As filed with the Securities and Exchange Commission on July 28, 1994
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
ALLEGHENY LUDLUM CORPORATION
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 25-1364894
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
1000 SIX PPG PLACE, PITTSBURGH, PENNSYLVANIA 15222-5479
(Address of principal executive offices) (Zip code)
ALLEGHENY LUDLUM CORPORATION RETIREMENT SAVINGS PLAN ("RSP")
(formerly known as the Allegheny Ludlum Planned Savings Plan)
SAVINGS AND SECURITY PLAN OF THE
TUBULAR PRODUCTS DIVISION OF
ALLEGHENY LUDLUM CORPORATION ("TUBULAR PLAN")
SAVINGS AND SECURITY PLAN FOR THE
SPECIAL MATERIALS DIVISION OF
ALLEGHENY LUDLUM CORPORATION ("SPECIAL MATERIALS PLAN")
(Full title of the plan)
Jon D. Walton, Esquire
Vice President - General Counsel
and Secretary
Allegheny Ludlum Corporation
1000 Six PPG Place
Pittsburgh, Pennsylvania 15222
(Name and address of agent for service)
(412) 394-2800
(Telephone number, including area code,
of agent for service)
Copies to:
Charles M. Grimstad, Esquire
Kirkpatrick & Lockhart
1500 Oliver Building
Pittsburgh, Pennsylvania 15222
<PAGE>
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Maximum Maximum Amount
Title of Amount Offering Aggregate of
Securities to be to be Price Offering Registration
Registered(1) Registered per Share(2) Price(2) Fee
Common Stock
par value $0.10 1,250,000
per share shares $20.1875 $25,234,375 $8,701.51
(1) In addition, pursuant to Rule 416(c) under the Securities Act of
1933, this registration statement also covers an indeterminate amount
of interests to be offered or sold pursuant to the employee benefit
plans described herein.
(2) Estimated pursuant to Securities and Exchange Commission
Rule 457(c) only for the purpose of calculating the registration fee;
based on the average of the high and low price per share of Common
Stock of Allegheny Ludlum Corporation on July 21, 1994, as published
in the NYSE-Composite Transactions quotations.
THE PROSPECTUS WHICH IS BEING USED WITH THIS REGISTRATION STATEMENT
IS ALSO BEING USED IN CONNECTION WITH REGISTRATION STATEMENT
NO. 33-18510.
EXHIBIT INDEX APPEARS ON PAGE II-13
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
---------------------------------------
The following documents filed by Allegheny Ludlum Corporation
(the "Company") with the Securities and Exchange Commission (the
"Commission") are hereby incorporated by reference in this
Registration Statement:
1. The Company's Annual Report on Form 10-K for the fiscal
year ended January 2, 1994.
2. The Company's Current Report on Form 8-K for April 1,
1994.
3. The Company's Current Report on Form 8-K for April 8,
1994, as amended by Current Report on Form 8-K/A-1
dated April 8, 1994.
4. The Company's Quarterly Report on Form 10-Q for the
fiscal quarter ended April 3, 1994.
5. The Company's Current Report on Form 8-K for June 7,
1994.
6. The description of the Company's Common Stock, par
value $0.10 per share (the "Common Stock"), contained
in the Company's Registration Statement filed under
Section 12 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), including all amendments
and reports updating such description.
The consolidated financial statements incorporated in this
Registration Statement by reference to the Company's Annual Report on
Form 10-K for the fiscal year ended January 2, 1994, have been so
incorporated in reliance on the report of Ernst & Young, independent
auditors, given on the authority of said firm as experts in auditing
and accounting.
All documents subsequently filed by the Company with the
Commission pursuant to Sections 13(a), 13(c), 14 and 15(d) of the
Exchange Act after the date of this Registration Statement, but prior
to the filing of a post-effective amendment to this Registration
Statement which indicates that all securities offered by this
Registration Statement have been sold or which deregisters all such
securities then remaining unsold, shall be deemed to be incorporated
by reference into this Registration Statement. Each document
incorporated by reference into this Registration Statement shall be
deemed to be a part of this Registration Statement from the date of
the filing of such document with the Commission until the information
contained therein is superseded or updated by any subsequently filed
document which is incorporated by reference into this Registration
II-1
<PAGE>
Statement or by any document which constitutes part of the prospectus
relating to the Allegheny Ludlum Corporation Stock Acquisition and
Retention Plan (the "Plan") meeting the requirements of Section 10(a)
of the Securities Act of 1933, as amended.
Item 4. Description of Securities.
-------------------------
The class of securities to be offered under this Registration
Statement is registered under Section 12 of the Exchange Act.
Item 5. Interests of Named Experts and Counsel.
--------------------------------------
The legality of the Common Stock to which this Registration
Statement relates has been passed upon for the Company by Jon D.
Walton, Vice President-General Counsel and Secretary. Mr. Walton is
paid a salary by the Company, participates in benefit plans of the
Company, holds a position within the Company which permits the
Personnel and Compensation Committee to determine that he is eligible
to participate in the Plan, and beneficially owns 56,977 shares of
Common Stock, including presently exercisable options to purchase
40,459 shares of Common Stock.
Item 6. Indemnification of Directors and Officers.
-----------------------------------------
Sections 1741 and 1742 of the Pennsylvania Business Corporation
Law (the "BCL") provide that a business corporation shall have the
power to indemnify any person who was or is a party, or is threatened
to be made a party, to any proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that such
person is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as
a director, officer, employee or agent of another corporation or other
enterprise, against expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with such proceeding, if such person
acted in good faith and in a manner he reasonably believed to be in,
or not opposed to, the best interests of the corporation, and, with
respect to any criminal proceeding, had no reasonable cause to believe
his conduct was unlawful. In the case of an action by or in the right
of the corporation, such indemnification is limited to expenses
(including attorneys' fees) actually and reasonably incurred by such
person in connection with the defense or settlement of such action,
except that no indemnification shall be made in respect of any claim,
issue or matter as to which such person has been adjudged to be liable
to the corporation unless, and only to the extent that, a court
determines upon application that, despite the adjudication of
liability but in view of all the circumstances, such person is fairly
and reasonably entitled to indemnity for the expenses that the court
deems proper.
II-2
<PAGE>
BCL Section 1744 provides that, unless ordered by a court, any
indemnification referred to above shall be made by the corporation
only as authorized in the specific case upon a determination that
indemnification is proper in the circumstances because the indemnitee
has met the applicable standard of conduct. Such determination shall
be made:
(1) by the Board of Directors by a majority vote of a quorum
consisting of directors who were not parties to the proceeding;
or
(2) if such a quorum is not obtainable, or if obtainable and
a majority vote of a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion; or
(3) by the shareholders.
Notwithstanding the above, BCL Section 1743 provides that to the
extent a director, officer, employee or agent of a business
corporation is successful on the merits or otherwise in defense of any
proceeding referred to above, or in defense of any claim, issue or
matter therein, such person shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by such
person in connection therewith.
BCL Section 1745 provides that expenses (including attorneys'
fees) incurred by a director, officer, employee or agent of a business
corporation in defending any such proceeding may be paid by the
corporation in advance of the final disposition of the proceeding upon
receipt of an undertaking to repay the amount advanced if it is
ultimately determined that the indemnitee is not entitled to be
indemnified by the corporation.
BCL Section 1746 provides that the indemnification and
advancement of expenses provided by, or granted pursuant to, the
foregoing provisions is not exclusive of any other rights to which a
person seeking indemnification may be entitled under any bylaw,
agreement, vote of shareholders or disinterested directors or
otherwise, and that indemnification may be granted under any law,
agreement, vote of shareholders or directors or otherwise for any
action taken or any failure to take any action whether or not the
corporation would have the power to indemnify the person under any
other provision of law and whether or not the indemnified liability
arises or arose from any action by or in the right of the corporation,
provided, however, that no indemnification may be made in any case
where the act or failure to act giving rise to the claim for
indemnification is determined by a court to have constituted willful
misconduct or recklessness.
Section 1 of Article VIA of the Registrant's By-Laws, as amended,
provides that the Registrant shall indemnify, to the fullest extent
permitted by law, each director or officer (including each former
director or officer) of the Registrant who was or is made a party to
or a witness in or is threatened to be made a party to or a witness in
any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, by reason of
II-3
<PAGE>
the fact that he is or was an authorized representative of the
Registrant, against all expenses (including attorneys' fees and
disbursements), judgments, fines (including excise taxes and
penalties) and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding.
Section 2 of Article VIA of the Registrant's By-Laws, as amended,
further provides that the Registrant shall pay expenses (including
attorneys' fees and disbursements) incurred by a director or officer
of the Registrant referred to in Section 1 of such Article in
defending or appearing as a witness in any civil or criminal action,
suit or proceeding described in Section 1 of such Article in advance
of the final disposition of such action, suit or proceeding. The
expenses incurred by such director or officer shall be paid by the
Registrant in advance of the final disposition of such action, suit or
proceeding only upon receipt of an undertaking by or on behalf of such
director or officer to repay all amounts advanced if it shall
ultimately be determined that he is not entitled to be indemnified by
the Registrant.
The Registrant's By-Laws provide that the rights of
indemnification and advancement of expenses provided for therein shall
not be deemed exclusive of any other rights to which those seeking
indemnification or advancement of expenses may otherwise be entitled.
The Registrant has entered into indemnification agreements with
each of its directors in which the Registrant agrees to indemnify each
of its directors to the fullest extent permitted by law both as to
action in his official capacity and as to action in another capacity
and agrees to purchase and maintain insurance on the terms and
conditions described therein.
BCL Section 1747 permits a Pennsylvania business corporation to
purchase and maintain insurance on behalf of any person who is or was
a director, officer, employee or agent of the corporation, or is or
was serving at the request of the corporation as a director, officer,
employee or agent of another corporation or other enterprise, against
any liability asserted against such person and incurred by him in any
such capacity, or arising out of his status as such, whether or not
the corporation would have the power to indemnify the person against
such liability under the provisions described above.
Section 5 of Article IVA of the Registrant's By-Laws, as amended,
provides that, except in the circumstances set forth in Section 5, the
Registrant shall purchase and maintain insurance on behalf of each
director and officer against any liability asserted against or
incurred by such officer or director in any capacity, or arising out
of such director's or officer's status as such, whether or not the
Registrant would have the power to indemnify such person against such
liability under the provisions of Article IVA.
The Registrant maintains directors' and officers' liability
insurance covering its directors and officers with respect to
liabilities, including liabilities under the Securities Act of 1933,
as amended, which they may incur in connection with their serving as
such. Such insurance provides coverage for the directors and officers
II-4
<PAGE>
against certain liabilities even though such liabilities may not be
covered by the foregoing By-Law indemnification provision.
As permitted by BCL Section 1713, the By-Laws of the Registrant
provide that no director shall be personally liable for monetary
damages for any action taken, or failure to take any action, except
to the extent that such elimination or limitation of liability is
expressly prohibited by the act of November 28, 1986 (P. L. No. 145)
as in effect at the time of the alleged action or failure to take
action by the director. The BCL states that this exculpation from
liability does not apply where the director has breached or failed to
perform the duties of his office and the breach or failure to perform
constitutes self-dealing, willful misconduct or recklessness, and does
not apply to the responsibility or liability of a director pursuant to
any criminal statute or the liability of a director for payment of
taxes pursuant to Federal, state or local law. It may also not apply
to liabilities imposed upon directors by the Federal securities laws.
Item 7. Exemption for Registration Claimed.
----------------------------------
Not applicable.
Item 8. Exhibits.
--------
Exhibit
Number Description
- ------- -----------
4(a) Restated and Amended Articles of Incorporation
4(b) By-Laws, as amended, incorporated by reference to Exhibit 3
to the Company's Quarterly Report on Form 10-Q for the
fiscal quarter ended July 4, 1993.
4(c) Allegheny Ludlum Corporation Retirement Savings Plan,
as amended (formerly known as the Allegheny Ludlum Planned
Savings Plan)
4(d) Savings and Security Plan of the Tubular Products Division
of Allegheny Ludlum Corporation, as amended
4(e) Savings and Security Plan for the Special Materials Division
of Allegheny Ludlum Corporation, as amended
5 Opinion of Jon D. Walton, Vice President - General Counsel
and Secretary of the Company relating to the legality of the
shares registered under the Plans
23(a) Consent of Jon D. Walton is contained in the Opinion of
Counsel filed as Exhibit 5
23(b) Consent of Ernst & Young
24 Power of Attorney (included on page II-8)
II-5
<PAGE>
Item 9. Undertakings.
------------
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:
(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;
(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;
Provided, however, that paragraphs (a)(1)(i) and
-------- -------
(a)(1)(ii) do not apply if 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 Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for the
purposes of determining any liability under the Securities Act of
1933, each filing of the registrant's annual report pursuant to
section 13(a) or section 15(d) of the Securities Exchange Act of 1934
(and, where applicable, each filing of an employee benefit plan's
annual report pursuant to section 15(d) of the Securities Exchange Act
of 1934) that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
* * *
II-6
<PAGE>
(h) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Pittsburgh,
Commonwealth of Pennsylvania, on the 28th day of July, 1994.
ALLEGHENY LUDLUM CORPORATION
(Registrant)
By: /s/ James L. Murdy
--------------------------
James L. Murdy
Senior Vice President-Finance
and Chief Financial Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints J. L. Murdy, J. D. Walton, and
M. W. Snyder and each of them, his or her true and lawful attorneys-
in-fact and agents, with full power of substitution and revocation,
for him or her and in his or her name, place and stead, in any and all
capacities, to sign any and all amendments to this Registration
Statement, and to file the same with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each
of them, full power and authority to do and perform each and every act
and thing requisite and necessary to be done, as fully to all intents
and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents,
or any of them, or their or his substitute, may lawfully 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 indicated on the 28th day of July, 1994.
Signature Title
--------- -----
/s/ Richard P. Simmons
- ------------------------- Chairman of the Board and Director
Richard P. Simmons
/s/ Robert P. Bozzone
- ------------------------- President and Chief Executive
Robert P. Bozzone Officer and Director
II-8
<PAGE>
/s/ Arthur H. Aronson
- ------------------------- Executive Vice President and Chief
Arthur H. Aronson Operating Officer and Director
/s/ James L. Murdy
- ------------------------- Senior Vice President-Finance and
James L. Murdy Chief Financial Officer and
Director
/s/ Richard R. Roeser
- ------------------------- Vice President-Controller and
Richard R. Roeser Chief Accounting Officer
/s/ Paul S. Brentlinger
- ------------------------- Director
Paul S. Brentlinger
/s/ C. Fred Fetterolf
- ------------------------- Director
C. Fred Fetterolf
/s/ Thomas Marshall
- ------------------------- Director
Thomas Marshall
/s/ W. Craig McClelland
- ------------------------- Director
W. Craig McClelland
/s/ Richard K. Pitler
- ------------------------- Director
Richard K. Pitler
/s/ Charles J. Queenan, Jr.
- ------------------------- Director
Charles J. Queenan, Jr.
/s/ James E. Rohr
- ------------------------- Director
James E. Rohr
/s/ George W. Tippins
- ------------------------- Director
George W. Tippins
/s/ Steven C. Wheelwright
- ------------------------- Director
Steven C. Wheelwright
II-9
<PAGE>
ALLEGHENY LUDLUM CORPORATION RETIREMENT SAVINGS PLAN
----------------------------------------------------
Pursuant to the requirements of the Securities Act of 1933, the
Allegheny Ludlum Corporation Retirement Savings Plan has caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Old Lyme, State of
Connecticut, on the 28th day of July, 1994.
ALLEGHENY LUDLUM CORPORATION
RETIREMENT SAVINGS PLAN
By: /s/ Bruce A. McGillivray
--------------------------
Title: Plan Administrator
II-10
<PAGE>
SAVINGS AND SECURITY PLAN OF THE
TUBULAR PRODUCTS DIVISION OF
ALLEGHENY LUDLUM CORPORATION
----------------------------
Pursuant to the requirements of the Securities Act of 1933, the
Savings and Security Plan of the Tubular Products Division of
Allegheny Ludlum Corporation has caused this Registration Statement to
be signed on its behalf by the undersigned, thereunto duly authorized,
in the City of Old Lyme, State of Connecticut, on the 28th day of July, 1994.
SAVINGS AND SECURITY PLAN OF THE
TUBULAR PRODUCTS DIVISION OF
ALLEGHENY LUDLUM CORPORATION
By: /s/ Bruce A. McGillivray
--------------------------
Title: Plan Administrator
II-11
<PAGE>
SAVINGS AND SECURITY PLAN FOR THE
SPECIAL MATERIALS DIVISION OF
ALLEGHENY LUDLUM CORPORATION
----------------------------
Pursuant to the requirements of the Securities Act of 1933, the
Savings and Security Plan for the Special Materials Division of
Allegheny Ludlum Corporation has caused this Registration Statement to
be signed on its behalf by the undersigned, thereunto duly authorized,
in the City of Old Lyme, State of Connecticut, on the 28th day of July, 1994.
SAVINGS AND SECURITY PLAN FOR THE
SPECIAL MATERIALS DIVISION OF
ALLEGHENY LUDLUM CORPORATION
By: /s/ Bruce A. McGillivray
--------------------------
Title: Plan Administrator
II-12
<PAGE>
EXHIBIT INDEX
Exhibit
Number Item
- ------- ----
4(a) Restated and Amended Articles of Incorporation
4(c) Allegheny Ludlum Corporation Retirement Savings Plan, as
amended
4(d) Savings and Security Plan of the Tubular Products Division
of Allegheny Ludlum Corporation, as amended
4(e) Savings and Security Plan for the Special Materials Division
of Allegheny Ludlum Corporation, as amended
5 Opinion of Jon D. Walton, Vice President - General Counsel
and Secretary of the Company relating to the legality of the
shares registered under the Plans
23(a) Consent of Jon D. Walton is contained in the Opinion of
Counsel filed as Exhibit 5
23(b) Consent of Ernst & Young
II-13
EXHIBIT 4(a)
9439-12B
Microfilm Number Filed with the Department of State on JUN 13 1994
---- -----------
Entity Number 7612 /s/ Robert M. Grant
---- -------------------------------------------------
ACTING Secretary of the Commonwealth
ARTICLES OF AMENDMENT - DOMESTIC BUSINESS CORPORATION
In compliance with the requirements of 15 Pa.C.S. Section 1915
(relating to articles of amendment), the undersigned business
corporation, desiring to amend its Articles, hereby states that:
1. The name of the Corporation is: Allegheny Ludlum Corporation
--------------------------------
2. The address of the Corporation's current registered office in
this Commonwealth is: 10th Floor, Six PPG Place
-----------------------------------------
Pittsburgh, PA 15222 (Allegheny County)
-----------------------------------------
3. The statute by or under which it was incorporated is: Act of
----------
May 5, 1933, P.L. 364, as amended.
-----------------------------------------------------------------
4. The original date of its incorporation is: April 24, 1980
--------------------
5. This amendment shall be effective upon filing these Articles of
Amendment in the Secretary of the Commonwealth.
6. This amendment was adopted by the board of directors and the
shareholders pursuant to 15 Pa.C.S. Section 1914(a) and (b).
7. The amendment adopted by the corporation, set forth in full, is
as follows:
The first paragraph and Section A of Article Fifth of the
Company's Restated Articles of Incorporation are amended to
read as follows:
FIFTH: The aggregate number of shares which the
Corporation shall have the authority to issue is Three
Hundred Million (300,000,000) shares, as follows:
A. Two Hundred Fifty Million (250,000,000) shares
of Common Stock, of the par value of 10 cents
($0.10) per share.
Except for and subject to those rights as may
be expressly granted to the holders of
Preferred Stock pursuant to the authority
vested by these Articles of Incorporation in
the Board of Directors of the Corporation, or
except as may be provided by the laws of the
Commonwealth of Pennsylvania, the holders of
Common Stock shall have exclusively all
rights of shareholders.
IN TESTIMONY WHEREOF, the undersigned Corporation has caused
these Articles of Amendment to be signed by a duly authorized officer
thereof this 7th day of June , 1994.
--------
ALLEGHENY LUDLUM CORPORATION
By: /s/ J. D. Walton
-------------------------
Title: Vice President-General
Counsel and Secretary
-------------------------
JUN 13 94
PA Dept. of State
<PAGE>
Applicant's Account No. Filed this day of
-------- --------
DSCB BCL 806 (Rev 8-72) MAR 13 1987 , A.D. 19
------------------
Filing Fee: $40 Commonwealth of Pennsylvania
AB2
Department of State
/s/ James J. Haggerty
Secretary of the Commonwealth
Articles of COMMONWEALTH OF PENNSYLVANIA
Amendment - DEPARTMENT OF STATE
Domestic Business Corporation CORPORATION BUREAU
- ----------------------------------------------------------------------
In compliance with the requirements of section 806 of the
Business Corporation Law, act of May 5, 1933 (P.L. 364) (15 P.S.
Section 1806), the undersigned corporation, desiring to amend its Articles,
does hereby certify that:
1. The name of the corporation is:
ALLEGHENY LUDLUM CORPORATION
- ----------------------------------------------------------------------
2. The location of its registered office in this Commonwealth is
(the Department of State is hereby authorized to correct the following
statement to conform to the records of the Department):
10th Floor Six PPG Place
- ----------------------------------------------------------------------
(NUMBER) (STREET)
Pittsburgh Pennsylvania 15222
- ----------------------------------------------------------------------
(CITY) (ZIP CODE)
3. The statute by or under which it was incorporated is:
Act of May 5, 1933, P.L. 364, as amended
- ----------------------------------------------------------------------
4. The date of its incorporation is: April 24, 1980
--------------------------------
5. (Check, and if appropriate, complete one of the following):
XX The meeting of the shareholders of the corporation at which
--- the amendment was adopted was held at the time and place and
pursuant to the kind and period of notice herein stated.
Time: The 10th day of March , 1987 .
---------- -------------- ------
Place: 10th Floor, Six PPG Place, Pittsburgh, PA
-----------------------------------------------------------
Kind and period of notice written notice was sent to the
----------------------------------------
shareholders on January 30, 1987
- ----------------------------------------------------------------------
The amendment was adopted by a consent in writing, setting
--- forth the action so taken, signed by all of the shareholders
entitled to vote thereon and filed with the Secretary of the
corporation.
6. At the time of the action of shareholders:
(a) The total number of shares outstanding was:
65,000 shares of common stock
- ----------------------------------------------------------------------
(b) The number of shares entitled to vote was:
65,000 shares of common stock
- ----------------------------------------------------------------------
<PAGE>
DSCB BCL 806 (Rev 8-72)-2
7. In the action taken by the shareholders:
(a) The number of shares voted in favor of the amendment was:
65,000 shares of common stock
- ----------------------------------------------------------------------
(b) The number of shares voted against the amendment was:
None
- ----------------------------------------------------------------------
8. The amendment adopted by the shareholders, set forth in full, is
as follows:
The Restated Articles of Incorporation of Allegheny Ludlum
Corporation are amended to add thereto new Articles Sixth,
Seventh and Eighth as set forth in Exhibit A attached hereto.
IN TESTIMONY WHEREOF, the undersigned corporation has caused
these Articles of Amendment to be signed by a duly authorized officer
and its corporate seal, duly attested by another such officer, to be
hereunto affixed this day of March 12 , 1987.
--------------- --
ALLEGHENY LUDLUM CORPORATION
----------------------------
(NAME OF CORPORATION)
Attest: By: /s/ Richard P. Simmons
----------------------------
/s/ Jon D. Walton (SIGNATURE)
- ------------------------------
(SIGNATURE) CHAIRMAN OF THE BOARD
------------------------------
General Counsel & Secretary (TITLE: PRESIDENT, VICE PRESIDENT,
- ------------------------------ ETC.)
(TITLE: SECRETARY,
ASSISTANT SECRETARY, ETC.)
(CORPORATE SEAL)
<PAGE>
EXHIBIT A
SIXTH: The directors of the Corporation shall be divided into three
- -----
classes: Class I, Class II and Class III. Each class shall consist,
as nearly as may be possible, of one-third of the whole number of the
Board of Directors. The Class I directors shall be elected to hold
office for a term to expire at the first annual meeting of the
shareholders thereafter; the Class II directors shall be elected to
hold office for a term to expire at the second annual meeting of the
shareholders thereafter; and the Class III directors shall be elected
to hold office for a term to expire at the third annual meeting of the
shareholders thereafter, and in the case of each class, until their
respective successors are duly elected and qualified. At each annual
election the directors elected to succeed those whose terms expire
shall be identified as being of the same class as the directors they
succeed and shall be elected to hold office for a term to expire at
the third annual meeting of the shareholders after their election, and
until their respective successors are duly elected and qualified. If
the number of directors is changed, any increase or decrease in
directors shall be apportioned among the classes so as to maintain all
classes as equal in number as possible, and any additional director
elected to any class shall hold office for a term which shall coincide
with the terms of the other directors in such class and until his
successor is duly elected and qualified.
Subject to the rights of holders of any series of Preferred Stock
then outstanding, in the case of any increase in the number of
directors of the corporation the additional director or directors
shall be elected by the Board of Directors. No decrease in the number
of directors of the Corporation shall shorten the term of any
incumbent director.
SEVENTH: In addition to the requirements of (i) law, and (ii) the
- -------
other provisions of these Articles of Incorporation, as amended, the
affirmative vote of the holders of at least two-thirds of the
outstanding shares of Common Stock of the Corporation entitled to vote
shall be required for the adoption or authorization of a Fundamental
Change unless the Fundamental Change has been approved at a meeting of
the Board of Directors by the vote of more than two-thirds of the
incumbent members of the Board of Directors.
As used in this Article Seventh, "Fundamental Change" shall mean
(1) any merger or consolidation of the Corporation with or into any
other corporation, (2) any sale, lease, exchange, transfer or other
disposition, but excluding a mortgage or any other security device, of
all or substantially all of the assets of the Corporation, (3) any
merger of a Significant Shareholder into the Corporation or a direct
or indirect subsidiary of the Corporation, (4) any sale, lease,
exchange, transfer or other disposition to the Corporation or to a
direct or indirect subsidiary of the Corporation of any Common Stock
of the Corporation held by a Significant Shareholder or any other
assets of a Significant Shareholder which, if included with all other
dispositions consummated during the same fiscal year of the
Corporation by the same Significant Shareholder, would result in
dispositions of assets having an aggregate fair value in excess of
five percent of the total consolidated assets of the Corporation as
shown on its certified balance sheet as of the
<PAGE>
end of the fiscal year preceding the proposed disposition, (5) any
reclassification of Common Stock of the Corporation, or any
recapitalization involving Common Stock of the Corporation,
consummated within five years after a Significant Shareholder becomes
a Significant Shareholder, whereby the number of outstanding shares of
Common Stock is reduced or any of such shares are converted into or
exchanged for cash or other securities, (6) any dissolution and (7)
any agreement, contract or other arrangement providing for any of the
transactions described in this definition of Fundamental Change but,
notwithstanding anything to the contrary herein, Fundamental Change
shall not include any merger pursuant to the Pennsylvania Business
Corporation Law, as amended from time to time, which does not require
a vote of the Corporation's shareholders for approval.
As used in this Article Seventh, "Significant Shareholder" shall
mean any person who or which beneficially owns a number of shares of
Common Stock of the Corporation, whether or not such number includes
shares not then outstanding or entitled to vote, which exceeds a
number equal to ten percent of the outstanding shares of Common Stock
of the Corporation entitled to vote, any and all affiliates of such
person and any and all associates and family members of such person or
any such affiliate.
EIGHTH: In addition to the requirements of (i) law, and (ii) the
- ------
other provisions of these Articles of Incorporation, as amended, the
affirmative vote of the holders of at least two-thirds of the
outstanding shares of Common Stock of the Corporation entitled to vote
shall be required to amend these Articles of Incorporation so as to
delete, amend or supplement any term or provision of Articles Fourth,
Sixth, Seventh or Eighth hereof.
<PAGE>
COMMONWEALTH OF PENNSYLVANIA
Department of State
To All to Whom These Presents Shall Come, Greeting:
Whereas, In and by Article VIII of the Business Corporation Law,
approved the fifth day of May, Anno Domini one thousand nine hundred
and thirty-three, P. L. 364, as amended, the Department of State is
authorized and required to issue a
CERTIFICATE OF AMENDMENT
evidencing the amendment of the Articles of Incorporation of a
business corporation organized under or subject to the provisions of
that Law, and
Whereas, The stipulations and conditions of that Law pertaining
to the amendment of Articles of Incorporation have been fully complied
with by
ALLEGHENY LUDLUM CORPORATION
Therefore, Know Ye, That subject to the Constitution of this
Commonwealth and under the authority of the Business Corporation Law,
I do by these presents, which I have caused to be sealed with the
Great Seal of the Commonwealth, extend the rights and powers of the
corporation named above, in accordance with the terms and provisions
of the Articles of Amendment presented by it to the Department of
State, with full power and authority to use and enjoy such rights and
powers, subject to all the provisions and restrictions of the Business
Corporation Law and all other applicable laws of this Commonwealth.
Given under my Hand and the Great Seal of the
Commonwealth, at the City of Harrisburg, this
13th day of March in the year of our Lord one
thousand nine hundred and eighty-seven and of
the Commonwealth the two hundred eleventh.
/s/ James J. Haggerty
---------------------------------------------
Secretary of the Commonwealth
pjd
<PAGE>
Applicant's Account No. Filed this 23rd day of
-------- --------
DSCB BCL 806 (Rev 8-72) January
------------------, A.D. 1987
Filing Fee: $40
AB2 Commonwealth of Pennsylvania
Department of State
/s/ James J. Haggerty
Secretary of the Commonwealth
Articles of COMMONWEALTH OF PENNSYLVANIA
Amendment - DEPARTMENT OF STATE
Domestic Business Corporation CORPORATION BUREAU
- ----------------------------------------------------------------------
In compliance with the requirements of section 806 of the
Business Corporation Law, act of May 5, 1933 (P.L. 364) (15 P.S. Section
1806), the undersigned corporation, desiring to amend its Articles,
does hereby certify that:
1. The name of the corporation is:
ALLEGHENY LUDLUM CORPORATION
- ----------------------------------------------------------------------
2. The location of its registered office in this Commonwealth is
(the Department of State is hereby authorized to correct the following
statement to conform to the records of the Department):
10th Floor Six PPG Place
- ----------------------------------------------------------------------
(NUMBER) (STREET)
Pittsburgh Pennsylvania 15222
- ----------------------------------------------------------------------
(CITY) (ZIP CODE)
3. The statute by or under which it was incorporated is:
Act of May 5, 1933, P.L. 364, as amended
- ----------------------------------------------------------------------
4. The date of its incorporation is: April 24, 1980
--------------------------------
5. (Check, and if appropriate, complete one of the following):
XX The meeting of the shareholders of the corporation at which
--- the amendment was adopted was held at the time and place and
pursuant to the kind and period of notice herein stated.
Time: The 22nd day of December , 1986 .
---------- -------------- ------
Place: 10th Floor Six PPG Place, Pittsburgh, PA
-----------------------------------------------------------
Kind and period of notice written notice was sent to the
----------------------------------------
shareholders on December 11, 1986.
- ----------------------------------------------------------------------
The amendment was adopted by a consent in writing, setting
--- forth the action so taken, signed by all of the shareholders
entitled to vote thereon and filed with the Secretary of the
corporation.
6. At the time of the action of shareholders:
(a) The total number of shares outstanding was:
465,000 shares of common stock; 179,600 shares of 10% Preference Stock
- ----------------------------------------------------------------------
(b) The number of shares entitled to vote was:
465,000 shares of common stock; 179,600 shares of 10% Preference Stock
- ----------------------------------------------------------------------
<PAGE>
DSCB BCL 806 (Rev 8-72)-2
7. In the action taken by the shareholders:
(a) The number of shares voted in favor of the amendment was:
465,000 shares of common stock; 179,600 shares of 10% Preference Stock
- ----------------------------------------------------------------------
(b) The number of shares voted against the amendment was:
none
- ----------------------------------------------------------------------
8. The amendment adopted by the shareholders, set forth in full, is
as follows:
The Restated Articles of Incorporation of Allegheny Ludlum
Corporation were amended and restated in their entirety and are
attached hereto as Exhibit A.
IN TESTIMONY WHEREOF, the undersigned corporation has caused
these Articles of Amendment to be signed by a duly authorized officer
and its corporate seal, duly attested by another such officer, to be
hereunto affixed this day of 1/21 , 1987.
--------------- --
ALLEGHENY LUDLUM CORPORATION
----------------------------
(NAME OF CORPORATION)
Attest: By: /s/ R. P. Simmons
----------------------------
/s/ Jon D. Walton (SIGNATURE)
- ------------------------------
(SIGNATURE) CHAIRMAN
------------------------------
General Counsel & Secretary (TITLE: PRESIDENT, VICE PRESIDENT,
- ------------------------------ ETC.)
(TITLE: SECRETARY,
ASSISTANT SECRETARY, ETC.)
(CORPORATE SEAL)
<PAGE>
RESTATED ARTICLES OF
INCORPORATION OF
ALLEGHENY LUDLUM CORPORATION
FIRST: The name of the Corporation is ALLEGHENY LUDLUM
-----
CORPORATION.
SECOND: The location and post office address of the registered
------
office of the Corporation in this Commonwealth is 10th Floor Six PPG
Place, Pittsburgh, Pennsylvania 15222.
THIRD: The Corporation is incorporated under the Business
-----
Corporation Law of the Commonwealth of Pennsylvania for the purpose or
purposes of having unlimited power to engage in and to do any lawful
act concerning any or all lawful business for which corporations may
be incorporated under said Business Corporation Law, including, but
not limited to, the right to engage in manufacturing, processing,
research and development.
FOURTH: The term for which the Corporation is to exist is
------
perpetual.
FIFTH: The aggregate number of shares which the Corporation
-----
shall have authority to issue is One Hundred Fifty Million
(150,000,000) shares, as follows:
A. One Hundred Million (100,000,000) shares of
Common Stock, of the par value of 10 cents ($0.10) per
share.
<PAGE>
EXHIBIT A
Except for and subject to those rights as may be expressly
granted to the holders of Preferred Stock pursuant to the
authority vested by these Articles of Incorporation in the Board
of Directors of the Corporation, or except as may be provided by
the laws of the Commonwealth of Pennsylvania, the holders of
Common Stock shall have exclusively all rights of shareholders.
B. Fifty Million (50,000,000) shares of Preferred Stock,
of the par value of one dollar ($1.00) per share.
Authority is hereby expressly vested in the Board of
Directors of the Corporation at any time and from time to time by
resolution to divide into and issue the Common Stock and the
Preferred Stock in one or more series and, in establishing such
series, to fix the following:
(a) The voting rights of such series which may be
full, limited, fractional or none, but which may not be
multiple;
(b) The designation of such series and the number of
shares constituting such series, which number may at any
time or from time to time be increased or decreased, but not
below the number of shares then outstanding;
-2-
<PAGE>
(c) The rate at which dividends are to be payable on
shares of such series and, if the resolution or resolutions
establishing such series determine that such dividends shall
be cumulative, the date from which such dividends shall be
cumulative;
(d) Whether the shares of such series shall be
redeemable and, if so, the price or prices at which, and the
terms and conditions on which, such shares may be redeemed;
(e) The amounts payable on shares of such series upon
voluntary or involuntary liquidation, dissolution, winding
up or reduction of capital;
(f) Whether the shares of such series shall be
entitled to the benefit of a sinking or retirement fund to
be applied to the purchase or redemption of such shares, and
if so entitled, the amount of such fund and the manner of
its application, including the price or prices at which such
shares may be redeemed or purchased through the application
of such fund;
(g) The right, if any, of the holders of shares of
such series to convert the same into shares of Common Stock
or Preferred Stock and the terms and conditions of such
conversion;
-3-
<PAGE>
(h) The price or other consideration for which the
shares of such series shall be issued; and
(i) Such other terms, limitations and relative rights
and preferences, if any, of any such series as the Board of
Directors may at the time of such resolution lawfully fix
and determine under the laws of the Commonwealth of
Pennsylvania.
In all other respects each series of the Common Stock
shall be identical and Preferred Stock shall be identical.
-4-
<PAGE>
COMMONWEALTH OF PENNSYLVANIA
Department of State
To All to Whom These Presents Shall Come, Greeting:
Whereas, In and by Article VIII of the Business Corporation Law,
approved the fifth day of May, Anno Domini one thousand nine hundred
and thirty-three, P. L. 364, as amended, the Department of State is
authorized and required to issue a
CERTIFICATE OF AMENDMENT
evidencing the amendment and restatement of the Articles of
Incorporation in their entirety of a business corporation organized
under or subject to the provisions of that Law, and
Whereas, The stipulations and conditions of that Law pertaining
to the amendment of Articles of Incorporation have been fully complied
with by
ALLEGHENY LUDLUM CORPORATION
Henceforth The "Articles," as defined in Article I of the
Business Corporation Law, shall not include any prior documents;
Therefore, Know Ye, That subject to the Constitution of this
Commonwealth and under the authority of the Business Corporation Law,
I do by these presents, which I have caused to be Sealed with the
Great Seal of the Commonwealth, extend the rights and powers of the
corporation named above, in accordance with the terms and provisions
of the Articles of Amendment presented by it to the Department of
State, with full power and authority to use and enjoy such rights and
powers, subject to all the provisions and restrictions of the Business
Corporation Law and all other applicable laws of this Commonwealth.
Given under my Hand and the Great Seal of the
Commonwealth, at the City of Harrisburg, this
23rd day of January in the year of our Lord
one thousand nine hundred and eighty-seven
and of the Commonwealth the two hundred
eleventh.
/s/ James J. Haggerty
---------------------------------------------
Secretary of the Commonwealth
pjd
EXHIBIT 4(c)
Allegheny Ludlum Retirement Savings Plan
January 1, 1984
Amended and Restated
as of December 31, 1993
<PAGE>
TABLE OF CONTENTS
Page
PREAMBLE 1
ARTICLE I DEFINITIONS 4
Section 1.01 Account 4
Section 1.02 Act 4
Section 1.03 Actual Deferral Percentage 4
Section 1.04 Administrator 4
Section 1.05 Affiliated Company 4
Section 1.06 Annual Addition 5
Section 1.07 Average Contribution Percentage 5
Section 1.08 Basic Savings 6
Section 1.09 Board 6
Section 1.10 Break in Service 6
Section 1.11 Code 6
Section 1.12 Company Stock 7
Section 1.13 Company Stock Fund 7
Section 1.14 Compensation 7
Section 1.15 Continuous Service 9
Section 1.16 Contract Fund 9
Section 1.17 Corporation 9
Section 1.18 Current Market Value 9
Section 1.19 Current Unit Value 10
Section 1.20 Deferred Portion 10
Section 1.21 Deferred Basic Savings 10
Section 1.22 Deferred Salary Savings 10
Section 1.23 Deferred Supplemental Savings 10
Section 1.24 Diversified Fund 11
Section 1.25 Elective Deferrals 11
Section 1.26 Elective Deferral Limitation 11
Section 1.27 Eligible Employee 11
Section 1.28 Eligible Salary 13
Section 1.29 Employing Company 13
Section 1.30 Equity Fund 14
Section 1.31 Excess Contributions 14
Section 1.32 Excess Deferrals 14
Section 1.33 First Day 14
Section 1.34 Funds 14
Section 1.35 Highly Compensated Employee 14
Section 1.36 Hour of Service 19
Section 1.37 Matching Contributions 19
Section 1.38 Merger Date 18
Section 1.39 Month, Quarter and Year 19
Section 1.40 Nondeferred Basic Savings 19
Section 1.41 Nondeferred Salary Savings 20
Section 1.42 Nondeferred Supplemental Savings 20
Section 1.43 Nonhighly Compensated Employee 20
Section 1.44 Participant 20
Section 1.45 Permanent Disability 20
-i-
<PAGE>
TABLE OF CONTENTS
Page
Section 1.46 Permanent Layoff 20
Section 1.47 Plan 21
Section 1.48 Plan Year 21
Section 1.49 Profit Sharing Award 21
Section 1.50 Reemployment Commencement Date 21
Section 1.51 Retirement 21
Section 1.52 Rollover Contribution 22
Section 1.53 Savings Part 22
Section 1.54 Security Contributions 22
Section 1.55 Security Part 22
Section 1.56 Severance from Service 22
Section 1.57 Supplemental Savings 23
Section 1.58 Trustee 23
Section 1.59 Unit 23
Section 1.60 Valuation Date 23
Section 1.61 Withdrawable Portion 23
Section 1.62 Year Class 23
Section 1.63 Year of Service 24
ARTICLE II PARTICIPATION 25
Section 2.01 Initial Participation 25
Section 2.02 Re-employment 26
Section 2.03 Enrollment 26
ARTICLE III EMPLOYEE SAVINGS 27
Section 3.01 Basic Savings 27
Section 3.02 Supplemental Savings 27
Section 3.03 Tax Deferred Savings 28
Section 3.04 Change in Contribution Rate 29
Section 3.05 Discontinuance of Contributions 29
Section 3.06 Payment to Trustee 29
Section 3.07 Excess Deferrals 30
Section 3.08 Prevention or Correction of Excess
Deferrals 30
Section 3.09 Excess Contributions 32
Section 3.10 Limitation on Deferred Basic Savings and
Deferred Supplemental Savings 33
Section 3.11 Limitation on Nondeferred Salary Savings 34
ARTICLE IV CONTRIBUTIONS BY EMPLOYING COMPANIES 36
Section 4.01 Matching Contributions 36
Section 4.02 Security Contributions 36
-ii-
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE V INVESTMENTS 38
Section 5.01 Investment of Matching Contributions 38
Section 5.02 Investment of Security Contributions 38
Section 5.03 Investment of Participant Contributions 39
Section 5.04 Change in Investment Election Concerning
Security Contributions and Participant
Contribution 39
ARTICLE VI INVESTMENT FUNDS 41
Section 6.01 Investment Funds 41
Section 6.02 Income and Dividends 42
Section 6.03 Voting and Exercise of Other Rights 42
Section 6.04 Appointment of Investment Manager 43
ARTICLE VII VALUATION OF UNITS AND CREDITS TO
ACCOUNTS 44
Section 7.01 Valuation of Units 44
Section 7.02 Computation of Value 44
Section 7.03 Purchase of Units 44
Section 7.04 Company Stock Fund 45
Section 7.05 Restoration of Forfeitures 46
ARTICLE VIII WITHDRAWABLE PORTION AND DEFERRED PORTION 47
Section 8.01 Withdrawable Portion 47
Section 8.02 Deferred Portion 47
Section 8.03 Special Rule with Regard to Year Classes 47
ARTICLE IX VESTING 48
Section 9.01 Contributions by Employees 48
Section 9.02 Matching Contributions 48
Section 9.03 Security Contributions 48
Section 9.04 Forfeitures 50
ARTICLE X WITHDRAWALS WHILE EMPLOYED 51
Section 10.01 Security Part 51
Section 10.02 Withdrawable Portion 51
Section 10.03 Deferred Portion 51
Section 10.04 Hardship Withdrawal 52
Section 10.05 Replacement 55
Section 10.06 Loans 55
ARTICLE XI DISTRIBUTIONS UPON TERMINATION OF
-iii-
<PAGE>
TABLE OF CONTENTS
Page
EMPLOYMENT 60
Section 11.01 Distributions Upon Termination
of Employment by Reason of Retirement,
Permanent Layoff or Death 60
Section 11.02 Distributions Upon Termination
of Employment by Reason of
Resignation or Discharge 60
Section 11.03 Disregard of Service 61
Section 11.04 Transfer of Employment 61
Section 11.05 Election to Defer Receipt of
Distributions and Withdrawals of
Distributions Deferred 61
ARTICLE XII PAYMENT OF WITHDRAWALS AND DISTRIBUTIONS 64
Section 12.01 Contract Fund, Equity Fund
and Diversified Fund 64
Section 12.02 Company Stock 64
Section 12.03 Effective Date of Withdrawal or
Distribution 64
Section 12.04 Payment of Benefits 65
Section 12.05 Application of Security and Matching
Contributions and Earnings Forfeited 66
Section 12.06 Incidental Benefit Requirements 66
ARTICLE XIII ADMINISTRATION 67
Section 13.01 Trustee 67
Section 13.02 Administrator 67
Section 13.03 Liability 68
Section 13.04 Administrative Expenses 68
Section 13.05 Designation of Beneficiaries
in the Event of Death 68
Section 13.06 Limits on Contributions 69
Section 13.07 Combined Limitations 71
ARTICLE XIV TOP-HEAVY PLAN PROVISIONS 74
Section 14.01 Purpose 74
Section 14.02 Definitions 74
Section 14.03 Determination of Whether the Plan is
"Top-Heavy" 76
Section 14.04 Aggregation Group of Employer Plans 77
Section 14.05 Special Minimum Contribution and
Minimum Vesting, and Compensation
Limitation, Becoming Operative in
the Event the Plan Becomes
-iv-
<PAGE>
TABLE OF CONTENTS
Page
"Top-Heavy" 78
Section 14.06 Pre-"Top-Heavy" Plan Terminated
Participant 80
Section 14.07 Special "Top-Heavy" Reduction in
Combined Benefit 80
Section 14.08 Termination of "Top-Heavy" Status 81
Section 14.09 Multiple "Top-Heavy" Plans 81
Section 14.10 Effect of the Plan Becoming "Super
Top-Heavy" 81
ARTICLE XV MISCELLANEOUS 83
Section 15.01 Alienation 83
Section 15.02 Extent of Participant's Rights 84
Section 15.03 Rollover Contributions 84
Section 15.04 Purpose 85
Section 15.05 Merger 85
Section 15.06 Amendment and Termination 87
Section 15.07 Applicable Law 87
Section 15.08 Incapacity of Recipient of Benefits 89
Section 15.09 Merger, Consolidation or Discontinuance
Involving Corporation 89
Section 15.10 Liability of Officers and Directors
of the Corporation 89
Section 15.11 Indemnification of Fiduciaries 90
Section 15.11 Service of Process 90
- v -
<PAGE>
ALLEGHENY LUDLUM RETIREMENT SAVINGS PLAN
PREAMBLE
Prior to January 1, 1981 Allegheny Ludlum Steel
Corporation was a wholly-owned subsidiary of Allegheny Ludlum
Industries, Inc. and as such was participating in the Allegheny
Ludlum Industries, Inc. Thrift Plan as an employing company. The
capital stock of Allegheny Ludlum Steel Corporation was sold by
Allegheny Ludlum Industries, Inc. to LSC, Inc. on December 26,
1980 and Allegheny Ludlum Steel Corporation ceased to be eligible
to participate in the Allegheny Ludlum Industries, Inc. Thrift
Plan on that date. Allegheny Ludlum Steel Corporation and
Allegheny Ludlum Industries, Inc. agreed to continue the
aforementioned Allegheny Ludlum Industries, Inc. Thrift Plan in
the form of two separate thrift plans for their respective
employees. The assets of the Allegheny Ludlum Industries, Inc.
Thrift Plan allocated to the accounts of Allegheny Ludlum Steel
Corporation employees were transferred to the Allegheny Ludlum
Steel Corporation Thrift Plan which was established by Allegheny
Ludlum Steel Corporation.
Effective 1985, Allegheny Ludlum Steel Corporation (now
Allegheny Ludlum Corporation) amended and restated the Plan to
reflect Section 401(k) of the Code, to broaden the investment
flexibility made available to participants in the Plan, to comply
with the provisions of the Tax Equity and Fiscal Responsibility
Act of 1982, and to generally simplify the Plan and further
amended and restated the Plan to comply with the provisions of
the Deficit Reduction Act of 1984 and the Retirement Equity Act
<PAGE>
of 1984. As amended and restated the Plan was renamed "Allegheny
Ludlum Planned Savings Plan".
The Plan was amended, effective July 1, 1987 (and in
connection with Allegheny Ludlum Corporation's initial public
offering), and restated to provide that Corporation contributions
thereafter under the Plan would be held in the form of Company
Stock and to provide that as soon as legally and administratively
feasible thereafter, Participants would have the right to direct
that some or all of their contributions and balances be held in
the form of Company Stock.
The Plan was amended, effective January 1, 1989, to
comply with the Tax Reform Act of 1986, the Technical and
Miscellaneous Revenue Act of 1988 and other federal statutes and
regulations.
The Plan was amended and restated effective January 1,
1994, to accommodate the merger of the Allegheny Ludlum
Retirement Security Program with and into the Plan, to divide the
Plan into the Savings and Security Parts, and to preserve in the
Plan the benefits, rights and features of the Allegheny Ludlum
Retirement Security Program to the extent administratively
practical or required by law. As amended and restated the Plan
has been renamed the "Allegheny Ludlum Retirement Savings Plan".
The Plan is intended to encourage thrift and to assist
employees to accumulate a fund to supplement retirement income by
allowing eligible employees to make tax-deferred savings, by
providing for a matching employer contribution with respect to
- 2 -
<PAGE>
certain matching contributions and by permitting the Corporation
to make additional contributions toward the retirement security
of eligible employees. The Plan is intended to be a profit
sharing plan qualified under Section 401(a) of the Code,
incorporating a cash or deferred arrangement under Section 401(k)
of the Code.
- 3 -
<PAGE>
ARTICLE I
DEFINITIONS
Whenever used in this Plan, unless a different meaning
is plainly required by the context:
Section 1.01 "Account" means, as of any Valuation
Date, the sum of a Participant's accounts under the (i) Savings
Part and (ii) Security Part.
Section 1.02 "Act" means the Employee Retirement
Income Security Act of 1974, as the same may be amended from time
to time.
Section 1.03 "Actual Deferral Percentage" means, for
any group of Eligible Employees, the average of the following
ratios computed separately for each Eligible Employee in the
group: (1) Deferred Basic Savings and Deferred Supplemental
Savings made by the Eligible Employee for the Plan Year, to (2)
the Eligible Employee's Eligible Salary for the Plan Year. For
purposes of calculating the Actual Deferral Percentage, in the
event an Eligible Employee who is a Highly Compensated Employee
participates in two or more cash or deferred arrangements
sponsored by the Corporation or an Affiliated Company, all such
cash or deferred arrangements shall be aggregated.
Section 1.04 "Administrator" means the committee
established pursuant to Section 13.02.
Section 1.05 "Affiliated Company" means any
corporation or other entity which is a member of a controlled
- 4 -
<PAGE>
group of corporations or other entities (as defined in Sections
414(b) and 414(c) of the Code and, for purposes of Sections 13.06
and 13.07 hereof, as modified by Section 415(h) of the Code) or
that is a member of an affiliated service group (as defined in
Section 414(m) of the Code), or any corporation or other entity
required to be aggregated with the Corporation under Section
414(o) of the Code or regulations issued thereunder.
Section 1.06 "Annual Addition" means with respect to
any Plan Year for any Participant the sum, as applicable, of (i)
Matching Contributions, (ii) Security Contributions, (iii) the
Deferred Basic Savings, (iv) the Deferred Supplemental Savings,
(v) Nondeferred Basic Savings, and (vi) Nondeferred Supplemental
Savings made to the Plan on behalf of the Participant for such
Plan Year.
Section 1.07 "Average Contribution Percentage" means,
for any group of Eligible Employees for a Plan Year, the average
of the ratios, computed separately for each Eligible Employee in
such group, of the Nondeferred Basic Savings and Nondeferred
Supplemental Savings made on behalf of such Eligible Employee for
the Plan Year to the Eligible Employee's Eligible salary for the
Plan Year. For purposes of calculating the Average Contribution
Percentage, in the event an Eligible Employee who is a Highly
Compensated Employee participates in two or more such plans
sponsored by the Corporation or an Affiliated Company, all such
plans shall be aggregated.
- 5 -
<PAGE>
Section 1.08 "Basic Savings" means the payments an
Eligible Employee elects to make pursuant to Section 3.01 and
which are matched with Matching Contributions.
Section 1.09 "Board" means the Board of Directors of
the Corporation.
Section 1.10 "Break in Service" means a Plan Year
including or following an Employee's Severance from Service,
during which he or she is not reemployed by and he or she does
not perform 501 Hours of Service for an Employing Company. In
the case of an Employee who is absent from work for maternity or
paternity reasons, such Employee shall receive credit for Hours
of Service, up to five hundred and one (501), which would have
been credited but for such absence. The Hours of Service
credited for a maternity or paternity absence shall be credited
in the year in which such absence begins if necessary to prevent
a Break in Service in such Plan Year or, in all other cases, in
the following Plan Year. For purposes of the previous sentence,
an absence from work for maternity or paternity reasons means an
absence (i) by reason of the pregnancy of the Employee, (ii) by
reason of the birth of a child of the Employee, (iii) by reason
of the placement of a child with the Employee in connection with
the adoption of such child by such Employee, or (iv) for purposes
of caring for such child for a period beginning immediately
following such birth or placement.
Section 1.11 "Code" means the Internal Revenue Code
of 1986, as amended from time to time.
- 6 -
<PAGE>
Section 1.12 "Company Stock" means shares of common
stock, $0.10 par value, of Allegheny Ludlum Corporation.
Section 1.13 "Company Stock Fund" means the Fund
provided for in Section 6.01(d).
Section 1.14 "Compensation" means all amounts paid by
the Corporation or an Affiliated Company to an employee as
compensation within the meaning of Section 415(c)(3) of the Code
and regulations issued thereunder. Without limiting the
foregoing, Compensation shall include a Participant's earned
income, wages, salaries and fees for professional services and
other amounts received for personal services actually rendered in
the course of employment with the Corporation or an Affiliated
Company (including, but not limited to, commissions paid
salesmen, compensation for services on the basis of a percentage
of profits, commissions on insurance premiums, tips and bonuses),
and excluding the following:
(i) Contributions to a plan of deferred compensation
by the Corporation or an Affiliated Company which are not
includable in the Employee's gross income for the taxable
year in which contributed, or contributions by the
Corporation or an Affiliated Company 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;
(ii) Amounts realized from the exercise of a
nonqualified stock option, or when restricted stock (or
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property) held by the Employee either becomes freely
transferable or is no longer subject to a substantial risk
of forfeiture;
(iii) Amounts realized from the sale, exchange or
other disposition of stock acquired under a qualified stock
option; and
(iv) Other amounts which received special tax benefits,
or contributions made by the Corporation or an Affiliated
Company (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).
For purposes of this Section, Compensation for a limitation year
is the compensation actually paid or includable in gross income
during such year. Notwithstanding any other provision of this
Plan, Compensation for purposes of this Plan for any Plan Year
commencing on or after January 1, 1994 shall not exceed an amount
equal to $150,000 ($200,000 as adjusted for years 1989-1993,
e.g., $235,840 for 1993) or such greater amount as may be in
effect for subsequent calendar years pursuant to Section
401(a)(17) of the Code. In determining the Compensation of a
Participant for purposes of the $150,000 limitation, the rules of
Section 414(q)(6) of the Code shall apply; provided that the term
"family" shall include only a Participant's spouse and lineal
descendants who have not attained age 19 before the end of the
Plan Year. If the $150,000 limitation is exceeded, then the
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limitation shall be prorated among the affected individuals in
proportion to each such individual's Compensation (as determined
without reference to the $150,000 limitation).
Section 1.15 "Continuous Service" means a period of
employment measured as follows:
(a) An Eligible Employee shall be credited with a
Month of Continuous Service for any calendar month in which he or
she completes at least one (1) Hour of Service. For purposes of
measuring the initial six (6) Months of Continuous Service, if an
Eligible Employee who has incurred a Severance from Service is
reemployed before incurring a Break in Service, his or her
Continuous Service shall be regarded as unbroken and shall
include the interim between his or her Severance from Service and
his or her Reemployment Commencement Date.
(b) For purposes of measuring Years of Service, an
Eligible Employee shall be credited with a Year of Continuous
Service for each twelve (12) months of Continuous Service,
whether or not consecutive, so long as such service is not
interrupted by a period of five (5) or more consecutive Breaks in
Service.
Section 1.16 "Contract Fund" means the Fund provided
for in Section 6.01(a).
Section 1.17 "Corporation" means Allegheny Ludlum
Corporation and any corporation which shall be its successor.
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Section 1.18 "Current Market Value" means with
respect to Company Stock, the closing market price on the New
York Stock Exchange on the relevant date, or, if not traded on
such date on such Exchange, the closing price on the next
preceding trading day.
Section 1.19 "Current Unit Value" means the value of
each Unit in a Fund as determined in accordance with Article VII.
Section 1.20 "Deferred Portion" means, as of any
Valuation Date, the then current value of the Participant's
Deferred Basic Savings and earnings thereon to the extent the
Matching Contributions made with respect thereto are then vested
and Deferred Supplemental Savings and earnings thereon.
Section 1.21 "Deferred Basic Savings" means the
payments into the Plan on behalf of an Eligible Employee pursuant
to Section 3.01 which may be made subject to Matching
Contributions pursuant to Section 1.36 and may be excluded from
the Eligible Employee's gross income for federal income tax
purposes pursuant to Section 401(k) of the Code.
Section 1.22 "Deferred Salary Savings" means the
total of a Participant's Deferred Basic Savings and Deferred
Supplemental Savings.
Section 1.23 "Deferred Supplemental Savings" means
the payments into the Plan on behalf of an Eligible Employee
pursuant to Section 3.02 which may not be made subject to
Matching Contributions pursuant to Section 4.01 and may be
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excluded from the Eligible Employee's gross income for federal
income tax purposes pursuant to Section 401(k) of the Code.
Section 1.24 "Diversified Fund" means the Fund
provided for in Section 6.01(c).
Section 1.25 "Elective Deferrals" means the sum of
the Deferred Basic Savings and Deferred Supplemental Savings
under this Plan and any other elective deferrals as defined in
Section 402(g)(3) of the Code to or with respect to any other
cash or deferred arrangement of any employer, including members
of the controlled group which includes the Corporation made on
behalf of an Eligible Employer.
Section 1.26 "Elective Deferral Limitation" means for
the 1993 calendar year, $8,994 and, for each subsequent calendar
year, such amount above as adjusted by the Secretary of the
Treasury pursuant to sections 402(g)(5) and 415 of the Code.
Section 1.27 "Eligible Employee" means any person who
shall be employed by one or more of the Employing Companies who
meets all of the following conditions:
(a) (i) For an initial determination of eligibility,
the employee completes one thousand (1,000) Hours of Service
during the 12 month period beginning on the date the
employee first completes an Hour of Service (the employee's
"Employment Commencement Date"); provided, that for purposes
of Section 2.01(a), each employee who otherwise meets the
requirements of this Section shall be deemed to be an
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Eligible Employee on the first day of his or her Employment
subject to a determination subsequent regarding compliance
with this Subsection; and
(ii) For any period following an initial
determination of eligibility, the employee completes one
thousand (1,000) Hours of Service in each computation
period, which shall be the Plan Year, provided, if an
employee is credited with one thousand (1,000) Hours of
Service under (a)(i) and with one thousand (1,000) Hours of
Service in the Plan Year which includes the first
anniversary of the employee's Employment Commencement Date,
the employee will be credited with two Years of Service for
eligibility to participate; and
(b) An employee who shall have completed at least six
(6) Months of Continuous Service during his or her current, or
any previous, period of employment with an Employing Company; and
(c) An employee who is not in a unit of employees
covered by a collective bargaining agreement, unless such
agreement provides for the application of the Plan to the
employees in such unit.
Eligible Employees shall not include any individuals (other
than common law employees) performing services for Employing
pursuant to an agreement between the Employing Company and a
leasing organization on a substantially full-time basis for at
least one year, where the services are of a type historically
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performed by employees in the business field of the Employing
Company (a "Leased Employee"). Leased Employees shall not be
considered an employee of the Employing Company for the purposes
described in Section 414(n)(3) of the Code if Leased Employees
constitute less than twenty percent (20%) of the Employing
Company's nonhighly compensated workforce (within the meaning of
Section 414(n)(5)(C)(ii) of the Code) and are covered by a money
purchase pension plan meeting the requirements of Code Section
414(n)(5)(B).
Section 1.28 "Eligible Salary" means base salary,
prior to any reduction for Deferred Basic Savings, Deferred
Supplemental Savings or any contribution to any other plan
pursuant to Section 401(k) or any reduction pursuant to Section
125 or 129 of the Code (or any other provisions thereof which
permit salary reductions), during such periods as the employee is
eligible to participate in the Plan. The term shall not include
additional compensation or other incentive payments (others than
commissions and bonuses), extended work week or other premiums
(other than overtime), or any other special payments, fees or
allowances.
Section 1.29 "Employing Company" means the
Corporation and (i) any Affiliated Company or (ii) any other
entity which the Board shall from time to time designate as a
participating company for the purposes of the Plan. Without
limiting the generality of the foregoing, as of the date of this
most recent restatement, Jessop Steel Company has been included
as a participating company.
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Section 1.30 "Equity Fund" means the Fund provided
for in Section 6.01(b).
Section 1.31 "Excess Contributions" means for any
Plan Year, the amount, if any, by which the sum of the Deferred
Basic Savings and Deferred Supplemental Savings such Plan Year
made on behalf of a Highly Compensated Employee exceeds the
limitations for such Plan Year pursuant to Section 3.10.
Section 1.32 "Excess Deferrals" means for any
calendar year, the amount, if any, by which a Participant's
Elective Deferrals for such calendar year exceeds the Elective
Deferral Limitation as in effect for such calendar year.
Section 1.33 "First Day" means the beginning of the
first payroll period ending in the month or quarter or year to
which reference is made.
Section 1.34 "Funds" means the Company Stock Fund,
the Contract Fund, the Equity Fund, the Diversified Fund and any
other fund established for such purpose or any replacement fund
for any or all of the foregoing, collectively.
Section 1.35 "Highly Compensated Employee" means:
(a) Any Eligible Employee who, during the calendar
year which ends in the current Plan Year or the preceding
calendar year:
(i) was at any time a 5-Percent Owner,
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(ii) received Compensation from the Corporation in
excess of $96,368 for the calendar year commencing in 1993
and as adjusted for any subsequent Plan year;
(iii) received Compensation from the Corporation in
excess of $64,245 for the calendar year commencing in 1993
and as adjusted for any subsequent calendar year and was in
the top-paid group of employees for such calendar year, or
(iv) was at any time an officer of the Corporation or
an Affiliated Company and received Compensation greater than
fifty percent (50%) of the amount in effect under Section
415(b)(1)(A) of the Code for such calendar year.
(b) Special Rule For Current Calendar Year. In the
case of the calendar year for which the relevant determination is
being made, an Eligible Employee not described in paragraph (ii),
(iii), or (iv) of subsection (a) for the preceding calendar year
(without regard to this subsection (b)) shall not be treated as
described in paragraph (ii), (iii), or (iv) of subsection (a)
unless such Eligible Employee is a member of the group consisting
of the one hundred (100) Eligible Employees paid the greatest
Compensation during the calendar year for which such
determination is being made.
(c) 5-Percent Owner. An Eligible Employee shall be
treated as a "5-Percent Owner" for any calendar year if at any
time during such calendar year such Eligible Employee was a 5-
percent owner (as defined in Section 416(i)(1) of the Code) of
the Corporation.
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<PAGE>
(d) Top-Paid Group. An Eligible Employee is in the
top-paid group of employees for any calendar year if such
Eligible Employee is in the group consisting of the top twenty
percent (20%) of the Eligible Employees when ranked on the basis
of Compensation paid during such calendar year.
(e) Special Rules For Officers.
(i) For purposes of paragraph (a)(i) above, no more
than fifty (50) Eligible Employees (or, if lesser, the
greater of three (3) Eligible Employees or ten (10) percent
of the Eligible Employees) shall be treated as officers.
(ii) If, for any calendar year, no officer of the
Corporation is described in paragraph (a)(i) above, the
highest paid officer of the Corporation for such calendar
year shall be treated as described in such paragraph.
(f) Treatment Of Certain Family Members.
(i) If any individual is a member of the family of a
5-Percent Owner or of a Highly Compensated Employee in the
group consisting of the ten (10) Highly Compensated
Employees paid the greatest Compensation during the year,
then,
(A) such individual shall not be considered a
separate Eligible Employee, and
(B) any Compensation paid to such individual (and
any applicable contribution or benefit on behalf of
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such individual) shall be treated as if it were paid to
(or on behalf of) the 5-Percent Owner or Highly
Compensated Employee.
(ii) For purposes of paragraph (i) of this subsection
(f), the term "family" means, with respect to any Eligible
Employee, such Eligible Employee's spouse and lineal
ascendants or descendants and the spouses of lineal
ascendants or descendants.
(g) Compensation. For purposes of this Section 1.35
the term "Compensation" means compensation within the meaning of
Section 415(c)(3) of the Code; provided, however, that such
determination shall be determined:
(i) without regard to Sections 125, 129, and
402(h)(1)(B) of the Code, and
(ii) in the case of employer contributions made
pursuant to a salary reduction agreement, without regard to
Section 402(a)(8) of the Code.
(h) Excluded Employees. (i) For purposes of
determining the number of Employees in the top-paid group under
paragraph (a)(iv) above, the following employees shall be
excluded:
(A) Employees who have not completed six (6) months of
service,
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(B) Employees who normally work less than seventeen
and one-half (17-1/2) hours per week,
(C) Employees who normally work during not more than
six (6) months during any year,
(D) Employees who have not attained age twenty-one
(21),
(E) Except to the extent provided in regulations
issued by the United States Department of the
Treasury, Eligible Employees who are included in a
Unit of employees covered by an agreement that the
Secretary of Labor finds to be a collective
bargaining agreement between employee
representatives and the Corporation or an
Affiliated Company, and
(ii) Employees who are nonresident aliens and who
receive no earned income (within the meaning of Section
911(d)(2) of the Code) from the Corporation or an Affiliated
Company which constitutes income from sources within the
United States (within the meaning of Section 861(a)(3) of
the Code) shall be excluded for all purposes in this
Section 1.35.
(i) Lag Period. For purposes of the determination
year, such amounts shall be adjusted as may be required for any
lag period under regulations published by the Secretary of the
Treasury.
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<PAGE>
Section 1.36 "Hour of Service" means an hour for
which an employee is paid, or entitled to payment, by the
Corporation or an Affiliated Company for the performance of
duties. Hours of Service hereunder shall be calculated and
credited in accordance with 29 C.F.R. Section 2530.200b, which is
incorporated herein by this reference.
Section 1.37 "Matching Contributions" means the
amount the Employing Companies will pay into the Plan pursuant to
Section 4.01 to match Participant Basic Savings.
Section 1.38 "Merger Date" means December 31, 1993,
the effective date of the merger of the Allegheny Ludlum
Retirement Security Program with and into the Plan.
Section 1.39 "Month, Quarter and Year" means, for the
purposes of determining eligibility to participate and of
computing savings in accordance with Sections 3.01 and 3.02 and
Matching and Security Contributions in accordance with Article
IV, as to each Employee that period which includes all payroll
periods ending in the calendar month or calendar quarter or
calendar year to which reference is made, and for such purposes
shall be considered to run from the beginning of the first
payroll period which ends in such calendar period to the end of
the last payroll period ending in such calendar period. For all
other purposes it means the calendar month or calendar quarter or
calendar year to which reference is made.
Section 1.40 "Nondeferred Basic Savings" means the
payments into the Plan by an Eligible Employee pursuant to
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Section 3.01 which may be made subject to Matching Contributions
pursuant to Section 4.01 and are not classified as Deferred Basic
Savings.
Section 1.41 "Nondeferred Salary Savings" means the
total of a Participant's Nondeferred Basic Savings and
Nondeferred Supplemental Savings.
Section 1.42 "Nondeferred Supplemental Savings" means
the payments into the Plan by an Eligible Employee pursuant to
Section 3.02 which may not be made subject to Matching
Contributions pursuant to Section 4.01 and are not classified as
Deferred Supplemental Savings.
Section 1.43 "Nonhighly Compensated Employee" means
any Eligible Employee who is not a Highly Compensated Employee.
Section 1.44 "Participant" means an Eligible Employee
who has elected to participate in the Plan in accordance with
Article II.
Section 1.45 "Permanent Disability" means disability
by bodily injury or disease, either occupational or
nonoccupational in cause, preventing the employee, on the basis
of medical evidence satisfactory to the Administrator, from
engaging in any occupation or employment with an Employing
Company.
Section 1.46 "Permanent Layoff" means any involuntary
termination of employment as a result of a reduction in force
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(other than by reason of discharge for cause, death, or
Retirement).
Section 1.47 "Plan" means the Allegheny Ludlum
Retirement Savings Plan, as amended from time to time, which is
set forth herein and is intended to qualify with the provisions
of Section 401(a) of the Code as a profit sharing plan which also
permits employees to redirect compensation and contributions
hereto under Section 401(k) of the Code and receive matching
contributions thereon under Section 401(m) of the Code.
Section 1.48 "Plan Year" means the twelve (12) month
period ending December 31.
Section 1.49 "Profit Sharing Award" means a payment
to an Eligible Employee in the nature of compensation paid by the
Corporation pursuant to a Plan or arrangement which determines
amounts based on the profits of the Corporation and/or the
Eligible Employee's contributions thereto.
Section 1.50 "Reemployment Commencement Date" means
the date following an employee's Severance from Service on which
the employee first completes an Hour of Service after
reemployment.
Section 1.51 "Retirement" means the earlier of: (i)
termination of employment with a pension under the provisions of
a retirement or pension plan of an Employing Company which the
Participant has a right to commence receiving immediately
following his or her termination of employment, or (ii)
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termination of employment following attainment of age sixty-five
(65) regardless of eligibility for pension.
Section 1.52 "Rollover Contribution" means an amount
transferred or rolled over to the Plan by or on behalf of an
Eligible Employee pursuant to Section 15.03.
Section 1.53 "Savings Part" means the part of the
Plan to which Basic Savings, Supplemental Savings, Rollover
Contributions, Matching Contributions and earnings thereon are
credited.
Section 1.54 "Security Contributions" means
contributions made by the Corporation pursuant to Section 4.02
Section 1.55 "Security Part" means the part of the
Plan to which Security Contributions and earnings thereon are
credited.
Section 1.56 "Severance from Service" means the
earlier of (i) the date an employee retires, resigns, is
Permanently Laid Off, or is discharged; or (ii) in the case of an
employee who is continuously absent from work for any other
reason (other than by reason of disability, or an approved leave
of absence pursuant to an Employing Company's non-discriminating
policy), on the first anniversary of the date such employee is
first absent for such other reason (unless he or she has retired,
resigned or been Permanently Laid Off or discharged before such
anniversary).
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Section 1.57 "Supplemental Savings" means the
payments an Eligible Employee elects to make pursuant to Section
3.02 and which are not matched with Matching Contributions.
Section 1.58 "Trustee" means the Trustee or Trustees
appointed by the Board in accordance with Section 13.01.
Section 1.59 "Unit" means one of the units
representing an interest in the Contract Fund, Equity Fund or
Diversified Fund and/or such other Fund for which recordkeeping
and accounting are performed in unit format.
Section 1.60 "Valuation Date" means the last date of
each calendar month or calendar quarter on which the
Administrator causes the fair market value of the assets
comprising the Funds to be determined.
Section 1.61 "Withdrawable Portion" means, as of any
Valuation Date, the then current value of (i) Nondeferred Salary
Savings and earnings thereon to the extent the Matching
Contributions made with respect thereto have become vested
pursuant to Article IX, (ii) vested Matching Contributions and
earnings thereon, and (iii) Rollover Contributions.
Section 1.62 "Year Class" means an annual period
beginning on January 1 and ending on December 31, inclusive;
provided, however, no Year Class shall be formed with respect to
contributions made by the Corporation or an Affiliated Company
with respect to Plan Years which commence on or after January 1,
1989.
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<PAGE>
Section 1.63 "Year of Service" means, except as
provided in Section 9.03 with respect to Years of Service for
Eligible Employees who were participating in the Allegheny Ludlum
Retirement Security Program as of the Merger Date, a twelve (12)
consecutive month period beginning with the date an Eligible
Employee first completes an Hour of Service if during that period
the Eligible Employee completes one thousand (1,000) Hours of
Service, and any Plan Year, ending after the initial anniversary
of the Eligible Employee's first Hour of Service, if during such
Plan Year the Eligible Employee has completed one thousand
(1,000) Hours of Service.
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ARTICLE II
PARTICIPATION
Section 2.01 Initial Participation.
(a) Security Part. Each individual hired after the
Merger Date who becomes an Eligible Employee shall commence
participation in the Security Part of the Plan or the First Day
of any Quarter next following or coinciding with the latest of:
(i) the date he or she first completes an Hour of Service, and
(ii) the date he or she is deemed to be an Eligible Employee.
(b) Savings Part. Each individual hired after the
Merger date who becomes an Eligible Employee may participate in
the Plan commencing with the First Day of any Quarter next
following or coinciding with the later of (i) the date he or she
completes six (6) Months of Continuous Service or (ii) the date
he or she became an Eligible Employee.
(c) Eligible Employees Hired on or Before Merger Date.
Notwithstanding Subsections (a) and (b) above, the eligibility
and participation of individuals hired by the Corporation or an
Affiliated Company on or before the Merger Date in the Security
Part and in the Savings Part (with respect to the deferral of
Profit Sharing Awards), shall be determined by reference to the
terms of the Allegheny Ludlum Retirement Security Program in
effect on the Merger Date, and the eligibility and participation
of such individuals in the Savings Part (with respect to Basic
and Supplemental Savings) shall be determined by the terms of the
Plan in effect on the Merger Date.
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Section 2.02 Re-employment. An Eligible Employee who
is re-employed following a Break in Service and who had
previously been a Participant in either the Security Part or the
Savings Part, or both, may participate in the Plan commencing
with his or her Reemployment Commencement Date. Each other
reemployed Employee shall become eligible to participate in
accordance with Section 2.01.
Section 2.03 Enrollment. An Eligible Employee may
become a Participant in the Security Part upon meeting the
requirements for participation set forth in Section 2.01(a) or
2.02, as applicable. An Eligible Employee may become a
Participant in the Savings Part upon meeting the requirements of
Section 2.01(b) or 2.02, as applicable, and executing the
appropriate forms for authorizing deferred savings from his or
her Eligible Salary and exercising the necessary investment
options.
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ARTICLE III
EMPLOYEE SAVINGS
Section 3.01 Basic Savings. An Eligible Employee may
defer and designate as his or her Basic Savings (i) all or any
whole percentage of his or her Profit Sharing Award, and
(ii) such whole percentage of his or her Eligible Salary as he or
she may elect in accordance with the following schedule:
Percentage
Continuous Service Applicable
From 6 months to 5 years . . . . . . . . . . 2, 3, 4, or 5%
Over 5 years to 10 years . . . . . . . . . . 2, 3, 4, 5, or 6%
Over 10 years to 15 years. . . . . . . . . . 2, 3, 4, 5, 6, or 7%
Over 15 years. . . . . . . . . . . . . . . . 3, 4, 5, 6, 7, or 8%
All Basic Savings, to the extent payable out of Profit Sharing
Awards, shall be paid into the Plan in a single payment and, to
the extent payable out of Eligible Salary, shall be paid into the
Plan through periodic payroll deferrals. Basic Savings shall be
credited to the Savings Part of the Plan. Separate elections may
be made for Profit Sharing Awards and for Eligible Salary and
such separate elections may, but need not be, consistent one with
the other. In the event an election is made with respect to
either Profit Sharing Awards or Eligible Salary but not for the
other, such election as made shall be implemented and, the
election not made shall be deemed an election for 0%.
Section 3.02 Supplemental Savings. In addition to
the Basic Savings an Eligible Employee elects pursuant to Section
3.01, the Eligible Employee may elect to pay into the Plan as
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Supplemental Savings a whole percentage of, separately, his or
her (i) a Profit Sharing Award or (ii) Eligible Salary not to
exceed that percentage of his or her Profit Sharing Award or
Eligible Salary respectively as shall equal the difference
between the percentage of his or her Eligible Salary he or she
has elected and makes as Basic Savings payments pursuant to
Section 3.01 and sixteen percent (16%) (or such lesser percentage
as may be put into effect from time to time by the Plan
Administrator on a uniform and non-discriminatory basis). All
Supplemental Savings shall be paid into the Plan through periodic
payroll deferrals. Supplemental Savings shall be credited to the
Savings Part of the Plan.
Section 3.03 Tax Deferred Savings. Subject to the
limitations set forth in this Plan, each Eligible Employee shall
designate that portion of his or her Basic and Supplemental
Savings which are to be excluded from his or her gross income as
provided in Section 401(k) of the Code. Savings so deferred
shall be referred to as Deferred Basic Savings and Deferred
Supplemental Savings, respectively, and, collectively, as
Deferred Salary Savings.
To the extent that Participant contributions are not
permitted to be classified as tax-deferred under Section 401(k)
of the Code by reason of the limitations contained in Section
3.09 and are reclassified as after-tax contributions thereunder,
such contributions shall be referred to as Nondeferred Basic
Savings or Nondeferred Supplemental Savings, as applicable.
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<PAGE>
Section 3.04 Change in Contribution Rate. A
Participant may upon no less than thirty (30) days prior written
notice, effective with the First Day of any subsequent month,
elect to increase or decrease the percentage of his or her Basic
Savings payable out of Eligible Salary or Supplemental Savings or
both to any percentage permitted by Sections 3.01 or 3.02. An
election with respect to a Profit Sharing Award once made shall
remain in effect unless or until revoked or modified by the
Participant. Elections with respect to a Profit Sharing Award
must be made upon no less than thirty (3) days written notice
prior to the payment of such Profit Sharing Award.
Section 3.05 Discontinuance of Contributions. A
Participant may, effective with the First Day of any subsequent
Month, discontinue his or her Basic Savings payable out of
Eligible Salary or Supplemental Savings in which event he or she
may not elect to re-commence such contributions until the First
Day of the second Quarter subsequent to the Quarter during which
he or she discontinued contributions or any Quarter subsequent
thereto.
Section 3.06 Payment to Trustee. Basic Savings
payable out of Eligible Salary and Supplemental Savings for any
Month will be paid by the Employing Company to the Trustee as
soon as practical but in no event later than ninety (90) days
after the date the Eligible Salary to which it relates was paid
to Participant. Basic Savings payable out of Profit Sharing
Awards will be paid by the Employing Company to the Trustee as
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<PAGE>
soon as practicable but in no event more than ninety (90) days
after the date set for payment of the Profit Sharing Award.
Section 3.07 Excess Deferrals. Notwithstanding any
other provision of this Plan, no Participant shall be permitted
to have an aggregate of Deferred Salary Savings which constitutes
Elective Deferrals made under this Plan for a calendar year to
the extent that the sum of his or her Elective Deferrals for such
calendar year are in excess of the Elective Deferral Limitation
as in effect for such calendar year.
Section 3.08 Prevention or Correction of Excess
Deferrals.
(a) Prevention of Excess Deferrals During a Calendar
Year. In the event that the Administrator knows or reasonably
believes that a Participant's Deferred Salary Savings
constituting Elective Deferrals under the Plan will cause the
amount of Elective Deferrals made by the Participant for the
calendar year to exceed the Elective Deferral Limitation for such
calendar year, the Administrator, under uniform rules and
procedures, may suspend a Participant's designation of first,
Deferred Supplemental Savings and, second, Deferred Basic Savings
to be made during such calendar year to the extent necessary to
cause the sum of a Participant's Elective Deferrals to be as
nearly equal to, but not in excess of, the Elective Deferral
Limitation for such calendar year as is administratively
feasible. In the event the Administrator suspends a
Participant's designation of Deferred Supplemental Savings and/or
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Deferred Basic Savings for the foregoing reasons, such
designation shall be automatically reinstated as of the first
Eligible Compensation otherwise payable in the next calendar year
without regard to Section 3.05.
(b) Correction of Excess Deferrals.
(i) During the Calendar Year. In the event that a
Participant notifies the Administrator prior to the end of a
calendar year that Excess Deferrals have been made on his or
her behalf for such calendar year, the Administrator may
distribute to the Participant an amount equal to the sum of
the Excess Deferral and earnings attributed thereto if the
Participant designates such amount as an Excess Deferral,
the distribution is made after the Plan received the Excess
Deferral and prior to the next succeeding January 1st and
the Plan designates the distribution as one of an Excess
Deferral.
(ii) After the End of the Calendar Year. After the end
of the calendar year in which Deferred Basic and/or
Supplemental Savings were made and prior to the next
succeeding April 15th, the Administrator may distribute to
the Participant an amount equal to the sum of the Excess
Deferral allocated to this Plan and earnings attributable
thereto if, prior to the March 1st of the year following the
year in which Excess Deferrals are made, the Participant
notifies the Administrator of the amount of Excess Deferral
allocated to this Plan.
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(c) Notice and Rules. The distributions permitted
under this Section may be made notwithstanding any other
provision of this Plan or of any law, rule or regulation. The
Administrator may make uniform rules to provide for notices to
Eligible Employees in the event of Excess Deferrals and to
otherwise prevent the Plan from accepting or holding Excess
Deferrals.
3.09 Excess Contributions. Notwithstanding any other
provision of this Plan, in the event it is determined for any
Plan Year that the Actual Deferral Percentage for Highly
Compensated Employees exceeds or is reasonably expected to exceed
the limitations set forth in Section 3.10, then, first, the
Deferred Supplemental Savings and, second, the Deferred Basic
Savings of the Highly Compensated Employees shall be equitably
reduced, according to uniform procedures determined by the
Administrator and consistent with law, so that such limitations
are satisfied. For the purposes of the foregoing sentence, the
Administrator may adopt rules with respect to the Plan Year in
which the limitations set forth in Section 3.10 are reasonably
expected to be exceeded which require the election of one or more
Highly Compensated Employees to be suspended for the duration of
such Plan Year so that the amounts deferred by Highly Compensated
Employees will as nearly equal, but not exceed, the limitations
set forth in Section 3.10 as is administratively feasible and
that any elections so suspended will be reinstated as of the
first day of the next following Plan Year without regard to
Section 3.05. Further, in the event that the limitations set
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forth in Section 3.10 are exceeded for any Plan Year, the
Administrator shall reduce, first, the Deferred Supplemental
Savings and, second, the Deferred Basic Savings of the Highly
Compensated Employee(s) in the manner described below and such
amount, together with earnings hereon, at the election of the
Administrator under uniform rules applicable to all such Highly
Compensated Employees for such Plan Year, shall either (i) be
recharacterized as Nondeferred Salary Savings (first to the
maximum of Basic Salary Savings for such Participant for such
year) after notice to such Highly Compensated Employees or (ii)
be distributed to the Participant in cash; the application of the
above actions to be effective on or before the date which is two
and one half calendar months after the end of the Plan Year in
which such Deferred Salary Savings were made. The amount of any
reduction for Highly Compensated Employees shall be determined by
reducing, first, the Deferred Supplemental Savings and, second,
the Deferred Basic Savings of the Highly Compensated Employee(s)
with the highest percentage of deferral to the percentage of the
Highly Compensated Employee(s) with the next highest percentage
of deferral and repeating such reductions as necessary until the
limitations set forth in Section 3.10 are satisfied.
3.10 Limitation on Deferred Basic Savings and
Deferred Supplemental Savings. For any Plan Year, the Actual
Deferral Percentage for Highly Compensated Employees may not
exceed the greater of (a) or (b):
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(a) one hundred twenty-five percent (125%) of the
Actual Deferral Percentage for Non-Highly Compensated Employees;
or
(b) the lesser of (i) two hundred percent (200%) of
the Actual Deferral Percentage for Non-Highly Compensated
Employees or (ii) the Actual Deferral Percentage for Non-Highly
Compensated Employees plus two (2) percentage points.
3.11 Limitation on Nondeferred Salary Savings. For
any Plan Year, the Average Contribution Percentage for Highly
Compensated Employees shall not exceed the greater of (a) or (b):
(a) One hundred twenty-five percent (125%) of the
Average Contribution Percentage for Non-Highly Compensated
Employees; or
(b) Two hundred percent (200%) of the Average
Contribution Percentage for Non-Highly Compensated Employees;
provided, however, that the Average Contribution Percentage for
Highly Compensated Employees may not exceed the Average
Compensation Percentage for Non-Highly Compensated Employees by
more than two (2) percentage points;
provided that in any Plan Year in which the Actual Deferral
Percentage of Highly Compensated Employees exceeds the amount
described in Section 3.10(a) but not the amount described in
Section 3.10(b) and the Average Contribution Percentage of Highly
Compensated Employees exceeds the amount set forth in Section
3.11(a) but not the amount set forth in Section 3.11(b), the sum
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of the Actual Deferral Percentage of the Highly Compensated
Employees and the Average Contribution Percentage of the Highly
Compensated Employees for the Plan Year may not exceed the sum of
(c) 125 percent of the greater of (1) the Actual Deferral
Percentage of Non-Highly Compensated Employees for the Plan Year
or (2) the Average Contribution Percentage of Non-Highly
Compensated Employees for the Plan Year plus (d) the lesser of
(Y) two percent (2%) plus the lesser of the amounts described in
(c)(1) and (c)(2) or (Z) two hundred percent (200%) of the lesser
of the amounts described in (c)(l) and (c)(2). "Lesser" may be
substituted for "greater" where it appears immediately after (c)
above, and "greater" may be substituted for "lesser" where it
appears immediately after (d) above if such substitutions would
yield a higher aggregate total.
In the event such limitations are exceeded, such excess
shall be reduced as described in Section 3.10 but the amount of
such reduction may only thereafter be distributed to the affected
Highly Compensated Employees on or before the last day of the
calendar year following the calendar year in which such
contribution was made.
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ARTICLE IV
CONTRIBUTIONS BY EMPLOYING COMPANIES
Section 4.01 Matching Contributions. The Employing
Companies shall contribute an amount which, when added to current
forfeitures of nonvested Matching Contributions pursuant to
Sections 9.04 and 11.02 shall equal fifty percent (50%) of the
amount of each Participant's Basic Savings paid into the Plan for
each Month plus the full amount of forfeitures required to be
restored to the accounts of Participants who repay distributions
pursuant to Section 7.05. Matching Contributions shall be paid
to the Trustee as soon as practicable. Matching Contributions
may be made, in the discretion of the Corporation, in the form of
either cash or Company Stock, including, but not limited to,
shares of treasury stock or authorized but unissued shares of
Company Stock.
Section 4.02 Security Contributions. The Employing
Companies may contribute, as a Security Contribution for a Plan
Year, such amount as the Board, in its discretion, shall
determine. Security Contributions may be made in the discretion
of the Corporation, in the form of either cash or Company Stock,
including, but not limited to, shares of treasury stock or
authorized but unissued shares of Company Stock and shall be paid
to the Plan during the course of, or within a reasonable period
after the close of, the Corporation's fiscal year, but in no
event later than the due date of the Corporation's federal income
tax return for such Fiscal Year (including extensions, if any).
Security Contributions may be made either as (i) stated dollar
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amounts for each Eligible Employee, (ii) as a percentage of an
Eligible Employee's Eligible Salary, or (iii) a combination of
(i) and (ii). Security Contributions shall be credited to the
Security Part of the Plan.
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ARTICLE V
INVESTMENTS
Section 5.01 Investment of Matching Contributions.
Matching Contributions made in the form of cash shall
be invested at the direction of the Participant, in whole
percentage increments, in any one or combination of the then
available Funds. Matching Contributions made in the form of
Company Stock shall be initially invested in the Company Stock
Fund. Once Matching Contributions have been made and initially
credited, a Participant may, upon no less than thirty (30) days
prior written notice, and effective on the first Day of the Month
next following receipt of timely notice, transfer, all or any
part, in whole percentage increments of any Fund as Matching
Contributions together with earnings thereon to any one or
combination of then available Funds, in whole percentage
increments.
Section 5.02 Investment of Security Contributions.
Security Contributions made in the form of cash shall be invested
at the discretion of the Participant, in whole percentage
increments, in any one or combination of the available Funds.
Security Contributions made in the form of shares of Company
Stock shall be initially invested in the Company Stock Fund.
Once Matching Contributions have been made and initially
credited, a Participant may, upon no less than thirty (30) days
prior written notice and effective on the First Day of the Month
next following receipt of timely notice, transfer all or any
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part, in whole percentage increments of the amount credited to
any Fund as Security Contributions together with earnings thereon
to any one or combination of then available Funds in whole
percentage increments. The remaining Security Contributions in
each Participant's Accounts not invested in the Contract Fund
pursuant to this Section may be invested in the Contract Fund,
Equity Fund and Diversified Fund in twenty-five percent (25%)
increments, at the written direction of the Participant;
provided, however, unless a Participant elects otherwise in
writing on a form approved for such purpose by the Administrator,
all Security Contributions allocated to his or her Accounts shall
be invested in the Contract Fund.
Section 5.03 Investment of Participant Contributions.
A Participant's Basic Savings and Supplemental Savings shall be
invested at the direction of the Participant, in whole percentage
increments, in any one or combination of then available Funds.
Once initially credited, a Participant may, upon no less than
thirty (30) days prior written notice and effective as of the
First Day of the Month next following receipt of timely notice,
transfer all or any part, in whole percentage increments of the
amount credited to any Fund as Participant Contributions together
with earnings thereon, to nay one or combination of then
available Funds in whole percentage increments.
Section 5.04 Securities Laws Consideration.
Notwithstanding any provisions of this Plan, the Plan
Administrator may promulgate any rules the Plan Administrator
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deems necessary or appropriate to insure that this Plan and
Participants hereunder comply in all respects with applicable
securities laws of the United States and any state with
jurisdiction. In addition, the Trustee shall sell such shares as
soon as practical, but shall use its discretion in the time of
such rules considering such factors as the applicable securities
laws, market conditions and trading volume of such stock. The
amount of proceeds reinvested as directed by the Participant
shall be the net amount actually realized upon such sale.
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ARTICLE VI
INVESTMENT FUNDS
Section 6.01 Investment Funds. Basic Savings,
Supplemental Savings Matching Contributions and Security
Contributions shall be invested by the Trustee as directed by
Participants in the following Funds:
(a) Contract Fund. A fund invested with an insurance
company, bank or other financial institution under an agreement
which shall contain provisions that the insurance company, bank
or other financial institution will guarantee repayment in full
of such amounts deposited with such insurance company, bank or
financial institution plus interest at either fixed or variable
rates for a specified period.
(b) Equity Fund. An equity fund, or a fund of common
stock or a commingled trust fund established for the collective
investment of funds of employee benefit plans qualified under
Section 401(a) of the Code, designed to invest primarily in
growth-oriented common stock.
(c) Diversified Fund. A diversified fund, or a fund
of common or preferred capital stocks, bonds, notes and/or
debentures or a commingled trust fund established for the
collective investment of funds of employee benefit plans
qualified under Section 401(a) of the Code, excluding, however,
any stocks or other securities of the Corporation, any Employing
Company, or any Affiliated Company designed to provide a balance
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between growth-oriented securities and income-oriented
securities.
(d) Company Stock Fund. A fund comprised of Company
Stock.
(e) Other. Such other investment Fund or Funds as the
Board of Directors may determine and announce to the
Participants.
Separate accounts may be maintained in each Fund to
record the investment of the Savings Part and the Security Part
of the Plan. The Trustee may temporarily hold cash or make
short-term investments pending investment as contemplated by this
Section 6.01.
Section 6.02 Income and Dividends. Dividends,
interest, and other distributions received on the assets held by
the Trustee, an insurance company or financial institution in
respect of each of the Funds shall be reinvested in the
respective Fund.
Section 6.03 Voting and Exercise of Other Rights.
The Trustee shall have the sole right to exercise all rights
relating to Company Stock held in the Company Stock Fund.
However, each Participant shall have the right to direct the
Trustee concerning the manner of exercise of voting and other
rights pertaining to whole shares of Company Stock, vested and
nonvested, allocated to his or her account. The Administrator
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shall set uniform procedures for securing directions of
Participants under this Subsection.
Section 6.04 Appointment of Investment Manager. The
Board may from time to time appoint (and, thereafter remove) an
Investment Manager which shall have such powers and duties in
respect to the establishment and maintenance of the investment
funds described above as the Board from time to time may direct.
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ARTICLE VII
VALUATION OF UNITS AND CREDITS TO ACCOUNTS
Section 7.01 Valuation of Units. As of each
Valuation Date and at least annually, the Administrator shall
determine or cause to be determined the total fair market value
of all assets then held in each Fund.
Section 7.02 Computation of Value. As of the
Valuation Date when the value of all assets in each Fund has been
determined pursuant to Section 7.01 the value of each Unit in
each of the Contract Fund, Equity Fund, and Diversified Fund (or
such other Fund or Funds then in effect other than the Company
Stock Fund) credited to Participant Accounts shall be determined
by dividing (i) the total fair market value of all assets in each
Fund by (ii) the total number of Units in that Fund credited to
the Accounts of all Participants immediately prior to such
Valuation Date, not including Units to be credited for new
contributions to that Fund as of that Valuation Date.
Section 7.03 Purchase of Units. As of the Valuation
Date for which the Units of each Fund have been valued pursuant
to Section 7.02, the number of additional Units to be credited to
the Accounts of each Participant in each of the Contract Fund,
Equity Fund, and Diversified Fund for the new contributions for
that month shall be the amount contributed to each Participant's
Account in that Fund for that month divided by the value of each
Unit of each Fund prior to such contribution as determined
pursuant to Section 7.02.
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Section 7.04 Company Stock Fund. For the purposes of
Section 7.01, the market value of the shares of Company Stock
comprising the Company Stock Fund shall be determined as of each
Valuation Date and the value of such shares allocated to
Participant Accounts adjusted appropriately as of such date. The
number of additional shares to be credited to the Accounts of
each Participant in the Company Stock Fund as of any Valuation
Date (i) in respect of dividends received since the immediately
preceding Valuation Date shall be the number of shares purchased
with such dividends multiplied by a fraction, the numerator of
which is the number of whole and fractional shares credited to
the Participant's Account as of the immediately preceding
Valuation Date and the denominator is the aggregate number of
shares held in the Company Stock Fund as of the immediately
preceding Valuation Date and (ii) in respect of additional
contributions made during the period, shall be the number of
shares equal to the amount contributed to such Participant's
Account since the immediately preceding Valuation Date divided by
the Current Market Value as of that Valuation Date. For the
purposes of determining the Current Market Value of Company Stock
in respect to any investment in the Company Stock Fund, transfer
to or from the Company Stock Fund or withdrawal or distribution
from the Company Stock Fund, Company Stock shall be valued as the
net amount actually paid or received by the Trustee upon the
purchase or sale of the shares of Company Stock, after payment of
reasonable expenses, including brokerage commissions,
attributable to such transaction; provided, however, the Trustee
may be directed to offset the number of shares, in whole or in
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part, otherwise to be sold in the aggregate of such transactions
against the number of shares, in whole or in part, which would
otherwise be purchased in respect to the aggregate of such
transactions, and, in such event, the shares so offset will be
valued at the trading price of Company Stock on the date of such
offset and no brokerage commission shall be charged. In the
event that all shares to be purchased or sold in respect to such
events may not be sold, purchased or offset at a single time or
on a single trading date, all shares of Company Stock comprising
such transactions shall be valued at the weighed average of the
net amount realized or paid upon all such sales, purchases and/or
offsets.
Section 7.05 Restoration of Forfeitures. A
Participant who has forfeited his or her nonvested Account
balance upon incurring a Break in Service in accordance with
Section 9.03 and who is reemployed prior to incurring five (5)
consecutive Breaks in Service shall have the amount of his or her
forfeiture restored to his or her Account upon the first
Valuation Date following the Participant's reemployment date;
provided, however, a reemployed Participant who received a
distribution pursuant to Section 11.02 must repay to the Trustee
the amount of such distribution to receive a restoration to his
or her Account of any amounts previously forfeited. The
restoration to the Participant's Account of the previously
forfeited amounts shall not be made unless the Trustee receives a
repayment of the amount distributed to the Participant within
five (5) years of the Participant's reemployment date.
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ARTICLE VIII
WITHDRAWABLE PORTION AND DEFERRED PORTION
Section 8.01 Withdrawable Portion. Amounts allocated
to a Participant's Account (including but not limited to Matching
Contributions, but excluding Security Contributions) which are
not attributable to (i) Deferred Salary Savings, (ii) amounts
treated as Deferred Salary Savings for purposes of the
limitations set forth in Section 3.09 or (iii) earnings on any of
the foregoing shall become part of the Participant's Withdrawable
Portion when such amounts become vested in accordance with
Article IX.
Section 8.02 Deferred Portion. Amounts allocated to
a Participant's Account which are attributable to (i) Deferred
Salary Savings, (ii) amounts treated as Deferred Salary Savings
for the purposes of the limitations set forth in Section 3.09 or
(iii) earnings on any of the foregoing shall become part of the
Participant's Deferred Portion when such amounts become vested in
accordance with Article IX.
Section 8.03 Special Rule with Regard to Year
Classes. Notwithstanding the provisions of Sections 8.01 and
8.02 above, separate Year Classes shall be formed under the Plan
for Deferred Salary Savings, Nondeferred Basic Savings, Rollover
Contributions and Matching Contributions made for each Plan Year
prior to the Plan Year beginning on January 1, 1989. No Class
Years shall be formed for any Plan Year beginning on or after
January 1, 1989.
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ARTICLE IX
VESTING
Section 9.01 Contributions by Employees. A
Participant shall always be completely vested in his or her
Deferred Salary Savings, Nondeferred Salary Savings, Rollover
Contributions and earnings on any of the foregoing.
Section 9.02 Matching Contributions. A Participant
shall become vested in Matching Contributions allocated to his or
her Account upon the happening of the earliest of the following:
(a) his or her Death;
(b) his or her Retirement;
(c) his or her Permanent Layoff;
(d) with respect to amounts contributed by the
Corporation or an Affiliated Company for Plan Years ending on or
before December 31, 1988 and which are part of the balance
attributable to a Year Class under Section 8.03, the third
anniversary of the end of such Class Year; or
(e) with respect to Employees who render an Hour of
Service on or after January 1, 1989, the date he or she completes
five (5) Years of Service.
Section 9.03 Security Contributions. A Participant
shall be fully and immediately vested in Security Contributions
(and earnings thereon) made in stated dollar amounts under
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Section 4.02(i). A Participant shall become vested in Security
Contributions (and earnings thereon) made to his or her Account
which were made as a percentage of Eligible Salary under Section
4.02(ii) upon the happening of the earliest of the following:
(a) his or her Death;
(b) his or her Retirement;
(c) his or her Permanent Layoff; or
(d) the date he or she completes five (5) Years of
Service.
For purposes of computing Years of Service for Eligible Employees
who were participating in the Allegheny Ludlum Retirement
Security Program (the "RSP") on the Merger Date, an Eligible
Employee shall receive credit for Years of Service equal to the
greater number determined under the rules described in this Plan
above or the rules as follows:
(i) a number of Years of Service equal to the number
of full Years of Continuous Service credited under the RSP
as of the Merger Date; plus
(ii) one Year of Service for the Plan Year of the Plan
beginning January 1, 1993 if the Eligible Employee renders
one thousand (1,000) Hours of Service in such year, computed
by crediting [190 Hours of Service for each Month of
Continuous Service] completed in such Plan Year before the
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Merger Date, plus the actual number of Hours of Service
completed in such Plan Year after the Merger Date; plus
(iii) one Year of Service for each Plan Year after the
Plan Year beginning January 1, 1993 during which the
Eligible Employee renders one thousand (1,000) Hours of
Service.
Section 9.04 Forfeitures.
(a) A Participant who incurs a Break in Service prior
to completing five (5) Years of Service or otherwise vesting in
any portion of his or her Account in accordance with the
provisions of Section 9.02 and 9.03 shall forfeit the nonvested
portion of his or her Account upon the date the Participant
incurs such Break in Service. Forfeitures of Matching
Contributions and Security Contributions, and earnings thereon,
shall be applied to reduce any subsequent Matching and Security
Contributions, respectively, and shall be allocated in accordance
with the provisions of Sections 4.01 and 4.02.
(b) A Participant who forfeited his or her nonvested
Accounts in accordance with (a) above and is subsequently
reemployed prior to incurring five (5) consecutive Breaks in
Service shall have Forfeitures restored to his or her Accounts in
accordance with Section 7.05.
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ARTICLE X
WITHDRAWALS WHILE EMPLOYED
Section 10.01 Security Part. In no event may a
Participant withdraw all or any part of his or her amount in the
Security Part while employed by the Corporation or an Affiliated
Company.
Section 10.02 Withdrawable Portion. A Participant
may withdraw all or any part of his or her Withdrawable Portion,
but in no event less than two hundred fifty dollars ($250) from
any Fund (if his or her total interest in such Fund is less than
two hundred fifty dollars ($250), he or she may withdraw the
total) by making written application therefor on a form approved
by the Administrator and effective as of the time determined by
the Administrator under uniform rules applicable to all
employees; furthermore, if after a withdrawal from any Fund his
or her remaining interest in that Fund would be less than two
hundred fifty dollars ($250), he or she must withdraw the total.
Section 10.03 Deferred Portion. A Participant who is
age fifty-nine and one-half (59-1/2) or older may withdraw all or
any part of his or her Deferred Portion, but in no event less
than two hundred fifty dollars ($250) from any Fund (if his or
her total interest in such Fund is less than two hundred fifty
dollars ($250), he or she may withdraw the total) by making
written application therefor on a form approved by the
Administrator and effective as of the time determined by the
Administrator under uniform rules applicable to all employees;
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furthermore, if after a withdrawal from any Fund his or her
remaining interest in that Fund would be less than two hundred
fifty dollars ($250) he or she must withdraw the total.
Section 10.04 Hardship Withdrawal. Notwithstanding
Section 10.03, a Participant who has not attained age fifty-nine
and one-half (59-1/2) may file an application in writing,
together with such supporting documents as the Committee may
request, for a Hardship Withdrawal in an amount not less than the
minimum under Section 10.03 but not greater than an amount equal
to the aggregate of his or her Deferred Salary Savings (not
including earnings thereon) not previously withdrawn. Upon the
Committee's approval and if the Committee finds that such
Hardship Withdrawal is required by reason of a financial
hardship, the Participant shall be permitted to alleviate such
hardship from his or her Deferred Portion. In the event a
Hardship Withdrawal is permitted, the Participant making such
withdrawal shall be suspended from making contributions under the
Plan for the period indicated below. For the purposes of this
Section 10.04, the term "hardship" shall mean circumstances such
that (i) the Participant is confronted with immediate and heavy
financial needs and (ii) the requested distribution is necessary
to meet such needs, after taking into account the Participant's
other available financial resources. The interpretation of the
term "hardship" shall be consistent with Section 401(k) of the
Code and the Treasury Regulations provided thereunder.
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For purposes of the preceding paragraph, the following
shall be deemed to constitute immediate and heavy financial needs
of the Participant:
(i) Expenses for medical care, as described in
Section 213(d) of the Code, incurred by the Participant, or
his or her spouse or other dependents, or necessary for such
persons to obtain medical care, which are not covered by an
insurance policy or employee benefit plan;
(ii) Purchase of a principal residence to be
occupied by the Participant, other than regular mortgage
payments;
(iii) Payment of tuition and related educational
fees for the next 12 months for post-secondary education for
the Participant or his or her spouse, children or
dependents;
(iv) The foreclosure of a mortgage on the
Participant's principal residence or preventing the eviction
of the Participant from his or her residence, and
(v) Such other immediate and heavy financial
needs as may be approved by the Internal Revenue Service
through the issuance of Revenue Rulings, Regulations,
Notices or other generally applicable documents.
For purposes of this Section 10.04, withdrawals shall
be deemed to be necessary to satisfy an immediate and heavy
financial need of a Participant if, and only if, the Participant
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submits written documents and other clear proof that all of the
following requirements are satisfied:
(i) The withdrawal is not in excess of the amount
of the immediate and heavy financial need of the
Participant, including any amounts necessary to pay federal,
state, or local income taxes or penalties reasonably
anticipated to result from the distribution;
(ii) The Participant has obtained all withdrawals,
other than hardship withdrawals, and all nontaxable loans
currently available under all employee benefit plans
maintained by the Corporation or any Affiliated Companies;
(iii) The Participant's Elective Deferrals and
other employee contributions to this Plan or other
contributory plan maintained by the Corporation and any
Affiliated Companies will be suspended for at least 12
months after receipt of the hardship; and
(iv) The Participant may not make elective
contributions under this Plan or any other plan maintained
by a Corporation and any Affiliated Companies for the
Participant's taxable year immediately following the taxable
year of the hardship withdrawal in excess of the Elective
Deferral Limitation for such year less the amount of such
Participant's elective contributions for the taxable year of
the hardship withdrawal.
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The Plan Administrator shall establish a uniform and
nondiscriminatory policy for reviewing Participant applications
for hardship withdrawals under this Section 10.04.
Section 10.05 Replacement. A Participant may not
replace any amounts withdrawn under Sections 10.02, 10.03 or
10.04.
Section 10.06 Loans.
(a) Upon application of a Participant, the
Administrator may direct the Trustee to make a loan or loans to
such Participant in accordance with a uniform, non-discriminatory
policy applicable to all loans made hereunder, upon the
Participant posting adequate security, agreeing to pay the
Trustee a reasonable rate of interest, and complying with such
other terms and conditions as the Administrator may require, in
accordance with this Section. Loans shall be available only to
Participants employed by the Corporation or an Affiliated Company
and their beneficiaries, and shall be available to all such
Participants and beneficiaries on a reasonably equivalent basis.
Loans shall not be made available to Highly Compensated Employees
in an amount greater than the amount made available to Nonhighly
Compensated Employees. Loans shall only be available from the
portion of a Participant's Accounts in the Savings Part of the
Plan.
(b) A Participant may apply for a loan by completing
and returning to the Administrator an application (the "Loan
Application"). The Administrator shall review the Loan
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Application and shall approve or deny a loan, in its sole
discretion. If approved, the loan shall be documented by a
promissory note, a payroll withholding authorization and certain
other forms that the Participant will be required to sign, which
are described in the Loan Application. The Loan Application also
contains the following information:
(i) the person authorized to administer loans made
under this Section;
(ii) the procedure for applying for loans;
(iii) the basis on which loans will be approved or
denied;
(iv) limitations on the types and amount of loans
available;
(v) how the interest rate will be determined;
(vi) the collateral required for a loan; and
(vii) events constituting a default and the action that
will be taken to preserve the assets of the Plan in the
event of a default.
The Administrator is authorized to amend the Loan Application and
the other forms used to document and secure loans in such manner
and at such times as the Administrator, in its discretion, deems
necessary or appropriate. The Loan Application is incorporated
in this Plan by this reference and is deemed to be a part of this
Plan.
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(c) Adequate security for repayment of a loan may
consist of, or include, in the discretion of the Administrator,
the Participant's vested balance in his or her Accounts;
provided, however, that not more than fifty percent (50%) of the
present value of a Participant's vested balance in his or her
Accounts may be used as security for all outstanding loans to the
Participant. In addition, such security may include the
pledging, upon such terms and conditions as are determined by the
Administrator, of governmental or corporate securities having
sufficient value adequately to secure in full the repayment of
the loan, including accrued interest. In the event of a default
on a loan, foreclosure on security consisting of the
Participant's vested balance in his or her Accounts shall not
occur until distribution is otherwise permitted under the Plan,
and the loan shall remain outstanding and shall continue to
accrue interest (at a penalty rate, if applicable) until the
default is cured or foreclosure occurs.
(d) Any loan to a Participant shall be repaid by the
Participant in such manner as the Administrator shall determine;
provided, however, that all loans shall provide for level
amortization of principal and interest over the term of the loan,
with payments not less frequently than quarterly, and that the
maximum term of all loans may not exceed five (5) years, unless a
loan is used to acquire any dwelling which within a reasonable
time (determined at the time the loan is made) is to be used as
the principal residence of the Participant. All outstanding
loans to Participants hereunder shall bear a reasonable rate of
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interest, determined by the Administrator at the time a loan is
made, accruing from the date the loan is made to the Participant
until the date of repayment of the outstanding principal.
(e) The amount of any such loan, together with the
outstanding balance of all other loans to the Participant from
the Plan and all other plans maintained by any Employing Company,
shall not exceed the smallest of the following amounts:
(i) $50,000 reduced by the excess (if any) of:
(A) the highest outstanding balance of loans from
the Plan to the Participant during the one year period
ending on the day before the date on which such loan
was made, over
(B) the outstanding balance of loans from the
Plan to the Participant on the date on which such loan
was made; or
(ii) one-half the vested balance of the Participant's
Accounts under the Plan determined as of the Valuation Date
immediately preceding the date the loan is requested.
In no event shall the total sum of any loan or loans
outstanding at any time to any Participant exceed 100% of the
vested balance of his or her Accounts as of the Valuation Date
immediately preceding the application.
(f) The Administrator shall promulgate rules and
procedures relating to such loans. In addition to the
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limitations contained in the Loan Application, the Administrator
may further limit the amount of a loan in order to maintain a
reserve chargeable against a Participant's Accounts for income
taxes which may have to be withheld by the Trustee if the loan
becomes a deemed distribution to the Participant. Any taxes
required to be withheld by the Trustee shall be charged to and
shall reduce the Participant's Accounts to the extent possible
and, if not payable from the Participant's Accounts, shall be an
administrative expense of the Plan and shall be reimbursed by the
Participant.
(g) Notwithstanding any provision in this Section to
the contrary, this Section and all loans made pursuant hereto
shall be construed and administered in accordance with Section
72(p) of the Code and Department of Labor Regulation Section
2550.408b-1.
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ARTICLE XI
DISTRIBUTIONS UPON TERMINATION OF EMPLOYMENT
Section 11.01 Distributions Upon Termination of
Employment by Reason of Retirement, Permanent Layoff or Death.
Subject to an election under Section 11.05, a Participant whose
employment terminates by reason of Retirement, Permanent Layoff
or death shall receive the then remaining balance in his or her
Account in a single distribution consisting of the sum of (i) an
amount of cash equal to the current unit value of all Units in
the Funds other than the Company Stock Fund and all uninvested
cash then held in his or her Account and (ii), at the election of
the Participant, either (x) an amount of cash representing the
Current Market Value determined under Section 7.04 of shares of
Company Stock held in his or her Account or (y) a certificate
representing the number of whole shares of such Company Stock and
an amount of cash equal to any fractional shares then held in his
or her Account.
Section 11.02 Distributions Upon Termination of
Employment by Reason of Resignation or Discharge. Subject to an
election under Section 11.05, a Participant whose employment
terminates by reason of resignation or discharge shall receive
the then remaining balance in his or her Account which is then
vested pursuant to Article IX in a single distribution consisting
of the sum of (i) an amount of cash equal to the current unit
value of all vested Units in the Funds other than the Company
Stock Fund and all uninvested cash then held in his or her
Account and (ii), at the election of the Participant, either (x)
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an amount of cash representing the value determined under Section
7.04 of vested shares of Company Stock held in his or her Account
or (y) a certificate representing the number of vested whole
shares of such Company Stock and an amount of cash equal to any
vested fractional shares then held in his or her Account.
Security and Matching Contributions and earnings thereon which
have not become vested and have not been distributed pursuant to
this Section shall be deemed Forfeitures as provided in Section
9.04 as of the date of distribution of the then vested amount. A
Participant who has a zero percent (0%) vested, nonforfeitable
right to his or her Security and Matching Contributions shall be
deemed to receive a total distribution of such zero (0) amount.
Section 11.03 Disregard of Service. If a Participant
has five (5) or more consecutive one-year Breaks in Service, all
service after such Breaks in Service shall be disregarded for the
purpose of vesting the Security and Matching Contributions
accrued prior to such Breaks in Service.
Section 11.04 Transfer of Employment. A Participant
will not be deemed to have a termination of employment for the
purposes of Sections 11.01 and 11.02 as long as he or she is an
employee of an Affiliated Company or an Employing Company.
Section 11.05 Election to Defer Receipt of
Distributions and Withdrawals of Distributions Deferred.
(a) Election to Defer Distributions. A person who is
entitled to receive a distribution pursuant to Article XI whose
Accounts have a present value in excess of $3,500 may elect, on
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writing in a form approved for such purpose and delivered to the
Administrator no less than thirty (30) days prior to the date of
such distribution would otherwise be made, to defer receipt of
the entire amount of such distribution until the earlier of (i)
the date designated by such person in such election or (ii) the
first day of April of the calendar year following the calendar
year in which the Participant with respect to whom such
distribution is made attains or would have attained age 70-1/2.
In addition, such person who files such election shall be
permitted to make a transfer between funds (subject to Subsection
(d) below), effective as soon as practicable thereafter pursuant
to Section 5.04. In the event that no election is made under
this Section, distributions shall be made as otherwise provided
by the Plan. After the date of such election, such Participant
(and his or her beneficiary) shall not be permitted to make
contributions to the Plan, notwithstanding his or her continuing
status as a Participant.
(b) Withdrawals. After making an election to defer
receipt of a distribution hereunder, such person may withdraw all
or any part of such amount, together with earnings thereon, by
filing with the Administrator a written notice of withdrawal
specifying both the amount to be withdrawn and the Fund or Funds
from which such amounts are to be withdrawn. Such withdrawal
shall be effective on the date specified in the written notice of
withdrawal presented to the Administrator but not earlier than
the Valuation Date next following the date such instructions are
received by the Trustee. Such withdrawal shall be paid in the
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form and at the values as set forth in Section 11.01 or Section
12.02, as applicable to the amounts withdrawn, provided, however,
no partial withdrawal may be in an amount less than the lesser of
(x) $5,000 or (y) 10% of the amount deferred, together with
interest thereon, but less the amount, if any, previously
withdrawn under this Subsection. Amounts withdrawn may not be
replaced.
(c) Distribution. On the first day of the month
coincident with or next following the date for distribution as
initially elected under subsection (a), the then balance,
together with interest thereon but less amounts previously
withdrawn, will be paid to the person who initially deferred
receipt of such distribution (or to his or her beneficiary in the
event of his or her death), in a single lump sum in the form of
payment and subject to the valuation as set forth in Section
11.01 and Section 11.02, as applicable. A person deferring under
this Section shall be entitled to designate and revoke a
designation of a beneficiary under Section 13.05 at any time
prior to the distribution date.
(d) Transfers Among Funds. Amounts deferred hereunder
may not be transferred into the Company Stock Funds.
(e) Other Provisions. Except as specifically set
forth in this Section, all other provisions of the Plan shall
apply to amounts deferred.
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ARTICLE XII
PAYMENT OF WITHDRAWALS AND DISTRIBUTIONS
Section 12.01 Contract Fund, Equity Fund and
Diversified Fund. Upon withdrawal or distribution from the
Contract Fund, Equity Fund or Diversified Fund, the Participant
shall be paid in cash. The amount shall be determined as of the
Valuation Date coinciding with or next preceding the date of
payment.
Section 12.02 Company Stock. Upon any withdrawal or
distribution from the Company Stock Fund, the Participant shall
receive, at his or her election, either (i) an amount of cash
equal to the then Current Market Value of such shares in respect
of such withdrawal or distribution as determined pursuant to
Section 7.04 or (ii) a certificate representing the number of
whole shares of Company Stock credited to his or her Account and
cash equal to the value of such share as determined pursuant to
Section 7.04 on the effective date of such withdrawal or
distribution of any fractional interest in a share being
withdrawn or distributed.
Section 12.03 Effective Date of Withdrawal or
Distribution. The effective date of any withdrawal or
distribution shall be (i) in the case of a withdrawal while still
employed, the date specified in a written notice of withdrawal
presented to the Administrator, but not earlier than the date
such notice is received by the Trustee, or (ii) in the case of
termination of employment, the date of such termination. Subject
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to the provisions of Section 12.01, payment shall be made as soon
as practicable after the effective date of withdrawal or
distribution, as the case may be, but in no event later than one
year after the date of withdrawal or distribution.
Section 12.04 Payment of Benefits. Notwithstanding
any other provision of the Plan, unless the Participant elects
otherwise pursuant to Section 11.05, payment of benefits under
the Plan shall be made not later than the sixtieth (60th) day
after the end of the Plan Year in which the latest of the
following events occurs:
(i) The date on which the participant attains
age sixty-five (65);
(ii) The fifth (5th) anniversary of the year in
which the Participant commenced participation in the
Plan; or
(iii) The date on which the Participant terminates
his or her service with the Employing Companies.
Notwithstanding the foregoing the benefits of a Participant must
be distributed no later than the first day of April following the
calendar year in which such Participant attains age seventy and
one-half (70-1/2). Notwithstanding any provision of this Plan to
the contrary, if the present value of a Participant's accrued
benefits (both from Employing Company and Eligible Employee
contributions) is in excess of $3,500 (or exceeded $3,500 at the
time of any previous withdrawal or distribution), distributions
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of such benefits shall not commence prior to the earliest
retirement age unless (i) the Participant has consented in
writing or (ii) the distribution is by reason of the
Participant's death.
Section 12.05 Application of Security and Matching
Contributions and Earnings Forfeited. Security and Matching
Contributions and earnings thereon that have been forfeited in
accordance with the provisions of Sections 9.04 and 11.02 shall
be applied to reduce any subsequent Security and Matching
Contributions, respectively, required under the Plan, or, if the
Plan shall be terminated, any amount not previously so applied
shall be credited totally to the Accounts of all Participants at
the time of such termination. Shares of Company Stock applied in
the reduction of Security and Matching Contributions shall be
credited at the Current Market Value on the date of such
forfeiture.
Section 12.06 Incidental Benefit Requirements.
Notwithstanding any contrary provision contained in this Plan, a
Participant's vested Accounts shall be distributed in accordance
with the required distribution rules and the minimum distribution
incidental benefit rules of Section 401(a)(9) of the Code and
Treasury Regulations promulgated thereunder.
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ARTICLE XIII
ADMINISTRATION
Section 13.01 Trustee. The Corporation shall enter
into a Trust Agreement with a corporation or association having
trust powers to act as Trustee under the Plan, a copy of which
Agreement will, upon written request of Participant, be made
available for inspection by him or her. The Corporation may,
from time to time, remove such Trustee or any Successor Trustee,
and such Trustee or any Successor Trustee may resign. The
Corporation may, upon removal or resignation of a Trustee,
appoint a Successor Trustee.
Section 13.02 Administrator. The Administrator of
the Plan shall be a committee appointed by the Board. The
Administrator shall be the named fiduciary with respect to
Administration of the Plan and shall have such additional
fiduciary responsibilities as the Board of Directors shall
delegate to it from time to time. The Administrator shall adopt
a claim and claims review procedure and such other administrative
regulations as it shall deem necessary or proper for the
efficient administration of the Plan. The Administrator shall
have complete discretionary authority to determine eligibility
for benefits, to interpret and construe the Plan, to supply
omissions herein and to establish rules and regulations for the
interpretation and administration of the Plan and transaction of
its business. Subject to the claims review procedure, decisions
of the Administrator shall be final and binding upon the
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Employing Companies and their employees to the extent permitted
by law.
Section 13.03 Liability. No member of the
Administrator shall be liable for any loss other than that
specifically provided for under the standards applicable to
fiduciaries as contained in the Act. No member shall be
personally liable upon, or with respect to, any agreement, act,
transaction or omission executed, committed or suffered to be
committed by himself as a member of the Administrator or by any
other member, agent or representative of the Administrator,
except as specifically provided in Title I of the Act. The
Administrator, and any member and agent thereof, shall be fully
protected in relying upon the advice of any legal counsel,
physician or other expert retained by the Administrator or the
Corporation. Other than the bonding requirement under Section
412 of the Act, no bond or other security shall be required of
any member of the Administrator in any jurisdiction.
Section 13.04 Administrative Expenses. Except as
otherwise provided in the Plan, all costs and expenses incurred
in administering the Plan, including the expenses of the
Administrator, the fees and expenses of the Trustee and other
legal and administrative expenses, shall be paid by the Employing
Companies.
Section 13.05 Designation of Beneficiaries in the
Event of Death. Upon the death of a Participant, the value of
the assets in his or her Account shall be distributed to the
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beneficiary or beneficiaries designated. A Participant shall
designate his or her beneficiary upon becoming a Participant and
may change such designation at any time by filing a written
designation with the Administrator. Any designation of a
beneficiary other than the Participant's spouse shall not be
effective unless the spouse consents in writing. The spouse's
consent must be witnessed by a representative of the
Administrator or a notary public. Notwithstanding this
requirement, if the Participant establishes to the satisfaction
of the Administrator that such written consent cannot be obtained
because there is no spouse or the spouse cannot be located, the
written consent of the Participant will be deemed sufficient. A
consent will be valid only with respect to the spouse who signs
the consent or, in the event of a deemed consent, the designated
spouse. A revocation of a prior election may be made by the
Participant without the consent of the spouse at any time before
the commencement of benefits. The number of revocations shall
not be limited. Upon the death of a Participant, if there is no
designated beneficiary then living, or if the designation is not
effective for any reason, as determined by the Administrator, the
Participant's beneficiary shall be his or her surviving spouse
or, if none, his or her estate.
Section 13.06 Limits on Contributions. Allocations
shall be limited to a Participant's Account as follows:
(a) The total value of the Annual Addition under this
Plan and any other defined contribution plan of the Corporation
and Affiliated Companies (whether or not terminated) made on
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behalf of any Participant for any Plan Year shall not exceed the
lesser of (i) thirty thousand dollars ($30,000), or such other
amount as may be permitted under regulations prescribed under
Section 415(d) of the Code or any successor provision, or (ii)
twenty-five percent (25%) of such Participant's Compensation
during such Plan Year.
(b) In the event that it is determined that the Annual
Addition on behalf of any Participant for any Plan Year is in
excess of the limitations contained in this Section 13.06(a),
such Annual Addition shall be reduced as follows to the extent
necessary to bring such contribution within the limitations
contained herein:
(i) Any Nondeferred Basic Savings and Nondeferred
Salary Savings shall be returned to the Participant, to the
extent no other limitations are exceeded. Any returned
contributions shall not be considered Nondeferred Basic and
Salary Savings for purposes of Section 3.11.
(ii) Matching Contributions attributable to any
returned Nondeferred Basic Savings shall be allocated to
Accounts of remaining Participants in proportion to their
Basic Savings for the Plan Year to the extent no other
limitations are exceeded.
(iii) Security Contributions shall be allocated to
the Accounts of remaining Participants in proportion to
their Compensation for the Plan Year, to the extent no other
limitations are exceeded.
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(iv) All remaining excess amounts shall be
allocated to a suspense account in accordance with the
following rules:
A. No Matching or Security Contributions
may be made at any time when the allocation thereof
would be precluded by Section 415 of the Code;
B. Investment gains and losses and other
income are not allocated to the suspense account;
C. Suspense account amounts are allocated
as of the end of each subsequent Plan Year to the
Participant's Accounts until the suspense account is
exhausted. If the Participant is not covered by the
Plan at the end of a Plan Year, the suspense account
amounts shall be allocated to the Accounts of remaining
Participants as of the end of each Plan Year.
In the event of Plan termination, such suspense account
shall revert to the Employing Companies to the extent it may not
then be allocated to any Participant's Account.
Section 13.07 Combined Limitations.
(a) Notwithstanding any other provision of this Plan,
and as required by the Act, if any Participant is, or was,
covered under a defined benefit plan and a defined contribution
plan maintained by the Corporation or an Affiliated Company, the
sum of the Participant's defined benefit plan fraction and
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defined contribution plan fraction may not exceed 1.0 in any Plan
Year (which shall also be the limitation year).
(b) The defined benefit plan fraction is a fraction,
the numerator of which is the sum of the Participant's projected
annual benefits under all defined benefit plans (whether or not
terminated) maintained by the Corporation or an Affiliated
Company, and the denominator of which is the lesser of (i) 1.25
times the dollar limitation of Section 415(b)(l)(A) of the Code
in effect for the Plan Year or (ii) 1.4 times the Participant's
average compensation for the three (3) consecutive years that
produces the highest average. "Projected annual benefit" means
the annual benefit to which the Participant would be entitled
under the terms of the Plan, if the Participant continued
employment until normal retirement age (or actual age, if later)
and the Participant's Compensation for the Plan Year and all
other relevant factors used to determine such benefit remained
constant until normal retirement age (or actual age, if later).
(c) The defined contribution plan fraction is a
fraction, the numerator of which is the sum of the annual
additions to the Participant's account under all defined
contribution plans maintained by the Corporation or an Affiliated
Company (whether or not terminated) for the current and all prior
Plan Years, and the denominator of which is the sum of the lesser
of the following amounts determined for such year and for each
prior year of service with the Corporation or an Affiliated
Company: (i) 1.25 times the dollar limitation in effect under
Section 415(c)(l)(A) of the Code for such year, or (ii) 1.4 times
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the amount which may be taken into account under Section
415(c)(1)(B) of the Code.
(d) If, in any Plan Year, the sum of the defined
benefit plan fraction and the defined contribution plan fraction
will exceed 1.0, the rate of benefit accrual under the defined
benefit plan will be reduced so that the sum of the fractions
equals 1.0.
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ARTICLE XIV
TOP-HEAVY PLAN PROVISIONS
Section 14.01 Purpose. The purpose of this Article
XIV of the Plan is to comply with the special rules applicable to
"top-heavy" plans contained in Section 416 of the Code, as added
by Section 240 of the Tax Equity and Fiscal Responsibility Act of
1982, and the appropriate Regulations issued thereunder,
including Proposed Reg. Section 1.416-1 and successor
Regulations. The rules set forth in this Article XIV shall be
operative if the Plan is, or becomes, "top-heavy" within the
meaning of Section 416 of the Code and the Regulations
thereunder. In the event that by statutory repeal or amendment,
or regulatory change or ruling by the Internal Revenue Service,
any of the limitations or restrictions of this Article XIV are no
longer necessary in order for the Plan to meet the requirements
of Section 416 of the Code or other applicable provisions of the
Code then in effect, such limitations or restrictions shall
immediately become null and void and shall no longer apply
without the necessity of further amendment to the Plan. The
rules contained in this Article XIV shall, except otherwise
specifically noted, be effective January 1, 1984.
Section 14.02 Definitions. For purposes of this
Article XIV only, the following terms shall have the meanings set
forth below:
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(a) "Determination Date" means, as to any Plan Year,
the last day of any preceding Plan Year or, in the case of the
first Plan Year, the last day of such Plan Year.
(b) "Key Employee" means any Employee, or former
Employee, or Beneficiary of either, who at any time during the
Plan Year or the four preceding Plan Years, is:
(i) an officer of the Employer having an annual
Compensation (as defined below) greater than the amount
determined by multiplying 50% of the dollar limitation under
Section 415(b)(l)(A) of the Code;
(ii) one of the 10 Employees owning the largest
interests in the Employer having an annual Compensation at
least equal to the dollar limitation under Section
415(c)(l)(A) of the Code;
(iii) a 5% owner of the Employer; or
(iv) a 1% owner of the Employer having aggregate
annual Compensation of at least $150,000 from the Employer
and all entities required to be aggregated with the Employer
under Sections 414(b), (c) and (m) of the Code.
For purposes of subparagraphs (ii), (iii) and (iv),
owners of the Employer shall include those considered as owners
within the meaning of Section 318 of the Code. As used in this
Section 14.02(b), "Compensation" shall have the meaning assigned
in Section 1.35(g) hereof. In identifying the top 10 Employee
owners under Subsection 14.02(b)(2), only owners of greater than
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a one-half percent (1/2%) interest in the Employer will be
considered, and if several Employees have equal ownership
interests, those Employees with higher Compensation shall be
treated as having a greater ownership interest. The
determination of who is a Key Employee shall be made in
accordance with Section 416(i) of the Code and the Regulations
thereunder, the provisions of which are incorporated herein by
reference.
(c) "Non-Key Employee" means any Employee other than a
Key Employee, and shall include any former Key Employee.
(d) "Valuation Date" means the most recent Valuation
Date occurring within the 12-month period ending on the
Determination Date.
(e) "Employer" means the Corporation.
(f) "Employee" means an Eligible Employee.
Section 14.03 Determination of Whether the Plan Is
"Top-Heavy". The Plan will be deemed to be "top-heavy" in any
Plan Year if, as of the Determination Date, the sum of the
present value of accrued benefits of Key Employees exceeds 60% of
the sum of the present value of accrued benefits of all
Participants, excluding former Key Employees. As used in this
Section 14.03, the present value of accrued benefits includes the
amount attributable to Security and Matching Contributions and
Employee contributions allocated to the individual accounts of
Participants and former Participants. The determination of
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whether the Plan is "top-heavy" and the extent to which
distributions, rollovers, and transfers are taken into account in
such calculation shall be made in accordance with Section 416 of
the Code and the regulations thereunder which are herein
incorporated by reference. Deductible employee contributions
will not be taken into account in determining whether the Plan is
"top-heavy". Furthermore with respect to Plan Years beginning
after December 31, 1984, a former Participant's account balance
is to be disregarded in determining whether the Plan is "top-
heavy", unless the Participant performed any services for the
Employer within the 5 year period ending on the Determination
Date.
Section 14.04 Aggregation Group of Employer Plans.
All corporations and businesses that are aggregated under
Sections 414(b), (c), (m) and (o) of the Code and regulations
thereunder with the Employer must be considered with the Employer
for the purposes of determining whether the Plan is "top-heavy".
All plans of the Employer in which a Key Employee participates,
and each other stock bonus, pension or profit sharing plan, if
any, of the Employer which enables any plan in which a Key
Employee participates to meet the requirements of Section
401(a)(4) or Section 410 of the Code, will be aggregated as a
required aggregation group within the meaning of Section 416(g)
of the Code. Each plan in the required aggregation group will be
"top-heavy" if the group is "top-heavy", and no plan in the group
will be "top-heavy" if the group is not "top-heavy".
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In addition, the Employer may elect to include as part
of the permissive aggregation group under Section 416(g) of the
Code any plans that are not part of a required aggregation group
but that satisfy the requirements of Sections 401(a)(4) and 410
of the Code when considered together with the plans constituting
the required aggregation group. If the permissive aggregation
group is "top-heavy", only those plans which are part of the
required aggregation group will be subject to the additional
requirements applicable to "top-heavy" plans as herein provided.
Section 14.05 Special Minimum Contribution and
Minimum Vesting, and Compensation Limitation, Becoming Operative
in the Event the Plan Becomes "Top-Heavy". In the event that the
Plan shall be determined to be "top-heavy" as to any Plan Year,
the following special vesting and minimum contribution
requirements shall become operative for such Plan Year:
(a) Notwithstanding Sections 9.02 and 9.03 of the
Plan, the following vesting schedule shall, to the extent it
results in more rapid vesting than provided for in Sections 9.02
and 9.03, apply to any Participant hereunder, as provided in
Section 416 of the Code:
Nonforfeitable Percentage
Years of Service of Accrued Benefit
2 20%
3 40%
4 60%
5 or more 100%
(b) Minimum Contributions. The Employer contributions
and forfeitures allocated to the accounts under the Plan of a
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Non-Key Employee for each Plan Year in which the Plan is "top-
heavy" shall equal the lesser of (i) 3% of the Participant's
Compensation for such Plan Year and (ii) the largest percentage
of his or her Compensation allocated to the accounts of a Key
Employee under the Plan for that Plan Year. For Plan Years
beginning after December 31, 1984, any Participant's elective
contributions under Section 401(k) of the Code will be treated as
Employer contributions for the purposes of the minimum
contributions requirements.
All Participants who have not terminated employment as
of the last day of the Plan Year must receive the minimum
contribution. Employees who (i) failed to complete 1,000 Hours
of Service during the Plan Year, (ii) declined to make mandatory
contributions to the Plan or (iii) would have been excluded from
the Plan because their compensation is less than a stated amount,
must nevertheless be considered Participants for purposes of the
minimum contribution in this Section 14.05(b) if such Employees
are required to satisfy the coverage requirements of Section
410(b) of the Code in accordance with Section 401(a)(5) of the
Code. The minimum contribution is determined without regard to
any Social Security contributions.
(c) In the event that the Employer maintains a defined
benefit plan and this Plan, both of which are top-heavy in any
Plan Year, all Participants entitled to a Minimum Contribution
under Subsection 14.05(b) shall receive, in lieu of and in place
of the Minimum Contribution in Subsection 14.05(b) a Minimum
Contribution of five percent of his or her Compensation for such
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Plan Year and benefits under this Plan shall be used to offset
the minimum benefit to be provided under the defined benefit plan
if such defined benefit plan so provides.
(d) In the event that the Non-Key Employee is covered
only under this Plan and under no other plan, an amount equal to
4% of the Non-Key Employee's Compensation for such top-heavy Plan
Year shall be allocated to his or her Account in lieu of the
Minimum Contribution otherwise provided under Subsection
14.05(b).
Section 14.06 Pre-"Top-Heavy" Plan Terminated
Participant. This Article XIV shall not apply to any Participant
who does not complete an Hour of Service after the Plan becomes
"top-heavy".
Section 14.07 Special "Top-Heavy" Reduction in
Combined Benefit. In the event that the Plan shall be determined
to be "top-heavy" in any Plan Year, the multiple applicable to
the dollar limitation in the denominator of the defined benefit
fraction described in Section 13.07(b) of the Plan and the
multiple applicable to the dollar limitation in the denominator
of the defined contribution fraction described in Section
13.07(c) of the Plan shall be one (1) rather than 1.25; provided,
however, that this Section 14.07 of the Plan shall not apply in
the event that the Plan is not a "super top-heavy" plan as
defined in Section 14.10(a) of the Plan and each participant who
is a Non-Key Employee shall receive the minimum contribution set
forth in paragraph (b) of Section 14.05 of the Plan, except that
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<PAGE>
the multiple in subparagraph (i) of paragraph (b) of Section
14.05 shall be 4% rather than 3%.
Section 14.08 Termination of "Top-Heavy" Status. In
the event that the Plan shall be "top-heavy" within the meaning
of Section 416 of the Code for any Plan Year, and in a subsequent
Plan Year the Plan shall cease to be "top-heavy", the special
"top-heavy" vesting, minimum contribution and Compensation
Limitation rules shall cease to apply with respect to any Plan
Year for which the Plan is not "top-heavy"; provided, however,
that in no event shall a reduction in a Participant's
nonforfeitable percentage of benefits accrued while the Plan was
top-heavy occur by reason of a change in the Plan's status.
Section 14.09 Multiple "Top-Heavy" Plans. In the
event that a Participant in the Plan is also participating in a
defined benefit plan maintained by the Employer or an affiliated
employer during a Plan Year in which both the Plan and such
defined benefit plan are "top-heavy", the Participant shall
receive the minimum accrued benefit under the defined benefit
plan rather than the minimum contribution provided for in this
Plan.
Section 14.10 Effect of the Plan Becoming "Super Top-
Heavy".
(a) The Plan shall be deemed to be "super top-heavy"
if, as of the most recent Valuation Date, the sum of the present
value of accrued benefits for Key Employees is more than 90% of
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<PAGE>
the sum of the present value of accrued benefits for all
Employees, excluding former Key Employees.
(b) In the event that the Plan shall be determined to
be "super top-heavy" in any Plan Year, the multiple applicable to
the dollar limitation in the denominator of the defined benefit
fraction described in Section 13.07(b) of the Plan and the
multiple applicable to the dollar limitation in the denominator
of the defined contribution fraction described in Section
13.07(c) of the Plan shall be one (1) rather than 1.25.
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<PAGE>
ARTICLE XV
MISCELLANEOUS
Section 15.01 Alienation. The income and principal
of the Trust Fund are for the sole use and benefit of the
Participants and beneficiaries of the Plan, and, to the extent
permitted by law, shall be free, clear, and discharged of and
from, and are not to be in any way liable for, debts, contracts
or agreements, now contracted or which may hereafter be
contracted, and from all claims and liabilities now or hereafter
incurred by any Participant or beneficiary. Other than as
permitted by the Act, and as expressly set forth in the Plan, no
contributions made by the Employing Companies to the Trust Fund
under the Plan shall at any time revert to the Employing
Companies. No Participant or beneficiary of a Participant under
this Plan shall have the right to commute, withdraw, surrender,
encumber, alienate or assign any of the income or principal of
the Trust Fund or any of the benefits to become due unto any
person or persons under the Agreement of Trust or the Plan except
as specifically provided by the terms of the Agreement of Trust
or the Plan. The limitations contained in this Section 15.01
shall apply to the creation, assignment or recognition of a right
to any benefit payable with respect to a Participant pursuant to
a domestic relations order unless such order is determined to be
a qualified domestic relations order as defined in Section 414(p)
of the Code, or is a domestic relations order entered before
January 1, 1985.
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<PAGE>
Section 15.02 Extent of Participant's Rights. At the
time of withdrawal by a Participant or distribution, he or she
shall be entitled to receive securities or cash as stated in
Article XII. The Corporation does not guarantee that the current
market value of any security or other investment will be equal to
the purchase price thereof or that the total amount withdrawable
in cash will be equal to or greater than the amount of the
Participant's contributions to the Plan. Each Participant
assumes all risks in connection with any decrease in the market
price of any Company Stock allocated to his or her Account in
accordance with the provisions of the Plan or of any securities
in the Equity Fund or Diversified Fund.
Section 15.03 Rollover Contributions. With the
permission of the Administrator and without regard to any limits
on Annual Additions stated in Sections 13.06 and 13.07, or other
limits set forth in the Plan, the Plan may receive from or on
behalf of an otherwise Eligible Employee (whether or not he or
she has completed six (6) Months of Continuous Service) any cash
theretofore received by such employee from, or held for such
employee in, a qualified plan, either directly within sixty (60)
days after such receipt if applicable, or from the trustee of
such Plan, or from any Individual Retirement Account, provided
that such account contains no assets other than those
attributable to employer contributions under qualified plans.
Such rollover contributions shall be credited to a fully vested
account for such employee, and will be part of the Withdrawable
Portion and the Savings Part. The employee may elect investment
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options for such rollover contributions in accordance with
Section 4.01. Such rollover contribution shall not be matched by
Matching Contributions. The Administrator, in its discretion,
(i) may separately account for such rollover contributions and
earnings, gains and losses thereon and, (ii) upon distribution,
may require a form of distribution thereof which would be
consistent with the provisions of Section 401(a)(11) and the
regulations promulgated thereunder as such may be in effect at
the time of such distribution.
Section 15.04 Purpose. (a) This Section 15.04
applies to distributions made on or after January 1, 1993.
Notwithstanding any provision of this Plan to the contrary that
would otherwise limit distributee's election under this Article,
a distributee may elect, at the time and in the manner prescribed
by the plan administrator, to have any portion of an eligible
rollover distribution paid directly to an eligible retirement
plan specified by the distributee in a direct rollover.
(b) Definitions.
(i) - 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
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<PAGE>
beneficiary, or for a specified period of ten 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 includable in gross income
(determined without regard to the exclusion for net
unrealized appreciation with respect to employer
securities).
(ii) 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 Section 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.
(iii) Distributee. A distributee includes an
employee or former employee. In addition, the employee's or
former employee's 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 distributed with regard
to the interest of the spouse or former spouse.
(iv) Direct rollover. A direct rollover is a
payment by this Plan to the eligible retirement plan
specified by the distributee.
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<PAGE>
Section 15.05 Merger. In the case of any merger or
consolidation of the Plan, with, or transfer of assets or
liabilities respecting the Plan to, any other plan, each
Participant or beneficiary in the Plan shall (if the Plan had
then terminated) receive a benefit hereunder immediately after
such merger, consolidation or transfer which is no less than the
benefit he or she would have been entitled to receive immediately
before such merger, consolidation or transfer (if the Plan had
then terminated).
Section 15.06 Amendment and Termination.
(a) Except as provided in the next sentence, the Board
of Directors reserves the right, without obtaining the approval
of the shareholders, to amend, modify, suspend or terminate the
Plan. Notwithstanding the foregoing, the Administrator, in
conformity with Section 10.06 hereof, may amend the Loan
Application (as defined in Section 10.06) and other forms used to
request, document and secure a loan from the Plan. No amendment,
modification, suspension, or termination of the Plan shall have
the effect of providing that the funds held in trust by the
Trustee, or the income thereof, may be used for or diverted to
purposes other than the exclusive benefit of the Participants and
their beneficiaries and defraying the reasonable expenses of
administering the Plan or the effect of reducing or restricting,
directly or indirectly, the accrued benefit of any Participant
unless the amendment satisfies the requirements of Section 412(c)
(8) of the Code. The Corporation retains the right to amend the
Plan at any time retroactively in effect if necessary to qualify
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<PAGE>
the Plan or the Trust under Section 401(a) of the Code or
corresponding provisions of any subsequent revenue law. No
amendment to the Plan, however, shall have the effect of
decreasing a Participant's vested Accounts, determined without
regard to such amendment as of the later of the date the
amendment is adopted and the date it becomes effective or
adversely affecting a protected benefit within the meaning of
Section 411(d)(6) of the Code. If any amendment to the Plan
affects the computation of vested benefits (including an
automatic change in the vesting schedule if the Plan becomes
"top-heavy"), each Participant with at least three (3) Years of
Service may elect to have his or her vested benefit determined
without regard to such amendment.
(b) In the event that the Plan shall be partially or
completely terminated or the Corporation shall permanently
discontinue making contributions under the Plan, all amounts then
credited to the accounts of the affected Participants shall
immediately be fully vested and nonforfeitable. After the making
of proper governmental notification, the Board of Directors shall
thereupon direct either (i) that the Trustee continue to hold the
accounts of Participants in the Trust Fund in accordance with the
provisions of this Plan (other than provisions related to
forfeiture) without regard to such termination until all funds in
such accounts have been distributed in accordance with such
provisions, or (ii) that the Trustee immediately distribute to
each affected Participant all amounts then credited to his or her
account as a lump sum in cash or other property.
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<PAGE>
15.07 Applicable Law. The Plan and Trust hereunder
shall be governed by, and construed in accordance with, the laws
of the Commonwealth of Pennsylvania (but not its principles of
conflicts of laws) except to the extent that the laws of the
Commonwealth of Pennsylvania have been specifically preempted by
the Act or other federal legislation.
15.08 Incapacity of Recipient of Benefits. If any
person entitled to receive benefits shall be physically or
mentally incapable of receiving or acknowledging receipt of any
payment of benefits, the Trust, upon the receipt of satisfactory
evidence that such incapacitated person is so incapacitated and
that another person or institution is maintaining him or her and
that no guardian or committee has been appointed for him or her,
may provide for such payment of benefits hereunder to such person
or institution so maintaining him or her, and any such payments
so made shall be deemed for every purpose to have been made to
such incapacitated person.
15.09 Merger, Consolidation or Discontinuance
Involving Corporation. In the event that the Corporation shall
at any time become insolvent, or in the event of the dissolution
of, or a merger or consolidation involving, the Corporation,
without any provision being made for the continuance of the Plan,
the Plan and the Trust thereunder shall terminate and the Plan
Administrator shall proceed in the manner provided herein in the
event of a termination of the Plan. In the event of a
dissolution, merger or consolidation involving the Corporation,
provisions may be made by the Corporation's successor, if any,
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<PAGE>
for the continuance of the Plan. In such event, said successor
shall be substituted hereunder in place of the Corporation by
proper corporate action of such successor.
15.10 Liability of Officers and Directors of the
Corporation. Subject to the provisions of the Act, no past,
present or future officer or director of the Corporation shall be
personally liable to any Participant, beneficiary or other person
under any provision of the Plan or Insurance Contract.
15.11 Indemnification of Fiduciaries. To the extent
permitted by the Act and regulations issued thereunder, the
Corporation shall indemnify and hold harmless all fiduciaries of
the Plan, as defined in the Act, who are employees of the
Corporation, and defend the same, against any and all claims or
liabilities which may be asserted against any of them by reason
of any action or omission in the administration of the Plan,
except in the case of any fraud or willful wrongdoing.
15.12 Service of Process. The Plan Administrator is
the designated agent of the Plan for the service of process in
connection with all matters affecting the Plan.
- 90 -
EXHIBIT 4(d)
Savings and Security Plan
of
the
Tubular Products Division
of
Allegheny Ludlum Corporation
As Amended and Restated Effective
First Day of August, 1993
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . 1
Section 1.01 Account . . . . . . . . . . . . . . . . . 1
Section 1.02 Act . . . . . . . . . . . . . . . . . . . 1
Section 1.03 Actual Deferral Percentage. . . . . . . . 1
Section 1.04 Administrator . . . . . . . . . . . . . . 1
Section 1.05 Affiliated Company. . . . . . . . . . . . 1
Section 1.06 Annual Addition . . . . . . . . . . . . . 1
Section 1.07 Average Contribution Percentage . . . . . 2
Section 1.08 Basic Savings . . . . . . . . . . . . . . 2
Section 1.09 Board . . . . . . . . . . . . . . . . . . 2
Section 1.10 Company Stock . . . . . . . . . . . . . . 2
Section 1.11 Company Stock Fund. . . . . . . . . . . . 2
Section 1.12 Corporation Contributions . . . . . . . . 2
Section 1.13 Compensation. . . . . . . . . . . . . . . 2
Section 1.14 Continuous Service. . . . . . . . . . . . 4
Section 1.15 Corporation . . . . . . . . . . . . . . . 6
Section 1.16 Deferred Portion. . . . . . . . . . . . . 6
Section 1.17 Deferred Salary Savings . . . . . . . . . 6
Section 1.18 Diversified Fund. . . . . . . . . . . . . 6
Section 1.19 Eligible Employee . . . . . . . . . . . . 7
Section 1.20 Eligible Salary/Wages . . . . . . . . . . 7
Section 1.21 Equity Fund . . . . . . . . . . . . . . . 8
Section 1.22 First Day . . . . . . . . . . . . . . . . 8
Section 1.23 Fixed Income Fund . . . . . . . . . . . . 8
Section 1.24 Funds . . . . . . . . . . . . . . . . . . 8
Section 1.25 Highly Compensated Employee . . . . . . . 8
Section 1.26 Hour of Service . . . . . . . . . . . . . 9
Section 1.27 Matching Contribution . . . . . . . . . . 10
Section 1.28 Month, Quarter and Year . . . . . . . . . 10
Section 1.29 Month of Service. . . . . . . . . . . . . 10
Section 1.30 Nondeductible Savings . . . . . . . . . . 10
Section 1.31 Non-Highly Compensated Employee . . . . . 10
Section 1.32 Participant . . . . . . . . . . . . . . . 11
Section 1.33 Permanent Disability. . . . . . . . . . . 11
Section 1.34 Permanent Layoff. . . . . . . . . . . . . 11
Section 1.35 Plan Year . . . . . . . . . . . . . . . . 11
Section 1.36 Reemployment Commencement Date. . . . . . 11
Section 1.37 Retirement. . . . . . . . . . . . . . . . 11
Section 1.38 Savings Part. . . . . . . . . . . . . . . 12
Section 1.39 Security Contributions. . . . . . . . . . 12
Section 1.40 Security Part . . . . . . . . . . . . . . 12
Section 1.41 Stock Index Fund. . . . . . . . . . . . . 12
Section 1.42 Supplemental Savings. . . . . . . . . . . 12
Section 1.43 Trust . . . . . . . . . . . . . . . . . . 12
Section 1.44 Trustee . . . . . . . . . . . . . . . . . 12
Section 1.45 Valuation Date. . . . . . . . . . . . . . 12
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<PAGE>
TABLE OF CONTENTS
Page
Section 1.46 Withdrawable Portion. . . . . . . . . . . 13
Section 1.47 Year Class. . . . . . . . . . . . . . . . 13
Section 1.48 Year of Continuous Service. . . . . . . . 13
ARTICLE II PARTICIPATION . . . . . . . . . . . . . . 14
Section 2.01 Initial Participation - Security Part . . 14
Section 2.02 Initial Participation - Savings Part. . . 14
Section 2.03 Reemployment. . . . . . . . . . . . . . . 14
ARTICLE III EMPLOYEE SAVINGS. . . . . . . . . . . . . 16
Section 3.01 Basic Savings . . . . . . . . . . . . . . 16
Section 3.02 Supplemental Savings. . . . . . . . . . . 16
Section 3.03 Change in Contribution Rate . . . . . . . 16
Section 3.04 Discontinuation of Contributions. . . . . 17
Section 3.05 Payment to Trustee. . . . . . . . . . . . 17
Section 3.06 Reduction of Deferred Salary Savings. . . 17
Section 3.07 Limits of Actual Deferral Percentage. . . 18
Section 3.08 Limits of Average Contribution
Percentage. . . . . . . . . . . . . . . 18
ARTICLE IV COMPANY CONTRIBUTIONS . . . . . . . . . . 19
Section 4.01 Security Contribution . . . . . . . . . . 19
Section 4.02 Matching Contribution . . . . . . . . . . 19
Section 4.03 Payment to Trustee. . . . . . . . . . . . 20
ARTICLE V PLAN OPERATION. . . . . . . . . . . . . . 21
ARTICLE VI SECURITY PART . . . . . . . . . . . . . . 23
Section 6.01 Participants' Accounts. . . . . . . . . . 23
Section 6.02 Investment. . . . . . . . . . . . . . . . 23
Section 6.03 Vesting of Security Part. . . . . . . . . 23
ARTICLE VII SAVINGS PART. . . . . . . . . . . . . . . 24
Section 7.01 Participants' Account . . . . . . . . . . 24
Section 7.02 Vesting of Savings Part . . . . . . . . . 24
Section 7.03 Withdrawable Portion. . . . . . . . . . . 24
Section 7.04 Investment. . . . . . . . . . . . . . . . 25
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<PAGE>
TABLE OF CONTENTS
Page
ARTICLE VIII INVESTMENT OF SAVINGS PART. . . . . . . . 26
Section 8.01 Investment of Savings Part and
Security Part. . . . . . . . . . . . . 26
Section 8.02 Income Dividends. . . . . . . . . . . . . 27
Section 8.03 Establishment of Investment Funds . . . . 27
Section 8.04 Investment of Security Contributions and
CODA Contributions and Rollovers. . . . 28
Section 8.05 Transfers of Participant Balances
Between or Among Investment Funds . . . 29
ARTICLE IX WITHDRAWALS WHILE EMPLOYED. . . . . . . . 30
Section 9.01 Security Part . . . . . . . . . . . . . . 30
Section 9.02 Withdrawable Portion. . . . . . . . . . . 30
Section 9.03 Deferred Portion After Age 59-1/2 -- . . 30
Section 9.04 Deferred Portion Prior to 59-1/2 --
Hardship Withdrawal . . . . . . . . . . 31
Section 9.05 Replacement . . . . . . . . . . . . . . . 31
Section 9.06 Basic Savings, Nondeductible Savings,
and Matching Contributions Prior to
Vesting . . . . . . . . . . . . . . . . 32
ARTICLE X DISTRIBUTIONS UPON TERMINATION OF
EMPLOYMENT. . . . . . . . . . . . . . . . 33
Section 10.01 Distributions Upon Termination of
Employment by Reason of Retirement,
Permanent Disability, Permanent Layoff,
or Death. . . . . . . . . . . . . . . . 33
Section 10.02 Distributions Upon Termination of
Employment by Reason of Resignation
or Discharge. . . . . . . . . . . . . . 33
Section 10.03 Transfer of Employment. . . . . . . . . . 34
ARTICLE XI PAYMENT OF WITHDRAWALS AND DISTRIBUTIONS. 35
Section 11.01 Form of Distribution. . . . . . . . . . . 35
Section 11.02 Payment of Benefits . . . . . . . . . . . 35
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<PAGE>
TABLE OF CONTENTS
Page
Section 11.03 Effective Date of Withdrawal
or Distribution . . . . . . . . . . . . 36
Section 11.04 Application of Corporation Contributions
and Earnings Forfeited. . . . . . . . . 37
Section 11.05 Valuation of Company Stock Fund . . . . . 37
ARTICLE XII ADMINISTRATION. . . . . . . . . . . . . . 40
Section 12.01 The Trustee . . . . . . . . . . . . . . . 40
Section 12.02 Administrator . . . . . . . . . . . . . . 40
Section 12.03 Liability . . . . . . . . . . . . . . . . 40
Section 12.04 Administrative Expenses . . . . . . . . . 42
Section 12.05 Designation of Beneficiaries in the Event
of Death. . . . . . . . . . . . . . . . 41
Section 12.06 Limits on Contributions . . . . . . . . . 42
Section 12.07 Combined Limitations. . . . . . . . . . . 44
ARTICLE XIII TOP-HEAVY RULES . . . . . . . . . . . . . 47
Section 13.01 Purpose . . . . . . . . . . . . . . . . . 47
Section 13.02 Definitions . . . . . . . . . . . . . . . 47
Section 13.03 Determination of Whether Plan Is
"Top-Heavy" . . . . . . . . . . . . . . 49
Section 13.04 Aggregation Group of Employer Plans . . . 50
Section 13.05 Special Minimum Contribution and Minimum
Vesting, and Compensation Limitation,
Becoming Operative in the Event the
Plan Becomes "Top-Heavy". . . . . . . . 51
Section 13.06 Pre-"Top-Heavy" Plan Terminated
Participant . . . . . . . . . . . . . . 53
Section 13.07 Special "Top-Heavy" Reduction in Combined
Benefit and Contribution Limitation . . 53
Section 13.08 Termination of "Top-Heavy" Status . . . . 54
Section 13.09 Multiple "Top-Heavy" Plans. . . . . . . . 54
Section 13.10 Effect of the Plan Becoming
"Super Top-Heavy" . . . . . . . . . . . 55
ARTICLE XIV MISCELLANEOUS . . . . . . . . . . . . . . 56
Section 14.01 Alienation. . . . . . . . . . . . . . . . 56
Section 14.02 Extent of Participant's Rights. . . . . . 57
Section 14.03 Rollover Contributions. . . . . . . . . . 57
Section 14.04 Merger. . . . . . . . . . . . . . . . . . 58
Section 14.05 Amendment and Termination . . . . . . . . 58
Section 14.06 Applicable Law. . . . . . . . . . . . . . 59
Section 14.07 Incapacity of Recipient of Benefits . . . 59
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<PAGE>
TABLE OF CONTENTS
Page
Section 14.08 Merger, Consolidation or Discontinuance
Involving Employer. . . . . . . . . . . 60
Section 14.09 Liability of Officers and Directors
of the Employer . . . . . . . . . . . . 60
Section 14.10 Indemnification of Fiduciaries. . . . . . 60
Section 14.11 Service of Process. . . . . . . . . . . . 61
- v -
<PAGE>
ARTICLE I
DEFINITIONS
Whenever used in this Plan, unless a different meaning is
plainly required by the context:
Section 1.01 "Account" means, as of any Valuation Date,
the sum of a Participant's accounts under the (i) Security Part and
(ii) Savings Part.
Section 1.02 "Act" means the Employee Retirement Income
Security Act of 1974, as the same may be amended from time to time.
Section 1.03 "Actual Deferral Percentage" means, for any
group of employees, the average of the following ratios for each
Eligible Employee in the group: (1) Basic and Supplemental Savings
made by the Eligible Employee for the Plan Year, to (2) the
Eligible Employee's Compensation for the Plan Year.
Section 1.04 "Administrator" means the committee
established pursuant to Section 12.02.
Section 1.05 "Affiliated Company" means any corporation
which is a member of a controlled group of corporations which
includes the Corporation, as defined in Section 414(b) of the Code
and, for purposes of Sections 12.06 and 12.07, as modified by
Section 415(h) of the Code.
Section 1.06 "Annual Addition" means with respect to any
Plan Year for any Participant the amount determined under Section
415(c)(2) of the Code, which includes the sum of (i) the
Corporation Security and Matching Contributions, (ii) the Basic and
<PAGE>
Supplemental Savings, and (iii) Nondeductible Savings made to the
Plan on behalf of the Participant for such Plan Year but excludes
any rollovers or transfers from another qualified plan.
Section 1.07 "Average Contribution Percentage" means the
average of the ratios, computed separately for each Eligible
Employee in the respective group of Matching Contributions to
Compensation for such year. For purposes of this Section the
administrator may take into account any other amounts permitted
under regulations promulgated by the Secretary of the Treasury.
Section 1.08 "Basic Savings" means the payments an
Eligible Employee elects to make pursuant to Section 3.01 which may
be excluded from the Eligible Employee's income for federal income
tax purposes pursuant to Section 401(k) of the Code and which will
be matched by a Matching Contribution.
Section 1.09 "Board" means the Board of Directors of the
Corporation.
Section 1.10 "Company Stock" means common stock, $0.10
par value, of the Corporation.
Section 1.11 "Company Stock Fund" means a fund comprised
of Company Stock.
Section 1.12 "Corporation Contributions" means the amount
the Company will pay into the Plan pursuant to Article IV.
Section 1.13 "Compensation" shall mean a Participant's
earned income, wages, salaries and fees for professional services
and other amounts received for personal services actually rendered
in the course of employment with the Employer (including, but not
- 2 -
<PAGE>
limited to, commissions paid salesmen, compensation for services on
the basis of a percentage of profits, commissions on insurance
premiums, tips and bonuses), and excluding the following:
(a) 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;
(b) 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;
(c) Amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified stock option; and
(d) 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).
For purposes of this Subsection 1.13, Compensation for a limitation
year is the compensation actually paid or includable in gross
income during such year.
- 3 -
<PAGE>
Section 1.14 "Continuous Service" means employment with
the Corporation or an Affiliated Company calculated from the
Eligible Employee's most recent employment commencement date to his
break in continuous service in accordance with the following
provisions:
(a) An Eligible Employee's employment commencement date
shall be the first date on which he performs an Hour of Service for
the Corporation or an Affiliated Company.
(b) An Eligible Employee shall incur a 1-year break in
continuous service upon the completion of a 12-consecutive month
period beginning on the date on which he incurs a break in
continuous service as provided in (g) of this Section 1.13 during
which period the Eligible Employee did not perform an Hour of
Service; provided, however, in the case of any Eligible Employee
who is absent from work for maternity or paternity reasons, the 12-
consecutive month period beginning on the first anniversary of the
first date of such absence shall not constitute a Break in Service.
For purposes of the previous sentence, an absence from work for
maternity or paternity reasons means an absence (i) by reason of
the pregnancy of the Eligible Employee, (ii) by reason of the birth
of a child of the Eligible Employee, (iii) by reason of the
placement of a child with the Eligible Employee in connection with
the adoption of such child by such Eligible Employee, or (iv) for
purposes of caring for such child for a period beginning
immediately following such birth or placement.
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(c) There shall be no deduction for any time lost which
does not constitute a break in continuous service.
(d) For purposes of calculating continuous service, the
term "layoff" shall mean discontinuance of active employment with
the Corporation which, at the time of discontinuance, is considered
to be temporary rather than permanent.
(e) Continuous service shall not be considered broken for
any Eligible Employee who has entered the military, naval or
merchant marine service of the United States if such employee
complies with the requirements of reemployment laws applicable to
him and is reemployed.
(f) Notwithstanding any other provision in (g) of this
Section 1.14, an Eligible Employee shall not be deemed to incur a
break in continuous service until the expiration of the 12-
consecutive month period following the date the Eligible Employee
was first absent from work for any reason other than retirement,
quit or discharge, during which he did not perform an Hour of
Service for the Corporation.
(g) An Eligible Employee who incurs a break in continuous
service on account of Retirement, quit or discharge and who
thereafter performs an Hour of Service with the Corporation within
the 12-consecutive month period following his break, shall receive
credit for the period of severance between the break and
performance of an Hour of Service for the purpose of eligibility
and vesting under the Plan.
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(h) If a Participant has five consecutive one-year breaks
in continuous service, all service after such breaks shall be
disregarded for the purpose of vesting the Security Contributions
accrued prior to such breaks in continuous service. Such
Participant's pre-break continuous service shall count in vesting
the post-break Security Contributions only if either (i) such
Participant has any nonforfeitable interest in his Company
Contributions at the time his break in continuous service commences
or (ii) upon returning to service with the Corporation, the number
of consecutive one-year breaks in continuous service is less than
the number of years of continuous service.
Section 1.15 "Corporation" means Allegheny Ludlum
Corporation and any corporation which shall be its successor.
Section 1.16 "Deferred Portion" means, as of any
Valuation Date, the then current value of (i) the Participant's
Deferred Salary Savings to the extent the Year Class to which they
are allocated has matured under Section 7.03 and (ii) earnings
thereon.
Section 1.17 "Deferred Salary Savings" means the total of
a Participant's Basic Savings and Supplemental Savings excluded
from the Eligible Employee's income for federal income tax purposes
pursuant to Section 401(k) of the Code.
Section 1.18 "Diversified Fund" shall mean the Fund
provided for in Section 8.01(b).
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Section 1.19 "Eligible Employee" means any person who is
employed by the Tubular Products Division of the Corporation and
who meets all of the following conditions:
(a) (i) for an initial determination of eligibility, the
employee completes one thousand (1,000) Hours of Service during the
12 month period beginning on the employee's employment commencement
date as set forth in Section 1.14(a); and
(ii) for any period following an initial
determination of eligibility, the employee completes one thousand
(1,000) Hours of Service in each computation period, which shall be
the Plan Year, provided, if an employee is credited with one
thousand (1,000) Hours of Service under (a)(i) and with one
thousand (1,000) Hours of Service in the Plan Year which includes
the first anniversary of the employee's employment commencement
date, the employee will be credited with two Years of Service for
eligibility to participate;
(b) An employee who is not in a unit of employees covered
by a collective bargaining agreement, unless such agreement
provides for the application of the Plan to the employees in such
unit and does not provide for Supplemental Unemployment Benefits,
or similar benefits. For purposes of Section 2.02 (a) an employee
of the Corporation who meets the requirements of this Subsection
1.19(b) will be eligible to make Basic or Deferred Savings.
Section 1.20 "Eligible Salary/Wages" means wages and/or
regular base salary, prior to any reduction for Basic Savings and
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Supplemental Savings; during such periods as the employee is
eligible to participate in the Plan. The term shall not include
commissions, shift differential, overtime, additional compensation
or other incentive payments, bonuses, extended work week or other
premiums, or any other special payments, fees or allowances but
shall include Vacation Pay for time taken off from work, Jury Duty
Pay and Holiday Allowances.
Section 1.21 "Equity Fund" shall mean the Fund provided
for in Section 8.01(c).
Section 1.22 "First Day" means the beginning of the first
payroll period beginning in the month or quarter or year to which
reference is made.
Section 1.23 "Fixed Income Fund" means the fund provided
for in Section 8.01(a).
Section 1.24. "Funds" shall mean the Fixed Income Fund,
the Diversified Fund, the Equity Fund, the Company Stock Fund, the
Stock Index Fund and any other Fund then permitted under Section
8.01.
Section 1.25 "Highly Compensated Employee" means any
Eligible Employee who:
(i) is at any time a 5% owner of the Company (as
defined for top heavy plan);
(ii) receives compensation from the Company in
excess of $75,000;
(iii) receives compensation from the Company in
excess of $50,000 and is among the most highly
compensated 20% of Employees during such year;
or
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(iv) is an officer of the Company and receives
compensation for the year greater than
$45,000.
In addition, a former Employee will be treated as a
Highly Compensated Employee if such person was a Highly
Compensated Employee at the time of separating from
service or was a Highly Compensated Employee at any time
after attaining age 55, provided, however:
(1) If for any year no officer receives
compensation in excess of $45,000, the highest
paid officer of the employer is treated as a
highly compensated employee.
(2) No more than 50 employees (or if less, the
greater of 3 employees or 10% of all
employees) will be treated as officers.
(3) If any individual is a family member (i.e.,
spouse and lineal ascendants or descendants
and their spouse) of a 5% owner or one of the
10 most highly compensated employees for the
year, such individual is not considered as a
separate employee and any compensation paid to
such individual (and plan contributions or
benefits on behalf of such individual) are
treated as if paid to the 5% owner or highly
compensated employee.
(4) An Employee described under category (ii),
(iii) or (iv) for any year shall be treated as
highly compensated for that year only if such
employee either was described in category
(ii), (iii) or (iv) for the preceding year, or
is a member of the group consisting of the 100
most highly compensated employees for the
current year.
For purposes of this Section 1.25, the dollar figures
shall be adjusted automatically upon an adjustment for
such purpose by the Secretary of the Treasury or his or
her designee.
Section 1.26 "Hour of Service" means an hour for which an
employee is paid, or entitled to payment, for the performance of
duties. Hours of Service hereunder shall be calculated and
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credited in accordance with 29 C.F.R. Section 2530.200b, which is
incorporated herein by this reference.
Section 1.27 "Matching Contribution" means contributions
made by the Corporation pursuant to Section 4.03 to match
Participant Basic Savings.
Section 1.28 "Month, Quarter and Year" means, for the
purposes of determining eligibility to participate and of computing
savings in accordance with Section 3.01 and Corporation
Contributions in accordance with Article IV, as to each employee
that period which includes all payroll paid periods ending in the
calendar month or calendar quarter or calendar year to which
reference is made, and for such purposes shall be considered to run
from the beginning of the first payroll paid period which ends in
such calendar period to the end of the last payroll paid period
ending in such calendar period. For all other purposes it means
the calendar month or calendar quarter or calendar year to which
reference is made.
Section 1.29 "Month of Service" means a calendar month in
which an Eligible Employee is credited with an Hour of Service.
Section 1.30 "Nondeductible Savings" means nondeductible
Participant contributions resulting from an Adjustment in Basic or
Supplemental Savings by the Administrator pursuant to Section 3.05.
Section 1.31 "Non-Highly Compensated Employee" means any
Eligible Employee who is not a Highly Compensated Employee.
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Section 1.32 "Participant" means an employee who is
participating in the Plan under Section 2.02.
Section 1.33 "Permanent Disability" means disability by
bodily injury or disease, either occupational or non-occupational
in cause, preventing the employee, on the basis of medical evidence
satisfactory to the Administrator, from engaging in any occupation
or employment with the Corporation or an Affiliated Company.
Section 1.34 "Permanent Layoff" means any involuntary
termination of employment (other than by reason of discharge for
cause, death, or Retirement).
Section 1.35 "Plan Year" means the twelve (12) month
period ending December 31.
Section 1.36 "Reemployment Commencement Date" means the
date following an Eligible Employee's reemployment after a one-year
break in Continuous Service on which the Eligible Employee first
completes an Hour of Service.
Section 1.37 "Retirement" means (i) termination of
employment with a pension under the provisions of defined benefit
retirement or pension plan sponsored by the Corporation or
Affiliated Company upon which the participant has a right to
commence receiving a benefit immediately following his termination
of employment whether or not the participant then elects to receive
a benefit, (ii) termination of employment following attainment of
age fifty-five (55) and completion of at least fifteen (15) years
of continuous service, or (iii) termination of employment following
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attainment of age sixty-five (65).
Section 1.38 "Savings Part" means the part of the Plan to
which Basic Savings and Supplemental Savings and the earnings
thereon are credited.
Section 1.39 "Security Contributions" means contributions
made by the Corporation pursuant to Section 4.01.
Section 1.40 "Security Part" means the part of the Plan
to which Security Contributions, and the one-time special
contribution made as of July 1, 1984 if applicable, and the
earnings thereon are credited.
Section 1.41 "Stock Index Fund" shall mean the Fund
provided for in Section 8.01(e).
Section 1.42 "Supplemental Savings" means the payments an
Eligible Employee elects to make pursuant to Section 3.02 which may
be excluded from the Eligible Employee's income pursuant to Section
401(k) of the Code.
Section 1.43 "Trust" shall mean Company Stock and such
other assets as may from time to time be designated as Trust assets
by the Company and held by the Trustee pursuant to the Plan.
Section 1.44 "Trustee" shall mean the trustee appointed
by the Board of Directors of the Corporation.
Section 1.45 "Valuation Date" means the last date of each
calendar month on which the Administrator causes the fair market
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value of the assets comprising each of the Funds to be determined.
Section 1.46 "Withdrawable Portion" means, as of any
Valuation Date, the sum of (i) an employee's Basic and Supplemental
Contribution, (ii) the then current value of all amounts credited
to a Year Class which has ended more than three years prior to the
then current Plan Year and (iii) earnings on amounts described in
(i) and (ii) above, provided, however, Deferred Salary Savings and
earnings thereon may be withdrawn only to the extent permitted
under Article IX.
Section 1.47 "Year Class" means an annual period
beginning on January 1 and ending on December 31, inclusive, with
respect to which contributions have been allocated.
Section 1.48 "Year of Continuous Service" means the
Participant's period of Continuous Service in months divided by
twelve (12); fractional years of Continuous Service shall be
disregarded. For the purposes of Section 6.03, Years of Continuous
Service shall be based only on Continuous Service from and after
April 1, 1984.
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ARTICLE II
PARTICIPATION
Section 2.01 Initial Participation - Security Part. Each
Eligible Employee shall commence participation in the Security Part
of the Plan on the latest of (i) the date he first completes an
Hour of Service for the Corporation, (ii) the date he becomes an
Eligible Employee, and (iii) April 1, 1984.
Section 2.02 Initial Participation - Savings Part.
With respect to the Savings Part of the Plan:
(a) An employee described in Section 1.19(b) may make
Basic or Supplemental Savings as of the First Day of the Month (or
any Month thereafter) following his or her first day of employment;
and
(b) Each Eligible Employee shall be eligible to receive
Matching Contributions in the Savings Part of the Plan from and
after the latest of (i) the date he completes six (6) months of
Continuous Service, (ii) the date he became an Eligible Employee
and (iii) the First Day of July, 1984. If an Employee makes
Deferred Salary Savings contributions during the period commencing
on his or her first day of employment and ending on the last day of
the sixth month thereafter, such Employer contributions shall not
be subject to Matching Contributions.
Section 2.03 Reemployment. An Eligible Employee who is
reemployed following a one-year break in continuous service and who
had completed six (6) months of Continuous Service or more during
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any previous period of employment shall begin participating in the
Security Part and the Savings Part as of the employee's
Reemployment Commencement Date.
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ARTICLE III
EMPLOYEE SAVINGS
Section 3.01 Basic Savings. An Employee described in
Section 1.19(b) may defer and designate as his Basic Savings such
percentage of his Eligible Salary as he may elect in accordance
with the following schedule:
Percentage of
Continuous Service Eligible Salary
From date of employment to 5 years........ 2, 3, 4, or 5%
Over 5 years to 10 year................... 2, 3, 4, 5, or 6%
Over 10 years to 15 years................. 2, 3, 4, 5, 6, or 7%
Over 15 years............................. 3, 4, 5, 6, 7, or 8%
Section 3.02 Supplemental Savings. In addition to Basic
Savings, an employee described in Section 1.19(b) may elect to pay
into the Plan as Supplemental Savings a percentage of his Eligible
Salary not to exceed that percentage of his Eligible Salary as
shall equal the difference between the percentage of his Eligible
Salary he has elected and makes as Basic Savings payments pursuant
to Section 3.01 and sixteen percent (16%). All Supplemental
Savings shall be paid into the Plan through payroll deferrals and
such election may be made only in full percentages.
Section 3.03 Change in Contribution Rate. A Participant
may elect to increase or decrease the percentage of his Basic
Savings and Supplemental Savings to any percentage permitted by
Sections 3.01 and 3.02 by filing a written notice. Such change
will be effective in the First Day of the Month next following the
30th day after receipt of such written notice.
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Section 3.04 Discontinuation of Contributions. A
Participant may upon written notice, effective with the First Day
of any subsequent Month, discontinue his Basic Savings and/or his
Supplemental Savings. If Basic and/or Supplemental Savings had
been discontinued, a Participant may direct, by written notice,
that such be recommenced as of the First Day of the next Year or
the First Day of any Month subsequent thereto.
Section 3.05 Payment to Trustee. Basic and Supplemental
Savings for any month will be paid over by the Corporation to the
Trustee as soon as practical, and in no event more than 90 days,
after such amounts have been withheld from a Participant's
paycheck. Such amounts shall be held in the Savings Part of the
Plan.
Section 3.06 Reduction of Deferred Salary Savings. In
the event that it is determined for any Plan Year that the Actual
Deferral Percentage for Highly Compensated Employees exceeds or may
be reasonably expected to exceed the limits set forth in Section
3.07 below, then, the Committee may take whatever action it deems
appropriate with respect to Highly Compensated Employees,
including, but not limited to, reducing the Basic Savings and/or
Supplemental Savings of the Highly Compensated Employees so that
the limitations under Section 3.07 will be satisfied. The amount
of any such reduction may, at the Committee's discretion, be
converted to Nondeductible Savings. Nondeductible Savings shall be
credited to the Savings Part of the Plan or returned to such
Participant.
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Section 3.07 Limits of Actual Deferral Percentage. For
any Plan Year, the Actual Deferral Percentage for Highly
Compensated Employees may not exceed the greater of (a) or (b)
below:
(a) One hundred twenty-five percent (125%) of the Actual
Deferral Percentage for Non-Highly Compensated Employees.
(b) Two hundred percent (200%) of the Actual Deferral
Percentage for Non-Highly Compensated Employees; provided, however,
that the Actual Deferral Percentage for Highly Compensated
Employees may not exceed the Actual Deferral Percentage for Non-
Highly Compensated Employees by more than two (2) percentage
points.
Section 3.08 Limits on Average Contribution Percentage.
For any Plan Year, the Average Contribution Percentage for Highly
Compensated Employees may not exceed the greater of (a) or (b)
below:
(a) One hundred twenty-five percent (125%) of the average
contribution percentage for Non-Highly Compensated Employees.
(b) Two hundred percent (200%) of the average
contribution percentage for Non-Highly Compensated Employees;
provided, however, that the average contribution percentage for
Highly Compensated Employees may not exceed the average
contribution percentage for Non-Highly Compensated Employees by
more than two (2) percentage points.
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ARTICLE IV
COMPANY CONTRIBUTIONS
Section 4.01 Security Contribution. The Corporation
shall for each Month contribute on behalf of each Participant
(whether or not the Participant is making Basic Savings
contributions) a Security Contribution equal to the sum of (i) five
percent (5%) of the Participant's Eligible Salary/Wages for such
Month plus (ii) the applicable Monthly amount per Eligible Employee
determined under the following Schedule:
(I) For Months prior to July 1, 1990 - $0;
(II) For Months after July 1, 1990 and before April 1,
1991 - $8.67;
(III) For Months after April 1, 1991 and before April 1,
1992 - $17.34;
(IV) For Months after April 1, 1992 and before April 1,
1993 - $26.43; and
(V) For Months after April 1, 1993 and before April 1,
1994 - $43.34.
The Security Contribution shall be credited to the Security Part of
the Plan. In addition, it is noted the Corporation made a special
one time contribution as of July 1, 1984 for Eligible Employees as
of that date.
Section 4.02 Matching Contribution. The Corporation
shall contribute on behalf of each Eligible Employee who has met
the requirements of Section 2.02(b) and who is making Basic
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Contributions, a Matching Contribution equal to fifty percent (50%)
of the Participant's Basic Savings made during such fiscal period.
The Matching Contribution shall be credited to the Savings Part of
the Plan.
Section 4.03 Payment to Trustee. Security Contributions
and Matching Contributions for any Month shall be paid over by the
Corporation to the Trustee as soon as practical, and in no event
more than 90 days, after the end of the Month during which the
services were rendered and/or Basic Contributions were made, as
applicable.
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ARTICLE V
PLAN OPERATION
The benefits under the Plan are provided by the
contributions of both the Participant and the Corporation. Basic
Savings and related Matching Contributions, Supplemental Savings
and Nondeductible Savings, if any, shall be credited to the Savings
Part (Article VII) and invested in accordance with Article VIII.
Security Contributions by the Corporation as well as the special
one-time contribution made as of July 1, 1984 are credited to the
Security Part (Article VI) and invested in accordance with Section
6.02. The Administrator shall maintain a separate Account for each
Participant to record, separately, a Participant's interest in the
Savings Part and the Security Part and, within each Part, the
Administrator shall separately account for, respectively, the
Participant's Basic Savings and Supplemental Savings, Matching
Contributions and Nondeductible Savings and the Participant's
Security Contributions and special one time contribution. From
such accounting, the Administrator shall determine the
Participant's Withdrawable Portion. At least as often as the last
day of the Plan Year, the Administrator shall cause the fair market
value of the assets comprising each of the Funds, separately, to be
determined and shall, as of that date, allocate the gains and/or
losses or dividends thereof between and among the Accounts of
Participants within such Funds in the ratios that each
Participant's Account invested in such Fund bears to the Accounts
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invested in such Fund of all Participants under the Plan. Upon
such allocation, the Administrator shall apportion the gain or loss
so allocated between or among the accounting for a Participant's
separate class of contributions in the ratio that the value of each
such class of contributions bears to the value of his Account. The
Administrator shall account for amounts in the Company Stock Fund
in whole and fractional shares of common stock.
In addition to the appointment of the Administrator as
provided in Section 12.02, the Board may appoint from time to time
(and, thereafter, may remove) an Investment Manager which shall
have such powers and duties as shall be delegated to the Investment
Manager from time to time.
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ARTICLE VI
SECURITY PART
Section 6.01 Participants' Accounts. An account shall be
established under the Security Part for each Participant to record
the Corporation's Security Contributions and, if applicable, the
special one-time contribution made as of July 1, 1984 together with
earnings thereon made with respect to such Participant.
Section 6.02 Investment. Amounts credited to the Account
of a Participant under the Security Part shall be invested as
directed by the Participant pursuant to Article VIII.
Section 6.03 Vesting of Security Part. A Participant's
interest in his Account under the Security Part shall become one
hundred percent (100%) vested and nonforfeitable upon the earlier
of the Participant's attaining age 65 or Participant's completion
of five (5) Years of Continuous Service. For the purpose of this
Section 6.03, a Participant's Continuous Service prior to the
effective date of the Plan (April 1, 1984) shall be disregarded.
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ARTICLE VII
SAVINGS PART
Section 7.01 Participants' Account. An account shall be
established under the Savings Part for each Participant electing to
make Basic Savings contributions to the Plan. The Participant's
Basic Savings, Supplemental Savings and Nondeductible Savings, if
any, together with the Corporation's Matching Contributions shall
be credited to such account.
Section 7.02 Vesting of Savings Part.
(a) Basic, Supplemental and Nondeductible Savings. A
Participant shall at all times be 100% vested in and have a non-
forfeitable interest in his or her Basic Savings, Supplemental
Savings and Nondeductible Savings and the earnings on any of the
foregoing.
(b) Matching Contributions. The Matching Contributions
made with respect to a Participant's contributions shall become
vested on the earlier of his or her (i) attainment of age 65 or
(ii) completion of five (5) Years of Continuous Service.
Section 7.03 Withdrawable Portion. Matching
Contributions and earnings thereon credited to a Participant's
Account shall be made a part of his or her Withdrawable Portion on
the later of (i) the date such amounts become vested under Section
7.02 or (ii) the third anniversary of the last day of the Year
Class in which such Matching Contributions were made. Unmatched
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Nondeductible Savings shall become part of the Withdrawable Portion
when such contributions are credited to the Participant's Account.
Section 7.04 Investment. Amounts credited to the Account
of a Participant shall be invested as directed by the Participant
pursuant to Article VIII.
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ARTICLE VIII
INVESTMENT OF SAVINGS PART
Section 8.01 Investment of Savings Part and Security
Part. Amounts credited to the Account of a Participant as his or
her Savings Part and/or his or her Security Part shall be invested
by the Trustee as directed by the Participant as set forth in this
Article in one or a combination of the following Funds:
(a) Fixed Income Fund. A fund invested with an
insurance company, bank or other financial institution under an
agreement which shall contain provisions that the insurance
company, bank or other financial institution will guarantee
repayment in full of such amounts deposited under such agreement
with the insurance company, bank or other financial institution
plus interest. Separate funds or agreements may be maintained for
the Security Part and the Savings Part.
(b) Diversified Fund. A diversified fund of common
and/or preferred capital stocks, bonds, notes and/or debentures or
a commingled trust fund established for the collective investment
of funds of employee benefit plans qualified under Section 401(a)
of the Code, designed to provide a balance between growth oriented
securities and income-oriented securities.
(c) Equity Fund. An equity fund, or a fund of common
stock or commingled trust fund established for the
collective investment of funds of employee benefit
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plans qualified under Section 401(a) of the Code,
designed to invest primarily in growth-oriented
common stock.
(d) Company Stock Fund. A fund comprised of Company
Stock.
(e) Stock Index Fund. A collective investment fund for
employee benefit plans qualified under Section
401(a) of the Code which closely tracks the
investment performance of the Standard & Poor's 500
Composite Stock Index by purchasing equity
securities of substantially all of the corporations
listed in that index in proportion to their
respective market capitalization.
(e) Other. Such other funds as the Board or its
designee may select and offer for investment to
Eligible Employees upon due notice and description.
The Trustee may temporarily hold cash or make short-term
investments pending investment as contemplated by this Section 8.01
or as it may reasonably determine are necessary to the liquidity of
the Plan.
Section 8.02 Income and Dividends. Dividends, interest
and other distributions received on the assets held by the Trustee
shall be reinvested in the respective Funds.
Section 8.03 Establishment of Investment Funds. The
Board may from time to time appoint (and, thereafter, remove or
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replace) an Investment Manager which shall have such powers and
duties in respect to the establishment and maintenance of the
investment funds described above as the Board may from time to time
direct.
Section 8.04 Investment of Security Contributions and
CODA Contributions and Rollovers.
(a) Participant Elections.
Each Participant shall be entitled to direct the
investment of each or all contributions made to his or her Account
to be credited to his or her Savings Part or Security Part, in
whole percentages, to any one or combination of Funds then
permitted under Section 8.01 of the Plan. An Investment Election
shall be made in writing on a form approved for such purpose and
shall be effective with respect to all contributions to the
Security Part and/or the Savings Part credited to the Participant's
Account on or after the first day of the calendar
Month which is no less than thirty (30) days after receipt by the
Administrator of such properly completed Investment Election. Each
Investment Election shall specify, in whole percentages, the Fund
or Funds to which such amounts shall be credited. Separate
elections may be filed with respect to the Security Part and the
Savings Part. An Investment Election, once properly made, shall
remain in effect until revoked in writing by the Participant.
(b) Change in Investment Elections. A Participant may
change his or her Investment Election with respect to the Security
Part and/or the Savings Part no more frequently than monthly by
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completing and filing a new Investment Election with the
Administrator. Such new Investment Election shall revoke all
previous Investment Elections and shall be effective with respect
to contributions credited to the Participant's Account on or after
the first day of the calendar Month thirty (30) days after receipt
by the Administrator of such properly completed Investment
Election.
(c) Default of Election. In the event a Participant does
not file an Investment Election or if any previous Investment
Election is invalid for any reason, one hundred percent (100%) of
all contributions shall be invested in the Fixed Income Fund.
Section 8.05 Transfers of Participant Balances Between or
Among Investment Funds. Effective as of the first day of the
calendar month next following the thirtieth (30th) day after
receipt by the Administrator of a properly completed Transfer
Election, a Participant may direct that all or, in whole
percentages, any portion of, separately, the Participant's balance
in the Security Part or the Savings Part may be transferred from
any one or more Funds to any other Fund or Funds then permitted
under Section 8.01 of this Plan.
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ARTICLE IX
WITHDRAWALS WHILE EMPLOYED
Section 9.01 Security Part. In no event may a
Participant withdraw all or any part of his amount in the Security
Part while still in the employ of the Corporation or an Affiliated
Company.
Section 9.02 Withdrawable Portion. A Participant may
withdraw all or any part of his Withdrawable Portion of the Savings
Part, but in no event less than two hundred fifty dollars ($250)
from any Fund (if his total interest in such Withdrawable Portion
is less than two hundred fifty dollars ($250), he may withdraw the
total); furthermore, if after a withdrawal from the Withdrawable
Portion his remaining interest in such portion would be less than
two hundred fifty dollars ($250), he must withdraw the total.
Section 9.03 Deferred Portion After Age 59-1/2. A
Participant who is age fifty-nine and one-half (59-1/2) or older
may withdraw all or any part of his Deferred Portion of the Savings
Part, but in no event less than two hundred fifty dollars ($250)
(if his total interest in such Deferred Portion is less than two
hundred fifty dollars ($250), he may withdraw the total);
furthermore, if after a withdrawal from the Deferred Portion his
remaining interest in such portion would be less than two hundred
fifty dollars ($250) he must withdraw the total.
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Section 9.04 Deferred Portion Prior to Age 59-1/2 --
Hardship Withdrawal. A Participant who has not attained age fifty-
nine and one-half (59-1/2) may, upon the approval of the
Adminstrator after written request, be permitted to withdraw all or
any part of his Deferred Portion of the Savings Part in the event
of financial hardship; provided, however, that a Participant may
withdraw no more of his Deferred Portion than is (i) necessary to
meet the immediate financial needs created by the hardship; and
(ii) not reasonably available from other resources of the
Participant. Such a withdrawal is to be permitted only if it is
coincident with or following a complete withdrawal of the
Participant's Withdrawable Portion of the Savings Part.
For purposes of this Section 9.04, the term "hardship"
shall mean circumstances such that the Participant is confronted
with immediate and heavy financial needs. The interpretation of
the term "hardship" shall be consistent with Section 401(k) of the
Code and the regulations provided thereunder.
The Administrator shall establish a uniform and
nondiscriminatory policy for reviewing Participant applications for
withdrawals under this Section 9.04 and such policy may include any
safe harbor mechanisms described by the Secretary of the Treasury
in regulations.
Section 9.05 Replacement. A Participant may not replace
any amounts withdrawn under Sections 9.02, 9.03 or 9.04.
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Section 9.06 Basic Savings, Nondeductible Savings, and
Matching Contributions Prior to Vesting. A Participant may not
withdraw any Contributions of any type prior to the time they
become a part of his or her Withdrawable Portion.
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ARTICLE X
DISTRIBUTIONS UPON TERMINATION OF EMPLOYMENT
Section 10.01 Distributions Upon Termination of
Employment by Reason of Retirement, Permanent Disability, Permanent
Layoff, or Death. A Participant whose employment terminates by
reason of Retirement, Permanent Disability, Permanent Layoff, or
death shall receive, as a distribution without election or other
action on his part, the then current value of the Participant's
interest in the Security Part and the Savings Part, notwithstanding
any vesting provisions. Payment shall be made in a single sum
within one taxable year of the recipient.
Section 10.02 Distributions Upon Termination of
Employment by Reason of Resignation or Discharge.
(a) A Participant whose employment terminates by reason
of resignation or discharge shall receive as a distribution,
without election or other action on his part, the current value of
the Participant's vested interest in the Savings Part and the
Security Part. Payment shall be made in a single sum within one
taxable year of the recipient. Matching and Security Contributions
and earnings thereon which have not become vested shall be
forfeited and used to reduce future Corporation Contributions to
the Plan; provided, however, Matching and Security Contributions
shall not be deemed forfeited by a Participant unless or until such
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Participant incurs five (5) consecutive one-year Breaks in Service.
Section 10.03 Transfer of Employment. A Participant will
not be deemed to have a termination of employment for the purposes
of Sections 10.01 and 10.02 as long as he is an employee of the
Corporation or an Affiliated Company.
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ARTICLE XI
PAYMENT OF WITHDRAWALS AND DISTRIBUTIONS
Section 11.01 Form of Distribution. All distributions
from the Fixed Income Fund, the Diversified Fund, the Equity Fund
or the Stock Index Fund shall be paid in the form of cash. The
amount shall be determined as of the Valuation Date coinciding with
or next preceding the date of payment. All distributions from the
Company Stock Fund shall be paid in the form of, at the election of
the Participant, either cash representing the then value of shares
of Company Stock as determined under Section 11.05 credited to his
or her Account or a certificate representing the number of whole
shares of Company Stock credited to his Account together with an
amount of cash representing the fair market value of any fractional
shares of Company Stock credited to his Account.
Section 11.02 Payment of Benefits. Distribution of a
Participant's vested interest shall be made as soon as
administratively feasible after the occurrence of the event giving
rise to such distribution. Notwithstanding the foregoing, a
Participant may elect to defer receipt of his or her distribution
from this Plan until the next following calendar year and, if so
deferred, payment shall be made to him as early as practicable in
such taxable year. Notwithstanding the foregoing or any other
provision of this Plan, if the present value of a Participant's
accrued benefit (both from his or her and Corporation
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contributions) is in excess of $3,500, distribution of his or her
vested interest shall not commence prior to his or her vested
interest shall not commence prior to his or her earliest retirement
age unless (i) Participant has consented in writing or (ii) the
distribution is by reason of the Participant's death.
Notwithstanding any other provision of the Plan, without the
Participant's consent,
(a) payment of benefits under the Plan shall be made not
later than the sixtieth (60th) day after the end of the Plan Year
in which the latest of the following events occurs:
(1) The date on which the Participant attains age
sixty-five (65);
(2) The tenth (10th) anniversary of the year in
which the Participant commenced participation in the
Plan; or
(3) The date on which the Participant terminates
his employment.
(b) provided, however, the value of a Participant's
Account must be distributed (or begin to be distributed) no later
than the first day of April following the calendar year in which
such Participant attains age seventy and one-half (70 1/2) whether
or not the Participant is then an employee of the Corporation.
Section 11.03 Effective Date of Withdrawal or
Distribution. The effective date of any withdrawal or distribution
shall be (i) in the case of a withdrawal while still employed, the
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date specified in a written notice of withdrawal presented to the
Administrator; but not earlier than the date such notice is
received by the Trustee, or (ii) in the case of termination of
employment, the date of such termination. Subject to the
provisions of Section 11.02, payment shall be made as soon as
practicable after the effective date of withdrawal or distribution,
as the case may be.
Section 11.04 Application of Corporation Contributions
and Earnings Forfeited. Corporation contributions and earnings
thereon that have been forfeited in accordance with the provisions
of Section 10.02 shall be applied to reduce any subsequent Matching
or Security Contributions required under the Plan, or, if the Plan
shall be terminated, any amount not previously so applied shall be
credited totally to the Accounts of all Participants at the time of
such termination.
Section 11.05 Valuation of Company Stock Fund. For the
purposes of determining the value of Company Stock as of any
Valuation Date in respect to any investment in the Company Stock
Fund, transfer to or from the Company Stock Fund or withdrawal or
distribution from the Company Stock Fund, Company Stock shall be
valued as the net amount actually paid or received by the Trustee
upon the purchase or sale of the shares of Company Stock, after
payment of reasonable expenses, including brokerage commissions,
attributable to such transaction; provided, however, the Trustee
may be directed to offset the number of shares, in whole or in
part, otherwise to be sold in the aggregate of such transactions
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against the number of shares, in whole or in part, which would
otherwise be purchased in respect to the aggregate of such
transactions, and, in such event, the shares so offset will be
valued at the trading price of Company Stock on the date of such
offset and no brokerage commission shall be charged. In the event
that all shares to be purchased or sold in respect to such events
may not be sold, purchased or offset at a single time or on a
single trading date, all shares of Company Stock comprising such
transactions shall be valued at the weighted average of the net
amount realized or paid upon all such sales, purchases and/or
offsets. As of each Valuation Date, the value of each
Participant's interest in the Company Stock Fund shall be adjusted
appropriately for earnings or contributions credited to such fund,
transfers to or from such Fund and withdrawals from such Fund, in
each case using the methodology described above from the Valuation
Date. The number of additional shares to be credited to the
Accounts of each Participant in the Company Stock Fund (i) in
respect of dividends received since the immediately preceding
Valuation Date shall be the number of shares purchased with such
dividends multiplied by a fraction, the numerator of which is the
number of whole and fractional shares credited to the Participant's
Account as of the immediately preceding Valuation Date and the
denominator is the aggregate number of shares held in the Company
Stock Fund as of the immediately preceding Valuation Date and (ii)
in respect of additional contributions made during the period,
shall be the number of shares equal to the amount contributed
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divided by the value of such shares determined under this Section
as of that Valuation Date.
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ARTICLE XII
ADMINISTRATION
Section 12.01 The Trustee. The Corporation shall appoint
a Trustee and enter into an Agreement of Trust with the Trustee for
the holding and investing of Plan assets.
Section 12.02 Administrator. The Administrator of the
Plan shall be a committee appointed by the Board. The
Administrator shall be the named fiduciary with respect to
administration of the Plan and shall have such additional fiduciary
responsibilities as the Board shall delegate to it from time to
time. The Administrator shall adopt a claim and claims review
procedure and such other administrative regulations as it shall
deem necessary or proper for the efficient administration of the
Plan. The Administrator shall have full power and authority to
construe, interpret and administer the Plan. Subject to the claims
review procedure, decisions of the Administrator shall be final and
binding upon the Corporation and their employees to the extent
permitted by law.
Section 12.03 Liability. No member of the Administrator
shall be liable for any loss other than that specifically provided
for under the standards applicable to fiduciaries as contained in
the Act. No member shall be personally liable upon, or with
respect to, any agreement, act, transaction or omission executed,
committed or suffered to be committed by himself as a member of the
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Administrator or by any other member, agent or representative of
the Administrator, except as specifically provided in Title I of
the Act. The Administrator, and any member and agent thereof,
shall be fully protected in relying upon the advice of any legal
counsel, physician or other expert retained by the Administrator or
the Corporation. Other than the bonding requirement under Section
412 of the Act, no bond or other security shall be required of any
member of the Administrator in any jurisdiction.
Section 12.04 Administrative Expenses. To the extent
permitted by the Act and regulations issued thereunder, all costs
and expenses incurred in administering the Plan, including the
expenses of the Administrator, shall be an expense payable from the
assets of the Plan held by the Trustee unless such cost and expense
is paid by the Corporation within 90 days after a statement of such
cost and expense is presented to the Corporation.
Section 12.05 Designation of Beneficiaries in the Event
of Death. Upon the death of a Participant, the value of the assets
in his Account shall be distributed to the beneficiary or
beneficiaries designated. A Participant shall designate his
beneficiary upon becoming a Participant and may change such
designation at any time by filing a written designation with the
Administrator. Any designation of a beneficiary other than the
Participant's spouse shall not be effective unless the spouse
consents in writing. The spouse's consent must be witnessed by a
representative of the Administrator or a notary public.
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Notwithstanding this requirement, if the Participant establishes to
the satisfaction of the Administrator that such written consent
cannot be obtained because there is no spouse or the spouse cannot
be located, the written consent of the Participant will be deemed
sufficient. A consent will be valid only with respect to the
spouse who signs the consent or, in the event of a deemed consent,
the designated spouse. A revocation of a prior election may be
made by the Participant with the consent of the spouse at any time
before the commencement of benefits. The number of revocations
shall not be limited. Upon the death of a Participant, if there is
no designated beneficiary then living, or if the designation is not
effective for any reason, as determined by the Administrator, the
Participant's beneficiary shall be his surviving spouse or, if
none, the beneficiary or beneficiaries designated by the
Participant for purposes of the group life insurance maintained by
the Corporation. In the absence of a surviving spouse and a
designation under the group life insurance, the beneficiary of the
Participant shall be his surviving children (per stirpes); if none,
his personal representative, if any; and, if none, those persons
entitled to his estate under the intestate laws of the state in
which the Participant is domiciled at the time of his death. In no
event shall any portion of such death benefit be payable to the
Corporation.
Section 12.06 Limits on Contributions. Allocations shall
be limited to a Participant's Account as follows:
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(a) The total value of the Annual Addition made on behalf
of any Participant for any Plan Year shall not exceed the lesser of
(i) thirty thousand dollars ($30,000), or such other amount as may
be permitted under regulations prescribed under Section 415(d) of
the Code or any successor provision, or (ii) twenty-five percent
(25%) of such Participant's Compensation during such Plan Year.
(b) In the event that it is determined that the Annual
Addition on behalf of any Participant for any Plan Year is in
excess of the limitations contained in this Section 12.06(a), such
Annual Addition shall be reduced as follows to the extent necessary
to bring such contribution within the limitations contained herein:
(1) Nondeductible Savings shall be returned to the
Participant.
(2) To the extent permitted by the Act and the
regulations promulgated thereunder, Supplemental Contributions
shall be converted to Nondeductible Savings.
(3) To the extent permitted by the Act and the
regulations promulgated thereunder, Basic Savings shall be
converted to Nondeductible Savings.
(4) Corporation Security Contributions shall be
allocated to Accounts of remaining Participants in proportion
to their Compensation for the Plan Year to the extent no other
limitations are exceeded.
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(5) All remaining excess amounts shall be, allocated
to a suspense account in accordance with the following rules:
a. No Corporation contributions may be made
at any time when the allocation thereof would be
precluded by Section 415 of the Code;
b. Investment gains and losses and other
income are not allocated to the suspense account;
c. Suspense account amounts are allocated as
of the end of each Plan Year until the suspense account
is exhausted.
In the event of Plan termination, such suspense
account shall revert to the Corporation to the extent it may
not then be allocated to any Participant's Account.
Section 12.07 Combined Limitations.
(a) Notwithstanding any other provision of this
Plan, and as required by the Act, if any Participant is, or
was, covered under a defined benefit plan and a defined
contribution plan maintained by the Corporation or an
Affiliated Company, the sum of the Participant's defined
benefit plan fraction and defined contribution plan fraction
may not exceed 1.0 in any Plan Year (which shall also be the
limitation year).
(b) The defined benefit plan fraction is a fraction,
the numerator of which is the sum of the Participant's
projected annual benefits under all defined benefit plans
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(whether or not terminated) maintained by the Corporation or
an Affiliated Company, and the denominator of which is the
lesser of (i) 1.25 times the dollar limitation of Section
415(b)(l)(A) of the Code in effect for the Plan Year or (ii)
1.4 times the Participant's average compensation for the three
(3) consecutive years that produces the highest average.
"Projected annual benefit" means the annual benefit to which
the Participant would be entitled under the terms of the Plan,
if the Participant continued employment until normal
retirement age (or actual age, if later) and the Participant's
Compensation for the Plan Year and all other relevant factors
used to determine such benefit remained constant until normal
retirement age (or actual age, if later).
(c) The defined contribution plan fraction is a
fraction, the numerator of which is the sum of the annual
additions to the Participant's account under all defined
contribution plans maintained by the Corporation or an
Affiliated Company (whether or not terminated) for the current
and all prior Plan Years, and the denominator of which is the
sum of the lesser of the following amounts determined for such
year and for each prior year of service with the Corporation
or an Affiliated Company: (i) 1.25 times the dollar
limitation in effect under Section 415(c)(1)(A) of the Code
for such year, or (ii) 1.4 times the amount which may be taken
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into account under Section 415(c)(l)(B) of the Code.
(d) If, in any Plan Year, the sum of the defined
benefit plan fraction and the defined contribution plan
fraction will exceed 1.0, the rate of benefit accrual under
the defined benefit plan will be reduced so that the sum of
the fractions equals 1.0.
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ARTICLE XIII
TOP-HEAVY RULES
Section 13.01 Purpose. The purpose of this Article XIII
of the Plan is to comply with the special rules applicable to "top-
heavy" plans contained in Section 416 of the Code, as added by
Section 240 of the Tax Equity and Fiscal Responsibility Act of
1982, and the appropriate Regulations issued thereunder, including
Proposed Reg. Section 1.416-1 and successor Regulations. The rules
set forth in this Article XIII shall be operative if the Plan is,
or becomes, "top-heavy" within the meaning of Section 416 of the
Code and the Regulations thereunder. In the event that by
statutory repeal or amendment, or regulatory change or ruling by
the Internal Revenue Service, any of the limitations or
restrictions of this Article XIII are no longer necessary in order
for the Plan to meet the requirements of Section 416 of the Code or
other applicable provisions of the Code then in effect, such
limitations or restrictions shall immediately become null and void
and shall no longer apply without the necessity of further
amendment to the Plan. The rules contained in this Article XIII
shall, except otherwise specifically noted, be effective January 1,
1984.
Section 13.02 Definitions. For purposes of this Article
XIII only, the following terms shall have the meanings set forth
below:
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(a) "Compensation Limitation" means the annual
Compensation of an Employee up to, but not exceeding $200,000,
subject to certain cost-of-living adjustments of the Secretary of
the Treasury, as provided in Section 416(d) of the Code.
(b) "Determination Date" means, as to any Plan Year, the
last day of any preceding Plan Year or, in the case of the first
Plan Year, the last day of such Plan Year.
(c) "Key Employee" means any Employee, or former
Employee, or Beneficiary of either, who at any time during the Plan
Year or the four preceding Plan Years, is:
(1) an officer of the Employer having an
annual Compensation greater than the amount determined by
multiplying 150% of the dollar limitation under Section
415(c)(1)(A) of the Code;
(2) one of the 10 Employees owning the largest
interests in the Employer having an annual Compensation
at least equal to the dollar limitation under Section
415(c)(1)(A) of the Code;
(3) a 5% owner of the Employer; or
(4) a 1% owner of the Employer having
aggregate annual Compensation of at least $150,000 from
the Employer and all entities required to be aggregated
with the Employer under Sections 414(b), (c) and (m) of
the Code.
For purposes of subparagraphs (2), (3) and (4), owners of
the Employer shall include those considered as owners within the
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meaning of Section 318 of the Code. In identifying the top 10
Employee owners under Subsection 13.02(c) (2), only owners of
greater than a one-half percent (1/2%) interest in the Employer
will be considered, and if several Employees have equal ownership
interests, those Employees with higher Compensation shall be
treated as having a greater ownership interest. The determination
of who is a Key Employee shall be made in accordance with Section
416(i) of the Code and the Regulations thereunder, the provisions
of which are incorporated herein by reference.
(d) "Non-Key Employee" means any Employee other than a
Key Employee, and shall include any former Key Employee.
(e) "Valuation Date" means the most recent Valuation Date
occurring within the 12-month period ending on the Determination
Date.
(f) "Employer" means the Corporation.
(g) "Employee" means an Eligible Employee.
Section 13.03 Determination of Whether Plan Is "Top-
Heavy". The Plan will be deemed to be "top-heavy" in any Plan Year
if, as of the Determination Date, the sum of the present value of
accrued benefits of Key Employees exceeds 60% of the sum of the
present value of accrued benefits of all Participants, excluding
former Key Employees. As used in this Section 13.03, the present
value of accrued benefits includes the amount attributable to
Company Contributions and Employee Contributions allocated to the
individual accounts of Participants and former Participants. The
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determination of whether the Plan is "top-heavy" and the extent to
which distributions, rollovers, and transfers are taken into
account in such calculation shall be made in accordance with
Section 416 of the Code and the regulations thereunder which are
herein incorporated by reference. Deductible employee
contributions will not be taken into account in determining whether
the Plan is "top-heavy". Furthermore with respect to Plan Years
beginning after December 31, 1984, a former Participant's account
balance is to be disregarded in determining whether the Plan is
"top-heavy", unless the Participant performed any services for the
Employer within the 5 year period ending on the Determination Date.
Section 13.04 Aggregation Group of Employer Plans. All
corporations and businesses that are aggregated under Sections
414(b), (c) and (m) of the Code with the Employer must be
considered with the Employer for the purposes of determining
whether the Plan is "top-heavy". All plans of the Employer in
which a Key Employee participates, and each other stock bonus,
pension or profit sharing plan, if any, of the Employer which
enables any plan in which a Key Employee participates to meet the
requirements of Section 401(a)(4) or Section 410 of the Code, will
be aggregated as a required aggregation group within the meaning of
Section 416(g) of the Code. Each plan in the required aggregation
group will be "top-heavy" if the group is "top-heavy", and no plan
in the group will be "top-heavy" if the group is not "top-heavy".
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In addition, the Employer may elect to include as part of
the permissive aggregation group under Section 416(g) of the Code
any plans that are not part of a required aggregation group but
that satisfy the requirements of Sections 401(a)(4) and 410 of the
Code when considered together with the plans constituting the
required aggregation group. If the permissive aggregation group is
"top-heavy", only those plans which are part of the required
aggregation group will be subject to the additional requirements
applicable to "top-heavy" plans as herein provided.
Section 13.05 Special Minimum Contribution and Minimum
Vesting, and Compensation Limitation, Becoming Operative in the
Event the Plan Becomes "Top-Heavy". In the event that the Plan
shall be determined to be "top-heavy" as to any Plan Year, the
following special vesting and minimum contribution requirements,
and Compensation Limitation, shall become operative for such Plan
Year:
(a) Notwithstanding Sections 6.03 and 7.03 of the Plan,
the following vesting schedule shall, to the extent it results in
more rapid vesting than provided for in Sections 6.03 and 7.03,
apply to any Participant hereunder, as provided in Section 416 of
the Code:
Nonforfeitable Percentage
Years of Service of Accrued Benefit
2 20%
3 40%
4 60%
5 80%
6 or more 100%
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(b) Minimum Contributions. The Employer contributions
and forfeitures allocated to the accounts under the Plan of a Non-
Key Employee for each Plan Year in which the Plan is "top-heavy"
shall equal the lesser of (i) 3% of the Participant's Compensation
for such Plan Year and (ii) the largest percentage of his
Compensation, subject to the Compensation Limitation, allocated to
the accounts of a Key Employee under the Plan for that Plan Year.
For Plan Years beginning after December 31, 1984, any Participant's
elective contributions under Section 401(k) of the Code will be
treated as Employer contributions for the purposes of the minimum
contribution requirements.
All Participants who have not terminated employment as of
the last day of the Plan Year must receive the minimum
contribution. Employees who (i) failed to complete 1,000 Hours of
Service during the Plan Year, (ii) declined to make mandatory
contributions to the Plan or (iii) would have been excluded from
the Plan because their compensation is less than a stated amount,
must nevertheless be considered Participants for purposes of the
minimum contribution in this Section 13.05(b) if such Employees are
required to satisfy the coverage requirements of Section 410(b) of
the Code in accordance with Section 401(a)(5) of the Code. The
minimum contribution is determined without regard to any Social
Security contributions.
(c) Compensation Limitation. The annual Compensation of
each Participant taken into account under the Plan shall not exceed
the Compensation Limitation.
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(d) In the event that the Employer maintains a defined
benefit plan and this Plan, both of which are top-heavy in any Plan
Year, all Participants entitled to a Minimum Contribution under
Subsection 13.05(b) shall receive, in lieu of and in place of the
Minimum Contribution in Subsection 13.05(b) a Minimum Contribution
of five per cent of his or her Compensation for such Plan Year and
benefits under this Plan shall be used to offset the minimum
benefit to be provided under the defined benefit plan if such
defined benefit plan so provides.
(e) In the event that the Non-Key Employee is covered
only under this Plan and under no other plan, an amount equal to 4%
of the Non-Key Employee's Compensation for such top heavy Plan Year
shall be allocated to his or her Account in lieu of the Minimum
Contribution otherwise provided under Subsection 13.05(b).
Section 13.06 Pre-"Top-Heavy" Plan Terminated
Participant. This Article XIII shall not apply to any Participant
who does not complete an Hour of Service after the Plan becomes
"top-heavy".
Section 13.07 Special "Top-Heavy" Reduction in Combined
Benefit and Contribution Limitation. In the event that the Plan
shall be determined to be "top-heavy" in any Plan Year, the
multiple applicable to the dollar limitation in the denominator of
the defined benefit fraction described in Section 12.07(b) of the
Plan and the multiple applicable to the dollar limitation in the
denominator of the defined contribution fraction described in
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Section 12.07(c) of the Plan shall be one (1) rather than 1.25;
provided, however, that this Section 13.07 of the Plan shall not
apply in the event that the Plan is not a "super top-heavy" plan as
defined in Section 13.10(a) of the Plan and each participant who is
a Non-Key Employee shall receive the minimum contribution set forth
in paragraph (b) of Section 13.05 of the Plan, except that the
multiple in subparagraph (i) of paragraph (b) of Section 13.05
shall be 4% rather than 3%.
Section 13.08 Termination of "Top-Heavy" Status. In the
event that the Plan shall be "top-heavy" within the meaning of
Section 416 of the Code for any Plan Year, and in a subsequent Plan
Year the Plan shall cease to be "top-heavy", the special "top-
heavy" vesting, minimum contribution and Compensation Limitation
rules shall cease to apply with respect to any Plan Year for which
the Plan is not "top-heavy"; provided, however, that in no event
shall a reduction in a Participant's nonforfeitable percentage
occur by reason of a change in the Plan's status.
Section 13.09 Multiple "Top-Heavy" Plans. In the event
that a Participant in the Plan is also participating in a defined
benefit plan maintained by the Employer or an affiliated employer
during a Plan Year in which both the Plan and such defined benefit
plan are "top-heavy", the Participant shall receive the minimum
accrued benefit under the defined benefit plan rather than the
minimum contribution provided for in this Plan.
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Section 13.10 Effect of the Plan Becoming "Super Top-
Heavy".
(a) The Plan shall be deemed to be "super top-heavy" if,
as of the most recent Valuation Date, the sum of the present value
of accrued benefits for Key Employees is more than 90% of the sum
of the present value of accrued benefits for all Employees,
excluding former Key Employees.
(b) In the event that the Plan shall be determined to be
"super top-heavy" in any Plan Year, the multiple applicable to the
dollar limitation in the denominator of the defined benefit
fraction described in Section 12.07(b) of the Plan and the multiple
applicable to the dollar limitation in the denominator of the
defined contribution fraction described in Section 12.07(c) of the
Plan shall be one (1) rather than 1.25.
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ARTICLE XIV
MISCELLANEOUS
Section 14.01 Alienation. The income and principal of the
Plan are for the sole use and benefit of the Participants and
beneficiaries of the Plan, and, to the extent permitted by law,
shall be free, clear, and discharged of and from, and are not to be
in any way liable for, debts, contracts or agreements, now
contracted or which may hereafter be contracted, and from all
claims and liabilities now or hereafter incurred by any Participant
or beneficiary. Other than as permitted by the Act, and as
expressly set forth in the Plan, no contributions made by the
Corporation to the Contract Fund under the Plan shall at any time
revert to the Corporation. No Participant or beneficiary of a
Participant under this Plan shall have the right to commute,
withdraw, surrender, encumber, alienate or assign any of the income
or principal of the Contract Fund or any of the benefits to become
due unto any person or persons under the Contract Fund or the Plan
except as specifically provided by the terms of the Contract Fund
or the Plan. The limitations contained in this Section 14.01 shall
apply to the creation, assignment or recognition of a right to any
benefit payable with respect to a Participant pursuant to a
domestic relations order unless such order is determined to be a
qualified domestic relations order as defined in Section 414(p) of
the Code.
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Section 14.02 Extent of Participant's Rights. At the
time of withdrawal by a Participant or distribution, he shall be
entitled to receive cash as stated in Article XI. The Corporation
does not guarantee that the current market value of any security or
other investment will be equal to the purchase price thereof or
that the total amount withdrawable in cash will be equal to or
greater than the amount of the Participant's contributions to the
Plan.
Section 14.03 Rollover Contributions. With the
permission of the Administrator and without regard to any limits on
Annual Additions stated in Sections 13.06 and 13.07, the Plan may
receive from an otherwise Eligible Employee (whether or not he has
completed six (6) Months of Service) any cash theretofore received
by such employee from a qualified plan, either directly within
sixty (60) days after such receipt, or from any individual
retirement account, provided that such account contains no assets
other than those attributable to employer contributions under
qualified plans. Such rollover contributions shall be credited to
a fully vested account for such employee, and will be part of the
Withdrawable Portion of the Savings Part. Such rollover
contribution shall not be matched by Corporation Contributions. The
Administrator, in its discretion, (i) may separately account for
such rollover contributions and earnings, gains and losses thereon
and (ii), upon distribution, may require a form of distribution
thereof which would be consistent with the provisions of Section
401(a)(11) and the regulations promulgated thereunder as such may
- 57 -
<PAGE>
be in effect at the time of such distribution.
Section 14.04 Merger. In the case of any merger or
consolidation of the Plan, with, or transfer of assets or
liabilities respecting the Plan to, any other plan, each
Participant or beneficiary in the Plan shall (if the Plan had then
terminated) receive a benefit hereunder immediately after such
merger, consolidation or transfer which is no less than the benefit
he would have been entitled to receive immediately before such
merger, consolidation or transfer (if the Plan had then
terminated).
Section 14.05 Amendment and Termination.
(a) The Board reserves the right, without obtaining the
approval of the shareholders, to amend, modify, suspend or
terminate the Plan. No amendment, modification, suspension, or
termination of the Plan shall have the effect of providing that the
funds held or invested pursuant to Article VIII, or the income
thereof, may be used for or diverted to purposes other than the
exclusive benefit of the Participants and their beneficiaries and
defraying the reasonable expenses of administering the Plan or the
effect of reducing or restricting, directly or indirectly, the
accrued benefit of any Participant unless the amendment satisfies
the requirements of Section 412(c)(8) of the Code. The Corporation
retains the right to amend the Plan at any time retroactively in
- 58 -
<PAGE>
effect if necessary to qualify the Plan under Section 401(a) of the
Code or corresponding provisions of any subsequent revenue law.
(b) In the event that the Plan shall be partially or
completely terminated or the Corporation shall permanently
discontinue making contributions under the Plan, all amounts then
credited to the accounts of the affected Participants shall
immediately be fully vested and nonforfeitable. After the making
of proper governmental notification, the Board shall thereupon
direct either (i) that the Insurance Company continue to hold the
Plan assets in accordance with the provisions of this Plan (other
than provisions related to forfeiture) without regard to such
termination until all funds in such accounts have been distributed
in accordance with such provisions, or (ii) that the Trustee
immediately distribute to each affected Participant all amounts
then credited to his account as a lump sum in cash or other
property.
14.06 Applicable Law. The Plan and Trust hereunder shall
be governed by, and construed in accordance with, the laws of the
Commonwealth of Pennsylvania except to the extent that the laws of
the Commonwealth of Pennsylvania have been specifically pre-empted
by the Act or other federal legislation.
14.07 Incapacity of Recipient of Benefits. If any person
entitled to receive benefits shall be physically or mentally
incapable of receiving or acknowledging receipt of any payment of
benefits, the Trustee, upon the receipt of satisfactory evidence
that such incapacitated person is so incapacitated and that another
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<PAGE>
person or institution is maintaining him and that no guardian or
committee has been appointed for him, may provide for such payment
of benefits hereunder to such person or institution so maintaining
him, and any such payments so made shall be deemed for every
purpose to have been made to such incapacitated person.
14.08 Merger, Consolidation or Discontinuance Involving
Employer. In the event that the Corporation shall at any time
become insolvent, or in the event of the dissolution of, or a
merger or consolidation involving, the Corporation, without any
provision being made for the continuance of the Plan, the Plan and
Trust thereunder shall terminate and the Plan Administrator shall
proceed in the manner provided herein in the event of a termination
of the Plan. In the event of a dissolution, merger or
consolidation involving the Corporation, provisions may be made by
the Corporation's successor, if any, for the continuance of the
Plan. In such event, said successor shall be substituted hereunder
in place of the Corporation by proper corporate action of such
successor.
14.09 Liability of Officers and Directors of the
Employer. Subject to the provisions of the Act, no past, present
or future officer or director of the Corporation shall be
personally liable to any Participant, beneficiary or other person
under any provision of the Plan or Trust Agreement.
14.10 Indemnification of Fiduciaries. To the extent
permitted by the Act and regulations issued thereunder, the
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<PAGE>
Employer shall indemnify and hold harmless all fiduciaries of the
Plan, as defined in the Act, who are employees of the Corporation,
and defend the same, against any and all claims or liabilities
which may be asserted against any of them by reason of any action
or omission in the administration of the Plan, except in the case
of any fraud or willful wrongdoing.
14.11 Service of Process. The Plan Administrator is the
designated agent of the Plan for the service of process in
connection with all matters affecting the Plan.
- 61 -
EXHIBIT 4(e)
Savings and Security Plan
of
the
Special Materials Division
of
Allegheny Ludlum Corporation
As Amended And Restated Effective
First Day of July, 1987
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS. . . . . . . . . . . . . . . . 1
Section 1.01 Account. . . . . . . . . . . . . . . . . . 1
Section 1.02 Act. . . . . . . . . . . . . . . . . . . . 1
Section 1.03 Actual Deferral Percentage . . . . . . . . 1
Section 1.04 Administrator. . . . . . . . . . . . . . . 1
Section 1.05 Affiliated Company . . . . . . . . . . . . 1
Section 1.06 Annual Addition. . . . . . . . . . . . . . 2
Section 1.07 Basic Savings. . . . . . . . . . . . . . . 2
Section 1.08 Board. . . . . . . . . . . . . . . . . . . 2
Section 1.09 Company Stock. . . . . . . . . . . . . . . 2
Section 1.10 Company Stock Fund . . . . . . . . . . . . 2
Section 1.11 Corporation Contribution . . . . . . . . . 2
Section 1.12 Compensation . . . . . . . . . . . . . . . 2
Section 1.13 Continuous Service . . . . . . . . . . . . 4
Section 1.14 Contract Fund. . . . . . . . . . . . . . . 6
Section 1.15 Corporation. . . . . . . . . . . . . . . . 6
Section 1.16 Deferred Portion . . . . . . . . . . . . . 6
Section 1.17 Deferred Salary Savings. . . . . . . . . . 6
Section 1.18 Eligible Employee. . . . . . . . . . . . . 7
Section 1.19 Eligible Salary/Wages. . . . . . . . . . . 7
Section 1.20 First Day. . . . . . . . . . . . . . . . . 8
Section 1.21 Highly Compensated Employees . . . . . . . 8
Section 1.22 Hour of Service. . . . . . . . . . . . . . 9
Section 1.23 Insurance Company. . . . . . . . . . . . . 9
Section 1.24 Lower Compensated Employee . . . . . . . . 9
Section 1.25 Matching Contribution. . . . . . . . . . . 9
Section 1.26 Month, Quarter, and Year . . . . . . . . . 9
Section 1.27 Month of Service . . . . . . . . . . . . . 10
Section 1.28 Nondeductible Savings. . . . . . . . . . . 10
Section 1.29 Participant. . . . . . . . . . . . . . . . 10
Section 1.30 Permanent Disability . . . . . . . . . . . 10
Section 1.31 Permanent Layoff . . . . . . . . . . . . . 11
Section 1.32 Plan Year. . . . . . . . . . . . . . . . . 11
Section 1.33 Reemployment Commencement Date . . . . . . 11
Section 1.34 Retirement . . . . . . . . . . . . . . . . 11
Section 1.35 Savings Part . . . . . . . . . . . . . . . 11
Section 1.36 Security Contributions . . . . . . . . . . 11
Section 1.37 Security Part. . . . . . . . . . . . . . . 11
Section 1.38 Supplemental Savings . . . . . . . . . . . 12
Section 1.39 Trustee. . . . . . . . . . . . . . . . . . 12
Section 1.40 Trust. . . . . . . . . . . . . . . . . . . 12
Section 1.41 Valuation Date . . . . . . . . . . . . . . 12
Section 1.42 Withdrawable Portion . . . . . . . . . . . 12
Section 1.43 Year Class . . . . . . . . . . . . . . . . 12
Section 1.44 Year of Continuous Service . . . . . . . . 12
- i -
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE II PARTICIPATION. . . . . . . . . . . . . . . 14
Section 2.01 Initial Participation-Security Part. . . . 14
Section 2.02 Initial Participation-Savings Part . . . . 14
Section 2.03 Re-employment. . . . . . . . . . . . . . . 14
ARTICLE III EMPLOYEE SAVINGS . . . . . . . . . . . . . 15
Section 3.01 Basic Savings. . . . . . . . . . . . . . . 15
Section 3.02 Supplemental Savings . . . . . . . . . . . 15
Section 3.03 Change in Contribution Rate. . . . . . . . 15
Section 3.04 Discontinuation of Contributions . . . . . 15
Section 3.05 Payment to Insurance Company or Trustee. . 16
Section 3.06 Reduction of Deferred Salary Savings . . . 16
Section 3.07 Limits of Actual Deferral Percentage . . . 16
Section 3.08 Limits of Average Contribution
Percentage . . . . . . . . . . . . . . . 17
ARTICLE IV COMPANY CONTRIBUTIONS. . . . . . . . . . . 19
Section 4.01 Security Contribution. . . . . . . . . . . 19
Section 4.02 Special Contribution . . . . . . . . . . . 19
Section 4.03 Matching Contribution. . . . . . . . . . . 19
Section 4.04 Payment to Insurance Company . . . . . . . 20
ARTICLE V PLAN OPERATION . . . . . . . . . . . . . . 21
ARTICLE VI SECURITY PART. . . . . . . . . . . . . . . 23
Section 6.01 Participants' Accounts . . . . . . . . . . 23
Section 6.02 Investment . . . . . . . . . . . . . . . . 23
Section 6.03 Vesting of Security Part . . . . . . . . . 23
ARTICLE VII SAVINGS PART . . . . . . . . . . . . . . . 24
Section 7.01 Participants' Account. . . . . . . . . . . 24
Section 7.02 Formation of Year Class. . . . . . . . . . 24
Section 7.03 Vesting of Matching Contributions. . . . . 24
Section 7.04 Supplemental and Nondeductible Savings . . 24
Section 7.05 Vesting of Basic and Supplemental
Savings. . . . . . . . . . . . . . . . . 25
Section 7.06 Deferred Portion . . . . . . . . . . . . . 25
Section 7.07 Withdrawable Portion . . . . . . . . . . . 25
Section 7.08 Investment . . . . . . . . . . . . . . . . 25
- ii -
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE VIII INVESTMENT . . . . . . . . . . . . . . . . 26
Section 8.01 Investment of Corporation Matching
Contributions. . . . . . . . . . . . . . 26
Section 8.02 Transfer of Investment of Matching
Contributions. . . . . . . . . . . . . . 26
Section 8.03 Investment of Participant
Contributions. . . . . . . . . . . . . . 26
Section 8.04 Transfers of Participant Contributions . . 27
Section 8.05 Special Election - Company Stock . . . . . 27
Section 8.06 Form of Elections. . . . . . . . . . . . . 26
Section 8.07 Contract Fund. . . . . . . . . . . . . . . 28
Section 8.08 Interest Income. . . . . . . . . . . . . . 28
Section 8.09 Company Stock Fund . . . . . . . . . . . . 28
Section 8.10 Dividend Income. . . . . . . . . . . . . . 28
Section 8.11 Voting of Company Stock. . . . . . . . . . 29
ARTICLE IX WITHDRAWALS WHILE EMPLOYED . . . . . . . . 30
Section 9.01 Security Part. . . . . . . . . . . . . . . 30
Section 9.02 Withdrawable Portion . . . . . . . . . . . 30
Section 9.03 Deferred Portion After Age 59-1/2. . . . . 30
Section 9.04 Deferred Portion Prior to 59-1/2
Hardship Withdrawal . . . . . . . . . . 31
Section 9.05 Replacement. . . . . . . . . . . . . . . . 32
Section 9.06 Basic Savings Nondeductible Savings,
- and Matching Contributions Prior to
Vesting. . . . . . . . . . . . . . . . . 32
ARTICLE X DISTRIBUTIONS UPON TERMINATION OF
EMPLOYMENT . . . . . . . . . . . . . . . 33
Section 10.01 Distributions Upon Termination of
-Employment by Reason of Retirement,
Permanent Layoff, Permanent Disability
or Death . . . . . . . . . . . . . . . . 33
Section 10.02 Distributions Upon Termination of
Employment by Reason of Resignation
or Discharge . . . . . . . . . . . . . . 33
Section 10.03 Transfer of Employment . . . . . . . . . . 35
- iii -
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE XI PAYMENT OF WITHDRAWALS AND
DISTRIBUTIONS. . . . . . . . . . . . . . 36
Section 11.01 Form of Distribution . . . . . . . . . . . 36
Section 11.02 Payment of Benefits. . . . . . . . . . . . 36
Section 11.03 Effective Date of Withdrawal
or Distribution. . . . . . . . . . . . . 37
Section 11.04 Application of Corporation Contributions
and Earnings Forfeited . . . . . . . . . 38
Section 11.05 Valuation of Company Stock Fund. . . . . . 38
ARTICLE XII ADMINISTRATION . . . . . . . . . . . . . . 40
Section 12.01 Insurance Company and Trustee. . . . . . . 40
Section 12.02 Administrator. . . . . . . . . . . . . . . 40
Section 12.03 Liability. . . . . . . . . . . . . . . . . 41
Section 12.04 Administrative Expenses. . . . . . . . . . 41
Section 12.05 Designation of Beneficiaries in the Event
of Death . . . . . . . . . . . . . . . . 41
Section 12.06 Limits on Contributions. . . . . . . . . . 43
Section 12.07 Combined Limitations . . . . . . . . . . . 45
ARTICLE XIII TOP-HEAVY RULES. . . . . . . . . . . . . . 47
Section 13.01 Purpose. . . . . . . . . . . . . . . . . . 47
Section 13.02 Definitions. . . . . . . . . . . . . . . . 47
Section 13.03 Determination of Whether Plan is
"Top-Heavy". . . . . . . . . . . . . . . 49
Section 13.04 Aggregation Group of Employer Plans. . . . 50
Section 13.05 Special Minimum Contribution and Minimum
Vesting and Compensation Limitation,
Becoming Operative in the Event the
Plan Becomes "Top-Heavy" . . . . . . . . 51
Section 13.06 Pre-"Top-Heavy" Plan Terminated
- Participant. . . . . . . . . . . . . . 54
Section 13.07 Special "Top-Heavy" Reduction in Combined
Benefit and Contribution Limitation. . . 54
Section 13.08 Termination of "Top-Heavy" Status. . . . . 54
Section 13.09 Multiple "Top-Heavy" Plans . . . . . . . . 55
Section 13.10 Effect of the Plan Becoming
"Super Top-Heavy". . . . . . . . . . . . 55
- iv -
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE XIV MISCELLANEOUS. . . . . . . . . . . . . . . 56
Section 14.01 Alienation . . . . . . . . . . . . . . . . 56
Section 14.02 Extent of Participant's Rights . . . . . . 57
Section 14.03 Rollover Contributions . . . . . . . . . . 57
Section 14.04 Merger . . . . . . . . . . . . . . . . . . 58
Section 14.05 Amendment and Termination. . . . . . . . . 58
Section 14.06 Applicable Law . . . . . . . . . . . . . . 59
Section 14.07 Incapacity of Recipient of Benefits. . . . 60
Section 14.08 Merger, Consolidation or Discontinuance
Involving Employer . . . . . . . . . . . 60
Section 14.09 Liability of Officers and Directors of
the Employer . . . . . . . . . . . . . . 61
Section 14.10 Indemnification of Fiduciaries . . . . . . 61
Section 14.11 Service of Process . . . . . . . . . . . . 61
- v -
<PAGE>
ARTICLE I
DEFINITIONS
Whenever used in this Plan, unless a different meaning is
plainly required by the context:
Section 1.01. "Account" means, as of any Valuation Date,
the sum of a Participant's accounts under the (i) Security Part and
(ii) Savings Part.
Section 1.02. "Act" means the Employee Retirement Income
Security Act of 1974, as the same may be amended from time to time.
Section 1.03. "Actual Deferral Percentage" means, for
any group of employees, the average of the following ratios for
each Eligible Employee in the group: (1) Basic and Supplemental
Savings made by the Eligible Employee for the Plan Year, to (2) the
Eligible Employee's Compensation for the Plan Year.
Section 1.04. "Administrator" means the committee
established pursuant to Section 12.02.
Section 1.05. "Affiliated Company" means any corporation
which is a member of a controlled group of corporations with the
Corporation as defined in Section 414(b) of the Code and, for
purposes of Sections 12.06 and 12.07, as modified by
Section 415(h) of the Code.
Section 1.06. "Annual Addition" means with respect to
any Plan Year for any Participant the sum of (i) the Corporation
Security and Matching Contributions, (ii) the Basic and
<PAGE>
Supplemental Savings, and (iii) Nondeductible Savings made to the
Plan on behalf of the Participant for such Plan Year.
Section 1.07. "Basic Savings" means the payments an
Eligible Employee elects to make pursuant to Section 3.01 which may
be excluded from the Eligible Employee's income for federal income
tax purposes pursuant to Section 401(k) of the Code and which will
be matched by a Matching Contribution.
Section 1.08. "Board" means the Board of Directors of
the Corporation.
Section 1.09. "Company Stock" means common stock, $0.10
par value of the Corporation.
Section 1.10. "Company Stock Fund" means a fund
comprised of Company Stock.
Section 1.11. "Corporation Contributions" means the
amount the Company will pay into the Plan pursuant to Article IV.
Section 1.12. "Compensation" shall mean a Participant's
earned income, wages, salaries and fees for professional services
and other amounts received for personal services actually rendered
in the course of employment with the Employer (including, but not
limited to, commissions paid salesmen, compensation for services on
the basis of a percentage of profits, commissions on insurance
premiums, tips and bonuses), and excluding the following:
(a) Employer contributions to a plan of deferred
compensation which are not includible in the Employee's gross
income for the taxable year in which contributed, or Employer
- 2 -
<PAGE>
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;
(b) Amounts realized from the exercise of a nonqualified
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;
(c) Amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified stock option; and
(d) 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).
For purposes of this Subsection 1.12, Compensation for a limitation
year is the compensation actually paid or includible in gross
income during such year.
Section 1.13. "Continuous Service" means employment with
the Corporation or an Affiliated Company calculated from the
Eligible Employee's most recent employment commencement date to his
break in continuous service in accordance with the following
provisions:
- 3 -
<PAGE>
(a) An Eligible Employee's employment commencement date
shall be the first date of which he performs an Hour of Service for
the Corporation or an Affiliated Company.
(b) An Eligible Employee shall incur a 1-year break in
continuous service upon the completion of a 12-consecutive month
period beginning on the date on which he incurs a break in
continuous service as provided in (g) of this Section 1.13 during
which period the Eligible Employee did not perform an Hour of
Service; provided, however, in the case of any Eligible Employee
who is absent from work for maternity or paternity reasons, the
12-consecutive month period beginning on the first anniversary of
the first date of such absence shall not constitute a Break in
Service. For purposes of the previous sentence, an absence from
work for maternity or paternity reasons means an absence (i) by
reason of the pregnancy of the Eligible Employee, (ii) by reason of
the birth of a child of the Eligible Employee, (iii) by reason of
the placement of a child with the Eligible Employee in connection
with the adoption of such child by such Eligible Employee, or
(iv) for purposes of caring for such child for a period beginning
immediately following such birth or placement.
(c) There shall be no deduction for any time lost which
does not constitute a break in continuous service.
(d) For purposes of calculating continuous service, the
term "layoff" shall mean discontinuance of active employment with
the Corporation which, at the time of discontinuance, is considered
to be temporary rather than permanent.
- 4 -
<PAGE>
(e) Continuous service shall not be considered broken
for any Eligible Employee who has entered the military, naval or
merchant marine service of the United States if such employee
complies with the requirements of reemployment laws applicable to
him and is reemployed.
(f) Notwithstanding any other provision in (g) of this
Section 1.13, an Eligible Employee shall not be deemed to incur a
break in continuous service until the expiration of the 12-
consecutive month period following the date the Eligible Employee
was first absent from work for any reason other than retirement,
quit or discharge, during which he did not perform an Hour of
Service for the Corporation.
(g) An Eligible Employee who incurs a break in
continuous service on account of Retirement, quit or discharge and
who thereafter performs an Hour of Service with the Corporation
within the 12-consecutive month period following his break, shall
receive credit for the period of severance between the break and
performance of an Hour of Service for the purpose of eligibility
and vesting under the Plan.
(h) If a Participant has five consecutive one-year
breaks in continuous service, all service after such breaks shall
be disregarded for the purpose of vesting the Security
Contributions accrued prior to such breaks in continuous service.
Such Participant's pre-break continuous service shall count in
vesting the post-break Security Contributions only if either
(i) such Participant has any nonforfeitable interest in his Company
- 5 -
<PAGE>
Contributions at the time his break in continuous service commences
or (ii) upon returning to service with the Corporation, the number
of consecutive one-year breaks in continuous service is less than
the number of years of continuous service.
Section 1.14. "Contract Fund" means the fund provided
for in Section 8.07.
Section 1.15. "Corporation" means Allegheny Ludlum Steel
Corporation and any corporation which shall be its successor.
Section 1.16. "Deferred Portion" means, as of any
Valuation Date, the then current value of (i) the Participant's
Basic Savings to the extent the Year Class to which they are
allocated has become vested and (ii) the Participant Supplemental
Savings.
Section 1.17. "Deferred Salary Savings" means the total
of a Participant's Basic Savings and Supplemental Savings excluded
from the Eligible Employee's income for federal income tax purposes
pursuant to Section 401(k) of the Code.
Section 1.18. "Eligible Employee" means any person who
is employed by the Special Materials Division of the Corporation
and who meets all of the following conditions:
(a)(i) for an initial determination of eligibility,
the employee completes one thousand (1,000) Hours of Service during
the 12 month period beginning on the employee's employment
commencement date as set forth in Section 1.11(a); and
- 6 -
<PAGE>
(a)(ii) for any period following an initial
determination of eligibility, the employee completes one thousand
(1,000) Hours of Service in each computation period, which shall be
the Plan Year, provided, if an employee is credited with one
thousand (1,000) Hours of Service under (a)(i) and with one
thousand Hours of Service in the Plan Year which includes the first
anniversary of the employee's employment commencement date, the
employee will be credited with two Years of Service for eligibility
to participate;
(b) An employee who is not in a unit of employees
covered by a collective bargaining agreement, unless such agreement
provides for the application of the Plan to the employees in such
unit and does not provide for Supplemental Unemployment Benefits,
or similar benefits.
Section 1.19. "Eligible Salary/Wages" means wages and/or
regular base salary, prior to any reduction for Basic Savings And
Supplemental Savings, during such periods as the employee is
eligible to participate in the Plan. The term shall not include
commissions, shift differential, overtime, additional compensation
or other incentive payments, bonuses, extended work week or other
premiums, or any other special payments, fees or allowances but
shall include Vacation Pay for time taken off from work, Jury Duty
Pay and Holiday Allowances.
Section 1.20. "First Day" means the beginning of the
first payroll period beginning in the month or quarter or year to
which reference is made.
- 7 -
<PAGE>
Section 1.21. "Highly Compensated Employee" means any
Eligible Employee who:
(i) is at any time a 5% owner of the Company (as
defined for top heavy plan);
(ii) receives compensation from the Company in
excess of $75,000;
(iii) receives compensation from the Company in
excess of $50,000 and is among the most highly
compensated 20% of Employees during such year;
or
(iv) is an officer of the Company and receives
compensation for the year greater than
$45,000.
In addition, a former Employee will be treated as a
Highly Compensated Employee if such person was a Highly
Compensated Employee at the time of separating from
service or was a Highly Compensated Employee at any time
after attaining age 55, provided, however:
(1) If for any year no officer receives
compensation in excess of $45,000, the highest
paid officer of the employer is treated as a
highly compensated employee.
(2) No more than 50 employees (or if less, the
greater of 3 employees or 10% of all
employees) will be treated as officers.
(3) If any individual is a family member (i.e.,
spouse and lineal ascendants or descendants
and their spouse) of a 5% owner or one of the
10 most highly compensated employees for the
year, such individual is not considered as a
separate employee and any compensation paid to
such individual (and plan contributions or
benefits on behalf of such individual) are
treated as if paid to the 5% owner or highly
compensated employee.
(4) An Employee described under category (ii),
(iii) or (iv) for any year shall be treated as
highly compensated for that year only if such
employee either was described in category
(ii), (iii) or (iv) for the preceding year, or
is a member of the group consisting of the 100
- 8 -
<PAGE>
most highly compensated employees for the
current year.
Section 1.22. "Hour of Service" means an hour for which
an employee is paid, or entitled to payment, for the performance of
duties. Hours of Service hereunder shall be calculated and
credited in accordance with 29 C.F.R. Section 2530.200b, which is
incorporated herein by this reference.
Section 1.23. "Insurance Company" shall mean any
insurance carrier authorized to do business in any state or the
District of Columbia.
Section 1.24. "Lower Compensated Employee" means any
Eligible Employee who is not a Higher Compensated Employee.
Section 1.25. "Matching Contribution" means
contributions made by the Corporation pursuant to Section 4.03 to
match Participant Basic Savings.
Section 1.26. "Month, Quarter and Year" means, for the
purposes of determining eligibility to participate and of
computing savings in accordance with Section 3.01 and Corporation
Contributions in accordance with Article IV, as to each employee
that period which includes all payroll paid periods ending in the
calendar month or calendar quarter or calendar year to which
reference is made, and for such purposes shall be considered to run
from the beginning of the first payroll paid period which ends in
such calendar period to the end of the last payroll paid period
ending in such calendar period. For all other purposes it means
the calendar month or calendar quarter or calendar year to which
reference is made.
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Section 1.27. "Month of Service" means a calendar month
in which an Eligible Employee is credited with an Hour of Service.
Section 1.28. "Nondeductible Savings" means
nondeductible Participant contributions resulting from an
Adjustment in Basic or Supplemental Savings by the Administrator
pursuant to Section 3.05.
Section 1.29. "Participant" means an Eligible Employee
who is participating in the Plan.
Section 1.30. "Permanent Disability" means disability by
bodily injury or disease, either occupational or non-occupational
in cause, preventing the employee, on the basis of medical evidence
satisfactory to the Administrator, from engaging in any occupation
or employment with the Corporation or an Affiliated Company.
Section 1.31. "Permanent Layoff" means any involuntary
termination of employment (other than by reason of discharge for
cause, death, or Retirement).
Section 1.32. "Plan Year" means the twelve (12) month
period ending December 31.
Section 1.33. "Reemployment Commencement Date" means the
date following an Eligible Employee's re-employment after a one--
year break in Continuous Service on which the Eligible Employee
first completes an Hour of Service.
Section 1.34. "Retirement" means (i) termination of
employment with a pension under the provisions of a retirement or
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pension plan of the Corporation or Affiliated Company which the
participant has a right to commence receiving immediately following
his termination of employment, (ii) termination of employment
following attainment of age fifty-five (55) and completion of at
least fifteen (15) years of continuous service, or
(iii) termination of employment following attainment of age
sixty-five (65).
Section 1.35. "Savings Part" means the part of the Plan
to which Basic Savings and Supplemental Savings and the earnings
thereon are credited.
Section 1.36. "Security Contributions" means
contributions made by the Corporation pursuant to Section 4.01.
Section 1.37. "Security Part" means the part of the Plan
to which Security Contributions, and the one-time special
contribution made pursuant to Section 4.02 and the earnings thereon
are credited.
Section 1.38. "Supplemental Savings" means the payments
an Eligible Employee elects to make pursuant to Section 3.02 which
may be excluded from the Eligible Employee's income pursuant to
Section 401(k) of the Code.
Section 1.39. "Trustee" shall mean the Trustee appointed
by the Board of Directors of the Corporation.
Section 1.40. "Trust" shall mean Company Stock and such
other assets as may from time to time be designated as Trust assets
by the Company and held by the Trustee pursuant to the Plan.
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Section 1.41. "Valuation Date" means the last date of
each calendar month or calendar quarter on which the Administrator
causes the fair market value of the assets comprising the Contract
Fund to be determined.
Section 1.42. "Withdrawable Portion" means, as of any
Valuation Date, the then current value of the Matching Contribution
after the Year Class to which they are allocated has become vested
pursuant to Article VII.
Section 1.43. "Year Class" means an annual period
beginning on January 1 and ending on December 31, inclusive.
Section 1.44. "Year of Continuous Service" means the
Participant's-period of Continuous Service in months divided by
twelve (12) and fractional years of Continuous Service shall be
disregarded.
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ARTICLE II
PARTICIPATION
Section 2.01. Initial Participation - Security Part.
Each Eligible Employee shall commence participation in the Security
Part of the Plan on the latest of (i) the date he first completes
an Hour of Service for the Corporation, (ii) the date he became an
Eligible Employee, and (iii) July 1, 1985.
Section 2.02. Initial Participation - Savings Part.
Each Eligible Employee shall commence participation in the Savings
Part of the Plan on the latest of (i) the date he completes six (6)
months of Continuous Service, (ii) the date he became an Eligible
Employee and (iii) the First Day of July, 1985.
Section 2.03. Re-employment. An Eligible Employee who
is re-employed following a one-year break in continuous service and
who had completed six (6) months of Continuous Service or more
during any previous period of employment shall begin participating
in the Security Part and the Savings part as of the employee's
Re-employment Commencement Date.
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ARTICLE III
EMPLOYEE Savings
Section 3.01. Basic Savings. Beginning the First Day of
July, 1985, an Eligible Employee may defer and designate as his
Basic Savings not less than two percent (2%) nor more than four
percent (4%) of his Eligible Salary/Wages (in whole percentages).
The Corporation shall deduct such Basic Savings from the
Participant's compensation and credit them to the Savings Part of
the Plan. Such Basic Savings shall be matched by Corporation
Contributions pursuant to Section 4.03.
Section 3.02. Supplemental Savings. Beginning the First
Day of July, 1985, an Eligible Employee may defer and designate as
his Supplemental Savings not less than one percent (1%) nor more
than six percent (6%) of his Eligible Salary/Wages (in whole
percentages). The Corporation shall deduct such Supplemental
Savings from the Participant's compensation and credit them to the
Savings Part of the Plan. Savings shall not in any manner be
matched with Corporation Contributions.
Section 3.03. Canna in Contribution Rate. A Participant
may upon no less than thirty (30) days prior written notice,
effective with the First Day of January or July next following
timely receipt thereof, elect to increase or decrease the
percentage of his Basic savings and Supplemental Savings to any
percentage permitted by Sections 3.01 and 3.02.
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Section 3.04. Discontinuation of Contributions. A
Participant may, effective with the First Day of any subsequent
Month, discontinue his Basic Savings or his Supplemental Savings or
both in which event he may not elect to re-commence such
contributions until the First Day of the next Year subsequent to
the Month during which he discontinued contributions or any Month
subsequent thereto.
Section 3.05. Payment to Insurance Company or Trustee.
Basic and Supplemental Savings for any month will be paid by the
Corporation to the Insurance Company or the Trustee as soon as
practical to be held in the Savings Part of the Plan.
Section 3.06. Reduction of Deferred Salary Saving. In
the event that it is determined for any Plan Year that the Actual
Deferral Percentage for the Higher Compensated Employees exceeds or
may be reasonably expected to exceed the limits set forth in
Section 3.07 below, then, as of any calendar quarter or quarters of
said Plan Year the Basic Savings and/or Supplemental Savings of the
Higher Compensated Employees shall be equitably reduced in a manner
to be determined by the Administrator, so that said limits are
satisfied. The amount of any such reduction may, at the
Committee's discretion, be converted to Nondeductible Savings.
Nondeductible Savings shall be credited to the Savings Part of the
Plan.
Section 3.07. Limits of Actual Deferral Percentage. For
any Plan Year, the Actual Deferral Percentage for Highly
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Compensated Employees may not exceed the greater of (a) or
(b) below:
(a) One hundred twenty-five percent (125%) of the Actual
Deferral Percentage for Lower Compensated Employees.
(b) Two hundred percent (200%) of the Actual Deferral Percentage
for Lower Compensated Employees; provided, however, that the Actual
Deferral Percentage for Highly Compensated Employees may not exceed
the Actual Deferral Percentage for Lower Compensated Employees by
more than two (2) percentage points.
Section 3.08. Limits on Average Contribution Percentage.
For any Plan Year, the average contribution percentage for Highly
Compensated Employees may not exceed the greater of (a) or
(b) below:
(a) One hundred twenty-five percent (125%) of the
average contribution percentage for Lower Compensated Employees.
(b) Two hundred percent (200%) of the average
contribution percentage for Lower Compensated Employees; provided,
however, that the average contribution percentage for Highly
Compensated Employees may not exceed the average contribution
percentage for Lower Compensated Employees by more than two (2)
percentage points.
For the purpose of this Section, the average contribution
percentage shall be the average of the ratios, computed separately,
for each Eligible Employee in the Group of Matching Contributions
made on behalf of the Eligible Employee or the Eligible Employee's
Compensation; provided, however, pursuant to regulations issued by
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the Secretary of the Treasury, the Administrator may include other
amounts in calculating such ratios.
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ARTICLE IV
COMPANY CONTRIBUTIONS
Section 4.01. Security Contribution. The Corporation
shall for each month contribute on behalf of each Participant
(whether or not the Participant is making Basic Savings
contributions) a Security Contribution equal to five percent (5%)
of the Participant's Eligible Salary/Wages for such time period.
The Security Contribution shall be credited to the Security Part of
the Plan.
Section 4.02. Special Contribution. The Corporation
shall make a one-time contribution on behalf of each Participant
based upon a Participant's Years of Continuous Service as of
July 1, 1985. The amount of each Participant's contribution
shall be equal to five percent (5%) of the Participant's Eligible
Salary/Wages from date of hire.
The special one-time contribution shall be made as soon
as practical after July 1, 1985 and shall be credited to the
Security Part of the Plan.
Section 4.03. Matching Contribution. Beginning the
First Day of July, 1985, the Corporation shall, for each month,
contribute on behalf of each Participant making Basic Contributions
a Matching Contribution equal to fifty percent (50%) of the
Participant's Basic Savings for such month. The Matching
Contribution shall be credited to the Savings Part of the Plan.
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Section 4.04. Payment to Insurance Company. Security
Contributions for any month and the special one-time contribution
will be invested in the Contract Fund as soon as practical to be
held in the Security Part of the Plan. Matching Contributions made
before July 1, 1987 for any month will be invested in the Contract
Fund to be held in the Savings Part of the Plan.
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ARTICLE V
PLAN OPERATION
The benefits under the Plan are provided by the
contributions of both the Participant and the Corporation. Basic
Savings and related Matching Contributions, Supplemental Savings
and Nondeductible Savings, if any, shall be credited to the Savings
Part (Article VII) and invested in accordance with Article VIII.
Security Contributions by the Corporation and the special one-time
contribution made pursuant to Section 4.02 will be credited to the
Security Part (Article VI) and invested in accordance with
Section 6.02. The Administrator shall maintain a separate Account
for each Participant to record, separately, a Participant's
interest in the Savings Part and the Security Part and, within each
Part, the Administrator shall separately account for, respectively,
the Participant's Basic Savings and Supplemental Savings, Matching
Contributions and Nondeductible Savings and the Participant's
Security Contributions and special one time contribution. From
such accounting, the Administrator shall determine the
Participant's Withdrawable Portion. At least as often as the last
day of the Plan Year, the Administrator shall cause the fair market
value of the assets comprising the Contract Fund and the Company
Stock Fund, separately to be determined and shall, as of that date,
allocate the gains and/or losses or dividends thereof between and
among the Accounts of Participants within such investment funds in
the ratios that each Participant's Account invested in such
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investment fund bears to the Accounts invested in such investment
fund of all Participants under the Plan. Upon such allocation, the
Administrator shall apportion the gain or loss so allocated between
or among the accounting for a Participant's separate class of
contributions in the ratio that the value of each such class of
contributions bears to the value of his Account. The Administrator
shall account for amounts in the Company Stock Fund in whole and
fractional shares of common stock.
In addition to the appointment of the Administrator as
provided in Section 12.02, the Board may appoint from time to time
(and, thereafter, may remove) an Investment Manager which shall
have such powers and duties as shall be delegated to the Investment
Manager from time to time.
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ARTICLE VI
SECURITY PART
Section 6.01. Participants' Accounts. An account shall
be established under the Security Part for each Participant. The
Corporation's Security Contributions and the special one-time
contribution made pursuant to Section 4.02 shall be credited to
such account.
Section 6.02. Investment. The monies comprising the
Security Part shall be invested by an Insurance Company in the
Contract Fund.
Section 6.03. Vesting of Security Part. A Participant's
interest in his account under the Security Part shall become one
hundred percent (100%) vested and nonforfeitable upon the earlier
of a Participant's attaining age 65 or the Participant's completion
of five (5) Years of Continuous Service.
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ARTICLE VII
SAVINGS PART
Section 7.01. Participants' Account. An account shall
be established for each Participant electing to make Basic Savings
contributions to the Plan. The Participant's Basic Savings,
Supplemental Savings and Nondeductible Savings, if any, together
with the Corporation's Matching Contributions shall be credited to
such account.
Section 7.02. Formation of Year Class. Separate Year
Classes shall be formed under the Plan for Basic Savings and
Matching Contributions made for each Plan Year.
Section 7.03. Vesting of Matching Contributions. The
Matching Contributions and related earnings with respect to each
Year Class shall vest in the Participant three years after the end
of the year of such Year Class, except to the extent previously
forfeited under provisions of Section 10.02. Notwithstanding the
foregoing, the Matching Contribution shall vest in any Participant
upon the earlier of (i) his attainment of age fifty-five (55) and
completion of fifteen (15) years of Continuous Service and (ii) his
attainment of age sixty-five (65).
Section 7.04. Supplemental and Nondeductible Savings.
All Supplemental Savings shall become part of the Deferred Portion
of the Savings Part as soon as they are credited to the Savings
Part. All nonmatched Nondeductible Savings shall become part of
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the Withdrawable Portion of the Savings Part as soon as they are
credited to the Savings Part.
Section 7.05. Vesting of Basic and Supplemental Savings.
A Participant shall at all times have a one hundred present (100%)
vested and nonforfeitable interest in his Basic Savings, his
Supplemental Savings and his Nondeductible Savings and the earnings
thereon.
Section 7.06. Deferred Portion. As each Year Class
becomes vested, the Basic Savings and earnings thereon shall become
part of the Deferred Portion of the Savings Part.
Section 7.07. Withdrawable Portion. As each Year Class
becomes vested, the Matching Contributions and earnings and any
matched Nondeductible Savings and earnings thereon shall become
part of the Withdrawable Portion of the Savings Part.
Section 7.08. Investment. The Savings Part shall be
invested in accordance with Article VIII.
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ARTICLE VIII
INVESTMENT
Section 8.01. Investment of Corporation Matching
Contributions. All Matching Contributions made by the Corporation
on or after July 1, 1987 shall be invested in the Company Stock
Fund. Matching Contributions made by the Corporation prior to
July 1, 1987, shall, subject to Section 8.02, be invested in the
Contract Fund.
Section 8.02. Transfer of Investment of Matching
Contributions. Upon thirty (30) days prior written notice, a
Participant may direct that amounts credited to his or her account
as Matching Contributions and invested in the Contract Fund
together with earnings thereon, may be transferred, in increments
of fifty percent (50%), from the Contract Fund to the Company Stock
Fund effective the subsequent July 1. Amounts credited to a
Participant's account as Matching Contributions and invested in the
Company Stock Fund, together with earnings thereon, may not be
transferred except as provided in Section 8.05.
Section 8.03. Investment of Participant Contributions.
Participant Contributions made prior to the effective date of any
election permitted under this Section shall, subject to
Section 8.04, be invested in the Contract Fund. In addition,
effective July 1, 1987 or such later date as may be set by the
Administrator for administrative and securities laws reasons, and
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each subsequent July 1, a Participant may, upon no less than thirty
(30) days prior written notice, elect to have Participant
Contributions made after the effective date of such election
invested, in increments of fifty percent (50%), in the Contract
Fund, the Company Stock Fund or a combination of the Contract Fund
and the Company Stock Fund. In the event any such election is not
deemed effective for any period, Participant Contributions made
during such period shall be invested in the Contract Fund.
Section 8.04. Transfers of Participant Contributions.
Effective July 1, 1987, or such later date as may be set by the
Administrator for administrative and securities laws reasons, and
each subsequent July 1, a Participant may, upon no less than thirty
(30) days prior written notice, direct that Participant
Contributions credited to his or her account, together with
earnings thereon, be transferred, in increments of 50%, from any
investment fund to any other investment fund.
Section 8.05. Special Election - Company Stock. A
Participant who has attained an age or combination of age and
service which, upon the completion of an additional five (5) years
of service and/or attainment of an additional five (5) years of
age, would entitle him or her to retirement under the Plan, may,
upon thirty (30) days written notice and effective the
subsequent July 1, direct that a number of shares held in the
Company Stock Fund, in increments of 50%, be sold and the proceeds
valued as set forth in Section 11.05 be invested in the Contract Fund.
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Section 8.06. Form of Elections. Any election under the
Plan shall be in writing and on a form approved for such purpose by
the administrator. Such election, once properly made, shall remain
in effect until revoked, in writing, by the Participant.
Section 8.07. Contract Fund. A Contract Fund is a fund
invested with an Insurance Company under an agreement which shall
contain provisions that the Insurance Company will guarantee
repayment in full of such amounts deposited with the Insurance
Company plus interest at a fixed minimum rate for a specified
period.
Section 8.08. Interest Income. Interest received on the
Contract Fund shall be reinvested in the Contract Fund.
Section 8.09. Company Stock Fund. The Company Stock
Fund is a fund invested in Company Stock and held by the Trustee
without guaranteed return and valued as set forth in Section 11.05.
Section 8.10. Dividend Income. Dividends paid on shares
held in the Company Stock Fund shall be reinvested in Company Stock
and shall be credited to Accounts of each Participant as of a given
Valuation Date in the same proportion that their respective
interest in the Company Stock Fund as of the preceding Valuation
Date bears to the interests of all Participants in the Company
Stock Fund as of the preceding Valuation Date.
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Section 8.11. Voting of Company Stock. The Trustee
shall have the right to exercise all rights relating to Company
Stock held in the Company Stock Fund. However, each Participant
shall have the right to direct the Trustee concerning the manner of
exercise of voting and other rights pertaining to whole shares of
Company Stock, vested and unvested, allocated to his account. The
Administrator shall set uniform procedures for securing directions
of Participant's under this Subsection.
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ARTICLE IX
WITHDRAWALS WHILE EMPLOYED
Section 9.01. Security Part. In no event may a
Participant withdraw all or any part of his amount in the Security
Part while still in the employ of the Corporation or an Affiliated
Company.
Section 9.02. Withdrawable Portion. A Participant may
withdraw all or any part of his Withdrawable Portion of the Savings
Part, but in no event less than two hundred fifty dollars ($250)
from any Fund (if his total interest in such Withdrawable Portion
is less than two hundred fifty dollars ($250), he may withdraw the
total); furthermore, if after a withdrawal from the Withdrawable
Portion his remaining interest in such portion would be less than
two hundred fifty dollars ($250), he must withdraw the total.
Section 9.03. Deferred Portion After Age 59-1/2. A
Participant who is age fifty-nine and one-half (59-1/2) or older
may withdraw all or any part of his Deferred Portion of the Savings
Part, but in no event less than two hundred fifty dollars ($250)
(if his total interest in such Deferred Portion is less than two
hundred fifty dollars ($250), he may withdraw the total);
furthermore, if after a withdrawal from the Deferred Portion his
remaining interest in such portion would be less than two hundred
fifty dollars ($250) he must withdraw the total.
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Section 9.04. Deferred Portion Prior to 59-1/2 -Hardship
Withdrawal. Notwithstanding Section 9.03, at the discretion of the
Administrator, a Participant who has not attained age fifty-nine
and one-half (59-1/2) may, upon written request, be permitted to
withdraw all or any part of his Deferred Portion of the Savings
Part in the event of financial hardship; provided, however, that a
Participant may withdraw no more of his Deferred Portion than is
(i) necessary to meet the immediate financial needs created by the
hardship; and (ii) not reasonably available from other resources of
the Participant. Such a withdrawal is to be permitted only if it
is coincident with or following a complete withdrawal of the
Participant's Withdrawable Portion of the Savings Part.
For purposes of this Section 9.04, the term "hardship"
shall mean circumstances such that the Participant is confronted
with immediate and heavy financial needs. The interpretation of
the term "hardship" shall be interpreted in a manner consistent
with Section 401(k) of the Code and the regulations provided
thereunder.
The Administrator shall establish a uniform and non-
discriminatory policy for reviewing Participant applications for
withdrawals under this Section 9.04.
Section 9.05. Replacement. A Participant may not
replace any amounts withdrawn under Sections 9.02, 9.03 or 9.04.
Section 9.06. Basic Savings, Nondeductible Savings, and
Matching Contributions Prior to Vesting. A Participant may not
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withdraw his Basic or Nondeductible Savings or Matching
Contributions allocated to an unvested Year Class prior to such
time as the Year Class becomes vested.
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ARTICLE X
DISTRIBUTIONS UPON TERMINATION OF EMPLOYMENT
Section 10.01. Distributions Upon Termination of
EmPloyment by Reason of Retirement, Permanent Disability Permanent
LaYoff, or Death. A Participant whose employment terminates by
reason of Retirement, Permanent Disability, Permanent Layoff, or
death shall receive, as a distribution without election or other
action on his part, the current value of the Participant's interest
in the Contract Fund and the Company Stock Fund and all uninvested
cash then held in his account under the Security Part and the
Savings Part, for all Year Classes, notwithstanding any vesting
provisions. Payment shall be made in a single sum within one
taxable year of the recipient at the discretion of the
Administrator; provided, however, that if at least thirty (30) days
prior to the Retirement of a Participant he shall have irrevocably
elected to have payment made in the taxable year following the year
in which he shall have retired, then payment shall be made to him
as early as practical in such taxable year.
Section 10.02. Distributions Upon Termination of
Employment by Reason of Resignation or Discharge. (a) A
Participant whose employment terminates by reason of resignation or
discharge shall receive as a distribution, without election or
other action on his part, the current value of the Participant's
interest in the Contract Fund and the Company Stock Fund, and all
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uninvested cash then held in his account under the Savings Fund
representing (i) his Basic Savings, Supplemental Savings and
related earnings for all Year Classes, and (ii) Matching
Contributions and earnings thereon, for such Year Classes as shall
have become vested by the date of termination and, if he has
completed at least five (5) Years of Continuous Service on his date
of termination, the current value allocated to his account under
the Security Part. Matching and Security Contributions and
earnings thereon which have not become vested shall be forfeited
and used to reduce future Corporation Contributions to the Plan;
provided, however, Matching Contributions shall not be deemed
forfeited by a Participant unless or until such Participant incurs
five (5) consecutive one-year Breaks in Service; and
(b) notwithstanding any provision of this Plan to the contrary, if
the present value of a Participant's accrued benefits (both from
Employer and Employee contributions) is in excess of $3,500
distributions of such benefits shall not commence prior to the
earliest retirement age unless (i) the Participant has consented in
writing or (ii) the distribution is by reason of the Participant's
death.
Section 10.03. Transfer of Employment. A Participant
will not be deemed to have a termination of employment for the
purposes of Sections 10.01 and 10.02 as long as he is an employee
of the Corporation or an Affiliated Company.
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ARTICLE XI
PAYMENT OF WITHDRAWALS AND DISTRIBUTIONS
Section 11.01. Form of Distribution. Upon withdrawal or
distribution from the Contract Fund, the Participant shall be paid
in cash. The amount shall be determined as of the Valuation Date
coinciding with or next preceding the date of payment. Upon
withdrawal or distribution from the Company Stock Fund, the
distribution or withdrawal shall be paid in the form of, at the
election of the Participant, either cash representing the then
value of shares of Company Stock as determined under Section 11.05
credited to his Account or a certificate representing the number of
whole shares of Company Stock credited to his or her Account
together with an amount of cash representing the fair market value
for any fractional shares of Company Stock credited to his Account.
Section 11.02. Payment of Benefits. Notwithstanding any
other provision of the Plan, unless the Participant elects
otherwise, pursuant to Section 10.02:
(a) payment of benefits under the Plan shall be made not
later than the sixtieth (60th) day after the end of the Plan Year
in which the latest of the following events occurs:
(1) The date on which the participant attains age
sixty-five (65);
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(2) The tenth (1Oth) anniversary of the year in
which the Participant commenced participation in the
Plan; or
(3) The date on which the Participant terminates
his employment.
(b) provided, however, the value of the Account of a
five percent owner as described in Section 416(i) of the Code
determined with respect to the Plan Year ending in the calendar
year in which such Participant attains age seventy and one-half (70
1/2) must be distributed no later than the first day of
April following the calendar year in which such five percent owner
attains age seventy and one-half (70 1/2). Distribution to a
Participant other than a five percent owner must be made no later
than the first day of April following the calendar year in which
such Participant attains age seventy and one-half (70 1/2) or
retires, whichever is later.
Section 11.03. Effective Date of Withdrawal or
Distribution. The effective date of any withdrawal or distribution
shall be (i) in the case of a withdrawal while still employed, the
date specified in a written notice of withdrawal presented to the
Administrator; but not earlier than the date such notice is
received by the Insurance Company or the Trustee, or (ii) in the
case of termination of employment, the date of such termination.
Subject to the provisions of Section 11.02,
payment shall be made as soon as practicable after the effective
date of withdrawal or distribution, as the case may be.
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Section 11.04. Application of Corporation Contributions
and Earnings Forfeited. Corporation contributions and earnings
thereon that have been forfeited in accordance with the provisions
of Section 10.02 shall be applied to reduce any subsequent Matching
or Security Contributions required under the Plan, or, if the Plan
shall be terminated, any amount not previously so applied shall be
credited totally to the Accounts of all Participants at the time of
such termination.
Section 11.05. Valuation of Company Stock Fund. For the
purposes of determining the value of Company Stock in respect to
any investment in the Company Stock Fund, shall be determined as of
each Valuation Date and the value of such shares allocated to
Participant Accounts adjusted appropriately and the number of
additional shares to be credited to the Accounts of each
Participant in the Company Stock Fund (i) in respect of dividends
received since the immediately preceding Valuation Date shall be
the number of shares purchased with such dividends multiplied by a
fraction, the numerator of which is the numbers of whole and
fractional shares credited to the Participant's Account as of the
immediately preceding Valuation Date and the denominator is the
aggregate number of shares held in the Company Stock Fund as of the
immediately preceding Valuation Date and (ii) in respect of
additional contributions made during the period, shall be the
number of shares equal to the amount contributed divided by the
value of such shares determined under this Section as of that
Valuation Date. For the purposes of determining the value of
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Company Stock in respect to any investment in the Company Stock
Fund, transfer to or from the Company Stock Fund or withdrawal or
distribution from the Company Stock Fund, Company Stock shall be
valued as the net amount actually paid or received by the Trustee
upon the purchase or sale of the shares of Company Stock, after
payment of reasonable expenses, including brokerage commissions,
attributable to such transaction; provided, however, the Trustee
may be directed to offset the number of shares, in whole or in
part, otherwise to be sold in the aggregate of such transactions
against the number of shares, in whole or in part, which would
otherwise be purchased in respect to the aggregate of such
transactions, and, in such event, the shares so offset will be
valued at the trading price of Company Stock on the date of such
offset and no brokerage commission shall be charged. In the event
that all shares to be purchased or sold in respect to such events
may not be sold, purchased or offset at a single time or on a
single trading date, all shares of Company Stock comprising such
transactions shall be valued at the weighed average of the net
amount realized or paid upon all such sales, purchases and/or
offsets.
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ARTICLE XII
ADMINISTRATION
Section 12.0d. Insurance Company and Trustee. The
Corporation shall enter into a Contract with an Insurance Company
for the investment Plan assets in the Contract Fund and shall
appoint a Trustee and enter into an agreement of Trust with the
Trustee for the investment of Plan Assets in the Company Stock
Fund. In addition, the Company may from time to time designate
that the Contract Fund shall be an asset of the Trust to be held by
the Trustee pursuant to the Trust Agreement.
Section 12.02. Administrator. The Administrator of the
Plan shall be a committee appointed by the Board. The
Administrator shall be the named fiduciary with respect to
administration of the Plan and shall have such additional fiduciary
responsibilities as the Board shall delegate to it from time to
time. The Administrator shall adopt a claim and claims review
procedure and such other administrative regulations as it shall
deem necessary or proper for the efficient administration of the
Plan. The Administrator shall have full power and authority to
construe, interpret and administer the Plan. Subject to the claims
review procedure, decisions of the Administrator shall be final and
binding upon the Corporation and their employees to the extent
permitted by law.
Section 12.03. Liability. No member of the
Administrator shall be liable for any loss other than that
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specifically provided for under the standards applicable to
fiduciaries as contained in the Act. No member shall be personally
liable upon, or with respect to, any agreement, act, transaction or
omission executed, committed or suffered to be committed by himself
as a member of the Administrator or by any other member, agent or
representative of the Administrator, except as specifically
provided in Title I of the Act. The Administrator, and any member
and agent thereof, shall be fully protected in relying upon the
advice of any legal counsel, physician or other expert retained by
the Administrator or the Corporation. Other than the bonding
requirement under Section 412 of the Act, no bond or other security
shall be required of any member of the Administrator in any
jurisdiction.
Section 12.04. Administrative Expenses. Except as
otherwise provided in the Plan, all costs and expenses incurred in
administering the Plan, including the expenses of the
Administrator, shall be paid by the Corporation.
Section 12.05. Designation of Beneficiaries in the Event
of Death. Upon the death of a Participant, the value of the assets
in his Account shall be distributed to the beneficiary or
beneficiaries designated. A Participant shall designate his
beneficiary upon becoming a Participant and may change such
designation at any time by filing a written designation with the
Administrator. Any designation of a beneficiary other than the
Participant's spouse shall not be effective unless the spouse
consents in writing. The spouse's consent must be witnessed by a
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representative of the Administrator or a notary public.
Notwithstanding this requirement, if the Participant establishes to
the satisfaction of the Administrator that such written consent
cannot be obtained because there is no spouse or the spouse cannot
be located, the written consent of the Participant will be deemed
sufficient. A consent will be valid only with respect to the
spouse who signs the consent or, in the event of a deemed consent,
the designated spouse. A revocation of a prior election may be
made by the Participant with the consent of the spouse at any time
before the commencement of benefits. The number of revocations
shall not be limited. Upon the death of a Participant, if there is
no designated beneficiary then living, or if the designation is not
effective for any reason, as determined by the Administrator, the
Participant's beneficiary shall be his surviving spouse or, if
none, the beneficiary or beneficiaries designated by the
Participant for purposes of the group life insurance maintained by
the Corporation. In the absence of a surviving spouse and a
designation under the group life insurance, the beneficiary of the
Participant shall be his surviving children (per stirpes); if none,
his personal representative, if any; and, if none, those persons
entitled to his estate under the intestate laws of the state in
which the Participant is domiciled at the time of his death. In no
event shall any portion of such death benefit be payable to the
Corporation.
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Section 12.06. Limits on Contributions. Allocations
shall be limited to a Participant's Account as follows:
(a) The total value of the Annual Addition made on
behalf of any Participant for any Plan Year shall not exceed the
lesser of (i) thirty thousand dollars ($30,000), or such other
amount as may be permitted under regulations prescribed under
Section 415(d) of the Code or any successor provision, or
(ii) twenty-five percent (25%) of such Participant's Compensation
during such Plan Year.
(b) In the event that it is determined that the Annual
Addition on behalf of any Participant for any Plan Year is in
excess of the limitations contained in this Section 12.06(a), such
Annual Addition shall be reduced as follows to the extent necessary
to bring such contribution within the limitations contained herein:
(1) Nondeductible Savings in excess of six percent
(6%) of a Participant's Compensation shall be returned to
the Participant.
(2) To the extent permitted by the Act and the
regulations promulgated thereunder, Supplemental
Contributions shall be converted to Nondeductible
Savings.
(3) To the extent permitted by the Act and the
regulations promulgated thereunder, Basic Savings shall
be converted to Nondeductible Savings.
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(4) Corporation Security Contributions shall be
allocated to Accounts of remaining Participants in
proportion to their Compensation for the Plan Year to the
extent no other limitations are exceeded.
(5) All remaining excess amounts shall be allocated
to a suspense account in accordance with the following
rules:
a. No Corporation contributions may be
made at any time when the allocation thereof
would be precluded by Section 415 of the Code;
b. Investment gains and losses and
other income are not allocated to the suspense
account;
c. Suspense account amounts are
allocated as of the end of each Plan Year
until the suspense account is exhausted.
In the event of Plan termination, such suspense
account shall revert to the Corporation to the extent it
may not then be allocated to any Participant's Account.
Section 12.07. Combined Limitations.
(a) Notwithstanding any other provision of this Plan,
and as required by the Act, if any Participant is, or was, covered
under a defined benefit plan and a defined contribution plan
maintained by the Corporation or an Affiliated Company, the sum of
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the Participant's defined benefit plan fraction and defined
contribution plan fraction may not exceed 1.0 in any Plan Year
(which shall also be the limitation year).
(b) The defined benefit plan fraction is a fraction, the
numerator of which is the sum of the Participant's projected annual
benefits under all defined benefit plans (whether or not
terminated) maintained by the Corporation or an Affiliated Company,
and the denominator of which is the lesser of (i) 1.25 times the
dollar limitation of Section 415(b)(1)(a) of the Code in effect for
the Plan Year or (ii) 1.4 times the Participant's average
compensation for the three (3) consecutive years that produces the
highest average. "Projected annual benefit" means the annual
benefit to which the Participant would be entitled under the terms
of the Plan, if the Participant continued employment until normal
retirement age (or actual age, if later) and the Participant's
Compensation for the Plan Year and all other relevant factors used
to determine such benefit remained constant until normal retirement
age (or actual age, if later).
(c) The defined contribution plan fraction is a
fraction, the numerator of which is the sum of the annual additions
to the Participant's account under all defined contribution plans
maintained by the Corporation or an Affiliated Company (whether or
not terminated) for the current and all prior Plan Years, and the
denominator of which is the sum of the lesser of the following
amounts determined for such year and for each prior year of service
with the Corporation or an Affiliated Company: (i) 1.25 times the
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dollar limitation in effect under Section 415(c)(1)(a) of the Code
for such year, or (ii) 1.4 times the amount which may be taken into
account under Section 415(c)(1)(b) of the Code.
(d) If, in any Plan Year, the sum of the defined benefit
plan fraction and the defined contribution plan fraction will
exceed 1.0, the rate of benefit accrual under the defined benefit
plan will be reduced so that the sum of the fractions equals 1.0.
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ARTICLE XIII
TOP-HEAVY RULES
Section 13.01. Purpose. The purpose of this
Article XIII of the Plan is to comply with the special rules
applicable to "top-heavy" plans contained in Section 416 of the
Code, as added by Section 240 of the Tax Equity and Fiscal
Responsibility Act of 1982, and the appropriate Regulations issued
thereunder, including Proposed Reg. Section 1.416-1 and successor
Regulations. The rules set forth in this Article XIII shall be
operative if the Plan is, or becomes, "top-heavy" within the
meaning of Section 416 of the Code and the Regulations thereunder.
In the event that by statutory repeal or amendment, or regulatory
change or ruling by the Internal Revenue Service, any of the
limitations or restrictions of this Article XIII are no longer
necessary in order for the Plan to meet the requirements of
Section 416 of the Code or other applicable provisions of the Code
then in effect, such limitations or restrictions shall immediately
become null and void and shall no longer apply without the
necessity of further amendment to the Plan. The rules contained in
this Article XIII shall, except otherwise specifically noted, be
effective January 1, 1984.
Section 13.02. Definitions. For purposes of this
Article XIII only, the following terms shall have the meanings
set forth below:
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(a) "Compensation Limitation" means the annual
Compensation of an Employee up to, but not exceeding $200,000,
subject to certain cost-of-living adjustments of the Secretary of
the Treasury, as provided in Section 416(d) of the Code.
(b) "Determination Date" means, as to any Plan Year, the
last day of any preceding Plan Year or, in the case of the first
Plan Year, the last day of such Plan Year.
(c) "Key Employee" means any Employee, or former
Employee, or Beneficiary of either, who at any time during the Plan
Year or the four preceding Plan Years, is:
(1) an officer of the Employer having an
annual Compensation greater than the amount determined by
multiplying 150% of the dollar limitation under
Section 415(c)(1)(a) of the Code;
(2) one of the 10 Employees owning the largest
interests in the Employer having an annual Compensation
at least equal to the dollar limitation under
Section 415(c)(1)(a) of the Code;
(3) a 5% owner of the Employer; or
(4) a 1% owner of the Employer having
aggregate annual Compensation of at least $150,000 from
the Employer and all entities required to be aggregated
with the Employer under Sections 414(b), (c) and (m) of
the Code.
For purposes of subparagraphs (2), (3) and (4), owners of
the Employer shall include those considered as owners within the
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meaning of Section 318 of the Code. In identifying the top 10
Employee owners under Subsection 13.02(c)(2), only owners of
greater than a one-half percent (1/2%) interest in the Employer
will be considered, and if several Employees have equal ownership
interests, those Employees with higher Compensation shall be
treated as having a greater ownership interest. The determination
of who is a Key Employee shall be made in accordance with
Section 416(i) of the Code and the Regulations thereunder, the
provisions of which are incorporated herein by reference.
(d) "Non-Key Employee" means any Employee other than a
Key Employee, and shall include any former Key Employee.
(e) "Valuation Date" means the most recent Valuation
Date occurring within the 12-month period ending on the
Determination Date.
(f) "Employer" means the Corporation.
(g) "Employee" means an Eligible Employee.
Section 13.03. Determination of Whether Plan Is "Top-
Heavy". The Plan will be deemed to be "top-heavy" in any Plan Year
if, as of the Determination Date, the sum of the present value of
accrued benefits of Key Employees exceeds 60% of the sum of the
present value of accrued benefits of all Participants, excluding
former Key Employees. As used in this Section 13.03, the present
value of accrued benefits includes the amount attributable to
Company Contributions and Employee Contributions allocated to the
individual accounts of Participants and former Participants. The
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determination of whether the Plan is "topheavy" and the extent to
which distributions, rollovers, and transfers are taken into
account in such calculation shall be made in accordance with
Section 416 of the Code and the regulations thereunder which are
herein incorporated by reference. Deductible employee
contributions will not be taken into account in determining whether
the Plan is "top-heavy". Furthermore with respect to Plan Years
beginning after December 31, 1984, a former Participant's account
balance is to be disregarded in determining whether the Plan is
"top-heavy", unless the Participant performed any services for the
Employer within the 5 year period ending on the Determination Date.
Section 13.04. Aggregation Group of Employer Plans. All
corporations and businesses that are aggregated under Sections
414(b), (c) and (m) of the Code with the Employer must be
considered with the Employer for the purposes of determining
whether the Plan is "top-heavy". All plans of the Employer in
which a Key Employee participates, and each other stock bonus,
pension or profit sharing plan, if any, of the Employer which
enables any plan in which a Key Employee participates to meet the
requirements of Section 401(a)(4) or Section 410 of the Code, will
be aggregated as a required aggregation group within the meaning of
Section 416(g) of the Code. Each plan in the required aggregation
group will be "top-heavy" if the group is "top-heavy", and no plan
in the group will be "top-heavy" if the group is not "top-heavy".
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In addition, the Employer may elect to include as part of
the permissive aggregation group under Section 416(g) of the Code
any plans that are not part of a required aggregation group but
that satisfy the requirements of Sections 401(a)(4) and 410 of the
Code when considered together with the plans constituting the
required aggregation group. If the permissive aggregation group is
"top-heavy", only those plans which are part of the required
aggregation group will be subject to the additional requirements
applicable to "top-heavy" plans as herein provided.
Section 13.05. Special Minimum Contribution and Minimum
Vesting, and Compensation Limitation, Becoming Operative in the
Event the Plan Becomes "Top-Heavy". In the event that the Plan
shall be determined to be "top-heavy" as to any Plan Year, the
following special vesting and minimum contribution requirements,
and Compensation Limitation, shall become operative for such Plan
Year:
(a) Notwithstanding Sections 6.03 and 7.03 of the Plan,
the following vesting schedule shall, to the extent it results in
more rapid vesting than provided for in Sections 6.03 and 7.03,
apply to any Participant hereunder, as provided in Section 416 of
the Code:
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Nonforfeitable Percentage
Years of Service of Accrued Benefit
2 20%
3 40%
4 60%
5 80%
6 or more 100%
(b) Minimum Contributions. The Employer contributions
and forfeitures allocated to the accounts under the Plan of a
Non-Key Employee for each Plan Year in which the Plan is "topheavy"
shall equal the lesser of (i) 3% of the Participant's Compensation
for such Plan Year and (ii) the largest percentage of his
Compensation, subject to the Compensation Limitation, allocated to
the accounts of a Key Employee under the Plan for that Plan Year.
For Plan Years beginning after December 31, 1984, any Participant's
elective contributions under Section 401(k) of the Code will be
treated as Employer contributions for the purposes of the minimum
contributions requirements.
All Participants who have not terminated employment as of
the last day of the Plan Year must receive the minimum
contribution. Employees who (i) failed to complete 1,000 Hours of
Service during the Plan Year, (ii) declined to make mandatory
contributions to the Plan or (iii) would have been excluded from
the Plan because their compensation is less than a stated amount,
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must nevertheless be considered Participants for purposes of the
minimum contribution in this Section 13.05(b) if such Employees are
required to satisfy the coverage requirements of Section 410(b) of
the Code in accordance with Section 401(a)(5) of the Code. The
minimum contribution is determined without regard to any Social
Security contributions.
(c) Compensation Limitation. The annual Compensation of
each Participant taken into account under the Plan shall not exceed
the Compensation Limitation.
(d) In the event that the Employer maintains a defined
benefit plan and this Plan, both of which are top heavy in any Plan
Year, all Participants entitled to a Minimum Contribution under
Subsection 13.05(b) shall receive, in lieu of and in place of the
Minimum Contribution in Subsection 13.05(b) a Minimum Contribution
of five per cent of his or her Compensation for such Plan Year and
benefits under this Plan shall be used to offset the minimum
benefit to be provided under the defined benefit plan if such
defined benefit plan so provides.
(e) In the event that the Non-Key Employee is covered
only under this Plan and under no other plan, an amount equal to 4%
of the Non-Key Employee's Compensation for such top heavy Plan Year
shall be allocated to his or her Account in lieu of the Minimum
Contribution otherwise provided under Subsection 13.05(b).
Section 13.06. Pre-"Top-Heavy" Plan Terminated
Participant. This Article XIII shall not apply to any Participant
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who does not complete an Hour of Service after the Plan becomes
"top-heavy".
Section 13.07. Special "Top-Heavy" Reduction in Combined
Benefit and Contribution Limitation. In the event that the Plan
shall be determined to be "top-heavy" in any Plan Year, the
multiple applicable to the dollar limitation in the denominator of
the defined benefit fraction described in Section 12.07(b) of the
Plan and the multiple applicable to the dollar limitation in the
denominator of the defined contribution fraction described in
Section 12.07(c) of the Plan shall be one (1) rather than 1.25;
provided, however, that this Section 13.07 of the Plan shall not
apply in the event that the Plan is not a "super top-heavy" plan as
defined in Section 13.10(a) of the Plan and each participant who is
a Non-Key Employee shall receive the minimum contribution set forth
in paragraph (b) of Section 13.05 of the Plan, except that the
multiple in subparagraph (i) of paragraph (b) of Section 13.05
shall be 4% rather than 3%.
Section 13.08. Termination of "Top-Heavy" Status. In
the event that the Plan shall be "top-heavy" within the meaning of
Section 416 of the Code for any Plan Year, and in a subsequent Plan
Year the Plan shall cease to be "top-heavy", the special
"top-heavy" vesting, minimum contribution and Compensation
Limitation rules shall cease to apply with respect to any Plan
Year for which the Plan is not "top-heavy"; provided, however, that
in no event shall a reduction in a Participant's nonforfeitable
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percentage occur by reason of a change in the Plan's status.
Section 13.09. Multiple "Top-Heavy" Plans. In the event
that a Participant in the Plan is also participating in a defined
benefit plan maintained by the Employer or an affiliated employer
during a Plan Year in which both the Plan and such defined benefit
plan are "top-heavy", the Participant shall receive the minimum
accrued benefit under the defined benefit plan rather than the
minimum contribution provided for in this Plan.
Section 13.10. Effect of the Plan Becoming "Super Top-
Heavy".
(a) The Plan shall be deemed to be "super top-heavy" if,
as of the most recent Valuation Date, the sum of the present value
of accrued benefits for Key Employees is more than 90~ of the sum
of the present value of accrued benefits for all Employees,
excluding former Key Employees.
(b) In the event that the Plan shall be determined to be
"super top-heavy" in any Plan Year, the multiple applicable to the
dollar limitation in the denominator of the defined benefit
fraction described in Section 12.07(b) of the Plan and the multiple
applicable to the dollar limitation in the denominator of the
defined contribution fraction described in Section 12.07(c) of the
Plan shall be one (1) rather than 1.25.
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ARTICLE XIV
MISCELLANEOUS
Section 14.01. Alienation. The income and principal of
the Plan are for the sole use and benefit of the Participants and
beneficiaries of the Plan, and, to the extent permitted by law,
shall be free, clear, and discharged of and from, and are not to be
in any way liable for, debts, contracts or agreements, now
contracted or which may hereafter be contracted, and from all
claims and liabilities now or hereafter incurred by any Participant
or beneficiary. Other than as permitted by the Act, and as
expressly set forth in the Plan, no contributions made by the
Corporation to the Contract Fund under the Plan shall at any time
revert to the Corporation. No Participant or beneficiary of a
Participant under this Plan shall have the right to commute,
withdraw, surrender, encumber, alienate or assign any of the income
or principal of the Contract Fund or any of the benefits to become
due unto any person or persons under the Contract Fund or the Plan
except as specifically provided by the terms of the Contract Fund
or the Plan. The limitations contained in this Section 14.01 shall
apply to the creation, assignment or recognition of a right to any
benefit payable with respect to a Participant pursuant to a
domestic relations order unless such order is determined to be a
qualified domestic relations order as defined in Section 414(p) of
the Code, or is a domestic relations order entered before
January 1, 1985.
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Section 14.02. Extent of Participant's Rights. At the
time of withdrawal by a Participant or distribution, he shall be
entitled to receive cash as stated in Article XI. The Corporation
does not guarantee that the current market value of any security or
other investment will be equal to the purchase price thereof or
that the total amount withdrawable in cash will be equal to or
greater than the amount of the Participant's contributions to the
Plan.
Section 14.03. Rollover Contributions. With the
permission of the Administrator and without regard to any limits on
Annual Additions stated in Sections 13.06 and 13.07, the Plan may
receive from an otherwise Eligible Employee (whether or not he has
completed six (6) Months of Service) any cash theretofore received
by such employee from a qualified plan, either directly within
sixty (60) days after such receipt, or from any individual
retirement account, provided that such account contains no assets
other than-those attributable to employer contributions under
qualified plans. Such rollover contributions shall be credited to
a fully vested account for such employee, and will be part of the
Withdrawable Portion of the Savings Part. Such rollover
contribution shall not be matched by Corporation Contributions.
The Administrator, in its discretion, (i) may separately account
for such rollover contributions and earnings, gains and losses
thereon and (ii), upon distribution, may require a form of
distribution thereof which would be consistent with the provisions
of Section 401(a)(11) and the regulations promulgated thereunder as
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such may be in effect at the time of such distribution.
Section 14.04. Merger. In the case of any merger or
consolidation of the Plan, with, or transfer of assets or
liabilities respecting the Plan to, any other plan, each
Participant or beneficiary in the Plan shall (if the Plan had then
terminated) receive a benefit hereunder immediately after such
merger, consolidation or transfer which is no less than the benefit
he would have been entitled to receive immediately before such
merger, consolidation or transfer (if the Plan had then
terminated).
Section 14.05. Amendment and Termination.
(a) The Board reserves the right, without obtaining the
approval of the shareholders, to amend, modify, suspend or
terminate the Plan. No amendment, modification, suspension, or
termination of the Plan shall have the effect of providing that the
funds held or invested pursuant to Article VIII, or the income
thereof, may be used for or diverted to purposes other than the
exclusive benefit of the Participants and their beneficiaries and
defraying the reasonable expenses of administering the Plan or the
effect of reducing or restricting, directly or indirectly, the
accrued benefit of any Participant unless the amendment satisfies
the requirements of Section 412(c)(8) of the Code. The Corporation
retains the right to amend the Plan at any time retroactively in
effect if necessary to qualify the Plan under Section 401(a) of the
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Code or corresponding provisions of any subsequent revenue law.
(b) In the event that the Plan shall be partially or
completely terminated or the Corporation shall permanently
discontinue making contributions under the Plan, all amounts then
credited to the accounts of the affected Participants shall
immediately be fully vested and nonforfeitable. After the making
of proper governmental notification, the Board shall thereupon
direct either (i) that the Insurance Company continue to hold the
Plan assets in accordance with the provisions of this Plan (other
than provisions related to forfeiture) without regard to such
termination until all funds in such accounts have been distributed
in accordance with such provisions, or (ii) that the Insurance
Company immediately distribute to each affected Participant all
amounts then credited to his account as a lump sum in cash or other
property.
Section 14.06. Applicable Law. The Plan, Insurance
Contract and Trust hereunder shall be governed by, and construed in
accordance with, the laws of the Commonwealth of Pennsylvania
except to the extent that the laws of the Commonwealth of
Pennsylvania have been specifically pre-empted by the Act or other
federal legislation.
Section 14.07. Incapacity of Recipient of Benefits. If
any person entitled to receive benefits shall be physically or
mentally incapable of receiving or acknowledging receipt of any
payment of benefits, the Insurance Company or Trust, upon the
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receipt of satisfactory evidence that such incapacitated person is
so incapacitated and that another person or institution is
maintaining him and that no guardian or committee has been
appointed for him, may provide for such payment of benefits
hereunder to such person or institution so maintaining him, and any
such payments so made shall be deemed for every purpose to have
been made to such incapacitated person.
Section 14.08. Merger, Consolidation or Discontinuance
Involving Employer. In the event that the Employer shall at any
time become insolvent, or in the event of the dissolution of, or a
merger or consolidation involving, the Employer, without any
provision being made for the continuance of the Plan, the Plan and
the Insurance Contract and Trust thereunder shall terminate and the
Plan Administrator shall proceed in the manner provided herein in
the event of a termination of the Plan. In the event of a
dissolution, merger or consolidation involving the Employer,
provisions may be made by the Employer's successor, if any, for the
continuance of the Plan. In such event, said successor shall be
substituted hereunder in place of the Employer by proper corporate
action of such successor.
Section 14.09. Liability of Officers and Directors of
the Employer. Subject to the provisions of the Act, no past,
present or future officer or director of the Employer shall be
personally liable to any Participant, beneficiary or other person
under any provision of the Plan or Insurance Contract.
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Section 14.10. Indemnification of Fiduciaries. To the
extent permitted by the Act and regulations issued thereunder, the
Employer shall indemnify and hold harmless all fiduciaries of the
Plan, as defined in the Act, who are employees of the Employer, and
defend the same, against any and all claims or liabilities which
may be asserted against any of them by reason of any action or
omission in the administration of the Plan, except in the case of
any fraud or willful wrongdoing.
Section 14.11. Service of Process. The Plan
Administrator is the designated agent of the Plan for the service
of process in connection with all matters affecting the Plan.
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EXHIBIT 5
July 28, 1994
Allegheny Ludlum Corporation
1000 Six PPG Place
Pittsburgh, PA 15222-5479
Re: Registration Statement on Form S-8
Ladies and Gentlemen:
I am Vice President - General Counsel and Secretary of
Allegheny Ludlum Corporation, a Pennsylvania corporation
(the "Company") and in such capacity, I have acted as counsel for
the Company in connection with the Registration Statement on
Form S-8 (the "Registration Statement") to be filed with the
Securities and Exchange Commission in connection with the
registration pursuant to the Securities Act of 1933, as amended
(the "Act") of the issuance of up to 1,250,000 shares (the
"Shares") of Common Stock, par value $0.10 per share, of the
Company, pursuant to the Allegheny Ludlum Corporation Retirement
Savings Plan, the Savings and Security Plan of the Tubular
Products Division of Allegheny Ludlum Corporation and the Savings
and Security Plan of the Special Materials Division of Allegheny
Ludlum Corporation (the "Plans"). I am furnishing this opinion
for use in accordance with Item 601(b)(5) of Regulation S-K
promulgated under the Act, for filing as Exhibit 5 to the
Registration Statement.
In preparation for this opinion, I have examined
(a) the Plans, (b) the Registration Statement and (c) the
corporate documents of the Company. I am familiar with the
proceedings taken by the Company in connection with the
authorization, registration, issuance and sale of the Shares
pursuant to the Plans.
Based on the foregoing, I am of the opinion that the
Shares have been duly authorized for issuance and sale pursuant
to the Plans, and when issued and delivered by the Company
pursuant to the Plans, the Shares will be validly issued, fully
paid and nonassessable.
<PAGE>
Allegheny Ludlum Corporation
July 28, 1994
Page 2
This opinion is rendered as of the date hereof, and I
have not undertaken to supplement this opinion with respect to
factual matters or changes in the law that may occur hereafter.
I consent to the use of this opinion as an Exhibit to
the Registration Statement and to the reference to the
undersigned in the Registration Statement.
Very truly yours,
s/ Jon D. Walton
Jon D. Walton
JDW/mem
<PAGE>
Exhibit 23(b)
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Item 3.-
Incorporation of Documents by Reference" in the Registration Statement
on Form S-8 of Allegheny Ludlum Corporation for the registration of
1,250,000 shares of its common stock and to the incorporation by
reference therein of our reports dated January 31, 1994, with respect
to the consolidated financial statements of Allegheny Ludlum
Corporation incorporated by reference in its Form 10-K for the fiscal
year ended January 2, 1994 and the related financial statement
schedules included therein, filed with the Securities and Exchange
Commission.
Ernst & Young
Pittsburgh, Pennsylvania
July 28, 1994
