
Trustees so designated. Employer and Administrator shall
thereafter accept and rely upon any document executed by such
Trustee or Trustees as representing action by all Trustees until
Trustees shall file a written revocation of such designation.
Receipt of Contributions . Trustee is
accountable only for funds actually received by Trustee. Trustee
shall have no right or duty to see that the contributions
received comply with the Plan or to collect any contributions
from Employer or Participants.
Section 13
INSURANCE
Purchase of Insurance not Permitted . The
purchase of life insurance policies on the life of Participants,
their spouses, or any other person in whom the Participants have
an insurable interest shall not be permitted.
Section 14
PARTICIPANT LOANS
General . Upon the request of a Participant,
Administrator, in accordance with a uniform nondiscriminatory
policy, may direct Trustee to make a loan or loans to such
Participant upon the following conditions:
Loans shall be available to all Participants
and Beneficiaries on a reasonably equivalent basis;
provided, however, loans made to Highly Compensated
Employees (as defined in Section 414(q)) of the Code shall
be limited to the same percentage of the Employee's vested
accrued benefit as loans made to other Employees; and
provided further, no loan shall be made to a
Shareholder-Employee in an "S" Corporation (as defined in
Section 1379 of the Code) or to a Self-Employed
Owner-Employee which would constitute a prohibited
Transaction under Section 4975 of the Code or Section 406 of
the Act, as amended.
For purposes of this requirement, a
Shareholder-Employee means an Employee or officer of an
electing small business (Subchapter S) corporation who owns
(or is considered as owning within the meaning of Section
(1) of the Code), on any day during the taxable year
of such corporation, more than 5 percent of the outstanding
stock of the corporation.
Loans shall be made available to all active
Participants and may be made available to inactive
Participants and Beneficiaries who are Parties in Interest
as defined in Act Section 3(14) to the extent such loans
would not constitute prohibited discrimination under Section
(4) of the Code.
The amount of the loan shall be limited as
follows:
The amount of the loan when added to the
outstanding balance of all other loans from the plan (or any
other qualified plan maintained by Employer or a related
Employer as defined in Sections 414(b), (c) and (m) of the
Code) to the Participant shall not exceed the lesser of the
following:
$50,000 reduced by the
highest outstanding participant loan balance during the
12-month period ending on the date of the loan; or
one-half of the vested
value of the Participant's account balances as of the
Anniversary Date preceding or coinciding with the date
of the loan, adjusted for any subsequent distributions,
contribution or Forfeitures made or allocated from or
to the account.
All loans to Participants granted under this
provision shall be considered Trust Fund investments;
provided, however, Administrator may adopt a policy treating
loans as a separate investment account for the Participant
to whom the loan is made, and any earnings, gains or losses
on such loan shall be allocated to the Participant to whom
such loan was made.
The loan must bear a reasonable rate of
interest which provides a return commensurate with the
prevailing interest rate charged by persons in the business
of lending money for loans which would be made under similar
circumstances.
The term of the loan shall be arrived at by
mutual agreement between Administrator and the Participant
pursuant to a uniform, nondiscriminatory policy and in no
event shall the term for repayment exceed 5 years, unless
the loan is used to acquire a dwelling unit which within a
reasonable time (determined at the time the loan is made) is
to be used as principal residence of the Participant.
Administrator may permit a term for a longer period if the
Participant acknowledges that such a term loan may result in
the amount of the loan being taxable to the Participant.
Repayment of the loan shall be on a periodic
payment basis. Loan payments must amortize the loan on a
substantially level basis over the term of the loan with
payments no less frequent than quarterly. Administrator may
establish a policy requiring as a condition of the granting
of the loan that the Participant shall authorize Employer to
withhold payments from his salary and Employer shall remit
such withheld amounts to Trustee to be applied in reduction
of the loan.
The amount of the loan shall be evidenced by
a Promissory Note given to Trustee, payable to the order of
the Trustee.
The loan shall be secured by adequate
collateral. Adequate collateral shall be such that the Plan
will suffer no loss of principal or income if a default
occurs. Up to 50 percent of the present value of a
Participant's vested account balance(s) (determined
immediately after origination of the loan) shall be assigned
as security for the loan. The Participant's Elective
Deferral Account shall not be used to secure the loan if the
value of the Participant's vested interest in his other
account balance exceeds the aggregate value of the
outstanding loans (determined immediately after origination
of the loan). In the event of the death of a Participant
who has an outstanding loan balance which is secured by his
plan account balance, the amount of such outstanding loan
shall be deducted from the Participant's death benefit
payable under the Plan.
If Employer's Plan is required to provide the
joint and survivor annuity form of payment, then any loan
made pursuant to this section where the vested account of
the Participant is used to secure such loan shall require
the written consent of the Participant's spouse. Such
written consent must be obtained within the 90-day period
prior to the date the loan is to be so secured. The consent
must be in writing, must acknowledge the effect of the loan,
and must be witnessed by a plan representative or notary
public. Such consent shall thereafter be binding with
respect to the consenting spouse or any subsequent spouse
with respect to that loan. A new consent shall be required
if the account balance is used for renegotiation, extension,
renewal, or other revision of the loan.
If a valid spousal consent has been obtained,
then, notwithstanding any other provision of this Plan, the
portion of the Participant's vested account balance used as
a security interest held by the Plan by reason of a loan
outstanding to the Participant shall be taken into account
for purposes of determining the amount of the account
balance payable at the time of death or distribution, but
only if the reduction is used as repayment of the loan. If
less than 100 percent of the Participant's vested account
balance (determined without regard to the preceding
sentence) is payable to the surviving spouse, then the
account balance shall be adjusted by first reducing the
vested account balance by the amount of the security used as
repayment of the loan, and then determining the benefit
payable to the surviving spouse.
Receipt of a loan shall constitute consent by
the Participant to distributions exceeding $3,500 before
Normal Retirement Date.
If any such outstanding loan is not paid when
due, such loan may be deducted at retirement, death,
Disability or other termination of employment from any
benefit to which such Participant or his Beneficiary is
entitled under this Plan, and any other security pledged
shall be sold at private or public sale when and as is
deemed appropriate by the Trustee. The proceeds of such
sale shall be applied first to pay the expenses of
conducting the sale, including reasonable attorneys' fees,
and then to pay any sums due from Participant to the Trust
under such loan arrangement, with such payment to be applied
first to accrued interest and then to principal. The
Participant shall remain liable for any deficiency, and any
surplus remaining shall be paid to the Participant. No
distribution shall be made from this Plan to any
Participant, former Participant or Beneficiary until all
unpaid loans, including accrued interest, of the Participant
in question have been fully paid.
In the event the number of loans actually
made or reasonably expected to be made during the preceding
or current calendar year exceeds 25, then each loan
applicant shall receive a clear statement of the charges
involved in each loan transaction, which statement shall
include the dollar amount and annual interest rate of the
finance charge, in accordance with the provisions of the
federal Truth in Lending Act.
Reasonable fees may be charged to the
Participant by the Administrator for the expenses of setting
up and administering the loan. Any such fees shall be paid
directly to the Employer by the Participant as a condition
of the granting of the loan and will not be a charge against
the Participant's Account. Administrator may adopt a
uniform nondiscriminatory policy providing for such fees and
expenses to be charged to the Participant's Account.
Administrator shall, as and when required by
regulations, establish a written participant loan policy to
include one or more of the following:
The identity of the person
or positions authorized to administer the participant
loan program;
A procedure for applying
for loans;
The basis on which loans
will be approved or denied;
Limitations (if any) on the
types and amounts of loans offered;
The procedure under the
program for determining a reasonable rate of interest;
The types of collateral
which may secure a participant loan; and
The events constituting
default and the steps that will be taken to preserve
plan assets in the event of such default.
Loan repayments will be suspended under the
Plan as permitted under Section 414(u) of the Code.
Section 15
HARDSHIP WITHDRAWALS
Employer Contributions . For Plan Years beginning
after December 31, 1988, Employer Contributions may not be
withdrawn by a Participant during his employment with Employer.
Participants' Elective Deferrals . A Participant
who is still employed by Employer may apply to Administrator for
a hardship withdrawal from the Participant's Elective Deferral
Account upon a showing of hardship. Hardship withdrawal requests
shall be approved or denied by Administrator under a uniform
nondiscriminatory policy. The withdrawal must be shown to be
necessary in light of an immediate and heavy financial need of
the Participant which cannot be met from other reasonably
available resources of the Participant. A hardship withdrawal
shall be approved only upon a showing that one or more of the
following needs exists:
Expenses for medical care (within the meaning
of Section 213(d) of the Code) previously incurred by or
necessary for the Participant, the Participant's spouse,
children or dependents; or
The cost of tuition and related educational
fees for the next 12 months of postsecondary education of
the Participant, the Participant's spouse, children or
dependents; or
The cost of purchasing real property which is
to serve as the principal residence of the Participant which
shall not include mortgage payments, remodeling or
refinancing; or
The cost of preventing an eviction or
mortgage foreclosure with respect to the Participant's
principal residence.
Such other needs as are designated by
regulations as acceptable.
Additional Limitations on Hardship Withdrawals .
Hardship withdrawals under this section shall be further limited
as follows:
Application for Withdrawal. A Participant
who wishes to withdraw all or a portion of his Elective
Deferrals must apply for such withdrawal by giving 30 days'
written notice to the Administrator and must comply with
such procedures as the Administrator may prescribe for
making hardship withdrawals. The withdrawal shall be
effective as of the last day of a calendar month. The
Participant must represent to the Administrator and agree to
the following:
The amount of the requested
withdrawal does not exceed the amount reasonably needed
to meet the hardship need (including any income taxes
attributable to the distribution).
The Participant has
obtained all distributions (other than hardship
distributions) currently available to the Participant
under all Plans maintained by the Employer.
Participant's Elective
Deferrals under all Plans maintained by Employer shall
be suspended for a period of 12 months following the
date of the hardship distribution.
The Participant has
obtained all participant loans currently available to
the Participant under all Plans maintained by Employer.
Participant's Elective
Deferrals under all Plans maintained by Employer for
the Plan Year following the Plan Year during which the
hardship distribution occurs shall be limited to the
indexed $7,000 annual limitation reduced by the amount
of the Participant's Elective Deferrals made during the
Plan Year during which the hardship distribution
occurred.
All spousal consents
required under Section 10 will be obtained.
Participant's Representations. Administrator
may rely on the Participant's representations regarding the
need for and use of the funds to be withdrawn without the
need to make an independent investigation and to require
financial statements if the Participant represents to the
Administrator and agrees to the conditions provided in (a)
above.
Optional Method of Determining Unavailability
of Other Resources. Administrator may establish a policy
under which the Participant represents to the Administrator
that the need cannot be relieved by other reasonably
available resources by providing a statement to
Administrator indicating that the need cannot be relieved:
Through reimbursement or
compensation by insurance or otherwise;
By reasonable liquidation
of the Participant's assets, to the extent such
liquidation would not itself cause an immediate and
heavy financial need;
By cessation of Elective
Deferrals under the Plan;
By other distributions from
plans maintained by Employer or by any other employer;
By borrowing from
commercial sources on reasonable commercial terms; or
By participant loans from
plans maintained by Employer or any other employer.
If the above representations are made
by the Participant, Administrator may approve the
withdrawal request and the requirement in paragraph (a)
above shall not apply.
Limits on Amounts. The amount of the
hardship withdrawal cannot exceed the amount reasonably
needed to meet the hardship need (including any income taxes
attributable to such distribution) and the value of the
Participant's Employee Elective Deferral Account on the
Valuation Date preceding the date of distribution. If at
any time the aggregate value of the Participant's Employee
Elective Deferral Account from which the withdrawal is being
made is less than the dollar amount previously contributed
and not withdrawn, the lesser amount attributable to such
contributions shall be the maximum which may be withdrawn.
A hardship withdrawal under this section may not include
earnings on an Employee's Elective Deferral and shall not
include Qualified Matching Contributions and Qualified
Nonelective Contributions, nor any earnings on such
contributions, irrespective of when credited.
In-Service Distributions From Rollover
Contribution Account s. A Participant who is still employed by
Employer may apply to Administrator for a distribution of all or
part of the Participant's Rollover Contribution account balance.
Only one such withdrawal shall be permitted during a 12-month
period. The withdrawal shall be paid to the Participant as soon
as administratively feasible following the date the Participant's
written request is submitted to and approved for payment by
Administrator.
Multiple Fund . The Participant shall specify
which investment fund or funds are to be charged with the
withdrawal if more than one fund is involved. If no such
specification is made by the Participant, the Administrator shall
determine which funds are to be charged.
Withholding on Withdrawals . Withdrawals under
this section shall be subject to federal income tax withholding
as prescribed by Section 3405 of the Code and the regulations
thereunder.
Section 16
ROLLOVERS AND PLAN TRANSFERS
Rollovers .
Transfers of Eligible Rollover Distributions.
A distribution from a qualified plan or from an individual
retirement account may be transferred to this Trust, subject
to the following conditions:
The amount transferred
consists entirely of an Eligible Rollover Distribution
as defined in Section 10.2(f) herein, including such a
distribution and the earnings thereon which were
previously transferred to an individual retirement
account as an Eligible Rollover Contribution within the
meaning of Sections 402(c)(5) and 408(d)(3) of the Code
as amended;
The transfer is made within
days from the date the Employee received it from (a)
the qualified plan or (b) the individual retirement
account;
Administrator consents to
the transfer;
The Employee is a
Participant under this Plan;
With respect to a transfer
from an individual retirement account, a transfer may
not be made if, during the preceding one-year period,
the Employee has received a similar distribution which
was not included in his gross income.
Prohibited Rollovers. A distribution from an
individual retirement account may not be transferred to this
Trust if the amount in the individual retirement account
consists of a distribution from a tax-sheltered annuity
under Section 403(b) of the Code.
Transfers--Qualified Plans .
Transfers to Other Plans of Employer. If a
Participant shall be entitled to receive a distribution of
benefits under this Plan and (i) becomes a Participant under
another qualified plan established by Employer or (ii) shall
be subsequently employed by another employer which has a
qualified plan, the Participant's vested interest in his
account(s) under this Plan may be transferred directly to
the Trustee of the other plan if the following conditions
are satisfied:
The plan to which such
funds are to be transferred permits the transfer to be
made;
The Participant's vested
interest in the transferred funds shall not be
forfeitable or reduce in any way the obligation of the
new employer;
The transferee plan
provides for all protected benefit options contained in
this Plan, as required under Section 411(d)(6) of the
Code;
Transfers From Other Plans Prohibited.
Trustee of this Plan is not authorized to accept assets from
a Trustee of another qualified plan other than as a Direct
Rollover.
Prohibited Transfers From Defined Benefit Pension
Plans . No merger, consolidation or transfer of assets with a
defined benefit pension plan may be made with this Plan.
Accounting for Transferred Funds . Amounts
received by transfer of a distribution or from another plan will
be accounted for in such manner as Administrator shall decide.
Mergers, Consolidations and Transfers of Plan
Assets . In the case of any merger or consolidation with, or
transfers of assets to any other Plan, each Participant in this
Plan shall be entitled (if the Plan had then terminated) to
receive a benefit immediately after the merger, consolidation or
transfer which is equal to or greater than the benefit he would
have been entitled to receive immediately before the merger,
consolidation or transfer (if the Plan had then terminated).
Section 17
AMENDMENT AND TERMINATION
Amendment . To provide for contingencies which
may require or make advisable the clarification, modification or
amendment of this Plan, Employer reserves the right to amend the
Plan at any time and from time to time, in whole or in part,
including without limitation, retroactive amendments necessary or
advisable to qualify the Plan and Trust under the provisions of
Section 401(a) of the Code, or any successor or similar statute
enacted. However, no such amendment shall (a) cause any part of
the assets of the Plan and Trust to revert to or be recoverable
by any Employer or be used for or diverted to purposes other than
the exclusive benefit of Participants, former Participants and
Beneficiaries; or (b) eliminate an optional form of distribution,
except to the extent permitted under the regulations.
Restrictions on Amendment . Any amendment by the
Employer to this Plan must be in writing and shall comply with
the following restrictions:
No amendment shall authorize or permit any
accrued benefits, to the extent funded, (other than such
part as is required to pay taxes and administration expenses
or otherwise permitted by this Plan) to be used for or
diverted to purposes other than for the exclusive benefit of
the Participants or their beneficiaries.
No amendment shall cause or permit any
portion of the Trust Fund to revert to or become the
property of Employer, except as otherwise provided herein
prior to the satisfaction of all liabilities to Participants
and their Beneficiaries.
No amendment shall cause any reduction in the
nonforfeitable accrued benefits of any Participant, except
as may be permitted under the Act, necessary to continue
qualification of the Plan and Trust as exempt under the
Code; or permitted under Section 412(c)(8) of the Code or
this Plan.
No amendment shall have the effect of
decreasing a Participant's vested interest determined
without regard to such amendment as of the later date of the
date such amendment is adopted or the date it becomes
effective.
No amendment shall decrease a Participant's
account balance, except to the extent permitted under
Section 412(c)(8) of the Code. For purposes of this
paragraph, a plan 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.
No amendment shall reduce or eliminate a
protected benefit under Section 411(d)(6) of the Code with
respect to benefits accrued up to and including the date the
amendment is adopted (or, if later, the Effective Date)
except as permitted by Section 412(c)(8) of the Code,
Section 4281 of the Act, Treasury Regulations or by
authority of the Commissioner of the Internal Revenue
Service exercised through publication of revenue rulings,
notices or other documents of general applicability. In the
event the Administrator determines that any amendment to
this Plan or the adoption of this Plan as a restatement of
an existing plan has the affect of eliminating or reducing a
protected benefit in violation of Section 411(d)(6) of the
Code or regulations promulgated thereunder, the amendment
shall be disregarded to the extent necessary to satisfy
Section 411(d)(6) and the regulation.
An amendment reduces or eliminates Section
(6) of the Code protected benefits if the amendment
has the effect of either (i) eliminating or reducing an
early retirement benefit or a retirement-type subsidy (as
defined in Treasury Regulations), or (ii) eliminating an
optional form of benefit except to the extent permitted
under Treasury Regulations.
Effective Date of Amendments . Any amendment
shall be effective on the date provided therein and may have
retroactive effect if necessary to satisfy the requirements of
the Code or the Act. Amendments may be adopted at any time prior
to the later of the time prescribed by law for filing the tax
return of Employer for the tax accounting year in which such
amendment was adopted (including extensions thereof), a date
designated by the Secretary of the Treasury or his delegate, or
as otherwise permitted by law.
Termination and Discontinuance of Contributions .
Employer shall have the right at any time to discontinue Employer
Contributions hereunder and to terminate the Plan hereby created
by delivering to the Trustee, Administrator and all Participating
Employers written notice of such discontinuance or termination.
The Plan shall also terminate with respect to an Employer upon
the dissolution, merger, consolidation, bankruptcy or
reorganization of the Employer or the sale by the Employer of
substantially all of its assets unless the Administrator's
successor in interest or purchaser substitutes itself for the
Employer under this Plan.
Upon complete discontinuance of Employer's
Contributions to the Plan or upon termination or partial
termination of the Plan hereunder, the rights of all affected
Participants to accrued benefits under such Plans to the date of
such termination or discontinuance, to the extent funded as of
such date, shall become fully vested and nonforfeitable.
Unallocated Forfeiture accounts shall be credited back to the
Participant's Account(s) as provided in Section 8.6(d) herein.
Forfeitures occurring prior to the date of termination shall not
become fully vested or restored to the Participant's Account as a
result of a complete or partial termination of the Plan.
Distribution of Trust . Upon permanent
discontinuance of contributions under the Plan, the Plan and
Trust shall not automatically terminate. Employer shall have the
option of terminating the Plan and Trust or continuing the Plan
in accordance with the provisions of this section. If Employer
elects to continue the Plan and Trust, Trustee shall continue to
hold the fully vested and nonforfeitable accounts of the
Participants for their benefit, and the Trust Agreement shall be
administered as though the Plan were otherwise in full force and
effect, to the extent not inconsistent with this section;
provided, however, that no further contributions will be made
thereafter by either Employer or the Participants.
Liquidation of Trust . If the Employer elects to
terminate the Plan and Trust, the Employer shall direct Trustee
to distribute the assets remaining in the Trust after payment of
any expenses properly chargeable against the Trust to the
Participants in the amounts credited to their accounts as of the
date of such termination. If a Participant's Account balance
under the Plan exceeds $3,500 and the Participant does not
consent to an immediate distribution: (a) Administrator may
purchase and distribute from a commercial provider an annuity
contract for such Participant with the Participant's Account
balance if an annuity option is otherwise available under the
terms of this Plan; or (b) if the Plan does not provide an
annuity option (i) the Participant's Account may be transferred
without the Participant's consent to another plan maintained by a
Related Employer; or (ii) if no other plan is maintained by a
Related Employer the Account may then be distributed to the
Participant without the consent of the Participant; provided,
however, Participant Elective Deferrals, Qualified Employer
Matching Contributions, Qualified Employer Nonelective
Contributions and income attributable thereto, may be distributed
to Participants or their Beneficiaries, provided that neither the
Employer or a Related Employer establishes or maintains a
Successor Plan at the time of the termination of the Plan or
within the period ending 12 months after the final distribution
of assets. If Employer maintains a Successor Plan, the
Participant's Accounts may be transferred to the Successor Plan.
A "Successor Plan" means another defined contribution plan
maintained by the same Employer, other than an ESOP or a
Simplified Employee Pension Plan. If fewer than 2 percent of the
Eligible Employees under this Plan at the time of its
termination, are or were eligible under the other defined
contribution plan at any time during the 24-month period
beginning 12 months before the time of termination, then the
other plan is not treated as a "Successor Plan." A distribution
made after March 31, 1988, pursuant to Plan termination, must be
part of a lump-sum distribution to the Participant of his Plan
Benefit.
Dissolution of Employer . In the event Employer
shall be dissolved or liquidated and has elected not to terminate
this Trust, Administrator shall retain all of its powers and
duties granted herein and shall assume the authority to fill any
vacancies occurring, to appoint successor Trustees in the event
of resignation by Trustee and to amend the Plan and Trust in
order to keep the Plan and Trust qualified under applicable law.
If Employer is Administrator, a successor Administrator shall be
appointed.
Section 18
QUALIFIED DOMESTIC RELATIONS ORDER
General . The provisions of this section shall
take precedent over any other provisions in the Plan which may be
inconsistent with this section.
Distributions under QDRO . Distributions to an
Alternate Payee (as defined in Section 414(p)(8) of the Code) may
be made in the manner described herein pursuant to a Qualified
Domestic Relations Order (as defined in Section 414(p) of the
Code ("QDRO")).
Time and Manner of Payment . Distributions may be
made to an Alternate Payee pursuant to the terms of a QDRO. The
time and manner of payment may be as provided herein, even if the
time of payment is prior to the "earliest retirement age" as
defined under Section 414(p)(4)(B) of the Code, and without
regard to whether the Participant has terminated employment with
Employer, provided the following conditions are met:
The QDRO specifies distribution at an
administratively feasible time which would be permitted
under the Plan if the Participant had terminated employment
as of the date of the QDRO or permits an agreement between
the Plan and the Alternate Payee to authorize a time for
distribution; and
Payment to the Alternate Payee must be in a
form permitted under the Plan, but not in the form of a
joint and survivor annuity with respect to the Alternate
Payee and his/her subsequent spouse. Notice and consent to
make a distribution to an Alternative Payee are not required
except as may be otherwise provided in the QDRO.
Procedures . The Administrator shall establish
reasonable procedures to determine the qualified status of a QDRO
and to administer distributions under a QDRO, including:
Upon receiving a domestic relations order,
the Administrator shall promptly 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 Administrator must determine the
qualified status of the order and must notify the
Participant and each Alternate Payee, in writing, of its
determination. The Administrator must provide such notice
by mailing the notice 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 Account is payable during the period the
Administrator is making its determination of the qualified
status of the domestic relations order, the Administrator
must make a separate accounting of the amounts payable. If
the Administrator 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 Administrator will direct the Trustee to distribute the
payable amounts in accordance with the order. If the
Administrator does not make its determination of the
qualified status of the order within the 18-month
determination period, the segregated amount shall be
returned to the Participant's Accounts under the Plan and
shall be paid at the time and the manner provided under the
Plan as if no order had been received by the Plan. If the
Administrator later determines that the order is a Qualified
Domestic Relations Order, Administrator will apply the order
prospectively.
To the extent it is not inconsistent with the
provisions of the Qualified Domestic Relations Order, the
Administrator 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 by
separate benefit check(s) or other separate distribution to
the Alternate Payee(s).
Section 19
OVERALL LIMITATION ON ALLOCATIONS
No Participation in any Other Plan . If the
Participant does not participate in, and has never participated
in, another qualified plan maintained by the Employer or a
welfare benefit fund, as defined in Section 419(e) of the Code
maintained by the Employer, or an individual medical account, as
defined in Section 415(l)(2) of the Code, maintained by the
Employer, which provides an annual addition as defined in
Section 19.3, the following provisions shall apply:
The amount of annual additions which may be
credited to the Participant's Account for any limitation year
will not exceed the lesser of the maximum permissible amount or
any other limitation contained in this Plan. If the Employer
Contribution that would otherwise be contributed or allocated to
the Participant's Account would cause the annual additions for
the limitation year to exceed the maximum permissible amount, the
amount contributed or allocated will be reduced so that the
annual additions for the limitation year will equal the maximum
permissible amount.
Prior to determining the Participant's actual
compensation for the limitation year, the Administrator may
determine the maximum permissible amount for a Participant on the
basis of a reasonable estimation of the Participant's
compensation for the limitation year, uniformly determined for
all Participants similarly situated. Administrator shall reduce
any Employer Contributions (including any allocation of
Forfeitures) based on estimated Compensation by any Excess
Amounts carried over from prior years.
As soon as is administratively feasible after
the end of the limitation year, the maximum permissible amount
for the limitation year will be determined on the basis of the
Participant's actual compensation for the limitation year.
If pursuant to Section 19.1-3 or as a result
of the allocation of Forfeitures there is an Excess Amount, the
excess will be disposed of as follows:
Any Nondeductible Voluntary Employee
Contributions, to the extent they would reduce the Excess
Amount, will be returned to the Participant;
If after the application of paragraph (a) an
Excess Amount still exists and the Participant is covered by
this Plan at the end of the limitation year, the Excess
Amount in the Participant's Account will be used to:
Reduce unmatched Participant Elective
Deferrals to the extent necessary to eliminate any
excess;
Reduce Matched Participant Elective
Deferrals to the extent necessary to eliminate any
excess remaining after reduction under (i) above.
Reduce Employer Contributions
(including any allocation of Forfeitures) for such
Participant in the next limitation year and each
succeeding limitation year if necessary.
If after the application of
paragraph (iii) an excess amount still exists and the
Participant is not covered by this Plan at the end of
the limitation year, the excess amount will be held
unallocated in a suspense account. The suspense
account will be applied to reduce future Employer
Contributions (including allocation of any Forfeitures)
for all remaining Participants in the next limitation
year and each succeeding limitation year if necessary.
The Administrator will not distribute any
Excess Amount(s) to Participants or to former Participants.
If an allocation of Employer Contributions
would result in an Excess Amount (other than an Excess
Amount resulting from the circumstances described in Section
or as a result of the allocation of Forfeitures) to
the Participant's Account, the Administrator 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
Administrator 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.
Notwithstanding any other provisions herein,
any Excess Amount or portion thereof which is attributable to
Participant Elective Deferrals shall not be allocated or
reallocated or distributed to any Participants other than the
affected Participants whose Elective Deferrals are included in
such Excess Amount. Administrator may elect one of the following
methods to dispose of such Excess Elective Deferrals: (1) hold
such Excess Deferrals in a separate Suspense Account (herein
called "415 Elective Deferral Suspense Account") to be allocated
in the next Plan Year and subsequent Plan Years to the affected
Participant's Elective Deferral Accounts in the manner provided
in 19.1-4(b) above, or (2) to distribute such Excess Elective
Deferrals to the affected Participants to the extent the
distribution would eliminate the Excess Elective Deferral Amount
in the Participants' account. The distribution shall be made on
or before the time prescribed by law for filing Employer's tax
return (including extensions) for the taxable year in which the
Excess Deferral arose.
If a suspense account is in existence at any
time during the limitation year pursuant to this section, it will
not participate in the allocation of the Trust's investment gains
and losses. If a suspense account is in existence at any time
during a particular limitation year, all amounts in the suspense
account must be allocated and reallocated to Participants'
Accounts before any Employer or any Employee Contributions may be
made to the Plan for that limitation year. Excess Amounts may
not be distributed to Participants or former Participants except
as provided in Section 19.1-5 above.
Participation in Another Defined Contribution Plan
. This section applies if, in addition to this Plan, the
Participant is covered under another qualified defined
contribution plan maintained by the Employer, a welfare benefit
fund, as defined in Section 419(e) of the Code maintained by the
Employer, or an individual medical account, as defined in Section
(2) of the Code, maintained by the Employer, which provides
an annual addition as defined in Section 19.3-1, during any
limitation year.
The annual additions which may be credited to
a Participant's Account under this Plan for any such limitation
year will not exceed the maximum permissible amount reduced by
the annual additions credited to a Participant's Account under
the other plans and welfare benefit funds for the same limitation
year. If the annual additions with respect to the Participant
under other defined contribution plans and welfare benefit funds
maintained by the Employer are less than the maximum permissible
amount and the Employer Contribution that would otherwise be
contributed or allocated to the Participant's Account under this
Plan would cause the annual additions for the limitation year to
exceed this limitation, the amount contributed or allocated will
be reduced so that the annual additions under all such plans and
funds for the limitation year will equal the maximum permissible
amount. If the annual additions with respect to the Participant
under such other defined contribution plans and welfare benefit
funds in the aggregate are equal to or greater than the maximum
permissible amount, no amount will be contributed or allocated to
the Participant's Account under this Plan for the limitation
year.
Prior to determining the Participant's actual
compensation for the limitation year, the Employer may determine
the maximum permissible amount for a Participant in the manner
described in Section 19.1-2.
As soon as is administratively feasible after
the end of the limitation year, the maximum permissible amount
for the limitation year will be determined on the basis of the
Participant's actual compensation for the limitation year.
If, pursuant to Section 19.2-3, or as a
result of the allocation of Forfeitures, a Participant's annual
additions under this Plan and such other plans would result in an
Excess Amount for a limitation year, the Excess Amount will be
deemed to consist of the annual additions last allocated, except
that annual additions attributable to a welfare benefit fund or
individual medical account will be deemed to have been allocated
first, regardless of the actual allocation date.
If an Excess Amount was allocated to a
Participant on an allocation date of this Plan which coincides
with an allocation date of another plan, the Excess Amount
attributable to this Plan will be the product of:
The total Excess Amount allocated as of such
date, times;
The ratio of (i) the annual additions
allocated to the Participant for the limitation year as of
such date under this Plan to (ii) the total annual additions
allocated to the Participant for the limitation year as of
such date under this and all the other qualified defined
contribution plans.
Any Excess Amount attributed to this Plan
will be disposed of in the manner described in Section 19.1-4.
Definitions .
Annual Additions: The sum of the following
amounts credited to a Participant's Account for the limitation
year:
Employer Contributions,
Employee Contributions,
Forfeitures, and
Amounts allocated, after March 31, 1984, to
an individual medical account, as defined in Section
(2) of the Code, which is part of a pension or annuity
plan maintained by the Employer, are treated as annual
additions to a defined contribution plan. Also amounts
derived from contributions paid or accrued after
December 31, 1985, in taxable years ending after such date,
which are attributable to post-retirement medical benefits,
allocated to the separate account of a Key Employee, as
defined in Section 419A(d)(3) of the Code, under a welfare
benefit fund, as defined in Section 419(e) of the Code,
which are maintained by the Employer are treated as annual
additions to a defined contribution plan.
For this purpose, any Excess Amount applied under
Sections 19.1-4 or 19.2-6 in the limitation year to reduce
Employer Contributions will be considered annual additions for
such limitation year.
Compensation: A Participant's earned income,
wages, salaries, and fees for professional services and other
amounts received (without regard to whether or not an amount is
paid in cash) for personal services actually rendered in the
course of employment with the Employer maintaining the Plan to
the extent that the amounts are includable in gross income
(including, but not limited to, commissions paid to salesmen,
compensation for services on the basis of a percentage of
profits, commissions on insurance premiums, tips, bonuses, fringe
benefits, reimbursements, and expense allowances) and excluding
the following:
Employer Contributions to a plan of deferred
compensation which are not includable in the Employee's
gross income for the taxable year in which contributed, or
Employer Contributions under a simplified employee pension
plan to the extent such contributions are deductible by the
Employee, or any distributions from a plan of deferred
compensation;
Amounts realized from the exercise of a
non-qualified stock option, or when restricted stock (or
property) held by the Employee either becomes freely
transferable or is no longer subject to a substantial risk
of forfeiture;
Amounts realized from the sale, exchange or
other disposition of stock acquired under a qualified stock
option; and
Other amounts which received special tax
benefits, or contributions made by the Employer (whether or
not under a salary reduction agreement) towards the purchase
of an annuity described in Section 403(b) of the Code
(whether or not the amounts are actually excludable from the
gross income of the Employee).
Elective deferrals under a Cash or Deferred
Arrangement under Section 401(k) of the Code.
For limitation years beginning after December 31,
for purposes of applying the limitations of this section,
compensation for a limitation year is the compensation actually
paid or includable in gross income during such limitation year.
Notwithstanding the preceding sentence, compensation
for a Participant in a defined contribution plan who is
permanently and totally disabled (as defined in Section 22(e)(3)
of the Code) is the compensation such Participant would have
received for the limitation year if the Participant had been paid
at the rate of compensation paid immediately before becoming
permanently and totally disabled; such imputed compensation for
the disabled Participant may be taken into account only if the
Participant is not a highly compensated Employee (as defined in
Section 414(q) of the Code) and contributions made on behalf of
such Participant are nonforfeitable when made.
Defined Contribution Fraction: A fraction,
the numerator of which is the sum of the annual additions to the
Participant's Account under all the defined contribution plans
(whether or not terminated) maintained by the Employer for the
current and all prior limitation years (including the annual
additions attributable to the Participant's Nondeductible
Employee Contributions to all defined benefit plans, whether or
not terminated, maintained by the Employer, and the annual
additions attributable to all welfare benefit funds, as defined
in Section 419(e) of the Code, and individual medical accounts,
as defined in Section 415(l)(2) of the Code, maintained by the
Employer), and the denominator of which is the sum of the maximum
aggregate amounts for the current and all prior limitation years
of service with the Employer (regardless of whether a defined
contribution plan was maintained by the Employer). The maximum
aggregate amount in any limitation year is the lesser of
percent of the dollar limitation determined under
Sections 415(b) and (d) of the Code in effect under
Section 415(c)(1)(A) of the Code or 35 percent of the
Participant's compensation for such year.
If the Employee was a Participant as of the end of the
first day of the first limitation year beginning after
December 31, 1986, in one or more defined contribution plans
maintained by the Employer which were in existence on May 6,
the numerator of this fraction will be adjusted if the sum
of this fraction and the defined benefit fraction would otherwise
exceed 1.0 under the terms of this Plan. Under the adjustment, an
amount equal to the product of (1) the excess of the sum of the
fractions over 1.0 times (2) the denominator of this fraction,
will be permanently subtracted from the numerator of this
fraction. The adjustment is calculated using the fractions as
they would be computed as of the end of the last limitation year
beginning before January 1, 1987, and disregarding any changes in
the terms and conditions of the Plan made after May 6, 1986, but
using the Section 415 limitation applicable to the first
limitation year beginning on or after January 1, 1987.
The annual addition for any limitation year beginning
before January 1, 1987, shall not be recomputed to treat all
Employee Contributions as annual additions.
Employer: For purposes of this section,
Employer shall mean the Employer that adopts this Plan, and all
members of a controlled group of corporations (as defined in
Section 414(b) of the Code as modified by Section 415(h)), all
commonly controlled trades or businesses (as defined in Section
as modified by Section 415(h)) or affiliated service
groups (as defined in Section 414(m)) of which the adopting
Employer is a part, and any other entity required to be
aggregated with the Employer pursuant to regulations under
Section 414(o) of the Code.
Excess Amount: The excess of the
Participant's annual additions for the limitation year over the
maximum permissible amount.
Limitation Year: The Plan Year shall be the
limitation year. All qualified plans maintained by the Employer
must use the same limitation year. If the limitation year is
amended to a different 12-consecutive-month period, the new
limitation year must begin on a date within the limitation year
in which the amendment is made.
Maximum Permissible Amount: The maximum
annual addition that may be contributed or allocated to a
Participant's Account under the Plan for any limitation year
shall not exceed the lesser of:
The Defined Contribution Dollar Limitation:
or, if greater, one-fourth of the defined benefit
dollar limitation set forth in Section 415(b)(1) of the Code
as in effect for the limitation year.
25 percent of the Participant's Compensation
for the limitation year after reduction for any Participant
Elective Deferrals for the year.
The compensation limitation referred to in (b) shall
not apply to any contribution for medical benefits (within the
meaning of Section 401(h) or Section 419A(f)(2) of the Code)
which is otherwise treated as an annual addition under Sections
(1) or 419A(d)(2) of the Code.
If a short limitation year is created because of an
amendment changing the limitation year to a different
12-consecutive-month period, the maximum permissible amount will
not exceed the defined contribution dollar limitation multiplied
by the following fraction:
Number of months in the short limitation year
Projected Annual Benefit: The annual
retirement benefit (adjusted to an actuarially equivalent
straight life annuity if such benefit is expressed in a form
other than a straight life annuity) or qualified joint and
survivor annuity to which the Participant would be entitled under
the terms of the Plan assuming:
The Participant will continue employment
until Normal Retirement Date under the Plan (or current age,
if later), and
The Participant's compensation for the
current limitation year and all other relevant factors used
to determine benefits under the Plan will remain constant
for all future limitation years.
Participation in Defined Benefit Plan . If the
Employer at any time maintained a qualified defined benefit plan
covering any Participant in this Plan, the sum of the
Participant's defined benefit plan fraction and defined
contribution plan fraction will not exceed 1.0 in any limitation
year.
The Defined Benefit Fraction is a fraction,
the numerator of which is the sum of the Participant's
projected annual benefits under all the defined benefit
plans (whether or not terminated) maintained by the
Employer, and the denominator of which is the lesser of
percent of the dollar limitation determined for the
limitation year under Sections 415(b) and (d) of the Code or
percent of the highest average compensation, including
any adjustments under Section 415(b) of the Code.
Highest Average Compensation shall mean the
average compensation for the 3 consecutive Years of Service
with the Employer that produces the highest average. A Year
of Service with the Employer is the 12-consecutive-month
period defined in Section 2.6.
Notwithstanding the above, if the Participant was a
Participant as of the first day of the first limitation year
beginning after December 31, 1986, in one or more defined benefit
plans maintained by the Employer which were in existence on
May 6, 1986, the denominator of this fraction will not be less
than 125 percent of the sum of the annual benefits under such
plans which the Participant had accrued as of the close of the
last limitation year beginning before January 1, 1987,
disregarding any changes in the terms and conditions of the Plan
after May 5, 1986. The preceding sentence applies only if the
defined benefit plans individually and in the aggregate satisfied
the requirements of Section 415 for all limitation years
beginning before January 1, 1987.
If the sum of the defined benefit plan fraction and the
defined contribution plan fraction shall exceed 1.0 in any year
for any Participant in this Plan, Administrator shall, in its
discretion, determine under which plan the Participant's benefits
are to be limited. If it is determined that the reduction shall
be made in this Plan, Employer shall adjust the numerator of the
defined contribution plan fraction so that the sum of both
fractions shall not exceed 1.0 in any year for such Participant.
The adjustment shall be made as provided in Section 19.1-4.
Section 20
TOP-HEAVY PROVISIONS
General . If the Plan is or becomes top heavy or
a member of a "required aggregation group" which is a "top-heavy
group" (as defined in Section 416 of the Code), in any Plan Year,
the provisions of this section will supersede any conflicting
provisions in the Plan, but only for those Plan Years in which
the Plan remains top heavy, except as otherwise provided below
with respect to vesting. The top-heavy provisions shall only
apply to Employees who completed at least one Hour of Service in
a top-heavy year. The top-heavy provisions shall be interpreted
to meet the requirements of IRC Section 416 and the regulations
promulgated thereunder. If Employer's Plan is or becomes top
heavy, the top-heavy vesting schedule applicable to Employer's
Plan will not be cut back in any Plan Year when the Plan ceases
to be top heavy.
Top-Heavy Year . "Top-Heavy Year" shall mean any
Plan Year beginning after December 31, 1983, in which the present
value of the cumulative accrued benefits, with respect to Key
Employees in the aggregation group of plans, exceeds 60 percent
of the present value of the cumulative accrued benefits for all
Employees in the aggregation group of plans on the applicable
determination date.
Definitions . For purposes of this section, the
following definitions shall apply:
Key Employee. Any Employee or former
Employee (and the Beneficiaries of such Employee) who at any
time during the determination period was an officer of the
Employer if such individual's Annual Compensation exceeds
percent of the dollar limitation under Section
(1)(A) of the Code, an owner (or considered an owner
under Section 318 of the Code) of one of the 10 largest
interests in the Employer if such individual's compensation
exceeds 100 percent of the dollar limitation under
Section 415(c)(1)(A) of the Code, a 5 percent owner of the
Employer, or a 1 percent owner of the Employer who has an
Annual Compensation of more than $150,000. The
determination of who is a Key Employee will be made in
accordance with Section 416(i)(1) of the Code and the
regulations thereunder.
Annual Compensation. Compensation as defined
in Section 415(c)(3) of the Code, but including amounts
contributed by the Employer pursuant to a salary reduction
agreement which are excludable from the Employee's gross
income under Section 125, Section 402(e)(3), Section 402(h)
or Section 403(b) of the Code. The determination period is
the Plan Year containing the determination date and the 4
preceding Plan Years.
Top-heavy Plan. For any Plan Year beginning
after December 31, 1983, this Plan is top heavy if any of
the following conditions exists:
If the top-heavy ratio for
this Plan exceeds 60 percent, and this Plan is not part
of any required aggregation group or permissive
aggregation group of plans.
If this Plan is a part of a
required aggregation group of plans, but not part of a
permissive aggregation group, and the top-heavy ratio
for the group of plans exceeds 60 percent.
If this Plan is a part of a
required aggregation group and part of a permissive
aggregation group of plans and the top-heavy ratio for
the permissive aggregation group exceeds 60 percent.
Top-heavy Ratio:
If the Employer maintains
one or more defined contribution plans (including any
simplified employee pension plan) and the Employer has
not maintained any defined benefit plan which, during
the five-year period ending on the determination
date(s) has or has had accrued benefits, the top-heavy
ratio for this Plan alone, or for the required or
permissive aggregation group as appropriate, is a
fraction, the numerator of which is the sum of the
account balances of all Key Employees as of the
determination date(s) (including any part of any
account balance distributed in the 5-year period ending
on the determination date(s)), and the denominator of
which is the sum of all account balances (including any
part of any account balance distributed in the 5-year
period ending on the determination date(s)), both
computed in accordance with Section 416 of the Code and
the regulations thereunder. Both the numerator and
denominator of the top-heavy ratio are increased to
reflect any contribution not actually made as of the
determination date, but which is required to be taken
into account on that date under Section 416 of the Code
and the regulations thereunder.
If the Employer maintains
one or more defined contribution plans (including any
simplified employee pension plan) and the Employer
maintains or has maintained one or more defined benefit
plans which, during the 5-year period ending on the
determination date(s), has or has had any accrued
benefits, the top-heavy ratio for any required or
permissive aggregation group, as appropriate, is a
fraction, the numerator of which is the sum of account
balances under the aggregated defined contribution plan
or plans for all Key Employees, determined in
accordance with (i) above, and the present value of
accrued benefits under the aggregated defined benefit
plan or plans for all Key Employees as of the
determination date(s), and the denominator of which is
the sum of the account balances under the aggregated
defined contribution plan or plans for all
Participants, determined in accordance with (i) above,
and the present value of accrued benefits under the
defined benefit plan or plans for all Participants as
of the determination date(s), all determined in
accordance with Section 416 of the Code and the
regulations thereunder. The accrued benefits under a
defined benefit plan in both the numerator and
denominator of the top-heavy ratio are increased for
any distribution of an accrued benefit made in the 5-
year period ending on the determination date.
For purposes of (i) and
above, the value of account balances and the
present value of accrued benefits will be determined as
of the most recent valuation date that falls within or
ends with the 12-month period ending on the
determination date, except as provided in Section 416
of the Code and the regulations thereunder for the
first and second Plan Years of a defined benefit plan.
The account balances and accrued benefits of a
Participant (a) who is not a Key Employee but who was a
Key Employee in a prior year, or (b) who has not been
credited with at least one Hour of Service with any
Employer maintaining the Plan at any time during the 5-
year period ending on the determination date, will be
disregarded. The calculation of the top-heavy ratio,
and the extent to which distributions, rollovers, and
transfers are taken into account will be made in
accordance with Section 416 of the Code and the
regulations thereunder. Deductible Employee
Contributions will not be taken into account for
purposes of computing the top-heavy ratio. When
aggregating plans, the value of account balances and
accrued benefits will be calculated with reference to
the determination dates that fall within the same
calendar year.
The accrued benefit of a Participant, other than a
Key Employee, shall be determined under (a) the method, if
any, that uniformly applies for accrual purposes under all
defined benefit plans maintained by the Employer, or (b) if
there is no such method, as if such benefit accrued not more
rapidly than the slowest accrual rate permitted under the
fractional rule of Section 411(b)(1)(C) of the Code.
Permissive Aggregation Group. The required
aggregation group of plans plus any other plan or plans of
the Employer which, when considered as a group with the
required aggregation group, would continue to satisfy the
requirements of Sections 401(a)(4) and 410 of the Code.
Required Aggregation Group. (i) Each
qualified plan of the Employer in which at least one Key
Employee participates or participated at any time during the
determination period (regardless of whether the plan has
terminated), and (ii) any other qualified plan of the
Employer which enables a plan described in (i) to meet the
requirements of Sections 401(a)(4) or 410 of the Code.
Determination Date. For any Plan Year
subsequent to the first Plan Year, the last day of the
preceding Plan Year. For the first Plan Year of the Plan,
the last day of that year. The Determination Period is the
5-year period ending on the Determination Date.
Valuation Date. The same date as the
Determination Date.
Present Value. Present value shall be based only
on the following interest and mortality rates.
Top-Heavy Provisions . If the Plan is determined
to be a top-heavy plan for a Plan Year, then, notwithstanding any
provisions herein to the contrary, the following provisions will
apply for such Plan Years as the Plan is determined to be
top-heavy.
Vesting. Vesting shall be determined in
accordance with the following schedule:
Years of Service
Completed for Vesting Vested
Purposes Interest
Less than 2 years 0%
years but less than 3 50%
years or more 100%
Top-Heavy Minimum Contributions.
Minimum Contribution. If
this Plan is a top-heavy plan for a Plan Year, Employer
shall contribute to the Plan for the benefit of and
allocate to all Non-Key Eligible Employees who have not
separated from service at the end of the Plan Year, an
amount not less than the lesser of the following:
3 percent of the
Non-Key Employee Participant's Annual Compensation
(as defined in Section 19 herein), excluding any
Employee Elective Deferrals by the Non-Key
Employee Participant, reduced by any Forfeitures
allocated to the Account of the Participant for
the Plan Year; or
the same percentage of
the Non-Key Employee Participant's Annual
Compensation (as defined in Section 19 herein),
excluding any Employee Elective Deferrals by the
Non-Key Employee Participant, as the percentage
(which percentage shall include the Elective
Deferrals of the Key-Employee Participant), made
on behalf of the Key Employee Participant who
receives the highest percentage for the Plan Year,
reduced by any Forfeitures allocated to the
Account of the Participant for the Plan Year.
The Minimum
Contribution is determined without regard to any
integration with social security otherwise
permitted under Section 401(l) of the Code and
without regard to any number of Hours of Service
performed during the Plan Year or any stated
amount of compensation.
Determination of Top-Heavy Minimum Contribution.
In determining the Minimum Contribution for a Non-Key Employee
Participant, Employer's Contribution and
allocation made pursuant to the contribution and
allocation formula selected under Employer's Plan
shall be taken into account and applied toward the
satisfaction of the top-heavy Minimum Contribution
requirement but Employee's Minimum Contribution
shall be in addition to Employee Elective
Deferrals by a Non-Key Employee Participant which
are applied to satisfy the ADP or ACP test for a
Plan Year.
For purposes of
determining the Minimum Contribution, Annual
Compensation shall not include any Employee
Elective Deferrals made by the Non-Key
Employee Participant.
Non Duplication
of Top-Heavy Minimum Contribution. In
determining the Minimum Contribution for a
Non-Key Employee Participant, any Employer
Contribution or Forfeitures allocated under
this Plan and any other defined contribution
plan qualified under Section 401(a) of the
Code sponsored by a Related Employer shall be
taken into account and applied toward the
satisfaction of the top-heavy Minimum
Contribution requirement. To the extent the
required Minimum Contribution is satisfied
under another defined contribution plan
maintained by a Related Employer, then no
minimum contribution is required under this
Plan.
Minimum Contributions Under Other Plans.
If Employer has adopted another plan or plans, one of
which is a money purchase pension plan, then
the Minimum Contribution shall be made first
under the money purchase pension plan.
Top-Heavy Contribution with Defined Benefit Plan.
If a Key Employee is a Participant in both
a defined contribution plan and a
defined benefit plan that are part of
a top-heavy group wherein neither
plan is a super top-heavy plan, the
percent Minimum Contribution shall
be increased to 4 percent if
necessary to avoid the application of
Section 416(h)(1) of the Code.
Notwithstanding anything herein
to the contrary, in any Plan Year in
which a Non-Key Employee is a
Participant in both this plan and a
defined benefit pension plan, and
both such plans are top-heavy plans,
the Employer shall not be required to
provide a Non-Key Employee with both
the full separate minimum defined
benefit plan benefit and the full
separate defined contribution plan
allocations. Therefore, for Non-Key
Employees who are participating in a
defined benefit plan maintained by
the Employer and the minimum benefits
under Section 416(c)(1) of the Code
are accruing to a Non-Key Employee
under such Plan, the minimum
allocations provided for above shall
not be applicable, and no Minimum
Contribution shall be made to the
Plan on behalf of the Non-Key
Employee. Alternatively, the
Employer may satisfy the minimum
benefit requirement of Section
(1) of the Code for the Non-Key
Employee by providing a 5 percent
Minimum Contribution for Non-Key
Employees under this Plan.
Annual Additions Limitations. If for any
Plan Year a Participant is a Participant in both a defined
contribution plan and a defined benefit plan maintained by
the Employer that are part of a top-heavy group, the
determination of the sum of the defined contribution plan
fraction and the defined benefit fraction for purposes of
Section 415(e) of the Code shall be made substituting "1.0"
for "1.25," unless the extra minimum benefit or contribution
is made. The extra required Minimum Contribution shall be
percent. Also, for any Plan Year in which the plans are
part of a super top-heavy group, 1.0 shall be substituted
for 1.25 in any event.
Section 21
CLAIMS PROCEDURE
Filing of Claim . A Participant or Beneficiary
may make a claim for a Plan Benefit by written request to the
Plan Administrator.
Notification of Decision . A decision shall be
made on the claim as soon as practicable and shall be
communicated in writing to the person who made the claim. If the
claim is partially or wholly denied, written notice of such
denial shall be made to the claimant within 90 days after receipt
of the written claim by the Plan Administrator. The notice of
denial shall contain:
The reasons for the denial, with specific
reference to the provisions of the Plan upon which the
denial is based;
If required, a description of any additional
data necessary, which may be furnished to further support
the request, and the reason why such additional data may be
necessary; and
Notice of the claimant's right to have the
denial reviewed, together with specific information as to
the steps to be taken, and the time limit involved, if the
claimant wishes to request a review of the decision.
If a written communication of the decision is not made
within 90 days, the claimant may deem the request denied.
Request for Review . If a claimant receives a
notice of denial or if no response has been made to his claim
within a specified 90 days, the claimant may request a review of
his claim and the denial thereof by giving written notice to the
Plan Administrator. The claimant's request for review must be
made not later than 60 days after receipt of the notice of
denial, or if no such notice has been given, within 60 days after
the expiration of the 90-day period specified for such notice.
If the written request for review is not made within the
specified 60-day period, the claimant shall waive his right to
review.
Review . A review shall be promptly made by the
Plan Administrator after receipt of a timely filed request for
review. The claimant may submit issues and comments in writing,
may review pertinent documents and may request a hearing. A
decision on review shall be made and furnished in writing to the
claimant. The decision shall be made not later than 60 days
after receipt of the request for review unless special
circumstances, such as a claimant's request for a hearing,
require an extension of time for processing, in which case the
time limit shall be not later than 120 days after such receipt.
The decision on review shall be furnished to the claimant in
writing and shall include the reasons for the decision, with
references to the pertinent plan provisions upon which the
decision is based.
Section 22
MISCELLANEOUS PROVISIONS
No Contractual Relationship . The establishment
of this Plan shall not be construed as creating any contract of
employment between any Employer and any Employee. Nothing herein
contained shall give any Employee of an Employer the right to
inspect the books of the Employer or any Related Employer; nor to
interfere with the right of the Employer to discharge any
Employee at any time; nor shall it give any Employer the right to
require any Employee to remain in its employ; nor shall it
interfere with any Employee's right to terminate his employment
at any time.
Liability for Benefits . All Plan Benefits
payable under this Plan shall be provided solely from the Trust,
to the extent funded, and neither the Employer, the
Administrator, the Trustee or the Sponsor assume any liability or
responsibility therefor.
Inability to Perform . Neither the Employer, the
Administrator or the Trustee shall be responsible for any
inability to perform or delay in performing, any act occasioned
by any person or by law, and, in the event any such inability or
delay shall be so occasioned, the Employer, the Administrator or
the Trustee shall perform such act which, in their sole
discretion, most completely carries out the intention and purpose
of this Plan. All parties to this Plan or in any way interested
therein shall be bound by any acts so performed under such
conditions.
Participant's Rights . No Participant or
Beneficiary shall have any rights or interest in any specific
assets in the Trust, except as expressly set forth herein.
Plan and Trust Binding on all Parties . The Plan
and Trust provisions shall be binding upon the heirs, personal
representatives, successors and assigns of all present and future
parties.
Conflict of Law Provisions . All matters
respecting the validity, effect, interpretation and
administration of the Plan and Trust shall be determined in
accordance with the laws of the state in which the Employer
maintains its principal place of business, except as preempted by
federal law.
Waiver of Notice . Any person, including a
Participant or Beneficiary, entitled to notice under the Plan may
waive the notice.
Third Party . No person dealing with the Trustee
is obligated to see to the proper application of any money paid
or property delivered to the Trustee, or to inquire whether the
Trustee has acted pursuant to any of the terms of the Plan. Each
person dealing with the Trustee may act upon any notice, request
or representation in writing by the Trustee, or by the Trustee's
duly authorized agent, and is not liable to any person in so
acting. The certificate of the Trustee that it is acting in
accordance with the Plan will be conclusive in favor of any
person relying on the certificate. If more than two persons act
as Trustee, a decision of the majority of such persons controls
with respect to any decision regarding the administration or
investment of the Trust Fund.
Use of Terms . Wherever appropriate, words used
herein in the singular may include the plural, or the plural may
be read as the singular, and the masculine may include the
feminine.
USERRA Provisions. Notwithstanding any
provision of this Plan to the contrary, contributions, benefits
and service credit with respect to qualified military service
will be provided in accordance with Section 414(u) of the Code.
IN WITNESS WHEREOF, Employer has caused this Agreement
to be executed by its duly authorized officer, and Trustees have
caused this Agreement to be executed this _____ day of
___________________, 1996.
EMPLOYER:
BIOJECT, INC.
By:__________________________
President
TRUSTEES:
_____________________________
Jim O'Shea
_____________________________
Peggy J. Miller
