<PAGE>
As filed with the Securities and Exchange Commission on February 8, 1995.
Registration No. 33-_____________
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
----------------------
TCF FINANCIAL CORPORATION
(Exact name of issuer as specified in its charter)
DELAWARE 41-1591444
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
801 MARQUETTE AVENUE, SUITE 302, MINNEAPOLIS, MINNESOTA 55402
(Address of principal executive offices, including Zip Code)
THE GREAT LAKES BANCORP
401(K) SAVINGS AND INVESTMENT PLAN
(Full title of the plan)
GREGORY J. PULLES
GENERAL COUNSEL AND SECRETARY
TCF FINANCIAL CORPORATION
801 MARQUETTE AVENUE, SUITE 302
MINNEAPOLIS, MINNESOTA 55402
(Name and address of agent for service)
(612) 661-6500
(Telephone number, including area code, of agent for service)
Approximate date of commencement of proposed sale:
FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------
PROPOSED PROPOSED
TITLE OF MAXIMUM MAXIMUM
SECURITIES AMOUNT OFFERING AGGREGATE AMOUNT OF
TO BE TO BE PRICE OFFERING REGISTRATION
REGISTERED REGISTERED PER SHARE PRICE FEE
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
$.01 par value (1) 25,516 shares (2) $39.19 (3) $1,000,000 (3) $ 345.00
- ---------------------------------------------------------------------------------------
<PAGE>
<FN>
- ---------------------------------------------------------------------------------------
(1) Includes Preferred Share Purchase Rights to purchase Series A Junior Participating
Preferred Stock which currently are not separable from the common stock and are
not exercisable.
(2) The number of shares registered represents the estimated number of shares to be
issued during the next 12 months. In addition, pursuant to Rule 416(c) under the
Securities Act of 1933, this registration statement also covers an indeterminate
amount of interests to be offered or sold pursuant to the employee benefit plan
described herein.
(3) Pursuant to Rule 457(c), the per share price is estimated, solely for the purpose
of determining the registration fee, based upon the average of the high and low
prices for such Common Stock reported on the New York Stock Exchange on
February 7, 1995.
- ---------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------
</TABLE>
-2-
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
Documents containing the information specified in this Part I will be sent
or given to employees as specified by Rule 428(b)(1). Such documents need not
be filed with the Securities and Exchange Commission either as part of this
Registration Statement or as prospectuses or prospectus supplements pursuant to
Rule 424. Such documents and the documents incorporated by reference in this
Registration Statement pursuant to Item 3 of Part II, taken together, constitute
a prospectus that meets the requirements of Section 10(a) of the Securities Act
of 1933.
ITEM 1. PLAN INFORMATION.
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents have been filed by TCF Financial Corporation
("TCF") with the Securities and Exchange Commission (the "Commission") pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934 (the "Exchange
Act") and are incorporated by reference herein:
a. TCF's Annual Report on Form 10-K for the fiscal year ended December
31, 1993;
b. TCF's Quarterly Reports on Form 10-Q for the quarters ended March 31,
June 30, and September 30, 1994;
c. TCF's Current Reports on Form 8-K dated January 24, January 26,
September 12, and September 23, 1994; and
d. The descriptions of TCF's capital stock at Item 1 of the Registration
Statements on Form 8-A for TCF Common Stock and TCF's Preferred Share
Purchase Rights.
All documents filed with the Commission by TCF pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Registration Statement and prior to the filing of a post-effective amendment
which indicates that all securities offered hereby have been sold or which
deregisters all such securities then remaining to be sold shall be deemed to be
incorporated by reference herein.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes hereof to the extent a statement contained herein or in any
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed to constitute a part hereof, except
as so modified or superseded.
-3-
<PAGE>
ITEM 4. DESCRIPTION OF SECURITIES.
The common stock, par value $.01 per share (the "Common Stock"), of TCF
offered pursuant to this Registration Statement and the related Preferred Share
Purchase Rights are registered under Section 12(b) of the Securities Exchange
Act of 1934. The descriptions of TCF's Common Stock and Preferred Share
Purchase Rights are incorporated by reference pursuant to Item 3.d. above.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Indemnification of directors and officers of TCF is provided under
Article 13 of the Certificate of Incorporation of TCF to the fullest extent
authorized by the Delaware Corporation Law, which generally provides for
indemnification for judgments, fines, settlements, and expenses, including
attorney's fees, incurred in connection with any threatened, pending, or
completed action, suit, or proceeding, whether civil, criminal, administrative,
or investigative if such director or officer acted in good faith and in a manner
he or she reasonably believed to be in or not opposed to the best interests of
TCF and, with respect to any criminal action or proceeding, had no reasonable
cause to believe his or her conduct was unlawful.
TCF has purchased director and officer liability insurance that insures
directors and officers against certain liabilities in connection with the
performance of their duties as directors and officers, including liabilities
under the Securities Act of 1933, as amended, and provides for payment to TCF of
costs incurred by it in indemnifying its directors and officers.
In addition, as allowed by the Delaware General Corporation Law, Article 12
of TCF's Certificate of Incorporation provides that a director of TCF shall not
be personally liable to TCF or its stockholders for monetary damages for certain
types of breaches of fiduciary duty as a director.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
-4-
<PAGE>
ITEM 8. EXHIBITS.
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
5.1 Opinion of Winthrop & Weinstine, P.A. as to the legality of Common
Stock of TCF
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Winthrop & Weinstine, P.A. [included in its opinion filed as
Exhibit 5.1].
24.1 Powers of Attorney [included as part of signature page].
99.1 Great Lakes Bancorp Amended 401(k) Savings and Investment Plan and
Trust Agreement
9. UNDERTAKINGS.
(a) RULE 415 OFFERING.
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; and
(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 registration statement is on Form S-3 or Form S-8,
and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports
filed by the registrant pursuant to Section 13 or Section 15(d) of
the 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.
-5-
<PAGE>
(b) FILINGS INCORPORATING SUBSEQUENT EXCHANGE ACT DOCUMENTS BY REFERENCE.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (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.
(H) STATEMENT REQUIRED IN CONNECTION WITH FILING OF REGISTRATION STATEMENT ON
FORM S-8.
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.
(The remainder of this page is intentionally left blank.)
-6-
<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 Minneapolis, State of Minnesota on February 8, 1995.
TCF FINANCIAL CORPORATION
By /s/ William A. Copper
--------------------------------------------------
William A. Cooper
Chairman of the Board and Chief Executive Officer
-7-
<PAGE>
POWER OF ATTORNEY
We, the undersigned directors and officers of TCF Financial Corporation, do
hereby severally constitute and appoint William A. Cooper and Gregory J. Pulles,
and each of them singly, our true and lawful attorneys and agents, to do any and
all things and acts in our names in the capacities indicated below and to
execute any and all instruments for us and in our names in the capacities
indicated below which said William A. Cooper or Gregory J. Pulles, or either of
them, may deem necessary or advisable to enable TCF Financial Corporation to
comply with the Securities Act of 1933, as amended, and any rules, regulations
and requirements of the Securities and Exchange Commission, in connection with
the Registration Statement on Form S-8 relating to the offering of TCF Common
Stock, including specifically, but not limited to, power and authority to sign
for us or any of us in our names in the capacities indicated below the
Registration Statement and any and all amendments (including post-effective
amendments) thereto; and we hereby ratify and confirm all that said William A.
Cooper and Gregory J. Pulles, or either of them, shall do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
- --------- ----- ----
/s/ William A. Cooper Chairman of the Board, February 8, 1995
- --------------------- Chief Executive Officer and Director --
William A. Cooper
/s/ Joseph P. Clifford Vice Chairman of the Board and February 8, 1995
- ---------------------- Director --
Joseph P. Clifford
/s/ Thomas A. Cusick Vice Chairman of the Board and February 8, 1995
- -------------------- Director --
Thomas A. Cusick
/s/ Robert E. Evans Vice Chairman of the Board and February 8, 1995
- -------------------- Director --
Robert E. Evans
/s/ Lynn A. Nagorske President, Chief Operating Officer February 8, 1995
- -------------------- and Treasurer (Principal Financial --
Lynn A. Nagorske Officer)
/s/ Mark R. Lund Senior Vice President, Assistant February 8, 1995
- -------------------- Treasurer and Controller (Principal --
Mark R. Lund Accounting Officer)
Director February , 1995
- -------------------- --
Bruce G. Allbright
Director February , 1995
- -------------------- --
Rudolph E. Boschwitz
/s/ Luella G. Goldberg Director February 8, 1995
- ---------------------- --
Luella G. Goldberg
Director February , 1995
- -------------------- --
Daniel F. May
/s/ Thomas J. McGough Director February 8, 1995
- --------------------- --
Thomas J. McGough
/s/ Ralph Strangis Director February 8, 1995
- -------------------- --
Ralph Strangis
-8-
<PAGE>
Director February , 1995
- -------------------- --
Ronald A. Ward
Director February , 1995
- -------------------- --
John M. Eggemeyer
/s/ Robert J. Delonis Director February 8, 1995
- --------------------- --
Robert J. Delonis
Director February , 1995
- -------------------- --
Roy E. Weber
Director February , 1995
- -------------------- --
Mark K. Rosenfeld
-9-
<PAGE>
Exhibit 5.1
OPINION AND CONSENT OF COUNSEL
TCF Financial Corporation
801 Marquette Avenue
Minneapolis, Minnesota 55402
Re: THE GREAT LAKES BANCORP 401(K) SAVINGS AND INVESTMENT PLAN
Registration Statement on Form S-8
25,516 Shares of Common Stock
Ladies and Gentlemen:
We have acted as counsel for TCF Financial Corporation, a Delaware corporation
("TCF Financial"), in connection with preparation and filing of a registration
statement on Form S-8 (the "Registration Statement"), and the preparation of a
prospectus (the "Prospectus") to be used in conjunction with the Registration
Statement, relating to the registration under the Securities Act of 1933, as
amended, of 25,516 shares ("Shares") of the common stock, par value $.01
per share, of TCF Financial, to be issued under The Great Lakes Bancorp 401(k)
Savings and Investment Plan (the "Plan").
In connection therewith, we have examined (i) the Certificate of Incorporation
and the Bylaws of TCF Financial, both as amended to date; (ii) the corporate
proceedings of TCF Financial relative to its organization and to the
authorization and issuance of the Shares; and (iii) the Registration Statement
and the Prospectus. In addition to such examination, we have reviewed such
other proceedings, documents and records and have ascertained or verified such
additional facts as we have deemed necessary or appropriate for purposes of this
opinion.
Based upon the foregoing, we are of the opinion that:
1. TCF Financial has been duly incorporated and is validly existing under the
laws of the State of Delaware.
2. All necessary corporate action has been taken by TCF Financial to authorize
the issuance of the Shares.
3. The Shares are validly authorized by TCF Financial's Certificate of
Incorporation, as amended, and when issued and paid for as contemplated in
the Registration Statement and Prospectus, will be validly issued, fully
paid, and non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
WINTHROP & WEINSTINE, P.A.
By /s/ Eric O. Madson
--------------------------
Eric O. Madson
<PAGE>
Exhibit 23.1
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
TCF Financial Corporation
Minneapolis, Minnesota:
We consent to incorporation by reference in this Registration Statement on Form
S-8 of our report dated January 12, 1994 on the consolidated financial
statements of TCF Financial Corporation and subsidiaries as of December 31, 1993
and 1992 for each of the years in the three-year period ended December 31, 1993
included in the Annual Report on Form 10-K for the fiscal year ended December
31, 1993 of TCF Financial Corporation.
KPMG Peat Marwick LLP
February 8, 1995
Minneapolis, Minnesota
<PAGE>
GREAT LAKES BANCORP
AMENDED
401(K) SAVINGS AND INVESTMENT
PLAN AND TRUST AGREEMENT
<PAGE>
GREAT LAKES BANCORP
AMENDED
401(K) SAVINGS AND INVESTMENT
PLAN AND TRUST AGREEMENT
INDEX
PART ONE
PAGE
----
ARTICLE I. DEFINITIONS AND INTERPRETATION
A. Definitions .......................................... I-1
B. Governing Law and Rules of Construction .............. I-10
C. Power to Interpret ................................... I-10
D. Adoption of Plan by Related Companies ................ I-10
ARTICLE II. PARTICIPATION
A. Eligibility .......................................... II-1
B. Breaks in Service .................................... II-1
C. Reemployment ......................................... II-1
D. Inactive Participants ................................ II-1
ARTICLE III. CONTRIBUTIONS
A. Supplementary Company Contributions .................. III-1
B. Elective Contributions; Adjusted $7,000
Limitation; Corrective Distributions ............... III-1
C. Matching Company Contributions ....................... III-2
D. Limitations on Company Contributions.................. III-3
E. Two or More Plans .................................... III-3
F. Deductibility ........................................ III-4
G. Contributions by Mistake ............................. III-4
H. Limitation on Repayments ............................. III-4
I. No After-Tax Employee Contributions .................. III-4
J. Corrective Contributions.............................. III-4
ARTICLE IV. ALLOCATION AND ACCOUNTS
A. Supplementary Company Contributions Accounts.......... IV-1
B. Elective Contributions Accounts....................... IV-1
C. Matching Company Contributions Accounts............... IV-1
D. Limitations on Annual Additions to Accounts .......... IV-1
E. Special Limitations on Allocations
of Elective Contributions ............................ IV-4
F. Special Limitations on Allocations of
Matching Company Contributions....................... IV-5
G. Adjustments to Prevent Excess Allocations
of Elective Contributions............................ IV-6
H. Adjustments to Prevent Excess Allocations
of Matching Company Contributions.................... IV-8
I. Adjustments to Prevent Multiple Use of
Alternative Limitation.............................. IV-10
J. Establishment and Objectives of Investment Funds...... IV-10
K. Investment of Company Contributions................... IV-11
L. Participant's Rights to Periodic Reallocation
of Accounts......................................... IV-11
M. Participants' Credit Accounts......................... IV-11
N. Periodic Revaluation of Investment Funds.............. IV-12
<PAGE>
PAGE
----
O. Periodic Adjustments to Accounts...................... IV-12
P. Fixed Accounts........................................ IV-13
Q. Forfeitures........................................... IV-14
R. Additional Participant Allocations ................... IV-15
S. Great Lakes Bancorp Stock Fund........................ IV-15
T. Voting of Great Lakes Bancorp Stock................... IV-16
U. Tender of Great Lakes Bancorp Stock................... IV-17
ARTICLE V. RETIREMENT BENEFITS AND VESTING
A. Normal Retirement .................................... V-1
B. Late Retirement ...................................... V-1
C. Early Retirement; Vesting Schedule for Supplementary
Company Contributions and Matching Company
Contributions; Full Vesting of Elective
Contributions ...................................... V-1
D. Deadline for Payment of Benefits;
Required Beginning Date ............................ V-3
E. Cash-Outs ............................................ V-4
F. Limitations on Payment of Benefits Derived from
Elective Contributions and Matching Company
Contributions....................................... V-4
G. Termination of Employment by Reason of Dissolution ... V-4
H. Termination of Employment in Other Circumstances ..... V-4
I. Temporary Absences ................................... V-4
ARTICLE VI. OTHER BENEFITS
A. Death; Spousal Consent to Designation
Required if Spouse is not Beneficiary .............. VI-1
B. Designation of Beneficiary ........................... VI-1
C. Required Distributions ............................... VI-1
D. Disability ........................................... VI-3
E. Hardship Distributions; Distributions
After Age 59-1/2 .................................. VI-3
F. Loans ................................................ VI-4
ARTICLE VII. SPECIAL PROVISIONS FOR MERGED PLAN
A. Cessation of Additional Annuities................... VII-1
B. Separate Accounts................................... VII-1
C. Annuity Distributions; Spousal Consent, etc......... VII-1
D. Effective Date...................................... VII-1
PART TWO
ARTICLE VIII. COMMITTEE
A. Composition of Committee ............................. VIII-1
B. Removal and Resignation .............................. VIII-1
C. Quorum ............................................... VIII-1
D. Officers ............................................. VIII-1
E. Records and Reports .................................. VIII-1
F. Powers and Duties .................................... VIII-1
G. Rules and Regulations ................................ VIII-2
H. Claims Procedure ..................................... VIII-2
I. No Separate Committee ................................ VIII-3
-ii-
<PAGE>
PAGE
----
ARTICLE IX. TRUSTEE AND OTHER FIDUCIARIES
A. Bonding .............................................. IX-1
B. Protective Provisions for Fiduciaries ................ IX-1
C. Management and Control of Assets; Consultants and
Investment Managers ................................. IX-1
D. Participant-Directed Investments ..................... IX-3
E. Prohibited Transactions, Etc. ........................ IX-3
F. General Duties of Trustee ............................ IX-3
G. General Powers of Trustee ............................ IX-4
H. Appraisal ............................................ IX-5
I. Periodic Accounting .................................. IX-6
J. Protective Provisions for Trustee .................... IX-6
K. Provisions Pertaining to Co-Trustees ................. IX-7
L. Removal and Resignation of Trustee ................... IX-8
M. Successor Trustees ................................... IX-8
N. Settlement of Accounts upon
Resignation or Removal of Trustee .................. IX-8
O. Segregated Accounts .................................. IX-8
P. Investments in Common Trust Funds .................... IX-9
Q. Commingling of Trust Funds of
Company and Related Companies ....................... IX-9
ARTICLE X. TERMINATION, AMENDMENT AND SUSPENSION
A. Termination, Etc.; Assumption of Plan ................ X-1
B. Liquidation of Trust ................................. X-1
C. Termination of Trust ................................. X-2
D. Amendment ............................................ X-2
ARTICLE XI. MISCELLANEOUS
A. Persons Prohibited from Serving as Fiduciaries, Etc... XI-1
B. Information Required by ERISA ........................ XI-1
C. Retention of Records for Six Years ................... XI-1
D. No Reversion ......................................... XI-1
E. Nonforfeitability, Etc. .............................. XI-1
F. Rollovers; Direct Transfers;
Certain Transfers Prohibited ....................... XI-2
G. Spendthrift Provision ................................ XI-4
H. Exceptions to Spendthrift Provision .................. XI-4
I. Execution of Instruments ............................. XI-5
J. Successors, Etc. ..................................... XI-5
K. Payment in Kind ...................................... XI-5
L. Miscellaneous Protective Provisions .................. XI-5
M. No Duress or Retaliation Against Participants, Etc. .. XI-5
N. Record Keeping, Investigations, Etc. ................. XI-6
O. Distributions to Minors and Incompetent
or Missing Individuals ............................. XI-6
P. Expenses and Compensation ............................ XI-6
Q. Transferred PAYSOP Accounts........................... XI-7
ARTICLE XII. INSURANCE PROVISIONS
A. Definitions......................................... XII-1
B. Type and Amount of Contracts........................ XII-1
C. Application and Ownership........................... XII-1
D. Dividends and Refunds............................... XII-2
E. Anniversary Date.................................... XII-2
F. Choice of Options................................... XII-2
G. Death............................................... XII-2
-iii-
<PAGE>
PAGE
----
H. Normal Retirement................................... XII-2
I. Other Benefits...................................... XII-3
J. Loans; Hardship Distributions; Distributions After
Age 59-1/2........................................ XII-3
K. Accounting for Contracts............................ XII-4
L. Protective Provisions............................... XII-4
M. Reports............................................. XII-5
N. Miscellaneous....................................... XII-5
ARTICLE XIII. TOP-HEAVY RULES
A. Application; Top-Heavy Status ........................ XIII-1
B. Effect of Top-Heavy Status ........................... XIII-3
C. Definitions .......................................... XIII-4
-iv-
<PAGE>
GREAT LAKES BANCORP
AMENDED
401(K) SAVINGS AND INVESTMENT
PLAN AND TRUST AGREEMENT
THIS AGREEMENT, made this ____ day of _____________, 1994, by and between
GREAT LAKES BANCORP, a Michigan corporation (herein called the "Company"), and
BRUCE A. HUBBARD (herein, with his predecessors and successors, called the
"Trustee"),
WITNESSETH THAT WHEREAS --
(A) By an agreement between the Company and the Trustee the Company
established a profit-sharing plan and trust hereby renamed the "Great Lakes
Bancorp 401(k) Savings and Investment Plan" (herein as amended called the
"Plan") and the "Great Lakes Bancorp 401(k) Savings and Investment Trust"
(herein as amended called the "Trust"), which the Company now desires to amend,
and the Trustee is willing to join in such amendment;
(B) It is the principal purpose of the Plan, as hereby amended, to
recognize the contribution made toward the successful operation of the Company
by its various employees and to reward and stimulate such contribution by
continuing a profit-sharing and 401(k) plan affording deferred compensation for
those employees who hereafter qualify as Participants and death benefits for
their designated Beneficiaries; and
(C) The parties intend that the amended Plan and Trust shall continuously
qualify under those provisions of the federal income tax laws relating to
qualified profit-sharing retirement plans containing cash or deferred
arrangements of the kind described in Section 401(k) of the Code and that
contributions to the Trust by the Company shall be deductible for federal income
tax purposes;
NOW, THEREFORE, in consideration of the premises and of the provisions
hereinafter set forth, it is agreed as follows:
1. The aforesaid agreement is hereby amended and restated in its entirety
to read as set forth in Parts One and Two attached hereto.
2. No benefit provided under the Plan protected by Section 411(d)(6) of
the Code and Regulations thereunder shall be eliminated by the adoption of this
agreement, and this agreement shall be construed and administered so as to
comply with such Code Section and Regulations.
3. This agreement shall be effective for Plan Years beginning after
December 31, 1988, except as herein otherwise expressly provided, and except
further that those provisions of this agreement required by the Tax Reform Act
of 1986 to be effective prior to the Plan Year beginning after December 31, 1988
shall be effective on the date or dates when so required to be effective, and
the following provisions shall be effective on the dates set forth opposite the
same below or on the effective date of the Plan, if later:
Provision Effective Date
--------- --------------
The elimination of the Plan Year beginning
provision in Article III(A) after 1985
which required Company
contributions to be made from
current or accumulated
profits.
Definition of Annual Addition Plan Year beginning
in Article I(A)(7) after 1986
-1-
<PAGE>
Changes in Article VI(F) October 18, 1989
relating to loans to
Participants not specifically
required by the Tax Reform Act
of 1986
IN WITNESS WHEREOF, the Company has duly executed this Agreement on the
___________ day of ____________________, 1994.
Signed and delivered
in the presence of: GREAT LAKES BANCORP
By
- -------------------------- ----------------------------------
Its
----------------------------
The Trustee acknowledges receipt of an executed copy of this
Agreement, assents to the provisions of this Agreement which relate to the
rights, duties and obligations of the Trustee, and agrees to serve as trustee
under this Agreement subject to its terms.
Signed and delivered
in the presence of: TRUSTEE
- ------------------------- --------------------------------------
Bruce A. Hubbard
-2-
<PAGE>
PART ONE
ARTICLE I
DEFINITIONS AND INTERPRETATION
A. DEFINITIONS. The following words and phrases, wherever capitalized, shall
have the following meanings respectively, unless the context otherwise requires:
(1) "Account" or "account" means and includes a Participant's
Supplementary Company Contributions Account, Elective Contributions Account,
Matching Company Contributions Account and any additional accounts established
for the Participant under this Agreement.
(2) "Accrued Benefit" means the balance in a Participant's account
separately maintained under Article IV hereof.
(3) "Adjusted Equivalent", wherever applied to a dollar amount, means said
amount adjusted for increases in the cost of living in accordance with
applicable Treasury Regulations.
(4) "Administrative Parties" means and includes the Company, the Trustee,
the Committee and any Insurer.
(5) "Agreement" means this Agreement, as from time to time amended or
supplemented.
(6) "Anniversary Date" means the last day of the Plan Year.
(7) "Annual Addition" means the amounts allocated to a Participant's
account for any Limitation Year which constitute -
(a) Company contributions to the Trust (including Elective
Contributions and Matching Company Contributions) in respect of
such Limitation Year;
(b) Forfeitures credited to the Participant's account in respect of
such Limitation Year;
(c) Contributions allocated to an individual medical account
described in Section 415(l)(2) of the Code which is part of a
pension or annuity plan maintained by the Company and amounts
described in Section 419A(d)(2) of the Code dealing with separate
accounts for key employees, as defined in Section 419A(d)(3) of
the Code, established for post-retirement medical benefits under
a welfare benefit fund maintained by the Company; and
(d) Employee after-tax contributions.
Company Contributions initially allocated to a Participant's Elective
Contributions Account or Matching Company Contributions Account and later
determined to be an Excess Elective Deferral, Excess Contribution or Excess
Matching Contribution do not cease to be Annual Additions even if corrected
through distribution or other means.
(8) "Attained Age" of any individual means his chronological age, not the
age he was, or will be, on his nearest birthday.
(9) "Beneficiary" means the person so designated by a Participant pursuant
to this Agreement, or the person otherwise named as the Participant's
beneficiary under (A) or (B) of Article VI.
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(10) "Code" means the Internal Revenue Code of 1986, as from time to time
amended.
(11) "Committee" means the administrative committee appointed under
Article VIII, which shall be the plan administrator as defined in Section 414(g)
of the Code, except as otherwise provided in Article VIII(I).
(12) "Company Contributions" means and includes Supplementary Company
Contributions, Elective Contributions, Matching Company Contributions, Qualified
Nonelective Contributions and Qualified Matching Contributions.
(13) "Compensation" means all compensation as that term is defined in
Section 415(c)(3) of the Code. The Compensation of each Participant taken into
account under the Plan for any Plan Year shall not exceed the Adjusted
Equivalent of $200,000. In determining the Compensation of a Participant for
purposes of this limitation, the rules of section 414(q)(6) of the Code shall
apply, except in applying such rules, the term "family" shall include only the
spouse of the Participant and any lineal descendants of the Participant who have
not attained age 19 before the close of the Plan Year. If, as a result of the
application of such rules such limitation is exceeded, then (except for purposes
of determining the portion of compensation up to the integration level if this
Plan is integrated with Social Security), the limitation shall be prorated among
the affected individuals in the ratio which each such individual's Compensation
as determined prior to the application of the limitation bears to the total
Compensation of all such individuals as so determined.
"Creditable Compensation," where used with reference to any Participant or
Employee, means the total Compensation (as above defined) paid to him by the
Company, including overtime and bonuses, if any, plus any amount contributed by
the Company pursuant to a salary reduction agreement and which is not includible
in the gross income of such individual under Section 125, 402(a)(8) or 403(b) of
the Code, but excluding -
(i) Compensation paid in kind, including personal use of a Company
car and similar non-cash compensation,
(ii) Special allowances or reimbursements to cover expenses on
behalf of the Company or in the course of employment with the
Company (for example, but not by way of limitation, travel and
entertainment expenses), and
(iii) Deferred compensation and contributions to or under any other
employee retirement, welfare, medical, dental, health,
disability or insurance plan or arrangement.
The Creditable Compensation of each Participant taken into account under
the Plan for any Plan Year shall not exceed the Adjusted Equivalent of $200,000,
subject to the rules of Section 414(q)(6) of the Code applied in the same manner
as in the first paragraph of this subparagraph (13) relating to Compensation.
In addition to other applicable limitations set forth in the Plan, and
notwithstanding any other provision of the Plan to the contrary, for Plan Years
beginning on or after January 1, 1994, the Compensation and Creditable
Compensation of each Employee taken into account under the Plan shall not exceed
the OBRA '93 annual compensation limit. The OBRA '93 annual compensation limit
is $150,000, as adjusted by the Commissioner for increases in the cost-of-living
in accordance with Section 401(a)(17)(B) of the Code. The cost-of-living
adjustment in effect for a calendar year applies to any period, not exceeding 12
months, over which Compensation and Creditable Compensation is determined
(determination period) beginning in such calendar year. If a determination
period consists of fewer than 12 months, the OBRA '93 annual compensation limit
will be multiplied by a fraction, the numerator of which is the number of months
in the determination period, and the denominator of which is 12.
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For Plan Years beginning on or after January 1, 1994, any reference in this
Plan to the limitation under Section 401(a)(17) of the Code shall mean the OBRA
'93 annual compensation limit set forth in this provision.
If Compensation or Creditable Compensation for any prior determination
period is taken into account in determining an Employee's benefits accruing in
the current Plan Year, the Compensation or Creditable Compensation for that
prior determination period is subject to the OBRA '93 annual compensation limit
in effect for that prior determination period. For this purpose, for
determination periods beginning before the first day of the first Plan Year
beginning on or after January 1, 1994, the OBRA '93 annual compensation limit is
$150,000.
(14) "Computation Period" means, for purposes of both eligibility and
vesting, the 12 consecutive month period beginning on the date the individual
first completes an Hour of Service and each succeeding 12 consecutive month
period beginning with the first anniversary of the date the individual first
completes an Hour of Service.
(15) "Date of Employment" means, with respect to an Employee, any date on
which the Employee enters into an employment relationship with the Company or a
Related Company by performing an Hour of Service for which the Employee is paid,
or entitled to payment, for the performance of duties.
(16) "Date of Separation" means, with respect to an Employee, the earlier
of:
(a) any date on which the Employee's employment with the Company or
a Related Company terminates by reason of a quit, discharge,
retirement, or death; or
(b) The first anniversary of the first date of a period in which an
Employee remains absent from active employment with the Company
or a Related Company (with or without compensation) for any
reason other than quit, discharge, retirement, or death;
provided, however, that if such Employee's employment with the
Company or a Related Company is deemed to terminate at an
earlier or later date under Article V(I), such earlier or later
date shall be the Employee's Date of Separation for purpose of
determining his Service.
(17) "Defined Contribution Plan" means a plan described in Section 415(k)
of the Code which provides for an individual account for each participant and
for benefits based solely on the amount contributed to the participant's
account, and any income, expenses, gains and losses, and any forfeitures of
accounts of other participants which may be allocated to such participant's
account, except as otherwise provided by Section 414(k) of the Code for hybrid
plans.
(18) "Employee" means an individual who renders services to the Company as
a common law employee or officer, I.E., a person whose compensation from the
Company is subject to federal income tax withholding, who -
(a) is not laid off without pay, on unpaid leave of absence, or on
active duty in the armed forces of any nation or international
body (other than as a member of the inactive reserve of the
armed forces of the United States of America while not
receiving pay from the Company); and
(b) is not included in an employee unit covered by a collective
bargaining agreement (not violated by this Subparagraph (b)) as
to which there is evidence that retirement benefits were the
subject of good faith bargaining, all within the meaning of
Section 410(b)(3)(A) of the Code; and
(c) is compensated on a salaried basis.
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An individual rendering services to the Company purportedly as an
independent contractor shall not be treated as an Employee before the Company
has acknowledged that it must withhold federal income tax from the individual's
compensation.
For purposes of the pension requirements of Section 414(n)(3) of the Code
(but not for purposes of eligibility to participate in the Plan) the term
Employee shall include leased employees as defined in Section 414(n)(2) of the
Code. Under this section of the Code the term leased employee means any person
who is not an employee of the Company or a Related Company (in this paragraph
any of such Companies being referred to as the "recipient") and who provides
services to the recipient if (i) such services are provided pursuant to an
agreement between the recipient and any other person (in this paragraph called
the "leasing organization"), (ii) such person has performed such services for
the recipient (or for the recipient and related persons) on a substantially
full-time basis for a period of at least one year, and (iii) such services are
of a type historically performed in the business field of the recipient by
employees. Contributions or benefits provided by the leasing organization which
are attributable to services performed for the recipient shall be treated as
provided by the recipient. However, a leased employee shall not be considered
an Employee if (i) such employee is covered by a money purchase pension plan
providing (aa) a nonintegrated employer contribution rate of at least 10% of
compensation, as defined in Section 415(c)(3) of the Code, but including amounts
contributed pursuant to a salary reduction agreement which are excludable from
the employee's gross income under Section 125, Section 402(h)(8), Section 402(h)
or Section 403(b) of the Code, (bb) immediate participation, and (cc) full and
immediate vesting, and (ii) leased employees do not constitute more than 20% of
the recipient's nonhighly compensated work force.
(For purposes of meeting the minimum coverage requirements of Section
410(b) of the Code, employee shall mean any employee of the Company or any other
employer required to be aggregated with the Company under Sections 414(b), (c),
(m), or (o) of the Code.)
(19) "Entry Date" means and includes: (1) for Plan Years beginning after
1991, the first day of each quarter of a Plan Year, i.e., January 1, April 1,
July 1 and October 1; and (2) for Plan Years beginning before 1992, January 1
and July 1.
(20) "ERISA" means the Employee Retirement Income Security Act of 1974
(Public Law 93-406), as from time to time amended.
(21) "Excess Contribution" means Excess Contribution as defined in Article
IV(G)(2)(c).
(22) "Fiduciary" means and includes the Trustee, Committee members, and any
other Person who -
(a) Exercises any discretionary authority or discretionary control
respecting management of the Plan or exercises any authority or
control respecting management or disposition of its assets,
(b) Renders investment advice for a fee or other compensation,
direct or indirect, with respect to any moneys or other
property of the Plan, or has any authority or responsibility to
do so,
(c) Has any discretionary authority or discretionary responsibility
in the administration of the Plan,
(d) Is described as a "fiduciary" in Section 3 of ERISA or is
designated to carry out fiduciary responsibilities (other than
trustee responsibilities) pursuant to this Agreement.
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Notwithstanding the foregoing provisions of this definition, the word
"Fiduciary" shall in any particular context not include any Person or category
of Persons to the extent excluded by any applicable Regulation. The Committee
shall be the "Named Fiduciary" with respect to control and management of the
operation and administration of the Plan. The Trustee shall be the "Named
Fiduciary" for custody of Plan assets, the investment of said assets (except
where an Investment Manager has been appointed to manage investments), and the
disbursement of benefits as instructed by the Committee.
(23) "Fixed Account" means an account which has become fixed, Vested, set
apart and segregated pursuant to Article IV(P), regardless of whether or not the
assets thereof shall be commingled with any other such account or accounts.
(24) "Highly Compensated Employee" means any Employee of the Company or a
Related Company who, during a particular Plan Year or the preceding Plan Year -
(a) Was at any time a 5-percent owner as defined in Code Section
416(i)(1);
(b) Received aggregate compensation from the Company or any Related
Company in excess of the Adjusted Equivalent of $75,000;
(c) Received aggregate compensation from the Company or any Related
Company in excess of the Adjusted Equivalent of $50,000 and was
in the top paid group of Employees for the Plan Year; or
(d) Was at any time an officer of the Company or a Related Company
and received compensation greater than 50 percent of the amount
in effect under Code Section 415(b)(1)(A) for the Plan Year;
provided that an Employee not described in (b), (c) or (d) above for the
preceding Plan Year shall not be treated as being described in (b), (c) or (d)
for the current Plan Year unless such person is a member of the group of 100
Employees paid the greatest compensation from the Company or any Related Company
during the current Plan Year. As used above in this Section A(24),
"compensation" means compensation as described in Code Section 415(c)(3)
increased by Elective Contributions and by any other compensation not includible
in gross income under Section 125 of the Code; "top paid group" means the group
consisting of the top 20-percent of Employees when ranked on the basis of Plan
Year compensation; and Employee means Employee as defined in Article I(A)(18)
but without regard to (b) of that provision and without restricting such term to
employees of the Company. Furthermore, with respect to any Plan Year, the Plan
Administrator may make the calendar year calculation election provided under
Regulation Section1.414(q)-1T, Q&A-14(b).
For purposes of (d) above no more than 50 Employees (or, if lesser, the
greater of three Employees or 10% of the Employees) shall be treated as
officers. If for any Plan Year no officer of the Company or a Related Company
meets the compensation requirements of (d) above, the highest paid officer for
such Plan Year shall be treated as a Highly Compensated Employee.
A former Employee who Separated from the Service of the Company or a
Related Company prior to the Plan Year for which the determination of Highly
Compensated Employees is being made shall be treated as a Highly Compensated
Employee if such Employee was a Highly Compensated Employee in the Plan Year of
separation or in any Plan Year ending on or after the Employee's 55th birthday.
If an Employee is during a particular Plan Year a family member of a 5-
percent owner or of a Highly Compensated Employee who is one of the 10 most
highly compensated Employees (ranked on the basis of compensation paid by the
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<PAGE>
Company or any Related Company) during such Plan Year, then such Employee shall
not be considered a separate Employee, and any compensation paid to the Employee
and any contribution made on his behalf under the Plan shall be treated as paid
to (or on behalf of) the 5-percent owner or top-ten compensated Employee. For
these purposes, "family member" means the spouse or any lineal ascendant or
descendant of such 5-percent owner or top-ten Employee as well as the spouses of
such lineal ascendants and descendants.
(25) "Hour of Service" means with respect to an employee of the Company:
(a) Each hour for which an employee is paid, or entitled to
payment, for the performance of duties for the Company during
the applicable Computation Period, with such hours being
credited to the employee for the Computation Period in which
such duties were performed;
(b) Each hour for which an employee is paid, or entitled to
payment, by the Company on account of a period of time during
which no duties are performed (irrespective of whether the
employment relationship has terminated) due to vacation,
holiday, illness, incapacity (including disability), layoff,
jury duty, military duty or leave of absence; provided, however
that no more than 501 hours of service are required to be
credited under this item (b) to an employee on account of any
single continuous period during which the employee performs no
duties (whether or not such period occurs in a single
Computation Period);
(c) Each Hour of Service for which he receives credit pursuant to
Article V(I), provided that the counting of such hours shall
not cause an individual who does not meet the requirements of
Article I(A)(18)(a) to become a Participant while temporarily
absent for a reason described in Article V(I); and
(d) Each hour for which back pay irrespective of mitigation of
damages, has been either awarded or agreed to by the Company.
These hours shall be credited to the employee for the
Computation Period or periods to which the award or agreement
pertains rather than the Computation Period in which the award,
agreement or payment is made.
(e) An Employee who completes at least one Hour of Service during a
calendar month shall be credited with 190 Hours for each such
period of service.
(f) Hours shall not be credited under (a), (b) and/or (c), (d) and
under (e) of this subparagraph (25).
Also, solely for purposes of determining whether a One-Year Break in
Service for eligibility and Vesting purposes has occurred, but not for purposes
of determining the number of Years of Service of an Employee or Participant for
eligibility or Vesting purposes, nor for any other purpose under the Plan, an
Employee or Participant who is absent from work by reason of maternity or
paternity shall be deemed to have completed Hours of Service during such absence
subject to the following terms and conditions:
(g) Absence from work by reason of maternity or paternity means and
includes any absence (i) by reason of the pregnancy of the
individual, (ii) by reason of the birth of a child of the
individual, (iii) by reason of the placement of a child of the
individual in connection with the adoption of such child by
such individual, or (iv) for purposes of caring for such child
for a period beginning immediately following such birth or
placement,
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<PAGE>
(h) The number of Hours of Service deemed to have been completed
during any such absence (not to exceed 501) shall be the number
of Hours of Service which otherwise normally would have been
credited to such Employee or Participant but for such absence,
or in any case when the Committee is unable to determine such
number of hours, eight Hours of Service per day of such
absence,
(i) Hours of Service shall be deemed to have been completed during
an absence under this paragraph only in the Computation Period
in which the absence begins if an Employee or Participant would
be prevented from incurring a One-Year Break in Service in such
Computation Period solely because Hours of Service are deemed
to have been completed during such absence, or in any other
case in the immediately following Computation Period,
(j) No Hour of Service shall be deemed to have been completed
during an absence under this paragraph unless the Employee or
Participant furnishes to the Committee such timely information
as the Committee may reasonably require to establish that the
absence is for a reason described in (g) above and the number
of days of such absence, and
(k) Nothing in this paragraph shall be deemed to prevent the
crediting of Hours of Service for any purpose under the Plan
under Article II(D), even though such hours are not required to
be credited under (g) through (j) above.
The word Company as used in this paragraph shall be deemed to include any
Related Company. The foregoing definition shall be interpreted in accordance
with the rules set forth in Department of Labor Regulations
SectionSection 2530.200b-2(b) and 2530.200b-2(c), the contents of which are
hereby incorporated herein by reference.
(26) "Investment Manager" means a Fiduciary which has fully complied with
the provisions of Section 3(38) of ERISA and has provided the Committee and the
Trustee with written acknowledgement that he has done so and is a Fiduciary with
respect to the Plan.
(27) "Limitation Year" shall mean the Plan Year unless the Company has
designated a different 12 consecutive month period pursuant to a written
resolution of its Board of Directors or by action of its Benefits Administration
Committee.
(28) "Lump Sum" means one or more payments all made within a single taxable
year of the recipient.
(29) "Normal Retirement Age," in respect of any Participant, means his 65th
birthday.
(30) "Normal Retirement Benefit" means the benefit payable under
Article V(A).
(31) "Normal Retirement Date," in respect of any Participant, means the
first day of the month coinciding with or next following his Normal Retirement
Age.
(32) "One-Year Break in Service" means a period of twelve (12) consecutive
months beginning with a Date of Separation (or anniversary thereof) and not
including any subsequent Date of Employment, during which period the individual
does not perform an Hour of Service for the Company or any Related Company. For
purposes of determining whether a break in service has occurred, any absence
from work by reason of maternity or paternity of up to twelve (12) consecutive
months commencing on the first anniversary of such absence shall be deemed not
to result in a Date of Separation. An absence from work by reason of maternity
or paternity means and includes an absence
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<PAGE>
from work (i) by reason of the pregnancy of the individual, (ii) by reason of
the birth of a child of the individual, (iii) by reason of the placement of a
child with the individual in connection with the adoption of such child by such
individual, (iv) for purposes of caring for such child for a period beginning
immediately following such birth or placement, all within the meaning of Section
410(a)(5)(E) of the Code. No credit will be given under the Plan for any such
absence unless the individual furnishes to the Committee such timely information
as the Committee may reasonably require to establish that the absence from work
is for a reason referred to above and the period during which there was such an
absence.
(33) "Participant" means a person who at the time in question is
participating in the Plan pursuant to Article II.
(34) "Person" means any individual, corporation or other entity mentioned
in Section 3(9) of ERISA.
(35) "Plan Year" means the fiscal year on which the records of the Plan are
kept, which shall be the twelve consecutive month period ending on December 31,
i.e., a calendar year.
(36) "Regulation" shall be construed as a reference to a regulation,
ruling, or other interpretation, validly promulgated by the Department of
Treasury or Department of Labor, as the case may be, and in effect at the time
in question.
(37) "Related Company" means and includes (i) each organization, whether or
not incorporated, which is a service organization and is a member of an
affiliated service group (within the meaning of Section 414(m) of the Code) of
which the Company is a member, (ii) all corporations which are members of a
controlled group of corporations (within the meaning of Section 414(b) of the
Code) of which the Company is a member, (iii) each trade or business, whether or
not incorporated, which is under common control (within the meaning of
Section 414(c) of the Code) with the Company and (iv) any other entity required
to be aggregated with the Company pursuant to Regulations under Section 414(o)
of the Code; provided that no such corporation, organization, trade or business
shall be considered to be a Related Company at any time prior or subsequent to
the period of time during which it meets the foregoing definition; provided
further that the status of being employed by a Related Company shall only
pertain to an individual during the period of time when his employer is a
Related Company, and not to any period of time prior or subsequent to its
Related Company status.
(38) "Separation (or Separated) from Service" means separation (or
separated) from the service of the Company within the meaning of Section
410(a)(4) of the Code.
(39) "Service" means and includes (i) each period of an Employee's
employment with the Company or a Related Company beginning with a Date of
Employment and ending on the next following Date of Separation, and (ii) each
period following a Date of Separation and ending on the Employee's next Date of
Employment if such next Date of Employment is within the twelve (12) consecutive
month period following such Date of Separation; provided, however, that if the
Employee's Date of Separation occurs while the Employee is absent from active
employment with the Company or a Related Company the period following such Date
of Separation and ending on the next following Date of Employment shall be
included as Service only if such Date of Employment occurs within the twelve
(12) consecutive month period following the commencement of such absence from
active employment.
(40) "Trust Fund" means and includes any and all property which shall
comprise the corpus of the Trust at the inception thereof, together with any
contributions thereto and such other property as shall from time to time become
subject to the Trust, and any and all property acquired by the Trustee in
substitution for any such contributions or other property, and any and all
accumulations thereon, increments thereof, and accretions thereto, less
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<PAGE>
amounts paid out or sustained as distributions, expenses, losses or otherwise;
provided, further, that Contracts (as hereafter defined) shall be deemed to be
property and included in the Trust Fund, except as otherwise expressly stated in
this Agreement.
(41) "Vested" when used with respect to a benefit, right or account
hereunder, means a claim obtained by a Participant or his Beneficiary to that
part of an immediate or deferred benefit under the Plan (arising from the
Participant's service) which is unconditional and legally enforceable against
the Trust; but a right to an Accrued Benefit derived from Company contributions
shall not fail to meet this definition solely (i) because it is not payable if
the Participant dies, or (ii) because the payment of benefits is suspended
during the period that the Participant is employed by the Company.
(42) "Year of Service" means a twelve (12) consecutive month period of
Service during which the Employee is credited with at least one (1) Hour of
Service in each month.
(43) Definitions of the following words and phrases are contained in the
following provisions, respectively:
Actual Contribution
Percentage Article IV(F)
Actual Deferral
Percentage Article IV(E)
Company Opening Paragraph
Contribution Percentage Article IV(F)
Deferral Percentage Article IV(E)
Defined Benefit Plan Article IV(D)(4)(a)
Defined Benefit Plan
Fraction Article IV(D)(4)(b)
Defined Contribution
Plan Fraction Article IV(D)(4)(d)
Elective Contribution Article III(B)
Elective Contributions
Account Article IV(B)
Excess Contribution Article IV(G)(2)(c)
Excess Elective
Deferrals Article III(B)
Excess Matching
Contributions Article IV(H)(3)
Great Lakes Bancorp
Stock Article IV(S)
Investment Fund Article IV(J)
Matching Company
Contribution Article III(C)
Matching Company
Contributions Account Article IV(C)
Plan Opening Paragraph
Qualified Matching
Contributions Article IV(G)(2)(b)
Qualified Nonelective
Contributions Article IV(G)(2)(a)
Re-employment
Commencement Date Article V(C)(2)(a)
Required Beginning
Date Article V(D)(2)
Rollover Contribution Article XI(F)
Supplementary Company
Contributions Article III(A)
Supplementary Company
Contributions Account Article IV(A)
Top Heavy Plan and
Related Definitions Article XIII
Trust Opening Paragraph
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<PAGE>
Trustee Opening Paragraph
Valuation Date Article IV(P)(1)
B. GOVERNING LAW AND RULES OF CONSTRUCTION. This Agreement shall be governed
in all respects, whether as to construction, capacity, validity, performance or
otherwise, by applicable Federal law and, to the extent that Federal law is
inapplicable, by the laws of the State of Michigan. Wherever reasonably
necessary, pronouns of any gender shall be deemed synonymous, as shall singular
and plural pronouns. The index to this Agreement and the headings to the
Articles and paragraphs of this Agreement are included solely for convenience
and shall in no event affect, or be used in connection with, the interpretation
of this Agreement. Each provision of this Agreement shall be treated as a
severable, to the end that, if any one or more provisions shall be adjudged or
declared illegal, invalid or unenforceable, this Agreement shall be interpreted,
and shall remain in full force and effect, as though such provision or
provisions had never been contained in this Agreement.
C. POWER TO INTERPRET. This Agreement shall be interpreted and effectuated to
comply with the applicable requirements of ERISA and the Code; and all such
applicable requirements are hereby incorporated herein by reference. Any
reference in this Agreement to the requirements of ERISA or any section or title
thereof shall be construed with due regard to Sections 108, 109 and 110 of
ERISA. Subject to the above, the Committee shall have power to construe and
interpret this Agreement, including but not limited to the power to construe and
interpret all provisions of this Agreement relating to eligibility for benefits
and the amount, manner, and time of payment of benefits, any such construction
and interpretation by the Committee and any action taken thereon in good faith
by any Administrative Party to be final and conclusive upon any affected party.
The Committee shall also have power to correct any defect, supply any omission,
or reconcile any inconsistency in such manner and to such extent as the
Committee shall deem proper to carry out and put into effect this Agreement; and
any construction made or other action taken by the Committee pursuant to this
Paragraph (C), if and when communicated in writing to any other Administrative
Party or affected party, shall be binding upon such other party and may be
relied upon by such other party.
D. ADOPTION OF PLAN BY RELATED COMPANIES. Any Related Company may adopt this
Agreement and the Plan and Trust for the benefit of its eligible employees by
the written request of its President or any Senior Vice-President, such action
to be approved in advance or subsequently ratified by its Board of Directors,
but only with the consent of the Bank evidenced by a resolution of the Benefits
Administration Committee or the written consent of its Chairperson. Unless the
context otherwise requires, at any time while a Related Company has adopted this
Agreement (i) the term Company as used herein with respect to any Employee or
Participant shall be construed to mean the adopting corporation by which such
Employee or Participant is employed, and (ii) whenever the term Company is used
in connection with action to be taken in connection with the Plan, or its
administration, e.g., in Article X relating to the termination or amendment of
the Plan or in Article VIII(A) relating to the appointment of the Committee, the
term Company shall mean Company as defined in the opening paragraph of this
Agreement. A transfer of employment by a Participant between Related Companies
shall not be considered a termination of employment requiring a distribution
from the Trust. The Plan was extended to eligible employees of Dollar Federal
Savings Bank of Hamilton, Ohio on January 1, 1991.
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<PAGE>
ARTICLE II
PARTICIPATION
A. ELIGIBILITY. Any Employee who has (i) attained the age of twenty-one (21)
years or more and (ii) completed at least one Year of Service shall become a
Participant automatically on the Entry Date coinciding with or next succeeding
the first date when said conditions are fulfilled. As a consequence of becoming
a Participant the Employee shall be entitled to allocations of any Supplementary
Company Contributions in accordance with Article IV(A) and shall be eligible to
elect as of the Entry Date on which he becomes a Participant, or as of any later
Entry Date on which he is a Participant, to reduce his Creditable Compensation
and to have the Company make Elective Contributions on his behalf to the Trust
in the amount of such reductions in accordance with Article III(B).
B. BREAKS IN SERVICE. For purposes of determining eligibility to participate
all Years of Service with the Company shall be counted, except that -
(1) In the case of a Participant or other Employee who does not have a
Vested right to an Accrued Benefit derived from Company contributions, i.e., who
is not Vested in any part of an account balance under the Plan derived from
Company contributions, Years of Service prior to a period of five consecutive
One-Year Breaks in Service shall not be counted (excluding from the number of
Years of Service before such period any Years of Service not required to be
counted hereunder by reason of any prior break in service).
(2) Notwithstanding paragraph (1) above, if as of the day before the first
day of the Plan Year beginning in 1985 any Years of Service prior to such date
were not required to be counted for purposes of determining eligibility under
the Plan as then in effect, such Years of Service shall not be counted
hereunder.
(3) No individual shall be eligible to become a Participant as of any
Entry Date when he is not an Employee.
C. REEMPLOYMENT. A former Participant or Employee shall be subject to the
following rules with respect to participation in the Plan upon reemployment:
(1) A former Employee who, after satisfying the minimum age and service
requirement, terminates employment before the next Entry Date, and subsequently
is reemployed by the Company or a Related Company before incurring a One-Year
Break in Service, shall become a Participant as soon as administratively
feasible after again becoming an Employee.
(2) A former Employee who (i) did not have a Vested right to an Accrued
Benefit derived from Company contributions on the date his employment with the
Company or a Related Company terminated, (ii) incurred a period of consecutive
One-Year Breaks in Service which equaled or exceeded five, and (iii)
subsequently is reemployed by the Company or a Related Company, shall become
eligible, or again become eligible, to participate in the Plan upon meeting anew
the eligibility requirements of Article II(A) above.
(3) A former Participant who is reemployed by the Company or a Related
Company shall again become a Participant as soon as administratively feasible
after again becoming an Employee.
D. INACTIVE PARTICIPANTS. Subject to Article IV(P)(1) and (R) with respect to
certain Participants, it is agreed as follows:
(1) During any period when a Participant fails to conform to the
definition of an Employee because he is covered by a collective bargaining
agreement within the meaning of Article I(A)(18)(b) but is still employed by the
Company or because he is transferred to employment with a Related Company which
has not adopted the Plan for its eligible employees, he shall be deemed an
inactive Participant and during such period no Compensation paid to him by
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the Company shall be taken into account for the purpose of allocating
Supplementary Company Contributions or forfeitures of the same under Article IV
or otherwise under the Plan. However, he shall continue to be treated as a
Participant for other Plan purposes including the periodic adjustments to
accounts of Participants described in Article IV(O)(1), (2), (4) and (5). If
such an inactive Participant again conforms to the definition of an Employee he
subsequently shall be treated as an active Participant for all Plan purposes and
Compensation paid to him thereafter by the Company shall be taken into account
for the foregoing purposes.
(2) During any period (i) when an election under Article III(B) to reduce
the Creditable Compensation which a Participant otherwise would be entitled to
receive and to have the Company make Elective Contributions to the Trust on his
behalf is not in effect, (ii) when a Participant fails to meet the definition of
an Employee because he is covered by a collective bargaining agreement within
the meaning of Article I(A)(18)(b), (iii) when a Participant fails to meet the
definition of an Employee because he is not compensated on a salaried basis
within the meaning of Article I(A)(18)(c), or (iv) when because of a transfer of
employment he is employed by a Related Company which has not adopted the Plan,
he shall be considered an inactive Participant in the Elective Contributions
portion of the Plan and no Elective Contributions will be allocated to his
Elective Account for such period. However, during such period the Participant
shall continue to be treated as a Participant in the Elective Contributions
portion of the Plan for other Plan purposes including the periodic adjustments
to accounts of Participants described in Article IV(O)(1), (2), (4) and (5).
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ARTICLE III
CONTRIBUTIONS
A. SUPPLEMENTARY COMPANY CONTRIBUTIONS. Subject to the limitations of Article
III(D) and (E), the Company shall in respect of each taxable year, within the
time prescribed by law for filing its federal income tax return for such taxable
year (including extensions thereof), contribute to the Trust in furtherance of
the Plan, in cash or investments authorized under Article IX(G) (General Powers
of Trustee), such amount, if any, as may be determined in the discretion of the
Company by or in accordance with a resolution of its Board of Directors adopted
within the time prescribed by law for filing its federal income tax return for
such taxable year, including extensions thereof, any such amounts being herein
called "Supplementary Company Contributions".
B. ELECTIVE CONTRIBUTIONS; ADJUSTED $7,000 LIMITATION; CORRECTIVE
DISTRIBUTIONS. Subject to the limitations of Article III(D) and (E) and Article
IV(E), each Participant may elect within a reasonable time (to be specified by
the Committee) before any Entry Date, and before any additional regular periodic
dates which the Committee may designate and communicate to Participants, on a
form to be furnished to him by the Committee to reduce the compensation which
otherwise would be paid to him after such Entry Date (or other designated date)
and to have the Company make contributions (herein called "Elective
Contributions") to the Trust in the amounts of such reductions on his behalf,
provided, however, that no Participant may elect to have Elective Contributions
(i) made to the Trust on his behalf of less than 1% or more than 12% of his
Creditable Compensation or (ii) made to the Trust and/or to any other tax
qualified plan of the Company on his behalf of more than the Adjusted Equivalent
of $7,000 in any taxable year of the Participant. Such an election, and any
election to change the same made pursuant to this Agreement, may be made only
with respect to Creditable Compensation which is not currently available to the
electing Participant on the Entry Date (or other designated date) as of which
the election is made.
Elective Contributions obtained by the Company by means of payroll
reductions shall be paid by the Company to the Trustee at the earliest date on
which they can reasonably be segregated from the Company's general assets and in
no event later than 90 days after the date on which such amounts otherwise would
have been paid to the Participant as Creditable Compensation. Subject to the
foregoing, Elective Contributions for a Plan Year shall be made during the Plan
Year or within the time prescribed in (A) above for making Supplementary Company
Contributions for the Plan Year, except that any additional Company
Contributions made under Article IV(G)(2) and treated as Elective Contributions
for the Plan Year may be made within 12 months following the close of the Plan
Year.
A Participant who has elected to have the Company make Elective
Contributions to the Trust on his behalf may, as of any Entry Date and as of any
additional regular periodic dates as the Committee may determine and communicate
to Participants, change the annual dollar amount of such Elective Contributions
or the percentage of Creditable Compensation used to determine the amount of
such Elective Contributions. Also, at any time, a Participant may elect to
terminate his Elective Contributions for the period subsequent to the effective
date of the election. All such elections may be made and become effective only
in accordance with such reasonable rules as may be established by the Committee.
In the event of the termination of Elective Contributions on behalf of a
Participant under this paragraph, the Participant shall not be entitled, until a
subsequent Entry Date, to again elect that Elective Contributions be made on his
behalf.
If the Elective Contributions made to the Trust on behalf of a Participant
under the Plan together with any elective deferrals (as defined in Section
402(g)(3) of the Code) under another qualified cash or deferred arrangement as
defined in Section 401(k) of the Code, a simplified employee pension as defined
in Section 408(k) of the Code, a salary reduction arrangement under Section
403(b) of the Code, a deferred compensation plan under Section 457 of the Code,
or a trust described in Section 501(c)(18) of
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the Code, cumulatively exceed the limitation imposed by Section 402(g) of the
Code for the Participant's taxable year, the Participant may, not later than
March 1 following the close of such taxable year, notify the Committee in
writing of the excess Elective Contributions made to the Trust (in this
Agreement called "Excess Elective Deferrals") and request that such Excess
Elective Deferrals be paid to the Participant. With respect to the Plan and any
other plan of the Company or a Related Company in which an Employee
participates, such individual shall be deemed to have notified the Committee
regarding Excess Elective Deferrals and to have requested that the total such
excess deferrals (and income thereon) be distributed, but taking into account
only elective deferrals under this Plan and any other plan of the Company or a
Related Company; furthermore, under such circumstances the Company may notify
the Committee on behalf of such individual. Such amount shall then be
distributed in the same manner as provided at the outset of this paragraph.
In such event the Committee may direct the Trustee to pay such Excess
Elective Deferrals plus any income, or less any loss, allocable to the same to
the Participant not later than the first April 15 following the close of such
taxable year. At the request of the Participant Excess Elective Deferrals for a
taxable year of the Participant may be paid to the Participant from the Trust
during the taxable year for which they were made if the Committee so directs the
Trustee, provided that in such event (i) the Participant designates the payment
as an Excess Elective Deferral, (ii) the payment is made after the date on which
the Trustee received the Excess Elective Deferral, and (iii) the Committee
designates the payment as a distribution of Excess Elective Deferrals.
Notwithstanding the foregoing, a Participant's Excess Elective Deferrals
for the taxable year of the Participant shall be reduced, but not below zero, by
any distribution of Excess Contributions made to the Participant pursuant to
Article IV(G) for the Plan Year beginning with or within the taxable year of the
Participant.
The income or loss allocable to an Excess Elective Deferral paid to a
Participant by the Trustee shall be an amount equal to the income or loss of the
Participant's Elective Contributions Account for the taxable year of the
Participant for which the Excess Elective Deferral was made multiplied by a
fraction the numerator of which is the Excess Elective Deferral made on behalf
of the Participant for such taxable year and the denominator of which is the
Participant's Elective Contributions Account balance as of the end of such
taxable year not counting any income or loss allocable to such account for such
taxable year and, solely for Plan Years beginning before 1991, an additional 10%
of the amount determined above multiplied by the number of calendar months
between the end of the taxable year and the date of payment to the Participant
counting the month in which payment is made only if payment is made after the
15th day of such month.
Elective contributions made by a Participant which exceed the percentage
limit specified in this Article III(B) shall be refunded, along with allocable
income, in the same manner as Excess Elective Deferrals.
Notwithstanding the above, effective October 1, 1994, no further Elective
Contributions may be made to the Plan during the Plan Year which began on
January 1, 1994. Furthermore, effective January 1, 1995, no Participant may
elect to have Elective Contributions made to the Trust on his behalf of more
than 6% of his Creditable Compensation.
C. MATCHING COMPANY CONTRIBUTIONS. Subject to the limitations of Article
III(D) and (E) and Article IV(F) and the rights and obligations of the Committee
under Article IV(G) and (H) to monitor and make adjustments in certain
contributions, the Company shall contribute to the Trust for each Plan Year on
behalf of each Participant for whom it makes Elective Contributions for such
Plan Year matching contributions (herein called "Matching Company
Contributions") in an amount equal to twenty-five percent (25%) of that portion
of his Elective Contribution which is invested in the Great Lakes Bancorp Stock
Fund and which does not exceed the lesser of Two Thousand
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Dollars ($2,000.00) or four percent (4%) of the Participant's Creditable
Compensation for the portion of the Plan Year in which he was a Participant and
made Elective Contributions. Effective April 1, 1993, the specific amounts
described above are changed to fifty percent (50%), Three Thousand Six Hundred
Dollars ($3,600) and six percent (6%) respectively. The Company in addition to
the amount described above may contribute as additional Matching Company
Contributions for any Plan Year an amount set in the discretion of the Company.
Such amounts shall be allocated as a percentage of each Participant's Elective
Contribution, but may be limited to a specified dollar amount. A Participant's
Elective Contribution for the Plan Year for purposes of this Paragraph (C) means
his Elective Contribution remaining after distribution to him of any Excess
Elective Deferrals under Article III(B) and any Excess Contributions under
Articles IV(D)(1) or IV(G)(2)(c) for such Plan Year. The Company shall
contribute all such Matching Company Contributions to the Trust for each Plan
Year in Great Lakes Bancorp Stock from time to time during such Plan Year, or
after the end of such Plan Year but not later than the time prescribed by law
for filing its federal income tax return for its taxable year with respect to
which the Matching Company Contribution is made, including extensions thereof.
Pursuant to Article IV(Q)(3), for Plan Years beginning after 1990, Matching
Company Contributions required to be made to the Trust under this Article III(C)
shall be reduced by any forfeitures of Matching Company Contributions under
Article V(C). Prior to the beginning of any Plan Year the Company may determine
and communicate to Participants any change to be made to the amount of the
Matching Company Contribution, if any, to be made for Participants for such Plan
Year. The Company shall make Matching Company Contributions to the Plan for
Participants in the amounts so determined and communicated to Participants.
D. LIMITATIONS ON COMPANY CONTRIBUTIONS. The Company Contributions to the
Trust for any taxable year of the Company shall not exceed the least of:
(1) The aggregate Company Contributions permitted by Article IV(D)
(specifying maximum Annual Additions) as applied to all Participants;
(2) An amount equal to 15% of the aggregate Compensation paid during such
taxable year to Employees who are Participants as of the Anniversary Date
falling within such taxable year, plus the amount of any unused pre-87
limitation carry forwards available under Section 404(a)(3)(A)(v) of the Code in
respect of such taxable year; or
(3) The Company contributions permitted by Article III(E) (pertaining to
two or more plans).
E. TWO OR MORE PLANS. If the Company makes contributions for the taxable year
in question, in connection with one or more additional tax qualified plans
(including annuity plans) whose participants include one or more Participants in
this Plan, the total amount so contributed by the Company for said taxable year,
including its contribution for said taxable year under Paragraphs A, B and C of
this Article III, shall not exceed the greater of (i) 25% of the Compensation
otherwise paid during said taxable year to the participants in said additional
plans and the Participants in this Plan or (ii) the amount of Company
contributions necessary to satisfy the minimum funding standard provided by
Section 412 of the Code for the Plan Year which ends with or within said taxable
year (or for any prior Plan Year), all within the meaning of Section 404(a)(7)
of the Code; provided that:
(1) If any carry-over deduction is available to the Company for said
taxable year from one or more prior taxable years under Section 404(a)(7)(B),
the amount thereof shall reduce the limitation set forth in the foregoing
portion of this Paragraph (E).
(2) If said limitation (reduced, if appropriate, under (1) above) would
otherwise be exceeded, the Company's contribution under this
Plan for said taxable year shall be reduced by an amount equal to the excess.
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<PAGE>
F. DEDUCTIBILITY. All Company Contributions to the Trust are conditioned upon
the Plan and Trust being initially tax qualified and upon deductibility under
Section 404 of the Code, unless otherwise expressly stated by the Company.
Accordingly (unless so stated), if the Plan and Trust are submitted to the
Internal Revenue Service for a determination letter within the time provided by
law for filing the Company's federal income tax return for the fiscal year of
the Company in which the Plan and Trust were adopted or by such later date as
the Secretary of the Treasury may prescribe, and are determined to be not
initially tax qualified, or if and to the extent that such a deduction is
disallowed within the meaning of Section 403(c)(2) of ERISA, the contribution in
question shall be repaid to the Company upon demand (but subject to
Paragraph (H) below and, if by reason of disallowance, only to the extent
disallowed) within one year after such disallowance or denial of initial
qualification. Any Elective Contributions so returned to the Company shall be
paid by the Company to the Employees on whose behalf they were made. If any
Company contribution for any taxable year shall exceed the amount deductible for
said taxable year under the Code, but shall not be repaid pursuant to the
foregoing sentence, the portion not so deductible shall in like amount reduce
the contribution required in respect of the subsequent taxable year during which
the disallowance or other determination of nondeductibility is made and (to the
extent not thereby consumed) any subsequent taxable year or years.
G. CONTRIBUTIONS BY MISTAKE. If and to the extent that a Company contribution
to the Trust is made as a result of facts and circumstances constituting a good
faith mistake of fact, the same shall be repaid to the Company upon demand (but
subject to Paragraph (H) below and only to the extent of such mistake) within
one year after the payment of the contribution. Any Elective Contributions so
returned to the Company shall be paid by the Company to the Employees on whose
behalf they were made.
H. LIMITATION ON REPAYMENTS. All repayments of Company Contributions under
Paragraphs (F) and (G) above shall be subject to the conditions that:
(1) Such repayment shall not include any earnings attributable to that
portion of the Company contribution which qualifies for repayment under
Paragraphs (F) and (G) above.
(2) There shall be deducted from the amount of such repayment any losses
attributable to that portion of the Company Contribution which qualifies for
repayment under Paragraphs (F) and (G) above.
(3) If in any event such repayment would result in any Participant's
account being reduced to a balance which is less than the balance which would
have been in his account had the amount contributed by mistake of fact or in
excess of the deductible amount not been contributed, then the amount to be
repaid shall be reduced until no Participant's account shall be so reduced by
reason of such repayment.
I. NO AFTER-TAX EMPLOYEE CONTRIBUTIONS. No Employee shall make any
nondeductible (after-tax) employee contributions to the Trust for any Plan Year
beginning after 1986. This prohibition shall not prevent rollovers or transfers
to the Trust permitted under Article XI(F). If this Agreement permitted
nondeductible employee contributions prior to the Plan Year beginning after 1986
and any Participant made such contributions, such contributions and earnings
thereon shall be fully vested and shall continue to be maintained in a separate
account by the Trustee for each such Participant. Also, the provisions of this
Agreement relating to nondeductible employee contributions in effect for Plan
Years prior to the Plan Year beginning after 1986 shall continue to apply to
such separate accounts.
J. CORRECTIVE CONTRIBUTIONS. If it becomes necessary to make additional
amounts available pursuant to Article IV(G), (H) or (I) in order to pass the
discrimination tests of Article IV(E) or (F), to correct mistakes made in
amounts distributed from or credited to Accounts, or to restore the portion of a
Participant's Account which was forfeited pursuant to any provision of the
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Plan, the additional contribution, correction or restoration shall first be made
out of Employer contributions and forfeitures and then out of Trust Fund
earnings for the Plan Year in question, but only to the extent that such amounts
have not already been allocated under the provisions of the Plan. Any
additional amounts needed may be provided by a special contribution to the Plan
which the Company, at its sole discretion (but subject to the applicable
limitations on deductible contributions and maximum annual additions), may elect
to make. Any such special contribution shall be allocated or credited in the
fashion specified by the Committee.
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<PAGE>
ARTICLE IV
ALLOCATION AND ACCOUNTS
A. SUPPLEMENTARY COMPANY CONTRIBUTIONS ACCOUNTS. The Trustee shall establish
an account (herein called a "Supplementary Company Contributions Account") for
each Participant who is not a Highly Compensated Employee and shall thereafter
maintain a record thereof. Supplementary Company Contributions under Article
III(A) for any taxable year shall, subject to the limitations of Article IV(D)
and to Article II(D) regarding inactive Participants, promptly upon receipt be
allocated among the various eligible Participants' Supplementary Company
Contributions Accounts, as of the Anniversary Date falling within such taxable
year, as follows:
(1) The amount allocated to each eligible Participant's Supplementary
Company Contributions Account (including the Supplementary Company Contributions
Account of any individual who first became an eligible Participant as of any
Entry Date falling within such taxable year) shall be that portion of the
Company's Supplementary Company Contributions which the Creditable Compensation
paid to such Participant in the taxable year bears to the total Creditable
Compensation paid to all the eligible Participants in the taxable year.
(2) A Participant shall be eligible to receive a Supplementary Company
Contribution only if he is not a Highly Compensated Employee and only if he both
completes a Year of Service during the Plan Year and is still an Employee on the
Anniversary Date except to the extent required by Article IV(P)(1) relating to
certain terminating Participants.
B. ELECTIVE CONTRIBUTIONS ACCOUNTS. The Trustee shall establish an account
(herein called an "Elective Contributions Account") for each Participant and
shall thereafter maintain a record thereof. Elective Contributions under
Article III(B) for any Plan Year shall, subject to the limitations of Paragraphs
(D) and (E) of this Article IV, be credited to the Participant's Elective
Contributions Account upon receipt by the Trustee not less frequently than
monthly and in no event later than as of the Anniversary Date falling within
such Plan Year.
C. MATCHING COMPANY CONTRIBUTIONS ACCOUNTS. The Trustee shall establish an
account (herein called a "Matching Company Contributions Account") for each
Participant in respect of whom the Company makes a Matching Company Contribution
to the Trust and shall thereafter maintain a record thereof. Matching Company
Contributions under Article III (C) for any Plan Year in respect of each
Participant shall be credited to the Participant's Matching Company
Contributions Account upon receipt by the Trustee and in no event later than as
of the Anniversary Date falling within such Plan Year.
D. LIMITATIONS ON ANNUAL ADDITIONS TO ACCOUNTS. Notwithstanding the foregoing
provisions of Paragraphs (A), (B) and (C) of this Article IV or of Article III,
the contributions and other additions with respect to any one Participant for
any such taxable year under all Defined Contribution Plans of the Company,
expressed as an Annual Addition to such Participant's account under this Plan
and as annual additions (defined similarly to Article I(A)(7)) allocated to such
Participant's accounts under all other Defined Contribution Plans of the
Company, shall not exceed the lesser of:
(i) The Adjusted Equivalent of $30,000.00, or, if greater,
one fourth of the defined benefit dollar limitation set
forth in Section 415(b)(1) of the Code in effect for the
Plan Year; or
(ii) 25% of the Compensation paid to such Participant by the
Company in such taxable year;
provided that:
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(1) if said limitation would otherwise be exceeded, the
amount allocated to said Participant's Account shall be
reduced by an amount equal to the excess, and Company
Contributions for said Limitation Year shall be reduced
to the extent necessary to avoid such excess; provided,
however, that if such reduction is not possible or
practical in the circumstances because the Company
Contributions for such Limitation Year have been made
at the time it is discovered that said limitation would
otherwise be exceeded and the Committee determines that
the excess part of such contribution cannot be returned
to the Company without adversely affecting the tax
qualified status of the Plan either as a contribution
made as a result of a mistake of fact or by reason of
its nondeductibility, then if such excess was created
as the result of the allocation of forfeitures, a
reasonable error in estimating a Participant's
Compensation or Creditable Compensation, or under other
limited facts and circumstances which the Commissioner
of Internal Revenue finds justify the availability of
the rules set forth in the remainder of this
subparagraph (1), such amount shall be distributed to
the Participant to the extent due to Elective
Contributions and any remaining excess shall be held in
a suspense account, provided (i) no further Company
Contributions will be made to the Trust on behalf of
the Participants for which such excess exists until
they can be allocated to the Accounts of such
Participants without violating the aforesaid
limitation, (ii) investment gains and/or losses and
other Trust income are not allocated to such suspense
account and (iii) the amounts in such suspense account
are allocated to the Accounts of Participants for which
such excess exists as of each subsequent date on which
Company Contributions are normally allocated until such
suspense account is exhausted. In the event the Plan
and Trust are terminated any amount in such suspense
account at the time of termination shall be allocated
to the Accounts of the Participants in the Plan Year in
which the Plan is terminated in the same proportions as
a Company Contribution for such Plan Year would be
allocated, but only to the extent permitted by the
aforesaid limitations on Annual Additions. If after
such allocation any amount remains in such suspense
account, it shall be paid to the Company and to the
extent any such amount consists of Elective
Contributions the Company shall pay the same to the
appropriate Participants.
(2) if said Participant is also a participant in a Defined
Benefit Plan maintained by the Company, the sum of his
Defined Benefit Plan Fraction and his Defined
Contribution Plan Fraction shall not exceed 1.0 for any
taxable year of the Company, except as otherwise
permitted by Section 2004(a) of ERISA; provided,
however, that if this requirement would otherwise be
violated, the Company shall first reduce the amount of
its contributions (or other components of Annual
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Additions) to any said Defined Contribution Plan to the
extent necessary, whether or not including this Plan,
with respect to the Participant in question, and shall
then adjust, freeze or suspend the rate of benefit
accrual under any said Defined Benefit Plan with
respect to the Participant in question, so that such
violation will not occur.
(3) for purposes of applying the foregoing provisions of
this Paragraph (D), all Defined Benefit Plans (whether
or not terminated) of the Company are to be treated as
one Defined Benefit Plan, and all Defined Contribution
Plans (whether or not terminated) of the Company are to
be treated as one Defined Contribution Plan, all within
the meaning of (and to the extent necessary to comply
with) Section 415 of the Code (including, in
particular, subsection (f) thereof) and any applicable
Treasury Regulations thereunder.
(4) for purposes of this Article IV(D) the following terms,
wherever capitalized, shall have the following
meanings, respectively, unless the context otherwise
requires:
(a) "Defined Benefit Plan" means any plan described in
Section 414(j) of the Code (listing tax qualified
and similar plans) which is not a Defined
Contribution Plan, except as otherwise provided in
Section 414(k) of the Code for hybrid plans.
(b) "Defined Benefit Plan Fraction" for a Participant
for any Plan Year is a fraction -
(i) The numerator of which is the projected
annual benefit of the Participant under the
Company's Defined Benefit Plan (determined as
of the close of such Plan Year), and
(ii) The denominator of which is the lesser of (1)
the product of 1.25, multiplied by the dollar
limitation in effect under
Section 415(b)(1)(A) of the Code for such
Plan Year, or (2) the product of 1.4,
multiplied by the amount which may be taken
into account under Section 415(b)(1)(B) of
the Code with respect to the Participant
under such Defined Benefit Plan for such Plan
Year.
(c) "Defined Contribution Plan" shall have the meaning
given to this term in Article I(A)(17).
(d) "Defined Contribution Plan Fraction" for a
Participant for any Plan Year is a fraction -
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(i) The numerator of which is the sum of the
Annual Additions to the Participant's account
as of the close of such Plan Year, and
(ii) The denominator of which is the sum of the
lesser of the following amounts determined
for such Plan Year and for each prior year of
service with the Company and/or a Related
Company: (1) the product of 1.25, multiplied
by the dollar limitation in effect under
Section 415(c)(1)(A) of the Code for such
Plan Year and for each prior year of service
with the Company and/or a Related Company, or
(2) the product of 1.4, multiplied by the
amount which may be taken into account under
Section 415(c)(1)(B) of the Code with respect
to such Participant for such Plan Year.
(5) The word Company as used in this Article IV(D) shall be
deemed to include any Related Company unless the
context otherwise requires so that for purposes of
Section 415 of the Code all employees of the Company
and any Related Company shall be treated as employed by
a single employer.
E. SPECIAL LIMITATIONS ON ALLOCATIONS OF ELECTIVE CONTRIBUTIONS. For each
Plan Year beginning after 1986, allocations of Elective Contributions to the
Participants' Elective Contribution Accounts shall be limited so that the Actual
Deferral Percentage for the group of Participants who are Highly Compensated
Employees shall bear a relationship to the Actual Deferral Percentage for the
group of all other Participants which meets either of the following tests:
(1) The Actual Deferral Percentage for the group of Participants who are
Highly Compensated Employees is not more than the Actual Deferral Percentage for
the group of all other Participants multiplied by 1.25, or
(2) The excess of the Actual Deferral Percentage for the group of
Participants who are Highly Compensated Employees over the actual Deferral
Percentage for the group of all other Participants is not more than 2 percentage
points, and the Actual Deferral Percentage for the group of Participants who are
Highly Compensated Employees is not more than the Actual Deferral Percentage for
the group of all other Participants multiplied by 2.
For purposes of this Paragraph (E), "Actual Deferral Percentage" for each
group of Participants referred to above for a Plan Year means the average of the
ratios, calculated separately for each Participant in the group, of the amount
of Elective Contributions paid to the Trust on behalf of the Participant for the
Plan Year, to the Participant's Creditable Compensation paid in that portion of
the Plan Year during which he was a Participant. As separately calculated for
each Participant, such ratio is referred to as his "Deferral Percentage."
The Deferral Percentage of a Participant for whom no Elective Contribution
is made for the Plan Year is zero. For Plan Years beginning after 1988 the
Deferral Percentages of Participants and the Actual Deferral Percentage of each
group of Participants shall be calculated to the nearest one hundredth of one
percent. For purposes of the tests described in (1) and (2) above Elective
Contributions shall include any amounts treated as Elective Contributions under
Article IV(G).
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For purposes of this Paragraph (E), the following special rules shall
apply:
(3) The Deferral Percentage for any Participant who is a Highly
Compensated Employee for the Plan Year and who is eligible to have Elective
Contributions allocated to his accounts under this Plan and under one or more
other plans or arrangements described in Section 401(m) of the Code that are
maintained by the Company or a Related Company shall be determined as if all
such Elective Contributions were made under a single plan or arrangement.
(4) For purposes of determining the Deferral Percentage of a Participant
who is a five percent owner of the Company or one of the ten most highly paid
Highly Compensated Employees, the Elective Contributions and Creditable
Compensation of such Participant shall include the Elective Contributions and
Creditable Compensation of family members, as defined in Article I(A)(24). Such
family members shall be disregarded as separate Participants in determining the
Actual Deferral Percentage for the group of Participants who are not Highly
Compensated Employees.
(5) The determination and treatment of the Elective Contributions and
Deferral Percentage of any Participant shall satisfy such other requirements as
may be prescribed by Regulation. The Company shall maintain for a reasonable
time records sufficient to demonstrate compliance with the Regulations relating
to the Actual Deferral Percentage test described above.
F. SPECIAL LIMITATIONS ON ALLOCATIONS OF MATCHING COMPANY CONTRIBUTIONS. For
each Plan Year beginning after 1986, allocations of Matching Company
Contributions to Participants' Matching Company Contributions Accounts shall be
limited so that the Actual Contribution Percentage for the group of Participants
who are Highly Compensated Employees shall bear a relationship to the Actual
Contribution Percentage for the group of all other Participants which meets
either of the following tests:
(1) The Actual Contribution Percentage for the group of Participants who
are Highly Compensated Employees is not more than the Actual Contribution
Percentage for the group of all other Participants multiplied by 1.25, or
(2) The excess of the Actual Contribution Percentage for the group of
Participants who are Highly Compensated Employees over the Actual Contribution
Percentage for the group of all other Participants is not more than 2 percentage
points, and the Actual Contribution Percentage for the group of Participants who
are Highly Compensated Employees is not more than the Actual Contribution
Percentage for the group of all other Participants multiplied by 2.
For purposes of this Paragraph (F), "Actual Contribution Percentage" for
each group of Participants for a Plan Year means the average of the ratios,
calculated separately for each Participant in the group, of the amount of
Matching Company Contributions paid to the Trust on behalf of each Participant
for the Plan Year, to the Participant's Creditable Compensation paid in that
portion of the Plan Year during which he was a Participant. As separately
calculated for each Participant, such ratio is referred to as his "Contribution
Percentage."
The Contribution Percentage of a Participant for whom no Matching Company
Contribution is made for the Plan Year is zero. For Plan Years beginning after
1988 the Contribution Percentages of Participants and the Actual Contribution
Percentage of each group of Participants shall be calculated to the nearest one
hundredth of one percent. For purposes of the tests described in (1) and (2)
above Matching Company Contributions shall include any amounts treated as
Matching Company Contributions under Article IV(H).
For purposes of this Paragraph (F), the following special rules shall
apply:
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(3) The Contribution Percentage for any Participant who is a Highly
Compensated Employee for the Plan Year and who is eligible to have Matching
Company Contributions allocated to his accounts under this Plan and under one or
more other plans or arrangements described in Section 401(k) of the Code that
are maintained by the Company or a Related Company shall be determined as if all
such Matching Company Contributions were made under a single plan or
arrangement.
(4) For purposes of determining the Contribution Percentage of a
Participant who is a five percent owner of the Company or one of the ten most
highly paid Highly Compensated Employees, the Matching Company Contributions and
Creditable Compensation of such Participant shall include the Matching Company
Contributions and Creditable Compensation of family members, as defined in
Article I(A)(24). Such family members shall be disregarded as separate
Participants in determining the Actual Contribution Percentage for the group of
Participants who are not Highly Compensated Employees.
(5) The determination and treatment of the Matching Company Contributions
and Contribution Percentage of any Participant shall satisfy such other
requirements as may be prescribed by Regulation. The Company shall maintain for
a reasonable time records sufficient to demonstrate compliance with the
Regulations relating to the Actual Contribution Percentage test described above.
G. ADJUSTMENTS TO PREVENT EXCESS ALLOCATIONS OF ELECTIVE CONTRIBUTIONS. In
order to assure that no amounts in excess of the limitations imposed by
Paragraph (E) of this Article IV are allocated to the Elective Contributions
Account of any Participant who is a Highly Compensated Employee, and in the case
of (1) below also to assure that no amounts in excess of the limitations imposed
by Article III(D) and (E) and Article IV(D) are exceeded, the following steps
shall be taken:
(1) The Committee shall monitor elections made by Participants under
Article III(B) and Elective Contributions being made periodically to the Trust
pursuant to such elections and may require changes in the elections of
Participants, prior to or during any Plan Year, which would reduce the Elective
Contributions being made to the Trust on behalf of such Participants and the
Matching Company Contributions being made to the Trust on account of such
Elective Contributions and/or may reduce or terminate such Elective
Contributions and the Matching Company Contributions being made to the Trust on
account of such Elective Contributions at any time, in order to assure
compliance with any of the limitations referred to above.
(2) If notwithstanding the Committee's efforts to monitor allocations to
the Accounts of Participants as required by subparagraph (1) above, the
Committee determines after the end of a Plan Year that the allocations of
Elective Contributions to the Elective Contribution Accounts of Highly
Compensated Employees for such Plan Year exceed the special limitations
described in Paragraph (E) above:
(a) The Company may make additional discretionary contributions to the
Trust for such Plan Year for allocation to separate accounts of
Participants who are not Highly Compensated Employees, or to accounts
of all Participants, in amounts which in combination with Elective
Contributions (and any Qualified Matching Contributions under (b)
below) for such Plan Year are sufficient to cause such special
limitations not to be exceeded. Any such contributions (i) shall be
allocated to separate accounts of such Participants in proportion to
the Creditable Compensation of each paid in that portion of the Plan
Year during which he was a Participant, or if for Plan Years beginning
after 1989 Regulations so require, at any time in the Plan Year, (ii)
shall meet the requirements of Regulation 1.401(k)-1(b)(5), and (iii)
shall normally be made within the time prescribed by law for filing
the Company's federal income tax return for its taxable year with
respect to which the discretionary contribution is made, including
extensions thereof.
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Such special accounts shall be fully Vested at all times, shall be
subject to the same limitations on distributions which are applicable
to Elective Contributions described in Article V(F) and shall be
treated as Elective Contributions for purposes of Article IV(E).
Also, the Company may transfer to separate accounts of the kind
described above any fully Vested Supplementary Company Contributions
made to the Trust for such Plan Year in which event they shall be
treated in the same manner and be subject to the same conditions as
additional discretionary contributions to the Trust under this
subparagraph (a). Contributions made or transferred to separate
accounts pursuant to this subparagraph (a) are referred to in this
Agreement as "Qualified Nonelective Contributions".
(b) The Company may make additional matching contributions to the Trust
for such Plan Year for allocation to separate accounts of Participants
for whom Elective Contributions were made to the Trust for such Plan
Year and who are not Highly Compensated Employees in amounts which in
combination with the Elective Contributions (and any Qualified
Nonelective Contributions under (a) above) for such Plan Year are
sufficient to cause such special limitations not to be exceeded. Any
such additional matching contributions (i) shall be allocated to
separate accounts of such Participants in proportion to the Elective
Contributions made on behalf of each for the Plan Year, (ii) shall
meet the requirements of Regulation 1.401(k)-1(b)(5), and (iii) shall
normally be made within the time prescribed by law for filing the
Company's federal income tax return for its taxable year with respect
to which the matching contribution is made, including extensions
thereof. Such special accounts shall be fully Vested at all times and
shall be subject to the same limitations on distributions which are
applicable to Elective Contributions described in Article V(F) and
shall be treated as Elective Contributions for purposes of Article
IV(E). Also, the Company may transfer to separate accounts of the
kind described above any Supplementary Company Contributions and
Matching Company Contributions, which are not fully Vested and subject
to the limitations of Article V(F), made to the Trust for such Plan
Year in which event they shall be treated in the same manner and be
subject to the same conditions as additional matching contributions to
the Trust under this subparagraph (b). Contributions made or
transferred to separate accounts pursuant to this subparagraph (b) are
referred to in this Agreement as "Qualified Matching Contributions".
(c) The Committee may direct the Trustee to distribute to Participants who
are Highly Compensated Employees that portion of the Elective
Contributions made to the Trust on their behalf for such Plan Year
which exceeds the special limitations of Article IV(E) (in this
Agreement called "Excess Contributions") adjusted for earnings or
losses. Any Excess Contributions, as so adjusted, to be distributed
to Participants shall be designated as Excess Contributions by the
Company and be distributed after the close of the Plan Year for which
they were made normally within 2 1/2 months after the end of such Plan
Year, and in any event not later than 12 months after the end of such
Plan Year. (If such Excess Contributions are distributed after 2 1/2
months after the end of such Plan Year an excise tax is imposed on the
Company with respect to the same.)
(d) The Excess Contribution for the Plan Year, if any, for each
Participant who is a Highly Compensated Employee shall be determined
and distributed as follows:
(i) The Deferral Percentage of the Highly Compensated Employee with
the highest Deferral Percentage shall be reduced to the extent
required to either (A) enable the Plan to satisfy one
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<PAGE>
of the Actual Deferral Percentage tests of Article IV(E), or (B)
cause the Highly Compensated Employee's Deferral Percentage to
equal the Deferral Percentage of the Highly Compensated Employee
with the next highest Deferral Percentage. This process shall be
repeated until the Plan satisfies one of the Actual Deferral
Percentage tests of Article IV(E). When and if the Deferral
Percentages of two or more Highly Compensated Employees to be
reduced are the same, such percentages shall be reduced equally
and simultaneously.
(ii) The Excess Contribution to be distributed to each Highly
Compensated Employee whose Deferral Percentage is reduced under
(i) above shall be the Elective Contributions made to the Trust
for the Plan Year on behalf of the Highly Compensated Employee
(determined prior to the application of this subparagraph (d))
minus the amount determined by multiplying the Highly Compensated
Employee's Creditable Compensation by his Deferral Percentage
(determined after the application of this subparagraph (d)).
(e) The income or loss allocable to an Excess Contribution distributed to
a Highly Compensated Employee under (c) and (d) above by the Trustee
shall be the income or loss of the Participant's Elective
Contributions Account for the Plan Year for which the Excess
Contribution was made multiplied by a fraction the numerator of which
is the Excess Elective Contribution made on behalf of the Participant
for such Plan Year and the denominator of which is the Participant's
Elective Contributions Account balance as of the end of such Plan Year
not counting any income or loss allocable to such account for such
Plan Year and, solely for Plan Years beginning before 1991, an
additional 10% of the amount determined under (i) above multiplied by
the number of calendar months between the end of the Plan Year and the
date of distribution to the Participant counting the month in which
distribution is made only if distribution is made after the 15th day
of such month.
(f) If a Participant and one or more of his family members are subject to
the family aggregation rules described in Article IV(E) and Code
Section 414(q)(6), the allocation and distribution of Excess
Contributions in respect of such individuals shall be made in
accordance with Regulation 1.401(k)-l(f)(5)(ii).
H. ADJUSTMENTS TO PREVENT EXCESS ALLOCATIONS OF MATCHING COMPANY
CONTRIBUTIONS. If notwithstanding the Committee's efforts to monitor
allocations to the Accounts of Participants as required by Article IV(G)(1), the
Committee determines after the end of a Plan Year that the allocations of
Matching Company Contributions to the Matching Company Contribution Accounts of
Highly Compensated Employees for such Plan Year exceed the special limitations
described in Paragraph (F) above:
(1) The Company may make Qualified Nonelective Contributions to the Trust
for such Plan Year for allocation to separate accounts of Participants and/or
transfer fully Vested Supplementary Company Contributions for such Plan Year to
such separate accounts, in the same manner and subject to the same conditions
set forth in Article IV(G)(2)(a), which in combination with the Matching Company
Contributions (and any additional matching contributions under (2) below) for
such Plan Year are sufficient to cause such special limitations not to be
exceeded. Also, to cause such special limitations not to be exceeded the
Company may transfer to separate accounts of the kind described above any
Elective Contributions made to the Trust for such Plan Year provided that
Elective Contributions for such Plan Year meet the requirements of Reg.
1.401(m)-1(b)(5).
(2) The Company may make additional matching contributions to the Trust
for such Plan Year for allocation to the Matching Company Contributions
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<PAGE>
Accounts of Participants for whom Elective Contributions were made to the Trust
for such Plan Year and who are not Highly Compensated Employees in amounts which
in combination with the Matching Company Contributions (and any Qualified
Nonelective Contributions under (1) above) for such Plan Year are sufficient to
cause such special limitations not to be exceeded. Any such contributions shall
be allocated to the Matching Company Contributions Accounts of such Participants
in proportion to the Matching Company Contributions theretofore made on behalf
of each for the Plan Year, and shall normally be made within the time prescribed
by law for filing the Company's federal income tax return for its taxable year
with respect to which the additional matching contribution is made, including
extensions thereof. Such additional matching contributions shall be subject to
the same plan rules applicable to Matching Company Contributions and shall be
treated as Matching Company Contributions for purposes of Article IV(F).
(3) The Committee may direct the Trustee to distribute to Participants who
are Highly Compensated Employees that portion of the Matching Company
Contributions made to the Trust on their behalf for such Plan Year which exceeds
the special limitations of Paragraph (F) of this Article IV (in this Agreement
called "Excess Matching Contributions") adjusted for earnings or losses. Any
Excess Matching Contributions, as so adjusted, to be distributed to Participants
shall be designated as Excess Matching Contributions by the Company and be
distributed after the close of the Plan Year for which they were made normally
within 2 1/2 months after the end of such Plan Year, and in any event not later
than 12 months after the end of such Plan Year. (If such Excess Matching
Company Contributions are distributed after 2 1/2 months after the end of such
Plan Year an excise tax is imposed on the Company with respect to the same.)
(4) The Excess Matching Company Contribution for the Plan Year, if any,
for each Participant who is a Highly Compensated Employee shall be determined
and, if not reallocated under subparagraph (7) below to the accounts of other
Participants, shall be distributed, as follows:
(a) The Contribution Percentage of the Highly Compensated Employee with
the highest Contribution Percentage shall be reduced to the extent
required to either (A) enable the Plan to satisfy one of the Actual
Contribution Percentage tests of Article IV(F), or (B) cause the
Highly Compensated Employee's Contribution Percentage to equal the
Contribution Percentage of the Highly Compensated Employee with the
next highest Contribution Percentage. This process shall be repeated
until the Plan satisfies one of the Actual Contribution Percentage
tests of Article IV(F). When and if the Contribution Percentages of
two or more Highly Compensated Employees to be reduced are the same,
such percentages shall be reduced equally and simultaneously.
(b) The Excess Matching Company Contribution to be distributed to each
Highly Compensated Employee whose Contribution Percentage is reduced
under (a) above shall be the Matching Company Contributions made to
the Trust on behalf of the Highly Compensated Employee (determined
prior to the application of this subparagraph (4)) minus the amount
determined by multiplying the Highly Compensated Employee's Creditable
Compensation by his Contribution Percentage (determined after the
application of this subparagraph (4)).
(5) The income or loss allocable to an Excess Matching Contribution
distributed to a Highly Compensated Employee under (3) and (4) above by the
Trustee shall be the income or loss of the Participant's Matching Company
Contributions Account for the Plan Year for which the Excess Matching
Contribution was made multiplied by a fraction the numerator of which is the
Excess Matching Company Contribution made on behalf of the Participant for such
Plan Year and the denominator of which is the Participant's Matching Company
Contributions Account balance as of the end of such Plan Year not counting any
income or loss allocable to such account for such Plan Year and,
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<PAGE>
solely for Plan Years beginning before 1991, an additional 10% of the amount
determined under (i) above multiplied by the number of calendar months between
the end of the Plan Year and the date of distribution to the Participant
counting the month in which distribution is made only if distribution is made
after the 15th day of such month.
(6) If a Participant and one or more of his family members are subject to
the family aggregation rules described in Article IV(F) and Code Section
414(q)(6), the allocation and distribution of Excess Matching Contributions in
respect of such individuals shall be made in accordance with Regulation
1.401(m)-1(e)(2)(iii).
(7) Instead of directing the Trustee to distribute any Excess Matching
Company Contributions for the Plan Year to Participants who are Highly
Compensated Employees, the Committee may direct the Trustee to allocate such
Excess Matching Company Contributions, adjusted for income or loss and
determined and allocated as provided in (3) through (6) above, to the Matching
Company Contribution Accounts of Participants who are not Highly Compensated
Employees and for whom Elective Contributions were made to the Trust for the
Plan Year. Such Excess Matching Company Contributions as so adjusted shall be
allocated among such accounts in the ratio which each such Participant's
Creditable Compensation for the Plan Year bears to the Creditable Compensation
of all such Participants for the Plan Year. Any Matching Company Contribution
for the Plan Year made to the Trust on account of an Elective Contribution which
is determined to be an Excess Elective Deferral under Article III(B) or an
Excess Contribution under Article IV(E) and (G) or (I) shall, after adjustment
for income or loss, be allocated among the Matching Company Contribution
Accounts of such participants in the same manner.
I. ADJUSTMENTS TO PREVENT MULTIPLE USE OF ALTERNATIVE LIMITATION. If multiple
use of the alternative limitations described in Articles IV(E)(2) and IV(F)(2),
as defined by Regulation 1.401(m)-2, shall occur, such multiple use shall be
corrected by reducing the Actual Deferral Percentage of the group of Highly
Compensated Employees in the manner described in Article IV(G)(2)(d) and (e).
In determining whether multiple use of such alternative limitations has occurred
the applicable Actual Deferral Percentages and Actual Contribution Percentages
shall be determined after all adjustments made under Article IV(G) and (H). The
required reduction shall be treated as an Excess Contribution and shall be
allocated and distributed in the same manner described in Article IV(G)(2)(c),
(d) and (e).
J. ESTABLISHMENT AND OBJECTIVES OF INVESTMENT FUNDS. The Company
Contributions allocated for each Plan Year to Accounts of Participants for such
Plan Year as provided in Paragraphs (A), (B) and (C) of this Article IV, shall
be received by the Trustee to be held and administered by it in accordance with
the terms of this Agreement. Within the context of the Trust Fund, the Trustee
at the direction of the Committee shall establish one or more Investment Funds
having such investment objectives as may be ascribed to each such fund by the
Committee. Such Investment Funds may consist of the Trust's investment in (i)
one or more pooled funds established by the Trustee, if it is a bank or trust
company, for the investment of the assets of tax qualified pension and/or
profit-sharing plans, (ii) one or more mutual funds, (iii) one or more contracts
issued by an insurance company, and/or in (iv) any other investment vehicle
suitable for the investment of assets of the Trust Fund and designated by the
Committee.
The Committee shall provide information to Participants regarding the
Investment Funds available under the Plan, including a description of the
investment objectives and types of investments of each such Investment Fund. If
a prospectus is required to be issued with respect to any such Investment Fund,
the Committee will inform Participants of the availability of such prospectus
or, if required by law, arrange to furnish a copy of the prospectus to each
Participant.
K. INVESTMENT OF COMPANY CONTRIBUTIONS. As of each Entry Date, and as of any
more frequent intervals designated by the Committee, each Participant
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shall have the right to designate on an investment election form furnished by
the Committee in accordance with procedures established by the Committee how
Company Contributions thereafter made to the Trust on his behalf are to be
allocated among the Investment Funds. The Committee shall either furnish such
investment election forms to the Trustee or shall compile the results of such
elections and direct the Trustee how such contributions for each Participant are
to be allocated among such Investment Funds. The Trustee shall as soon as
reasonably possible after receipt of each Company Contribution made by the
Company to the Trust, and not less frequently than monthly, allocate such
contribution among the Investment Funds in accordance with such investment
elections or instructions. Until a new investment election or instruction for
any Participant is received by the Trustee, the Trustee shall continue to invest
Company Contributions made for such Participant in the manner designated on the
most recently received investment election or instruction relating to such
Participant. If the Trustee shall receive a Company Contribution for a
Participant for whom it has not received any investment election or instruction,
the Trustee shall invest such contribution in the Investment Fund which most
nearly fits the description of a short-term fixed income fund.
Notwithstanding the foregoing, if the Committee so directs the Trustee in
writing and advises the Participants in the summary description of the Plan or
in another written communication, the amounts allocated to the Supplementary
Company Contribution Accounts of Participants shall be invested in the sole
discretion of the Trustee or an investment manager appointed pursuant to Article
IX(C). Such investments shall be considered to be a separate Investment Fund
invested in the discretion of the Trustee.
L. PARTICIPANT'S RIGHTS TO PERIODIC REALLOCATION OF ACCOUNTS. As of each
Entry Date and as of any more frequent intervals designated by the Committee,
each Participant shall be entitled to direct the Trustee in accordance with
procedures established by the Committee to reallocate all or a portion of his
Accounts so that, as of the date of such reallocation, specified percentages (in
multiples to be designated by the Committee) of his Accounts shall be invested
in one or more of the Investment Funds. Upon receipt of timely instructions
from the Committee (which shall be consistent with the directions of
Participants desiring allocation or reallocation) the Trustee shall, not later
than the month end following receipt of such instructions, invest or reinvest
such portions of the Accounts of Participants thus directing allocation or
reallocation as will (immediately following such investment or reinvestment)
result in the Accounts of each such Participant being invested in the Investment
Funds substantially in accordance with the directions of each such Participant.
However, no transfers between Investment Funds shall be permitted if prohibited
by the rules applicable to the particular Investment Fund from or to which a
transfer is to be made or by rules adopted by the Committee and communicated to
the Participants.
M. PARTICIPANTS' CREDIT ACCOUNTS. The Trustee shall establish and maintain
one or more Credit Accounts for each Participant, showing the balance of each of
his Accounts in each of the Investment Funds, and for such other purposes as may
be useful in the administration of the Trust under this Agreement, and shall
cause to be furnished to each Participant at least annually a statement of the
Credit Accounts. The fact that Credit Accounts are established and maintained
shall not be construed to mean under any circumstances or event that any
Participant has title to any specific asset held in trust hereunder.
N. PERIODIC REVALUATION OF INVESTMENT FUNDS. As of each Valuation Date the
Trustee shall determine as provided in Article IX(H) (Appraisal), or shall cause
the organization(s) holding the assets of a particular Investment Fund, such as
an insurance company or mutual fund, to determine the net earnings or the net
loss of each Investment Fund including net capital gains or losses, if any, for
the period ending on such date or since the previous Valuation Date, and shall
revalue, or cause to be revalued, each Investment Fund so as to reflect the
increase or decrease in the value of the investments of each Investment Fund as
compared to the value of such investments as of the previous Valuation Date. To
the extent an Investment Fund is invested in
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shares or units of participation in a mutual fund or pooled fund maintained by
the Trustee, such shares or units of participation shall be valued in the manner
they are normally valued by the mutual fund or pooled fund. To the extent an
Investment Fund is invested in an annuity or deposit administration contract,
including a guaranteed income contract or similar contract issued by an
insurance company, it shall be valued in the manner such contract is normally
valued by the insurance company.
O. PERIODIC ADJUSTMENTS TO ACCOUNTS. Adjustments shall from time to time be
made to each Participant's Accounts as follows:
(1) The Trustee shall debit such Accounts currently in respect of any
distributions of benefits therefrom.
(2) Promptly following each revaluation of an Investment Fund pursuant to
Paragraph (N) above, the Trustee shall allocate, or shall cause to be allocated,
to each such Account invested in such Investment Fund a portion of the net
earnings or net loss of such Investment Fund, including appreciation or
depreciation in the value of the assets of such fund, such portion being
determined by applying to such net earnings or loss the ratio which the balance
of each Account in such fund on the immediately preceding Valuation Date bears
to the total of the balances of all Accounts in such fund on such Valuation
Date, but taking into account in a manner determined to be equitable by the
Trustee (with the consent of the Committee) any Company Contributions to, or
distributions from, such Accounts since the immediately preceding Valuation
Date. Notwithstanding the foregoing, the Trustee may allocate, or cause to be
allocated, to each such Account invested in such Investment Fund a portion of
the net earnings or net loss of such Investment Fund, periodically and not less
frequently than quarterly, on any other basis which in the Trustee's judgment is
fair and equitable to Participants and which is based in substance on the sizes
of the Accounts invested in such Investment Fund over the period during which
such net earnings or net loss in value occurs; provided the Committee consents
to such other basis of allocation.
(3) As of each Anniversary Date, the Trustee shall credit each
Supplementary Company Contributions Account in the same proportion as
Supplementary Company Contributions are to be credited under Paragraph (A)
above, with respect to any forfeitures occurring or becoming final, as the case
may be, since the previous Anniversary Date, as provided in Paragraph (Q) below
(Forfeitures).
(4) Notwithstanding (2) above, any portion of a Participant's
Supplementary Company Contributions Account which is "segregated" pursuant to
Article IX(O) shall be excluded from the calculation described in (2) above but
shall nevertheless remain as part of such Participant's Supplementary Company
Contributions Account.
(5) Expenses and compensation of the Trustee and Committee may be charged
to the Accounts of Participants as provided in Article XI(P).
P. FIXED ACCOUNTS. After a Participant's Date of Separation from the Company,
whether due to his retirement, death, disability or other cause whatsoever, he
shall cease to be a Participant for purposes of Article III and, except for
benefits payable or distributable under this Agreement, shall cease to have any
further right, title or interest in the Plan and Trust; provided, further,
that-
(1) Such Participant's Accounts, except to the extent his Supplementary
Company Contributions Account and/or his Matching Company Contributions Account
may be forfeited, shall become fixed and Vested at their balances as of the
close of the Valuation Date coinciding with or next following the date of such
termination. "Valuation Date" with respect to a Participant's Supplementary
Company Contribution Account shall mean the Anniversary Date or other date
occurring regularly more frequently than annually designated by the Committee
and communicated to the Participants. "Valuation Date" with respect to a
Participant's other accounts shall mean the
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last day of each calendar quarter or other date occurring regularly more
frequently than quarterly designated by the Committee and communicated to the
Participants in writing. Subject to Article IV(R), if such termination shall be
by reason of his death, disability or attainment of Normal Retirement Age his
Supplementary Company Contributions Account shall participate in the allocation
of Company contributions and forfeitures under Paragraphs (A) and (O)(3) above
as of the Anniversary Date coinciding with or next following his termination to
the same extent as if he were still a Participant. At the election of the
Participant, payment, or the start of payments, of the Participant's entire
Vested Account under Article V may be deferred until after any Supplementary
Company Contribution allocable to his Supplementary Company Contributions
Account for the Plan Year of termination is made, or the portion of such Vested
Accounts not including such Supplementary Company Contribution may be paid or
may start as soon as administratively feasible after the applicable Valuation
Date, and such Supplementary Company Contribution may be paid, or payments of
the same may start, as soon as administratively feasible after it is made to the
Trust. Otherwise, subject to Article IV(R), unless such Participant is employed
by the Company on the Anniversary Date falling within the Plan Year in which his
employment terminates, his Supplementary Company Contributions Account shall not
participate in the allocation of any Company contributions or forfeitures for
such Plan Year. Notwithstanding the foregoing, if the Valuation Date described
above is subsequent to the Participant's Required Beginning Date then such
Valuation Date shall be the Valuation Date immediately preceding the
Participant's Required Beginning Date.
(2) In determining the balance of any Account under (1) above, there shall
be included any Company Contributions and other items which have been or should
be credited or debited to such Account as of the Valuation Date or prior
thereto. Thereafter, no further credits or debits shall be made to said
Account, except as provided in (1) above and except for:
(a) Distributions therefrom,
(b) Special expenses chargeable thereto under Article XI(P)(2)(b),
(c) Matters mentioned in Subparagraphs (3) and (4) below,
(d) Adjustments in respect of Contracts under Article XII, and
(e) Any Elective Contributions and Matching Company Contributions
made to the Trust with respect to the Participant after the
Valuation Date.
(3) If prior to the termination of the Participant's employment the
Trustee was investing any of his Accounts in accordance with the Participant's
instructions, the Trustee shall continue to invest such Accounts in accordance
with such instructions for as long as administratively feasible prior to the
time such Accounts are paid to the Participant. However, the Trustee shall, as
soon as administratively feasible, segregate and set apart cash and/or other
assets of the Trust Fund having an aggregate fair market value equal to the
balance of any other of the Participant's Accounts, e.g., his Supplementary
Company Contribution Account if the Participant is not directing the investment
of such Account, on the Valuation Date determined as aforesaid. Thereafter,
unless such other Account, if any, shall have been distributed in full, the
Trustee shall maintain the same as a fixed and segregated Account but may
commingle the assets thereof with any one or more other similar Accounts;
provided, however, that -
(a) Except as provided in (b) below, the portion of such Account
which is not invested in the Great Lakes Bancorp Stock Fund,
whether segregated or commingled, shall be held and invested only
in the form of units of participation in a short term fixed
income fund or a mutual fund, or in cash, savings or checking
accounts of the Trustee (or of the Company or a
IV-13
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Related Company), direct obligations of the United States
government, or obligations the principal and interest of which
are unconditionally guaranteed by such government, or in prime
commercial paper; or
(b) To the extent that the Participant (or, if deceased, his
Beneficiary) shall authorize in writing (if the Committee shall
permit such authorization), it may be invested and reinvested in
any manner allowed by Article IV(K).
(4) If investments are made out of a commingled Fixed Account, as provided
in (3) above, such account shall be credited or debited from time to time with
its allocable share of the profits and losses of the commingled fund (after
including Trustee fees and expenses of the Trustee and Committee chargeable to
such fund) according to such reasonable and uniform practice as the Trustee
shall adopt or the Committee shall direct.
Q. FORFEITURES. With respect to all or part of a Participant's Supplementary
Company Contributions Account and Matching Company Contributions Account which
are subject to forfeiture under Article V(C) below (Early Retirement; Vesting
Schedule) -
(1) If the Participant elects under Article V(A)(1) and (C) to receive the
Vested part of his Supplementary Company Contributions Account, if any, in a
Lump Sum as promptly as possible after the termination of his employment and
such forfeiture is not contested, on the last day of the Plan Year in which the
Participant's employment terminates the forfeited part of his Supplementary
Company Contributions Account shall become final and shall first be used to
restore forfeitures under Article V(C)(4 and next shall be used to pay expenses
of the Plan under Article XI(P)(2)(a). Any remaining forfeitures shall be
credited to other Supplementary Company Contributions Accounts, as provided by
Article IV(O)(3) above (Periodic Adjustments to Accounts). If the Participant
is not Vested in any part of his Supplementary Company Contributions Account, he
shall be deemed to have elected to receive the Vested part of such Account,
namely zero, in the manner provided above.
(2) In the event such forfeiture is contested, it shall be held in
suspense and, while so held, shall be subject to debits and credits under
Paragraph (G) above in the same manner as an active Participant's Supplementary
Company Contributions Account, except that Supplementary Company Contributions
and other forfeitures shall not be credited thereto. Later, when its status is
finalized, it shall (adjusted by debits and credits as aforesaid) either be paid
to the terminated Participant to the extent successfully contested by him or
credited to other Supplementary Company Contributions Accounts as provided by
(1) above.
(3) Matching Company Contributions forfeited under Article V(C) shall be
treated in the same manner as forfeited Supplementary Company Contributions
under (1) and (2) above as if the terms Matching Company Contributions and
Matching Company Contributions Accounts were substituted for the terms
Supplementary Company Contributions and Supplementary Company Contributions
Accounts, except that, with respect to Plan Years beginning after 1990, instead
of allocating such forfeited Matching Company Contributions to the Matching
Company Contribution Accounts of other Participants such forfeited amounts shall
be applied to reduce Matching Company Contributions otherwise required to be
made to the Trust for the Plan Year in which the forfeiture occurred or for the
next following Plan Year or Plan Years and pending such application shall be
held in a suspense account in the Trust.
R. ADDITIONAL PARTICIPANT ALLOCATIONS. If for any Plan Year the Plan would
otherwise fail to meet the requirements of Code Section 410(b)(1) and the
Regulations thereunder because the Company's Supplementary Company Contribution
has not been allocated to a sufficient percentage of Employees who are not
Highly Compensated Employees for the Plan Year, then the following rules shall
apply:
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<PAGE>
(1) Subject to (3) below, the group of Participants eligible to share in
the Company's Supplementary Company Contribution and forfeitures, if any, for
the Plan Year shall be expanded to include the minimum number of additional non-
Highly Compensated Employees who would not otherwise be eligible as are
necessary to satisfy the test specified above. The specific additional non-
Highly Compensated Employees who shall become eligible to share under this
subparagraph shall be those who are actively employed on the last day of the
Plan Year and, when compared to similarly situated non-Highly Compensated
Employees, have completed the greatest number of Hours of Service in the Plan
Year.
(2) Subject to (3) below, if after application of subparagraph (1) above,
the applicable test is still not satisfied, then the group of Participants
eligible to share in the Company's Supplementary Company Contribution and
forfeitures, if any, for the Plan Year shall be further expanded to include the
minimum number of additional non-Highly Compensated Employees who are not
actively employed on the last day of the Plan Year as are necessary to satisfy
the applicable test. The specific additional non-Highly Compensated Employees
who shall become eligible to share under this subparagraph shall be those non-
Highly Compensated Employees, when compared to similarly situated non-Highly
Compensated Employees, who have completed the greatest number of Hours of
Service in excess of 500 in the Plan Year before terminating employment.
(3) The only Employees eligible to share in the Company's Supplementary
Company Contribution and forfeitures, if any, for the Plan Year under this
Paragraph (R) shall be non-Highly Compensated Employees who were Participants as
of either Entry Date falling within the Plan Year but who either failed to
complete the number of Hours of Service required under Article IV(P)(1) to share
in the Company's Supplementary Company Contribution and any forfeitures for the
Plan Year or failed to be actively employed by the Company on the last day of
the Plan Year.
(4) Nothing in this Paragraph (R) shall permit the reduction of a
Participant's Accrued Benefit. Therefore any amounts that have previously been
allocated to Participants may not be reallocated to satisfy these requirements.
In such event, the Company shall make an additional Supplementary Company
Contribution equal to the allocations such additional non-Highly Compensated
Employees would have received had they initially been eligible for allocations,
even if such contribution exceeds the amount which would be deductible under
Code Section 404. Any adjustment to the allocations pursuant to this paragraph
(R) shall be considered a retroactive amendment effective in the Plan Year and
adopted within the time permitted by Code Section 401(b).
S. GREAT LAKES BANCORP STOCK FUND. Pursuant to Article IV(J) the Trustee
shall establish and maintain the Great Lakes Bancorp Stock Fund, which shall be
invested by the Trustee solely in Great Lakes Bancorp Stock purchased by the
Trustee in the open market or by private purchase from the Company or others at
the fair market value of such stock at the time of purchase as determined by the
Trustee pursuant to Article IX(H), provided, that the purchase price of any
newly issued Great Lakes Bancorp Stock purchased by the Trustee from the Company
shall not be less than the par value of such stock. There shall be no
percentage limitation on the portion of the Trust Fund which the Trustee may
invest or hold in Great Lakes Bancorp Stock. For purposes of this Agreement,
"Great Lakes Bancorp Stock" means shares of voting common stock, $0.01 par
value, of the Company.
Dividends, interest and other distributions received by the Trustee in
respect of any of the Investment Funds, including the Great Lakes Bancorp Stock
Fund, shall be reinvested in the same Investment Fund. However, pending
reinvestment such dividends, interest and other distributions shall be invested
by the Trustee in short-term fixed income investments, which may include units
of participation in a short-term fixed income fund maintained by the Company or
a Related Company.
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<PAGE>
Payments to Participants or to Beneficiaries of Participants from the Great
Lakes Bancorp Stock Fund under Articles V and VI shall be made in full shares of
Great Lakes Bancorp Stock (or at the request of the Participant in cash) and any
fractional share balance in the Great Lakes Bancorp Stock Fund shall be paid in
cash.
T. VOTING OF GREAT LAKES BANCORP STOCK. All shares of Great Lakes Bancorp
Stock acquired by the Trustee shall be held by the Trustee until disposed of
pursuant to provisions of this Agreement. Such shares may be registered in the
name of the Trustee or its nominee. Effective January 1, 1991, the Trustee or
his nominee shall vote shares of Great Lakes Bancorp Stock in the accounts of
Participants as follows:
(1) The Trustee shall adopt reasonable measures to notify Participants
(and beneficiaries of Participants) who have an interest in the Great Lakes
Bancorp Stock Fund of the date and purposes of each meeting of stockholders of
the Company at which holders of shares of Great Lakes Bancorp Stock shall be
entitled to vote, and to request instructions from the Participant to the
Trustee as to the voting at such meeting of shares of Great Lakes Bancorp Stock
in the account of each Participant;
(2) Before each such meeting the Committee shall furnish to the Trustee,
and the Trustee shall furnish to each such Participant (or beneficiary of a
Participant), the same information furnished by the Company to its shareholders
in respect to such meeting, including proxy materials and, where applicable, a
copy of the Company's annual report;
(3) The instructions received by the Trustee from particular Participants
(or beneficiaries of Participants) shall be held by the person or persons
designated by the Trustee to receive such instructions in confidence and shall
not be divulged or released to any other person, including officers or employees
of the Company or any Related Company (including the Trustee);
(4) Upon timely receipt of such instructions the Trustee himself or by
proxy shall vote the shares of Great Lakes Bancorp Stock in such accounts of the
Participants in accordance with the Participants' instructions; and
(5) If the Trustee shall not have received timely instructions from a
Participant on a particular matter in respect of any shares of Great Lakes
Bancorp Stock in such Participant's account, the Trustee himself or by proxy
shall vote all such shares in the same ratio as the shares with respect to which
instructions were received from Participants.
All shares of Great Lakes Bancorp Stock held by the Trustee but not
allocated to the accounts of Participants shall be voted in the same ratio as
the shares with respect to which instructions were received from Participants.
U. TENDER OF GREAT LAKES BANCORP STOCK. Except as otherwise expressly
provided in this Agreement, the Trustee shall not sell, alienate, encumber,
pledge, transfer or otherwise dispose of, or tender or withdraw, any shares of
Great Lakes Bancorp Stock held by it under the Plan. In the event the Trustee
determines that a tender or exchange offer for shares of Great Lakes Bancorp
Stock has commenced, then, notwithstanding any other provision of this
Agreement, the following provisions of this Article IV(U) shall become
applicable:
(1) Upon determination that an offer described in the first paragraph of
this Article IV(U) has commenced, the Trustee shall cause to be sent to each
Participant and Beneficiary of a deceased Participant who, on the effective date
of such offer or at any time during the effective period of such offer, has
shares of Great Lakes Bancorp Stock allocated to his account, such information
as is reasonably available to the Trustee and as the Trustee determines is
necessary for such Participant or Beneficiary to make an informed decision in
respect of such offer, together with a form prescribed by the Trustee pursuant
to which such Participant or Beneficiary may direct the
IV-16
<PAGE>
Trustee to tender or exchange pursuant to such offer all or part of the shares
of Great Lakes Bancorp Stock so allocated to his account. The Trustee shall
tender or exchange only those shares of Great Lakes Bancorp Stock as to which
valid and timely directions to tender or exchange are received and not validly
and timely revoked, and all other shares of Great Lakes Bancorp Stock held under
the Plan, whether or not allocated to the accounts of Participants, shall
continue to be held by the Trustee. If in the course of an offer described in
the first paragraph of this Article IV(U) there shall arise any issue on which
Participants or Beneficiaries who have directed the tender or exchange of shares
of Great Lakes Bancorp Stock are required to have an opportunity to alter their
circumstances (including but not limited to an opportunity to tender or exchange
shares of Great Lakes Bancorp Stock in a competing offer), the Trustee shall, in
accordance with the foregoing provision of this subparagraph (1) and to the
extent reasonably practicable, solicit the directions of such Participants and
Beneficiaries with respect to each such issue and act in response to such
directions.
(2) The instructions received by the Trustee from Participants (or
Beneficiaries of Participants) shall be held by the person or persons designated
by the Trustee to receive such instructions in confidence and shall not be
divulged or released to any other person, including officers or employees of the
Company or any Related Company (including the Trustee).
(3) To the extent that an offer described in the first paragraph of this
Article IV(U) is for cash, proceeds received by the Trustee from the tender or
sale of any shares of Great Lakes Bancorp Stock pursuant to such offer shall be
invested by the Trustee in one or more of the other Investment Funds in
accordance with directions from Participants and Beneficiaries whose shares of
Great Lakes Bancorp Stock were sold. In the absence of such direction from any
such Participant or Beneficiary, such proceeds shall be invested in the
Investment Fund which most clearly fits the description of a short-term fixed
income fund. To the extent that an offer described in the first paragraph of
this Article IV(U) is for property other than cash, property received by the
Trustee from the tender, exchange, or sale of any shares of Great Lakes Bancorp
Stock pursuant to such offer shall be held by the Trustee in a separate
investment fund pending a determination of its disposition by the Trustee. The
Trustee shall allocate the proceeds from any shares of Great Lakes Bancorp Stock
sold pursuant to such an offer to the accounts of Participants and Beneficiaries
who directed the Trustee to sell such shares pursuant to such offer.
(4) Any rights to purchase Great Lakes Bancorp common or preferred stock
appurtenant to shares of Great Lakes Bancorp Stock allocated to the account of a
Participant which become detached from such shares of Great Lakes Bancorp Stock
shall be allocated, held or disposed of by the Trustee in the manner directed by
the Committee.
IV-17
<PAGE>
ARTICLE V
RETIREMENT BENEFITS AND VESTING
A. NORMAL RETIREMENT. A Participant may retire from the employment of the
Company at his Normal Retirement Date, whereupon the Trustee shall as promptly
as possible arrange to make benefits available to the Participant as follows
(except as otherwise provided in Article XII):
(1) Not later than 30 days after the later of (i) his retirement or (ii)
the Valuation Date as of which the balance of his Account is to be determined
under Article IV(P)(1), the balance of his Fixed Account shall be paid in a Lump
Sum. However, a Participant retiring on or after his Normal Retirement Date may
elect to delay distribution of his benefits until his Required Beginning Date.
(2) The Participant's Fixed Account payable under (1) above shall be fully
Vested and nonforfeitable.
(3) If a distribution is one to which Sections 401(a)(11) and 417 of the
Code do not apply, such distribution may commence less than 30 days after the
notice required under Section 1.411(a)-11(c) of the Regulations is given,
provided that:
(a) the Committee clearly informs the Participant that the
Participant has a right for a period of at least 30 days after
receiving the notice to consider the decision of whether or not to
elect a distribution (and, if applicable, a particular distribution
option), and
(b) the Participant, after receiving the notice, affirmatively elects
a distribution.
Notwithstanding the foregoing, a Participant's Normal Retirement Date under the
Plan shall not be construed as a mandatory retirement date.
B. LATE RETIREMENT. If a Participant shall continue in the Company's employ
beyond his Normal Retirement Date (in which event he shall remain a Participant
in the Plan for all purposes), no retirement benefits shall be payable to him
under this Agreement until his actual retirement, at which time the same steps
shall be taken as in the case of normal retirement, provided that in no event
shall such benefits be paid or commence to be paid later than the Required
Beginning Date or other deadline specified in Article V(D).
C. EARLY RETIREMENT; VESTING SCHEDULE FOR SUPPLEMENTARY COMPANY CONTRIBUTIONS
AND MATCHING COMPANY CONTRIBUTIONS; FULL VESTING OF ELECTIVE CONTRIBUTIONS.
Upon retirement of a Participant prior to his Normal Retirement Date, the
Trustee shall as promptly as possible (but subject to Article V(E)) arrange to
make benefits available to the Participant (except as otherwise provided in
Article X(A) and in Article XII) in the same manner and form as at normal
retirement; provided, however, that -
(1) Such Participant shall be entitled only to a percentage of the
balances in his Supplementary Company Contributions Account and his Matching
Company Contributions Account based upon the number of his Years of Service, as
follows:
Years of Percentage
Service Vesting
less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 but less than 6 80%
6 or more 100%
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<PAGE>
(2) In computing a Participant's period of service for purposes of
(1) above, he shall be credited with one Year of Service for each vesting
Computation Period during which he has completed at least twelve months of
Service with the Company or with Dollar Federal Savings Bank of Hamilton, Ohio
(regardless of whether or not he was a Participant at such time) except that the
following shall not be counted:
(a) For purposes of determining his Vested percentage in such account
following a break in service, Years of Service during vesting
Computation Periods prior to a One-Year Break in Service shall
not be counted unless and until the Employee completes a Year of
Service after his subsequent Date of Employment;
(b) In the case of a Participant or other Employee who does not have
a Vested right to an Accrued Benefit derived from Supplementary
Company Contributions and Matching Company Contributions, i.e.,
who is not Vested in any part of his account balance under the
Plan derived from Supplementary Company Contributions and
Matching Company Contributions, Years of Service prior to a
period of consecutive One-Year Breaks in Service shall not be
counted if the number of consecutive One-Year Breaks in Service
in such period equals or exceeds five (excluding from the number
of Years of Service before such period any Years of Service not
required to be counted hereunder by reason of any prior break in
service);
(c) Notwithstanding subparagraph (b) above, if as of the day before
the first day of the Plan Year beginning in 1985 any Years of
Service prior to such date were not required to be counted for
purposes of determining the Vested percentage of a Participant's
account (referred to in (b) above) under the Plan as then in
effect, such Years of Service shall not be counted;
(d) Years of Service during any period for which the Company did not
maintain the Plan or a predecessor plan (within the meaning of
Section 411(a)(4)(C) of the Code);
(e) Years of Service before age 18 if permitted by Section
411(a)(4)(A) of the Code, but not the Year of Service during
which age 18 was attained;
provided, further, that Years of Service after five or more consecutive One-Year
Breaks in Service shall not be counted for purposes of determining the Vested
percentage under (1) above of the Participant's Accrued Benefit derived from
Supplementary Company Contributions and Matching Company Contributions which
accrued before such five or more consecutive One-Year Breaks in Service.
(3) In computing a Participant's Years of Service for purposes of (1)
above, nonconsecutive periods of Service shall be combined at the rate of twelve
months of Service comprising a Year of Service, with an Employee being credited
with a month of Service for any calendar month in which he is credited with at
least one (1) Hour of Service. The disaggregation principle of (2) above,
relating to five or more consecutive One-Year Breaks in Service, shall also
apply for purposes of this subparagraph (3).
(4) The portion of such Participant's Supplementary Company Contributions
Account to which he is not entitled under (1) above, if any, shall be forfeited
and allocated among the other Participants' Supplementary Company Contributions
Accounts pursuant to Article IV(Q) (Forfeitures). For Plan Years beginning
after 1990, the portion of such Participant's Matching Company Contribution
Account to which he is not entitled under (1) above, if any, shall be forfeited
and applied to reduce Matching Company Contributions pursuant to Article
IV(Q)(3). If, following a distribution of the Vested
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<PAGE>
portion of a partially Vested Participant's Account, he is re-employed by the
Company in circumstances where he has not sustained five consecutive One-Year
Breaks in Service, then, following such re-employment, the portion of the
Participant's Account which was forfeited will be restored to its amount on the
date of distribution if the Participant repays to the Trust the full amount of
the distribution attributable to Supplementary Company Contributions and
Matching Company Contributions before the earlier of 5 years after the first
date on which the Participant is re-employed by the Company, or the date the
Participant incurs 5 consecutive One-Year Breaks in Service following the date
of the distribution. If a Participant who was not Vested in any part of his
Supplementary Company Contributions Account or Matching Company Contributions
Account was deemed to have received a distribution pursuant to Article IV(Q)(1)
or Article IV(Q)(3), and the Participant is re-employed by the Company in
circumstances where he has not sustained five consecutive One-Year Breaks in
Service, upon the reemployment of such Participant, the forfeited Account
balances of the Participant will be restored to their amounts on the date of
such deemed distribution. The funds to be used to restore such accounts shall
first be obtained out of forfeitures, if any, and next out of Company
contributions to the Trust, for such Plan Year or succeeding Plan Years.
(5) For purposes of (1) above, service during the Company's first fiscal
year shall be counted as a Year of Service even if less than 12 months in
duration, but only if caused by the fact that said fiscal year is less than
12 months.
(6) Notwithstanding the foregoing provisions, a Participant's
Supplementary Company Contributions Account and his Matching Company
Contributions Account shall be fully Vested at his Normal Retirement Age.
(7) A Participant's Elective Contributions Account shall at all times be
fully and immediately Vested.
D. DEADLINE FOR PAYMENT OF BENEFITS; REQUIRED BEGINNING DATE. The following
deadlines shall apply to the payment, or commencement of payment, of any
benefits under the Plan:
(1) Unless the Participant shall otherwise elect, the payment of benefits
under the Plan to the Participant shall begin not later than the 60th day after
the close of the Plan Year in which occurs the latest of the following:
(a) The date on which he attains the earlier of age 65 or Normal
Retirement Age;
(b) The tenth anniversary of the year in which he commenced
participation in the Plan; or
(c) The termination of his service with the Company.
If the Participant under another provision of this Agreement may elect to defer
the payment, or commencement of payment, of benefits under the Plan beyond the
latest of the foregoing dates, such election shall be subject to (2) below and
to the distribution rules of Article V(A), must be submitted to the Committee in
writing, signed by the Participant, and must describe the benefit and the date
on which payment of such benefit shall be made or shall commence.
(2) Any benefits payable under the Plan to a Participant who attains age
70-1/2 after 1988 shall be paid, or shall begin to be paid, not later than
April 1 of the calendar year following the calendar year in which the
Participant attains age 70-1/2. In the Plan the date by which any such benefits
must be paid, or begin to be paid, as specified above in this paragraph, is
called the "Required Beginning Date".
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<PAGE>
E. CASH-OUTS. Notwithstanding anything in this Article V or in Article VI to
the contrary, if at the time of a Participant's death or other termination of
employment the present value of any Accrued Benefit payable to or with respect
to him under the Plan, i.e., the Vested portion of his Fixed Account derived
from Company contributions plus his Rollover Account, if any, plus his account,
if any, derived from nondeductible employee contributions made by him to the
Trust for any Plan Year beginning before 1987 does not exceed (or at the time of
any prior distribution did not exceed) $3,500, such benefit shall be paid to his
Beneficiary or to him in a Lump Sum. If a Participant's employment terminates
before his Normal Retirement Date for any reason other than his death and such
Accrued Benefit exceeds (or exceeded) $3,500, the Participant shall have the
right to elect in writing delivered to the Committee to defer payment of such
Accrued Benefit (subject to adjustment for profits or losses and fees and
expenses as provided in Article IV(O)(2) and (5)) to the Participant's Normal
Retirement Date. The failure of such a Participant to elect a Lump Sum as
permitted by Article V(C) and Article V(A)(1) shall be deemed an election by the
Participant to defer payment of any such Accrued Benefit to his Normal
Retirement Date as provided above. If payment of the Participant's Accrued
Benefit is so deferred to his Normal Retirement Date, such Accrued Benefit shall
be paid to the Participant as soon as administratively feasible thereafter in a
Lump Sum.
F. LIMITATIONS ON PAYMENT OF BENEFITS DERIVED FROM ELECTIVE CONTRIBUTIONS AND
MATCHING COMPANY CONTRIBUTIONS. In no event shall any distribution from a
Participant's account which is attributable to Elective Contributions or
Matching Company Contributions (other than a hardship distribution under
Article VI(E)) be made earlier than: (1) the Participant's retirement, death,
disability, separation from service, or attainment of age 59-1/2; (2) the
termination of the Plan and Trust pursuant to Article X without establishment of
a successor plan; (3) the date of sale by the Company of substantially all of
its assets to a corporation in whose employment the Participant continues; or
(4) the date of sale by the Company of a subsidiary in whose employment the
Participant continues.
G. TERMINATION OF EMPLOYMENT BY REASON OF DISSOLUTION. Subject to
Paragraph (F) above, if a Participant's employment shall terminate by reason of
complete or partial liquidation or dissolution of the Company, then such
Participant shall be deemed to have retired under Article V(A), (B) or (C), as
the case may be, except that, for purposes of said Paragraph (C) (Early
Retirement; etc.), his percentage Vesting in his Supplementary Company
Contributions Account and his Matching Company Contributions Account shall be
100%.
H. TERMINATION OF EMPLOYMENT IN OTHER CIRCUMSTANCES. Subject to Paragraph (F)
above, if a Participant's employment shall terminate for any reason not covered
by Article V(G) (Dissolution) or Article VI(A) (Death, etc.) or (D)
(Disability), he shall be deemed to have retired and shall be entitled to only
such benefits as are provided by Article V(A), (B) or (C), as the case may be.
I. TEMPORARY ABSENCES. Any substantial absence from active employment with
the Company other than during vacation, holidays and non-business hours shall
constitute a termination of employment for purposes of the Plan except as
follows:
(1) If the Participant or other Employee shall be absent from active
employment with the Company for a period not exceeding six (6) months on account
of (i) illness, (ii) mental or physical disability, (iii) leave of absence
granted by the Company in accordance with uniform and nondiscriminatory rules so
that all employees in similar circumstances are treated alike, (iv) temporary
layoff or (v) jury duty, his employment with the Company or participation in the
Plan, as the case may be, shall not be deemed to have terminated solely on
account of such absence and during such absence he shall be provisionally
credited with Service at the same rate he was being credited with Service at the
time such absence commenced; provided, however, that if he does not resume
active employment within thirty (30) days from the
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<PAGE>
expiration of such illness, disability, leave of absence or jury duty, or if he
fails promptly to report for work upon being recalled from such layoff, his
employment or participation, as the case may be, shall be deemed to have
terminated on the date when such absence commenced, provided, further that his
Valuation Date shall be the Valuation Date coinciding with or immediately
following the expiration of such thirty (30) day period. The above six month
period shall be extended for an additional three (3) month period if such an
extension is granted the Employee in accordance with the applicable personnel
policy of the Company.
(2) If the Participant or other Employee shall leave the active employment
of the Company for the purpose of becoming (and thereupon becomes) a member of
the Armed Forces of the United States, his employment with the Company or
participation in the Plan, as the case may be, shall not be deemed to have
terminated solely on account of such absence and during such absence he shall be
credited with Service at the same rate he was being credited with Service at the
time such absence commenced; provided, however, that if he does not resume
active employment within ninety (90) days after his first eligibility for
release or discharge from said Armed Forces, his employment or participation, as
the case may be, shall be deemed to have terminated on the date when such
absence commenced, provided, further that his Valuation Date shall be the
Valuation Date coinciding with or preceding the expiration of such ninety (90)
day period.
(3) During any period when a Participant or other Employee is not in fact
actively employed by the Company, he shall not be regarded as receiving any
Compensation except such as the Company may actually pay to him during such
period.
(4) If contributions or other credit or debit items shall be allocated to
a Participant's account due to the provisions of Subparagraph (l) above and it
shall later be determined that such Participant's employment should be deemed to
have theretofore terminated, then the Trustee upon notification thereof shall
treat such allocations as erroneous and shall reasonably endeavor to undo the
effects thereof.
(5) If the Participant timely resumes active employment (or reports for
work) as contemplated by (1) or (2) above but his resumed employment is
terminated (other than by death, permanent and total disability, normal or late
retirement, or complete or partial dissolution or liquidation of the Company)
prior to his having been in the Company's continuous employ for a period at
least equal to the lesser of (a) six (6) months or (b) the period from the
commencement of the absence in question to the resumption of his active
employment, then his employment or participation, as the case may be, shall be
deemed to have terminated on the date when such absence commenced.
(6) The foregoing provisions of this Paragraph (I) shall not prevent the
Company and the Participant or other employee in question from mutually
determining in writing that his status as an employee or Participant, as the
case may be, shall terminate (or have terminated) at any designated time, either
with or without cause.
(7) The foregoing provisions of this Paragraph (I) are subject to any
contrary requirements, more favorable to the Participant or other employee in
question, contained in Article II(A) or Article V(C).
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ARTICLE VI
OTHER BENEFITS
A. DEATH, SPOUSAL CONSENT TO DESIGNATION REQUIRED IF SPOUSE IS NOT
BENEFICIARY. Upon the death of a Participant irrespective of whether his
employment has theretofore terminated, the Trustee shall (except as otherwise
provided in Article XII respecting Contracts) arrange as promptly as possible to
pay, or commence to pay, the entire balance of such Participant's Fixed Account
(reduced by any portion of the Participant's account applied pursuant to Article
VI(F)(4) to pay the balance of any loan from the Trust to the Participant
outstanding at the time of the Participant's death) to his surviving spouse
(who, subject to the following provisions of this sentence, shall be deemed the
Participant's designated Beneficiary), or if there is no surviving spouse, or
the surviving spouse has consented in writing to the designation of another
specific Beneficiary by the Participant, to the Participant's designated
Beneficiary, subject, however, to Article VI (B) and (C) below. Any such
written consent by the Participant's spouse shall acknowledge the effect of the
consent and be witnessed by a representative of the Plan or a notary public. A
representative of the Plan shall include any member of the Committee or any
other person designated by the Committee for this purpose. No designation by a
married Participant of a Beneficiary other than the Participant's spouse or
method of payment shall be changed without the written consent of the spouse
unless the written consent of the spouse to the first designation expressly
permits further designations by the Participant without any requirement of
further consent by the spouse. No such written consent of the spouse of a
Participant need be obtained if it is established to the satisfaction of the
Committee that such spouse cannot be located or that such other circumstances as
may be described in Treasury Regulations promulgated under Section 417(a)(2)(B)
of the Code exist.
B. DESIGNATION OF BENEFICIARY. Subject to Paragraphs (A) (requiring spousal
consent if a person other than the Participant's spouse is to be designated as a
Beneficiary) and (C) (imposing certain restrictions on distributions from the
Plan on account of the death of the Participant) of this Article VI, a
Participant shall have the right from time to time to file with the Committee a
written designation of Beneficiary under the Plan, which designation may from
time to time be amended or revoked; provided, however, -
(1) No designation of Beneficiary, and no amendment or revocation thereof,
shall become effective if filed after such Participant's death, unless the
Committee and Trustee shall determine such designation, amendment or revocation
to be valid.
(2) A Participant shall not have the right, unless the Committee shall
otherwise consent, to designate as a Beneficiary anyone except his estate, his
dependents, individuals who are the natural objects of his bounty, or a trust or
trusts for the principal benefit of one or more such dependents or Persons.
(3) In the absence of an effective designation of Beneficiary, or if the
Beneficiary designated shall not survive the Participant, then said death
benefits shall be paid to the spouse of the Participant. Effective 1991, if and
to the extent that there shall be no surviving spouse, the Participant's estate
shall be deemed to be the Beneficiary.
C. REQUIRED DISTRIBUTIONS. Upon the death of a Participant the following
restrictions shall apply to the distribution of his interest under the Plan,
i.e., the entire balance of his Fixed Account:
(1) If the Participant dies after starting to receive benefits but before
his entire interest under the Plan has been distributed to him, the remaining
portion of such interest must be distributed at least as rapidly as under the
method of distribution selected by the Participant in effect at the date of his
death.
(2) If the Participant dies before receiving any of his interest under the
Plan, his entire interest shall be distributed to his Beneficiary by
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December 31 of the calendar year in which the first anniversary of the
Participant's death falls, with the following exceptions:
(a) If any portion of such interest is payable to or for the benefit
of a designated Beneficiary, such portion shall be distributed in
a Lump Sum to such Beneficiary not later than sixty days after
December 31 of the calendar year of such Participant's death.
(b) If such designated Beneficiary dies before payments have begun to
be made to such Person, then payments to the Person or Persons
entitled to the same shall be subject to the distribution
restrictions under this subparagraph (2) which would have applied
had such Person(s) been the designated Beneficiary.
(c) The amount required to be distributed under (a) and (b) above for
each calendar year, beginning with the distribution for the first
calendar year for which a minimum distribution is required must
be at least equal to the quotient obtained by dividing the
Participant's interest in the Plan by the life expectancy of the
Beneficiary. The Participant's interest in the Plan for purposes
of this paragraph (c) shall be the Participant's account balance
as of the last Valuation Date in the calendar year immediately
preceding the first calendar year for which the distribution is
required, adjusted as provided in Treasury Regulations for
allocations of contributions, forfeitures and distributions, if
any, after such Valuation Date.
(d) For purposes of subparagraphs (a) and (c) above, life expectancy
shall be computed by use of the return multiples included in
Tables V and VI of Section 1.72-9 of the Income Tax Regulations.
For purposes of subparagraphs (a) and (c) above, the life
expectancy of the Participant's spouse may be recalculated
annually, but the life expectancy of a Beneficiary other than the
Participant's spouse may not be recalculated.
(3) Subject to applicable Regulations, for purposes of (1) and (2) above
any amount paid to a child of the Participant shall be treated as if it had been
paid to the surviving spouse of the Participant if such amount will become
payable to the surviving spouse upon such child reaching the age of majority (or
other designated event permitted under applicable Regulations).
(4) If, prior to January 1, 1984, such Participant had made a valid,
unrevoked, written designation pursuant to Section 242(b) of the Tax Equity and
Fiscal Responsibility Act of 1982 as in effect prior to amendments made by the
Tax Reform Act of 1984, then distributions to such Participant and his
Beneficiary shall be made according to such designation which shall be binding
on the Committee, notwithstanding any other provision of this Agreement.
(5) Subject to Article VI(C)(4) above, but not withstanding any other
provision of this Agreement to the contrary, all distributions under the Plan
shall be made in accordance with Section 401(a)(9) of the Code and the
Regulations thereunder, including but not limited to Regulation
Section 1.401(a)(9)-2.
(6) Wherever the method of distribution of a Participant's Account
provided in the Plan other than in this Article VI(C) does not violate the
required distribution rules of this Article VI(C), distribution shall be made in
accordance with such other provisions of the Plan. This Article VI(C) shall
change the method of distribution of a Participant's Account provided elsewhere
in the Plan only if, and to the extent, necessary to comply with Section
401(a)(9) of the Code and applicable Regulations thereunder.
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<PAGE>
D. DISABILITY. If, notwithstanding Article V(I) (Temporary Absences), a
Participant's employment shall terminate on account of his disability, mental or
physical, evidenced by the certificate of a physician satisfactory to the
Committee then the entire balance of his Fixed Account shall be paid in a Lump
Sum (subject to the same restrictions set forth in Article V(A)), if the
Participant shall so elect in writing delivered to the Committee. For purposes
of this Paragraph (D) a Participant shall be considered disabled if by reason of
his mental or physical condition he is unable to perform the normal duties of
his employment with the Company.
E. HARDSHIP DISTRIBUTIONS; DISTRIBUTIONS AFTER AGE 59-1/2. Subject to the
application of uniform rules consistently applied, the Committee may upon the
written request of a Participant direct the Trustee to distribute funds to such
Participant from his Elective Contributions Account (but not amounts treated as
Elective Contributions or income allocable thereto), and from his entire Account
if he has attained age 59-1/2, in a Lump Sum, as follows:
(1) Any such distribution from the Participant's Elective Contributions
Account made after March 31, 1989 shall be subject to the following
requirements:
(a) No such distribution shall be made unless the Committee
determines that the distribution will be made on account of an
immediate and heavy financial need of the Participant and is
necessary to satisfy such financial need.
(b) A distribution will be deemed to be made on account of an
immediate and heavy financial need only if the distribution is on
account of:
(i) Medical expenses described in Code Section 213(d) incurred
by the Participant, the Participant's spouse, or any
dependents of the Participant (as defined in Code Section
152);
(ii) Purchase (excluding mortgage payments) of a principal
residence for the Participant;
(iii) Payment of tuition and related educational fees for the next
twelve (12) months of post-secondary education for the
Participant, his or her spouse, children or dependents;
(iv) The need to prevent the eviction of the Participant from his
principal residence or foreclosure on the mortgage of the
Participant's principal residence; or
(v) Any other immediate and heavy financial need of the
Participant designated as such for purposes of Section
401(k) of the Code in a revenue ruling, notice, or other
document of general applicability published by the U.S.
Treasury Department.
(c) A distribution will be deemed necessary to satisfy an immediate
and heavy financial need of a Participant if all of the following
requirements are satisfied:
(i) The distribution is not in excess of the amount which, net
of taxes thereon, is required to satisfy the immediate and
heavy financial need of the Participant,
(ii) The Participant has obtained all distributions, other than
hardship distributions, and all nontaxable loans currently
available under this Plan and all other plans maintained by
the Company,
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<PAGE>
(iii) All other plans maintained by the Company which cover the
Participant provide that the Participant's elective
contributions and employee contributions, if any, will be
suspended for at least 12 months after receipt of the
hardship distribution under the Plan, and
(iv) All other plans maintained by the Company which cover the
Participant provide that the Participant may not make
elective contributions for the Participant's taxable year
immediately following the taxable year of the hardship
distribution in excess of the applicable limit under Section
402(g) of the Code for such taxable year less the amount of
the Participant's elective contributions (to this Plan and
such other plans) for the taxable year of the hardship
distribution.
If a Participant receives a hardship distribution under this Plan
the Participant's Elective Contributions to this Plan will be
suspended for 12 months after receipt of the distribution and he
may not make Elective Contributions to this Plan (and to any
other plan of the Company) for his taxable year immediately
following the taxable year of the distribution in excess of the
applicable limit under Section 402(g) of the Code for such
taxable year less the amount of his Elective Contributions to
this Plan (and his elective contributions to any other plan of
the Company) for the taxable year of the hardship distribution.
A Participant will not fail to be treated as an eligible employee
for purposes of the coverage and discrimination requirements of
Regulation Section 1.401(k)-1(b) merely because he is suspended
from making elective contributions or employee contributions
under the above requirements.
(d) No such distribution shall exceed the Participant's Elective
Contributions Account balance as of December 31, 1988 plus
Elective Contributions (but not earnings thereon) credited to
such account after December 31, 1988.
(2) Notwithstanding the foregoing provisions of this Paragraph (E), the
Trustee may distribute up to 100% of the funds from the Participant's Vested
account under the Plan to such Participant in a Lump Sum while the Participant
is still employed by the Company, provided the Participant has attained age 59-
1/2, requests such distribution in writing and has not previously received a
distribution under this Article VI(E)(2).
F. LOANS. Subject to the application of uniform rules consistently applied,
the Committee may upon the written request of a Participant, which shall be
treated as an election by the Participant to segregate and separately direct the
investment of a portion of his account under Article IX(O), direct the Trustee
to make a loan or loans to such Participant from his Account as follows:
(1) The aggregate amount of such loan or loans to a Participant shall not
exceed the lesser of -
(a) $50,000 reduced by the excess, if any, of (i) the highest
outstanding balance of loans from the Trust during the one-year
period ending on the day before the date on which the loan is
made, over (ii) the outstanding balance of loans from the Trust
on the date on which the loan is made; or
(b) 50% of the amount which would be the Vested balance of his Fixed
Account if he were to retire or otherwise terminate his
employment with the Company at the time of the loan.
VI-4
<PAGE>
(2) No such loan shall be made unless the Committee shall determine that
there is a reasonable expectation of its repayment as and when due, otherwise
than under (4) below.
(3) The Committee shall determine the amount, terms and conditions of any
such loan; provided that each such loan must by its terms be repayable in
substantially equal payments of principal and interest not less frequently than
quarterly within five years from the date of the loan, bear interest at a
reasonable rate, be adequately secured, and, if made to a so-called
"disqualified person", meet the other requirements of Section 4975(d)(1) of the
Code. Notwithstanding the limitation on the term of a loan set forth in this
subparagraph, the Committee may agree to a loan term in excess of five years
provided that the loan is used to acquire a dwelling unit which within a
reasonable time is to be used (determined at the time the loan is made) as the
principal residence of the Participant.
(4) No payment out of the Trust shall be made to or in respect of such
Participant or his Beneficiary (except under Paragraph (E) or this
Paragraph (F)) unless and until all unpaid loans to such Participant have been
satisfied in full, and if any loan to a Participant has not been satisfied in
full at the time such Participant or the Participant's Beneficiary is to receive
a payment out of the Trust, the Trustee may apply a sufficient part of the
Participant's account in satisfaction of any unpaid part of such loan. No part
of a Participant's Elective Contributions Account or Matching Company
Contributions Account shall be applied in satisfaction of the unpaid part of a
loan to the Participant prior to the earlier of an event entitling the
Participant or the Participant's Beneficiary to the payment of his Elective
Contributions Account or the Participant's attainment of age 59-1/2.
(5) The aggregate of all loans to a Participant under this Plan and under
all other tax qualified Plans of the Company or any Related Company shall not
exceed the amount stated in (1)(a) above.
(6) If the Company is or should become an electing small business (S)
corporation, no such loan shall be made to any shareholder-employee of the
Company in any taxable year of the Company in which it is an S corporation. For
purposes of this paragraph a shareholder-employee means an employee or officer
of the Company who owns, or is considered as owning within the meaning of
Section 318(a)(1) of the Code, on any day during the taxable year of the
Company, more than 5% of its outstanding capital stock.
(7) To the extent permitted by applicable Department of Labor regulations,
no loan shall be made to a Participant who is not an active employee.
(8) The Committee shall, before directing the Trustee to make any loan
under this Paragraph (F), adopt rules relating to loans consistent with this
Paragraph (F) and in compliance with the applicable provisions of the Code and
ERISA.
(9) Notwithstanding the above, effective October 1, 1994, no further loans
to Participants may be made from the Plan.
VI-5
<PAGE>
ARTICLE VII
SPECIAL PROVISIONS FOR MERGED PLAN
A. CESSATION OF ADDITIONAL ANNUITIES. Effective January 1, 1991, no further
contributions shall be made under the Dollar Federal Savings Bank of Hamilton,
Ohio Profit Sharing Plan's arrangement with State Mutual of America. The
annuity provisions and any other form of benefit contained in the aforesaid plan
shall not apply to any contributions made on or after January 1, 1991 unless
provided for elsewhere than in this Article VII or in Article XI(F) of this
Agreement.
B. SEPARATE ACCOUNTS. The Trustee shall maintain separate accounts on behalf
of each affected Participant for assets transferred to the Trust Fund from the
trust maintained under the Dollar Federal plan cited in Paragraph (A) above.
These separate accounts shall be credited with earnings (or losses),
distributions therefrom and other items generally allocable to an individual
account.
C. ANNUITY DISTRIBUTIONS; SPOUSAL CONSENT, ETC. The statutory provisions
relating to qualified pre-retirement survivor annuities, qualified joint and
survivor annuities and spousal consents to distributions shall apply to the
separate accounts maintained under Paragraph (B) above. Furthermore, any form
of distribution or other optional form of benefit which was available on
December 31, 1990 under the Dollar Federal plan cited in Paragraph (A) above,
and which may not be disregarded under Section 411(d)(6) of the Code, shall
continue to apply to the separate accounts maintained under Paragraph (B) above,
but shall not apply to any other accounts under this Agreement.
D. EFFECTIVE DATE. The provisions of Article VII(B) and (C) and the reference
in Article XI(F) to this Article VII became effective only as of December 31,
1992, when the assets of the trust under the Dollar Federal plan cited in
Paragraph (A) above were transferred to the Trust Fund. Notwithstanding the
above, any provisions of this Plan which are required in order that the Dollar
Federal plan comply with the Tax Reform Act of 1986 or other applicable law
shall be deemed to have been incorporated into the Dollar Federal plan as of
January 1, 1989 or other effective date of such laws.
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<PAGE>
PART TWO
ARTICLE VIII
COMMITTEE
A. COMPOSITION OF COMMITTEE. Subject to Article IX, the Plan may, but need
not, be administered by a Committee of one or more employees (or other
individuals familiar with the affairs and personnel of the Company), who shall
be appointed by, and hold office at the pleasure of, the Board of Directors of
the Company. Vacancies in the Committee resulting from death, resignation,
removal or otherwise shall be promptly filled by the Board, but the Committee
may exercise its powers and authority notwithstanding the existence of
vacancies.
B. REMOVAL AND RESIGNATION. A member of the Committee may resign at any time
upon not less than ten days' written notice to the Board, specifying the
effective date of resignation. A member may be removed or appointed by the
Board for any reason or for no reason and at any meeting of the Board, whether
or not called for that purpose.
C. QUORUM. The Committee shall act by a majority of its members at the time
in office, and such action may be taken either by vote at a meeting or in
writing without a meeting. A member of the Committee shall not vote or act on
any matter relating solely to himself.
D. OFFICERS. The Committee may by such majority action appoint from among its
number a Chairman to preside at its meetings and a Secretary, who need not be a
member, to keep records of its meetings and activities and to perform such other
duties and functions as the Committee may prescribe. It may in like manner
designate any one or more of its members or its Secretary to execute any
instrument or document upon its behalf, and the action of such person shall have
the same force and effect as if taken by the entire Committee. In the event of
such authorization, the Committee shall in writing notify the other
Administrative Parties thereof, and such parties shall be entitled to rely upon
such notification until the Committee shall give written notification to the
contrary.
E. RECORDS AND REPORTS. The Committee shall exercise such authority and
responsibility as it deems appropriate in order to comply with ERISA, the Code,
and governmental regulations issued thereunder relating to reporting and
disclosure, including the furnishing of information to Participants and
Beneficiaries and the filing of information and reports with the Internal
Revenue Service and the Department of Labor.
F. POWERS AND DUTIES. The Committee shall have any and all powers, authority
and duties which shall be necessary and proper to enable it to carry out its
obligations under this Agreement, including by way of illustration and not
limitation, the power and duty:
(1) To construe and interpret the Plan as provided in Article I(C), decide
all questions of eligibility, determine the amount, manner and time of payment
of any benefits hereunder, and direct the Trustee with respect to the amount,
manner and time of payment of such benefits;
(2) To prescribe procedures to be followed by Participants or
Beneficiaries filing applications to participate, elections, designation of
beneficiary forms, applications for benefits, if any, and any other forms
required or desirable under the Plan;
(3) To prepare and distribute, in such manner as the Committee determines
to be appropriate, information explaining the Plan;
(4) To receive from the Company and from Participants such information as
shall be necessary for the proper administration of the Plan;
VIII-1
<PAGE>
(5) To furnish the Company, upon request, such annual reports with respect
to the administration of the Plan as are reasonable and appropriate;
(6) To receive and review the periodic valuation of accounts made by the
Trustee;
(7) To receive, review and keep on file (as it deems convenient and
proper) reports of account allocations and benefit payments by the Trustee and
reports of disbursements for expenses directed by the Committee;
(8) To appoint or employ individuals to assist in the administration of
the Plan and any other agents it deems advisable, including legal, accounting,
and benefit consultant counsel.
(9) Whenever in the judgment of the Committee it would be in the best
interest of the Participants in the Plan, because of a significant fluctuation
in the fair market value of the assets of the Trust Fund or any separate
Investment Fund, to cause the Vested balances of any one or more of the
Participant's accounts payable to or in respect of a retired or otherwise
terminated Participant(s) to be determined as of a date other than the regularly
occurring Valuation Date specified in Article IV(P)(1), the Committee may direct
the Trustee to determine such Vested account balance(s) as of a different date.
G. RULES AND REGULATIONS. The Committee may adopt such rules and regulations
as it deems necessary, desirable or appropriate in connection with the
administration of the Plan including, but not limited to, rules and regulations
relating to loans and hardship distributions or to the facilitation of
compliance with applicable provisions of the Securities Exchange Act of 1934.
All rules and regulations of the Committee shall be uniformly and consistently
applied to all Participants in similar circumstances. When making a
determination or calculation, the Committee shall be entitled to rely upon
information furnished by a Participant or Beneficiary, the Company, any Related
Company, legal counsel for the Company, or the Trustee.
H. CLAIMS PROCEDURE. If any Participant or Beneficiary shall claim benefits
for which the Committee has determined he is ineligible, or shall dispute the
amount or timing of benefits determined by the Committee to be payable
hereunder, he shall be entitled to make a claim for benefits pursuant to this
Paragraph (H). All claims for benefits under this Agreement, whether made by a
Participant or Beneficiary, shall be in writing addressed and delivered to the
Committee, or any member thereof, at the Company's main office, shall contain
the claimant's name, mailing address, and telephone number, if any, and shall
identify the claim in a manner reasonably calculated to make the claim
understandable to the Committee. If the claim is defective in any foregoing
respect, the Committee may at any time within ten days after said delivery give
the claimant not less than ten days' written notice specifying the defect or
defects and the deadline for correction. A claim shall be deemed to be
effectively made when and if it is timely corrected in writing (addressed and
delivered as aforesaid), or when it is timely and correctly prepared and
delivered in the first place, or when it (or a revision thereof) is timely
delivered as aforesaid if the Committee does not give written notice of any
defect therein within ten days after said delivery. It is further agreed:
(1) If a claim is (or is deemed to be) effectively made, the Committee,
shall within 60 days thereafter notify the claimant in writing whether the claim
has been granted or has been denied in whole or in part. Such notice shall be
written in a manner calculated to be understood by the claimant, shall make
specific reference to the Plan, and, if adverse in whole or in part, shall set
forth:
(a) The specific reason or reasons for the denial;
VIII-2
<PAGE>
(b) A description of any additional material or information necessary
for the claimant to perfect the claim, together with an
explanation of why such material or information is necessary; and
(c) An explanation of the claim review procedure set forth in (3) and
(4) below.
(2) If within said 60 days the claim has not been granted, it shall be
deemed to have been denied for purposes of the claim review procedure set forth
in (3) below, even if notice of denial has not been given under (1) above.
(3) Upon denial of a claim in whole or in part, the claimant or his duly
authorized representative shall have 60 days within which to file with the
Committee or any member thereof a written request for a review of such denial,
whereupon -
(a) The Committee shall as promptly as is practicable, but not later
than 60 days after receipt of such request, schedule a hearing to
review said claim.
(b) The claimant or his duly authorized representative shall, pending
and/or at said hearing, be permitted at all reasonable hours to
review the pertinent documents and also be entitled to submit
issues and comments in writing.
(4) The hearing mentioned in (3) above shall be held at the Company's main
office during normal business hours, unless a different time and/or place are
mutually agreed upon. It shall be attended by at least a majority of the
Committee. A decision on the claim shall be rendered thereat or as soon as
possible thereafter, but in no event later than 120 days after the Committee's
receipt of the written request for review; shall be in writing and include
specific reasons; shall be written in a manner calculated to be understood by
the claimant; and shall contain specific reference to the pertinent Plan
provisions on which the decision is based.
I. NO SEPARATE COMMITTEE. Notwithstanding the foregoing provisions of this
Article VIII -
(1) If and while the one or more Persons comprising the Committee and
Trustee are identical, the separation in this Agreement of the responsibilities,
rights, powers, authority, and functions of the Committee and Trustee
respectively shall be disregarded; said Persons shall act and serve in both said
capacities combined; and they need not furnish information, directions,
instructions or notices, or make reports or demands, by themselves in one such
capacity to themselves in the other such capacity.
(2) If and while there is no Committee, either because none is designated
or no one or more Persons are at the time in question actively serving as
members thereof, the responsibilities, rights, powers, authority, and functions
of the Committee shall be vested in the Company; and the Company and Committee
need not furnish information, directions, instructions or notices, or make
reports or demands, one to the other.
(3) Whoever performs the functions of the Committee shall be the Plan
Administrator as defined in ERISA.
VIII-3
<PAGE>
ARTICLE IX
TRUSTEE AND OTHER FIDUCIARIES
A. BONDING. Every Fiduciary shall be bonded to the extent (1) required by
Section 412 of ERISA or applicable Labor Regulations or (2) directed by the
Company.
B. PROTECTIVE PROVISIONS FOR FIDUCIARIES. To the extent permitted by ERISA,
it is agreed:
(1) No Fiduciary shall be liable with respect to a breach of fiduciary
duty if such breach was committed before he became a Fiduciary or after he
ceased to be a Fiduciary.
(2) Notwithstanding any other provisions of this Agreement -
(a) Any Fiduciary may, but need not, purchase insurance from and for his
own account to cover liability arising under or with respect to the
Plan.
(b) The Company may, but need not, purchase insurance to cover potential
liability of one or more Persons who serve in a fiduciary capacity
with respect to the Plan. In addition, the Company shall indemnify
and hold harmless any individual who is a Committee member or other
Fiduciary of the Plan and who is a current or former officer, director
or employee of the Company (or a Related Company) against any
liabilities incurred by him in his exercise and performance of his
powers and duties under the Plan.
(c) Upon first obtaining the written consent of the Company, any Trustee
may use assets of the Trust to purchase insurance for itself and/or
one or more other Fiduciaries and/or the Trust to cover liability or
losses occurring by reason of the act or omission of itself and/or one
or more other Fiduciaries, if such insurance permits recourse by the
insurer against such Trustee and/or one or more other Fiduciaries in
question in the case of its or their breach of a fiduciary obligation.
(3) Any Fiduciary may, by written instrument, allocate and delegate to
others any of such Fiduciary's powers, duties or responsibilities, terminable
upon such notice as such Fiduciary deems prudent. Any person or entity may
serve in more than one fiduciary capacity with respect to the Plan. A
Fiduciary's responsibility shall be limited to performance of those duties
conferred upon such Fiduciary by or pursuant to the Plan, and, subject to
Section 405 and 410 of ERISA, no Fiduciary shall be responsible for the acts or
omissions of any other Fiduciaries.
C. MANAGEMENT AND CONTROL OF ASSETS; CONSULTANTS AND INVESTMENT MANAGERS. To
the extent permitted by Section 402(c) of ERISA:
(1) Any Fiduciary may employ one or more Persons to render advice with
regard to any responsibility which such Fiduciary has under this Agreement.
(2) Except as hereinafter provided, the Trustee shall be the Fiduciary
with respect to the investment, management and control of the Trust Fund, with
full discretion in the exercise of such investment, management and control;
provided, however, that this subparagraph (C)(2) shall not apply to Trust assets
which consist of Contracts issued by an Insurer qualified to do business in
Michigan nor to any Trust assets held by such Insurer; nor shall it apply if the
Plan is exempt from such requirements by reason of Section 403(b)(4) of ERISA
and applicable Labor Regulations.
(3) The Company may, by resolution of its Board of Directors, assume from
the Trustee and transfer to the Committee or an Investment Manager the authority
and duty to direct the investment and management of all or a portion of the
Trust Fund; and, if such authority and duty have been transferred to
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the Committee, the Committee, by appropriate action, may appoint an Investment
Manager to direct the investment and management of all or a portion of the Trust
Fund, provided that:
(a) A copy of any such Board resolution or Committee action shall be
delivered to the Trustee whereupon the Committee or the Investment
Manager, as the case may be, shall be the Fiduciary with respect to
the investment and management of the Trust Fund (or designated portion
thereof) and the Trustee shall have no responsibility therefor.
(b) Any transfer of investment and management to the Committee or to an
Investment Manager may be revoked upon receipt by the Trustee of a
written notice to that effect by the Company through its Board of
Directors or the Committee, as the case may be.
(c) The appointment, selection and retention of a qualified Investment
Manager shall be solely the responsibility of the Company or the
Committee, as the case may be.
(4) During such period or periods of time, if any, as the Committee or any
Investment Manager is authorized to direct the investment and management of all
or a part of the Trust Fund:
(a) The Trustee is authorized and entitled to rely upon the fact that said
Investment Manager is at all times a qualified Investment Manager, as
defined in Section 3(38) of ERISA, until such time as the Trustee has
received a written notice from the Company or Committee to the
contrary, as well as to rely upon the fact that said Investment
Manager is authorized to direct the investment and management of the
Trust Fund until such time as the Company or Committee, as the case
may be, shall notify the Trustee in writing that another Investment
Manager has been appointed in the place and stead of the Investment
Manager named or, in the alternative, that the Investment Manager
named has been removed and the responsibility for the investment and
management of the Trust Fund has been assumed by the Committee or has
been transferred back to the Trustee, as the case may be.
(b) The Trustee shall not be liable or responsible for losses or
unfavorable results arising from the Trustee's compliance with proper
directions of the Committee which are made in accordance with this
Agreement and which are not contrary to the provisions of any
applicable Federal or State statute regulating such investment and
management of the assets of an employee benefit trust.
(c) The Trustee shall not be liable or responsible in any way for any
losses or other unfavorable results arising from the Trustee's
compliance with investment or management directions received by the
Trustee from the Investment Manager.
(d) All directions concerning investments made by the Committee or the
Investment Manager shall be signed by such person or persons, acting
on behalf of the Committee or the Investment Manager, as the case may
be, as may be duly authorized in writing; provided, however, that the
transmission to the Trustee of such directions by photostatic
teletransmission with duplicate or facsimile signature or signatures
shall be considered a delivery in writing of the aforesaid directions
until the Trustee is notified in writing by the Committee that the use
of such devices with duplicate or facsimile signatures is no longer
authorized.
(e) The Trustee shall, as promptly as possible, comply with any written
directions given by the Committee or an Investment Manager hereunder
and, where such directions are given by photostatic
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teletransmission with facsimile signature or signatures, the Trustee
shall be entitled to presume that any directions so given are fully
authorized.
(f) The Trustee shall not be liable for its failure to invest any or all
of the Trust Fund in the absence of such written directions.
(g) The Trustee shall have no obligation to determine the existence of any
conversion, redemption, exchange, subscription or other right relating
to any of said securities purchased, of which notice was given prior
to the purchase of such securities, and shall have no obligation to
exercise any such right unless the Trustee is informed of the
existence of the right and is instructed to exercise such right, in
writing, by the Committee or the Investment Manager, as the case may
be, within a reasonable time prior to the expiration of such right.
(h) Neither the Committee nor any Investment Manager referred to above
shall direct the purchase, sale or retention of any assets of the
Trust Fund if such directions are not in compliance with the
applicable provisions of ERISA and any Regulations issued thereunder.
D. PARTICIPANT-DIRECTED INVESTMENTS. If, while, and to the extent that a
Participant exercises control over the assets in his account by an election
under Paragraph (O) below, such Participant shall not be deemed to be a
Fiduciary by reason of such exercise; and no Person who is otherwise a Fiduciary
shall be liable under Title I, Subtitle B, Part 4, of ERISA (or comparable
provisions of this Agreement) for any loss, or by reason of any breach, which
results from such Participant's exercise of control.
E. PROHIBITED TRANSACTIONS, ETC. Notwithstanding any other provision of this
Agreement -
(1) Except as authorized by applicable Regulations, no Fiduciary may
maintain the indicia of ownership of any assets of the Trust outside the
jurisdiction of the district courts of the United States.
(2) A Fiduciary shall not knowingly and willfully cause the Trust to
engage in a transaction which violates Section 406 or 407 of ERISA or which is
taxable under Section 4975 of the Code.
F. GENERAL DUTIES OF TRUSTEE. In addition to all its other duties and
responsibilities under this Article IX and other provisions of this Agreement,
the Trustee shall -
(1) Receive, collect, hold, safeguard, administer and retain, temporarily
or permanently, the cash and other property originally or at any time comprising
all or part of the Trust Fund, together with such income, rents, issues and
profits as shall from time to time be produced thereby or arise therefrom.
(2) Make such payments and distributions, and take such further action, as
shall be proper to effectuate benefits under the Plan and to carry out this
Agreement.
(3) Maintain complete records and accounts of the Trust, including those
which the Company or Committee may direct, and the Company or Committee may
examine the same at all reasonable times during business hours.
(4) Render such periodic accountings and reports, including but not
limited to reports required under the Securities Exchange Act of 1934 or to
those hereafter described in this Article IX, as the Company or Committee may
reasonably require.
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(5) Carry out the proper directions and instructions of the Committee and,
insofar as may be proper under this Agreement, make determinations, participate
in consultations and conferences, and give or withhold approvals and consents.
G. GENERAL POWERS OF TRUSTEE. Except as otherwise expressly provided in this
Agreement or required by law, the Trustee is authorized and empowered -
(1) To sell, exchange, transfer, assign, lease, pledge, mortgage or
otherwise encumber or dispose of, publicly or privately, any real or personal
property at any time included in the Trust Fund as and when, for such (if any)
price and consideration, on credit or otherwise, with or without security, and
upon such other terms and conditions as the Trustee shall deem proper.
(2) To invest and reinvest all or part of the Trust Fund, in such amounts,
proportions and investments, including but not limited to bonds, notes,
debentures, mortgages, equipment trust certificates, investment trust
certificates, preferred or common stocks (including those of the Company or a
Related Company), mutual funds or other property, real or personal, either
within or without the State of Michigan, as the Trustee may deem proper or the
Committee shall direct.
(3) To hold cash uninvested, or on deposit with any bank, savings and loan
association or trust company, in such amount as the Trustee shall deem proper,
for the purpose of defraying anticipated expenses of (and benefits out of) the
Trust. At any time the Trustee is a bank or trust company the authority herein
conferred shall extend to deposits with the Trustee.
(4) To pay, perform, defend, collect, maintain, sue on, modify, settle,
compromise, release, abandon or otherwise adjust or dispose of any claims or
demands in favor of or against the Trust Fund or any Participant's account.
(5) To vote or not vote any stock or securities in person, through
designees or by proxy.
(6) To hold or register any stock, securities or other property in the
name of any Trustee or nominee or unregistered or in such form that title shall
pass by delivery, provided that the records of the Trustee shall always indicate
the fiduciary nature of such ownership.
(7) To exercise, not exercise, sell or otherwise dispose of any conversion
or subscription right, or other right or option, and to make any payments
incidental thereto.
(8) To oppose, consent to or participate in any voting trust, pooling
agreement, foreclosure, reorganization, consolidation, merger, liquidation,
refinancing, or sale of assets, of or with respect to any corporation or other
organization, and in connection therewith to deposit stock, securities or other
property with, and transfer title to, any protective committee or other Person
whatsoever.
(9) To pay calls, assessments and other charges which the Trustee shall
deem proper.
(10) To borrow and lend money in such circumstances and upon such terms and
conditions, with or without security, as the Trustee shall deem proper.
(11) To make or not make any provision for amortization or a sinking fund
with respect to any security which is received at a value or purchased at a
price in excess of par or of the amount payable on its call, redemption,
maturity or liquidation.
(12) Subject to Article IX(E)(1), to keep all or part of the Trust Fund at
any place or places, and to hold and administer the Trust Fund in one or more
common trust funds or other consolidated funds, in which the various
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<PAGE>
accounts may have undivided interests, and without distinction between income
and corpus.
(13) To retain as an investment any stock, securities or other property
received through the exercise of any foregoing powers and authority.
(14) To make, execute and deliver any and all agreements, instruments and
documents whatsoever, including but not limited to those incidental to the
foregoing powers and authority, and to make the same binding and enforceable
beyond the duration of the Trust.
(15) To buy, sell and trade in option contracts and 'short' sales for cash,
and for such purpose the Trustee may maintain and operate cash accounts with
brokers, and may deliver and pledge any securities held or purchased by the
Trustee with such brokers both as security for loans and advances made to the
Trustee and to ensure the Trustee's ability to deliver stock against short
options provided that all such purchases, sales and trades shall be made on one
or more designated national securities exchanges whose plans regulating such
transactions have been declared effective pursuant to the Securities Exchange
Act of 1934, such as the Chicago Board Options Exchange, Incorporated.
(16) To do any and all additional acts and things which the Trustee shall
be authorized to do under the laws of the State of Michigan or of any other
jurisdiction in which it may act or which the Trustee in its discretion shall
deem proper to carry out this Agreement, to the end that the Trustee shall have
and may exercise all the powers and authority of an absolute owner, except as
the Committee shall otherwise direct; and no Person dealing with the Trustee
shall be bound to see to the application of any money or other property paid,
delivered or transferred to the Trustee or to inquire into the validity or
propriety of any transaction whatsoever.
H. APPRAISAL. As of each Anniversary Date and Valuation Date, and as of such
other dates as the Company or Committee may reasonably direct, the Trustee shall
determine the fair market value of the assets comprising the Trust Fund,
including the assets of each Investment Fund, established within the context of
the Trust Fund by appraising such assets as follows, except as otherwise
required by ERISA:
(1) Stocks and securities which are listed or reported on any national
exchange shall be valued on the basis of their closing prices on such exchange
on the appraisal date or, if there were no reported sales on such exchange on
the appraisal date, then at their bid prices at the close of market.
(2) Stocks and securities not susceptible of valuation under (l), but
which are traded over-the-counter, shall be valued on the basis of their closing
prices on the market on the appraisal date or, if there were no reported sales
over-the-counter on the appraisal date, then at their bid prices at the close of
market.
(3) Stocks and securities not susceptible of valuation under (1) or (2),
but which would be susceptible of valuation as of a date not more than seven
(7) days prior to the appraisal date, shall be valued as of such prior date as
near as possible to the appraisal date.
(4) For purposes of (1), (2) and (3) above, information contained in any
newspaper of general circulation or any standard financial periodical, or
furnished by any national securities exchange or by any broker who is a member
of any national securities exchange, as the case may be, may be fully relied
upon by the Trustee in the absence of actual knowledge or advice to the
contrary.
(5) Property not subject to valuation by the foregoing methods shall be
valued at its fair market value in accordance with written directions given to
the Trustee by the Committee (except as otherwise provided in Article XII).
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<PAGE>
(6) There shall be excluded from the assets valued under this
Paragraph (H), if appraisal is being made as of an Anniversary Date, the amount
of the Company's contribution which is allocable to the Participants' accounts
as of said date.
(7) Valuations determined by appraisal under this Paragraph (H) shall be
binding and conclusive upon each and every Person beneficially interested in the
Trust, but shall not be binding upon the Company or Committee unless
incorporated in an accounting under Paragraph (I) below.
(8) Upon completion of an appraisal, the Trustee shall file copies thereof
with the Committee and the Company.
(9) Notwithstanding the foregoing, any assets of the Trust Fund or any
Investment Fund within the context of the Trust Fund consisting of units of
participation in any pooled fund established and maintained by the Trustee under
any trust instrument establishing a pooled fund or funds for the investment of
the assets of pension and profit-sharing plans of various employers for which
the Trustee acts as trustee shall be valued in accordance with the terms of such
trust instrument.
I. PERIODIC ACCOUNTING. Within 90 days after such Anniversary Date, and at
such other times as the Company or Committee may reasonably direct or as ERISA
may require, the Trustee shall prepare and deliver to the Company and Committee
an accounting of the administration of the Trust, which accounting shall include
a description of all assets then comprising the Trust Fund and shall be in such
further detail as the Company or Committee may reasonably request. Within
90 days after receiving such accounting, the Company and Committee,
respectively, shall notify the Trustee in writing whether or not such accounting
is approved; and unless so disapproved, it shall be deemed to be approved. It
is in addition agreed:
(1) Either the Company or the Committee or both may require the Trustee to
furnish such other or additional information with respect to the administration
of the Trust as may be reasonably necessary or desirable prior to determining
upon the approval thereof; and in such event the aforesaid 90-day period shall
be tolled until such information is received by the party requesting it.
(2) If the Company or Committee shall notify the Trustee that the
aforesaid accounting is not approved, an audit or opinion shall thereupon be
made by an independent public accountant or accountants chosen by the Company or
Committee, as the case may be. Upon completion of such audit or opinion, any
errors in the accounting shall be corrected, and the corrected accounting shall
be deemed to be approved by the Company and Committee.
(3) The approval by the Company and Committee of the accounting or
corrected accounting shall constitute an account stated between the Company,
Committee, Trustee, all Participants, all Beneficiaries, and any other Persons
having any interest in the Trust or Plan.
(4) Nothing in this Paragraph (I) shall prevent the Trustee from having an
accounting settled and allowed by, or being required by the Company or Committee
to account in, a court of competent jurisdiction.
(5) The foregoing provisions of this Paragraph (I) are subject to the
provisions of ERISA.
J. PROTECTIVE PROVISIONS FOR TRUSTEE. The Trustee accepts the Trust solely
upon the terms and conditions of this Agreement, and no duties or
responsibilities not expressly set forth herein or in ERISA shall be implied or
imposed. It is further agreed:
(1) The Trustee shall have no duty to ascertain whether any directions or
instructions of the Company or Committee are in accordance with this
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<PAGE>
Agreement, nor to see to the application of any payment made pursuant to such
directions or instructions.
(2) Any benefit or other payment under the Plan shall be made only if and
when the Trustee has sufficient assets of the Trust Fund available for the
purpose intended.
(3) In the event of any dispute as to the Persons to whom payment of any
money or delivery of any other property shall be made by the Trustee, the
Trustee may withhold such payment or delivery in whole or part until such
dispute shall be settled to the satisfaction of the Trustee or determined by a
court of competent jurisdiction.
(4) The Trustee may withhold all or such part of any distribution as the
Trustee in its discretion may deem proper to protect the Trustee and the Trust
Fund against any liability or claim or account of any estate, inheritance,
income or other tax whatsoever, and with all or any part of any such
distribution so withheld may discharge any such liability. Any part of any such
distribution so withheld by the Trustee that may be determined by the Trustee to
be in excess of any such liability shall upon such determination by the Trustee
be distributed forthwith to the Person from whom it was withheld.
(5) The Trustee shall not be obligated to institute any action or
proceedings for the collection of money or other property due the Trust, or in
defense of any claim against the Trust or any portion of the Trust Fund, unless
the Trustee shall first have been indemnified to its satisfaction for all costs,
expenses, attorney fees and liabilities to which the Trustee might become
subject.
K. PROVISIONS PERTAINING TO CO-TRUSTEES. During any period of time when the
Trustee shall consist of two or more Persons (whether individuals, corporations
or otherwise), the following provisions shall apply:
(1) Except as otherwise provided in the foregoing provisions of this
Article IX -
(a) Each such Person shall use reasonable care to prevent a co-Trustee
from committing a breach; and
(b) Such Persons shall jointly manage and control the Trust assets, except
that this item (b) shall not preclude any agreement, and the co-
Trustees are hereby authorized to agree (in a written document
executed by all co-Trustees) to allocate specific responsibilities,
obligations or duties among themselves, in which event a co-Trustee to
whom certain responsibilities, obligations or duties have not been
allocated shall not be liable by reason of this item (b), either
individually or as a Trustee, for any loss resulting to the Trust
arising from acts or omissions on the part of another co-Trustee to
whom such responsibilities, obligations or duties have been allocated.
(2) Nothing in (1) above shall limit any liability that a Fiduciary may
have under Part 4 of Title I of ERISA.
(3) The Trustee shall act by a majority of such Persons at the time in
office, and such action may be taken either by vote at a meeting or in writing
without a meeting.
(4) Said Persons serving as co-Trustees may unanimously designate any one
or more co-Trustees to execute any instrument or document on behalf of all,
including but not limited to the signing or endorsement of any check and the
signing of any applications for Contracts, and the action of such designated co-
Trustee shall have the same force and effect as if taken by all the co-Trustees.
In the event of such authorization, all the co-Trustees shall in writing notify
the other Administrative Parties thereof, and such
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parties shall be entitled to rely upon such notifications until one or more co-
Trustees shall give written notification to the contrary.
L. REMOVAL AND RESIGNATION OF TRUSTEE. Any sole or co-Trustee may resign at
any time upon not less than 30 days written notice (unless Company and Trustee
agree otherwise) to the Board of Directors of the Company specifying the
effective date of resignation. Any sole or co-Trustee may be removed by the
Board with or without cause, but only upon not less than 30 days' written notice
to such sole or co-Trustee specifying the effective date of removal and
enclosing a copy of the resolution of the Board (unless shorter notice and/or
waiver of the resolution is accepted by Trustee). No such removal shall become
effective until all sums due to such sole or co-Trustee under this Agreement
have been paid.
M. SUCCESSOR TRUSTEES. The lack of a Trustee due to resignation, removal or
otherwise shall not terminate the Trust. The Company shall promptly appoint one
or more successor Trustees. In the absence of any other Trustee, the Committee
shall act and serve as an interim Trustee. Each and every estate, title, right,
power, authority, discretion, duty and obligation conferred upon the Trustee by
this Agreement shall devolve upon, and be exercised and performed by, such
successor Trustees, including the Committee or any remaining Trustee.
N. SETTLEMENT OF ACCOUNTS UPON RESIGNATION OR REMOVAL OF TRUSTEE. In the
event of the resignation or removal of a sole or co-Trustee, such sole or co-
Trustee shall have the right to a settlement of its accounts at the expense of
the Trust, which accounting shall be made as provided in Paragraph (I) above.
Upon completion of such accounting and payment to the outgoing sole or co-
Trustee of its compensation and expenses, including court costs and legal fees,
such sole or co-Trustee or its legal representative shall promptly assign,
transfer and deliver unto the remaining or successor Trustee (or in the absence
thereof, to the Committee) the Trust Fund and all records and data (or copies
thereof) pertaining to the Plan and Trust.
O. SEGREGATED ACCOUNTS. Notwithstanding Paragraph (G) above or any other
provisions of this Agreement, any Participant may at any time while employed by
the Company notify the Committee in writing, on such form and in such manner as
the Committee may prescribe, that he elects to have all or a portion of his
account separately held and administered (i.e., segregated) and invested in such
manner, at such time and upon such terms as he may designate, including but not
limited to investments in Contracts to the extent permitted by Article XII(B)(4)
and (C). Subject to applicable Treasury Regulations, the Committee in its
discretion may but need not abide by such election; but if it does so, it shall
(in such manner and to such extent as it deems advisable) relay the
Participant's instructions in writing to the Trustee, who shall observe them.
Assets acquired pursuant to such election shall be held by the Trustee for the
benefit of the Participant in question; all income, gains and the like received
or earned thereon shall be credited to such Participant's account; and all
expenses, losses and the like shall be charged to his account as contemplated by
Articles IV(B) and XI(P). Such assets shall be held by the Trustee until
distributed in accordance with this Agreement, or until the Participant (acting
through the Committee) directs that they be disposed of, or until the
Participant revokes his election or his account becomes a Fixed Account,
whereupon the other provisions of this Agreement shall govern; but the
Participant in question may at any time purchase such assets from the Trustee at
their then market value (which for Contracts shall be their cash surrender
value). Such assets (including Contracts) held by the Trustee may be appraised
for the information of the Participant or otherwise in connection with any
appraisal made under Section (H) above but shall nevertheless be excluded from
such appraisal, and from the assets of the Trust Fund, for purposes of the Trust
as a whole and, in particular, for purposes of allocating profits and losses to
accounts pursuant to Article IV.
Also, the Committee in its discretion may permit any Participant who has
attained a specified age not earlier than age 55 to elect, subject to such non-
discriminatory terms and conditions as the Committee may prescribe, to
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have all of his account balance under the Plan separately held and invested by
the Trustee in a segregated fixed income fund under an arrangement whereby all
the assets of all Participants making such election are commingled and invested
in such segregated fund in a manner similar to the investment of commingled
Fixed Accounts described in Article IV(P). In such event the last sentence of
the preceding paragraph of this Section (O) shall apply to such segregated fund.
P. INVESTMENTS IN COMMON TRUST FUNDS. Notwithstanding any other provisions of
this Agreement, all or any part of the assets of the Trust may be invested in
any collective investment trust; provided that such collective investment trust
is exempted under the Code or regulations or rulings issued by the Internal
Revenue Service and is then maintained by the Trustee. The provisions of the
document governing any such collective investment trust, as amended from time to
time, shall govern any investment therein and are hereby made a part of this
Agreement.
Q. COMMINGLING OF TRUST FUNDS OF COMPANY AND RELATED COMPANIES. The Trustee
may, upon written instructions of the Committee, commingle the assets of the
Trust Fund for investment purposes only with the assets of any other tax
qualified plan(s) sponsored by the Company or any Related Company, provided (i)
such commingling shall be permitted only so long as such other tax qualified
plan(s) and related trust(s) and this trust continue to meet the requirements of
Sections 401(a) and 501(a) of the Code, (ii) such commingling is permitted under
the terms of such other tax qualified plan(s) and related trust(s), (iii) each
such trust shall be deemed to have a proportionate undivided interest in such
commingled trust the dollar amount of which shall be identifiable at all times
by the Trustee, except that any assets identified by the Committee as allocable
to each such trust and income, appreciation or depreciation and expenses
attributable to each of such trusts shall be allocated or charged to that trust,
(iv) the individual account records (if any) of participants in each such trust
shall continue to be kept separately for each trust, and (v) except as provided
herein each such trust shall continue to be treated as a separate trust for all
purposes including reporting to the Internal Revenue Service and disclosure to
participants.
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ARTICLE X
TERMINATION, AMENDMENT AND SUSPENSION
A. TERMINATION, ETC.; ASSUMPTION OF PLAN. It is the present intention of the
Company permanently to maintain the Plan and continue to make contributions
under Article III(A); provided, however, that subject to Article XI(E) -
(1) The Company reserves the right at any time to revoke this Agreement,
terminate the Plan, or terminate or suspend its liability to make further
contributions to the Trust, but no such action shall become effective until the
Company shall notify the Committee and Trustee.
(2) The Plan shall automatically terminate, and likewise the Company's
liability to make contributions to the Trust, upon the Company's legal
dissolution, or upon its adjudication as bankrupt or insolvent, or upon its
making a general assignment for the benefit of creditors, or upon a receiver
being appointed for its assets, or upon its merger or consolidation with or into
any other corporation or corporations, or upon a complete discontinuance of
contributions under the Plan within the meaning of Section 411(d)(3) of the
Code.
(3) Termination of the Plan may be forestalled if and to the extent that
any successor corporation, or any corporation or business entity employing a
majority of the then Participants, shall expressly assume the Plan and the
Company's liability to make contributions. Such assumption shall be expressed
in a written agreement between the Company and such corporation or business
entity, pursuant to proper resolution of the latter's Board of Directors or
other governing body, but shall not be effective unless copies of such agreement
and resolution shall be filed with the Trustee prior to termination. Such
agreement shall provide for assumption of the Plan and the liability to make
contributions, with respect to all Participants employed by such corporation or
business entity, and such corporation or business entity shall thereupon be
substituted pro tanto in the place and stead of the Company. With respect to
any then Participants who are not taken over as employees of such corporation or
business entity, the Plan shall be deemed to terminate, and Paragraph (B) below
shall be invoked.
(4) In the event of any termination or suspension under (1) or (2) above,
the Company and the Trustee shall give prompt notice thereof to the Internal
Revenue Service; and, subject to Paragraph (B) below, each Participant's account
shall be Vested to the extent required by Article XI(E)(2).
B. LIQUIDATION OF TRUST. In the event of termination of the Plan, the Trustee
shall proceed as promptly as possible, subject to any directions from the
Committee, to liquidate all investments, other than Contracts, and shall
thereupon determine the value of each Participant's account under Article IV(P)
as of the date of termination. After each such account has been appropriately
adjusted to cover any expenses of distribution and final liquidation costs, but
subject nevertheless to Sections 403(d)(1) and 4044 of ERISA and applicable
Labor Regulations, the Trustee shall pay the balance of such account to the
Participant (or, if deceased, his Beneficiary) in an immediate Lump Sum or by
means of the purchase and delivery of a Contract providing one of the payment
options permitted by the Plan (if such a Contract can be purchased from an
Insurer), whichever the Participant (or, if deceased, his Beneficiary) shall
elect in writing delivered to the Committee. Any Contract issued in respect of
any Participant shall be assigned to him or, if deceased, his Beneficiary at as
early a date as is possible after termination.
Notwithstanding Article V(E) (Cash-Outs) or any other provision of the Plan
to the contrary, if at the time the Trust is terminated the Company does not
maintain any other defined contribution plan (other than an employee stock
ownership plan as defined in Section 4975(e)(7) of the Code), the Trustee shall
pay the balance of each Participant's account (adjusted as provided above) to
the Participant (or, if deceased, his Beneficiary) in a Lump Sum as
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soon as administratively possible after such termination and the consent of the
Participant or his Beneficiary to such distribution shall not be required.
Alternatively, if so directed by the Committee, the Trustee shall continue
the Plan and Trust in existence as a "frozen" Plan and Trust (without receiving
any additional Company contributions and without admitting any additional
Participants) and shall pay the balances of the accounts of Participants to them
at such times as they are entitled to receive the same under this Agreement,
i.e., at retirement, death, other termination of employment, or by reason of
hardship or the attainment of age 59-1/2. In such event the frozen Plan and
Trust shall be operated and maintained so that they continue to meet the
qualification requirements of Section 401(a) of the Code, including the minimum
coverage requirements of Section 410(b) of the Code.
C. TERMINATION OF TRUST. Notwithstanding termination of the Plan, the Trust
shall terminate when and if, but not until, the Trust Fund shall be entirely
paid out and distributed in accordance with this Agreement.
D. AMENDMENT. Subject to Article XI(E) (Nonforfeitability, etc.) the Company
reserves the right at any time and from time to time to amend this Agreement,
without the consent of any Participant or Beneficiary, in any manner which the
Company deems to be proper, whether or not (1) for reasons of business necessity
or (2) for the purpose of causing the Plan and Trust to be tax qualified or to
continue to be tax qualified. The Company may amend the Agreement by action of
its Board of Directors or by action of its Benefits Administration Committee
(which may, but need not, subsequently be ratified by the Board of Directors).
No such amendment, except upon written consent, shall increase the duties or
liabilities of the Trustee or Committee, or diminish their compensation, or
deprive any Participant or Beneficiary of any then Vested equitable interest in
the Trust; provided, however, that such amendment may be retroactive to the
extent necessary to take full advantage of Section 401(b) of the Code if such
amendment is adopted for the purpose of causing the Plan and Trust to be tax
qualified or to continue to be tax qualified with respect to any taxable year
of the Company and is adopted and effective within the time limit specified in
Article III(A) with respect to making contributions for such taxable year or
within such longer period permitted under applicable Regulations.
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ARTICLE XI
MISCELLANEOUS
A. PERSONS PROHIBITED FROM SERVING AS FIDUCIARIES, ETC. No person shall serve
as a Committee member, Fiduciary, officer, Trustee, custodian, counsel, agent or
employee of the Trust, or as a consultant to the Trust or in any other capacity,
if prohibited so to do by Section 411 of ERISA.
B. INFORMATION REQUIRED BY ERISA. If some or all of the information necessary
to enable the Committee to comply with the requirements of Title I of ERISA is
maintained by -
(1) An insurance carrier or other organization (normally the Insurer)
which provides some or all of the benefits under the Plan, or holds assets of
the Plan in a separate account,
(2) A bank or similar institution (normally a corporate Trustee) which
holds some or all of the assets of the Plan in a common or collective trust or a
separate trust or custodial account, or
(3) A Plan sponsor (normally the Company) as defined in Section 3(16)(B)
of ERISA,
such carrier, organization, bank, institution or sponsor shall transmit and
certify the accuracy of such information to the Committee within 120 days after
the end of the Plan Year (or such other date as may be prescribed by applicable
Labor Regulations).
C. RETENTION OF RECORDS FOR SIX YEARS. Every Person (such as the Trustee,
Committee, Insurer, Company or an accountant) who is subject to a requirement to
file any description or report or to certify any information therefor under
Title I of ERISA (whether or not expressly required to do so by this Agreement),
or who would be subject to such a requirement but for an exemption or simplified
reporting requirement under Section 104(a)(2) or (3) of ERISA, shall maintain
records on matters of which disclosure is required which will provide in
sufficient detail the necessary basic information and data from which the
documents thus required may be verified, explained or clarified, and checked for
accuracy and completeness, and shall include vouchers, worksheets, receipts, and
applicable resolutions, and shall keep such records available for examination
for a period of not less than six (6) years after the filing date of the
documents based on the information which they contain, or six (6) years after
the date on which such documents would have been filed but for the aforesaid
exemption or simplified reporting requirement.
D. NO REVERSION. The assets of the Trust shall never inure to the benefit of
the Company and shall be held for the exclusive purposes of providing benefits
to Participants and their Beneficiaries and defraying reasonable expenses of
administering the Plan; and except as otherwise provided in Article III(F) and
(G), the Company shall not be entitled to receive or recover any part of its
contributions to the Trust or the earnings thereof.
E. NONFORFEITABILITY, ETC. In compliance with ERISA and the Code, it is
agreed:
(1) A Participant's right to his normal retirement benefits under
Article V(A) shall be Vested upon his attaining his Normal Retirement Age.
(2) Upon termination or partial termination of the Plan, or the complete
discontinuance of contributions by the Company under the Plan, the rights of all
Participants to Accrued Benefits as of such time (i.e., those accrued to the
date of such event), to the extent then funded or credited, shall be Vested,
except as otherwise required or permitted by applicable Regulations (e.g.,
Regulation Section 1.411(d)-2(a)) mentioned in Section 411(d)(3) of the Code.
XI-1
<PAGE>
(3) The Accrued Benefit of a Participant shall never be decreased by an
amendment of the Plan, except an amendment described in Section 412(c)(8) of the
Code and Section 302(c)(8) of ERISA. An amendment which has the effect of
eliminating an optional form of benefit with respect to benefits attributable to
service before the amendment shall be treated as decreasing the Accrued Benefit
of a Participant except as otherwise provided by Treasury Regulations.
(4) The vesting schedule in Article V(C) and any other vesting provision
of this Agreement based thereon shall not be amended unless -
(a) The Vested percentage of the Accrued Benefit derived from the
Supplementary Company Contributions and Matching Company
Contributions (determined as of the later of the date such
amendment is adopted, or the date such amendment becomes
effective) of any Participant is at least equal to such Vested
percentage computed without regard to such amendment; and
(b) Each Participant with at least three Years of Service is
permitted an election to have his aforesaid Vested percentage
computed without regard to such amendment. The period during
which the election may be made shall commence with the date the
amendment is adopted or deemed to be made and shall end on the
latest of:
(i) 60 days after the amendment is adopted;
(ii) 60 days after the amendment becomes effective; or
(iii) 60 days after the participant is issued written notice
of the amendment by the Company or the Committee.
(5) In the case of any merger or consolidation with, or transfer of assets
or liabilities to, any other plan, within the meaning of Section 401(a)(12) of
the Code, each Participant shall (if the Plan then terminates) receive a benefit
immediately after the merger, consolidation, or transfer which is equal to or
greater than the benefit he would have been entitled to receive immediately
before the merger, consolidation, or transfer (if the Plan had then terminated).
F. ROLLOVERS; DIRECT TRANSFERS; CERTAIN TRANSFERS PROHIBITED. Notwithstanding
any contrary provisions of this Agreement, including but not limited to
Articles V, VI and X, but only as and to the extent contemplated by Section
402(a)(5), (6) or (7), 403(a)(4), 408(d)(3) or 409(b)(3) of the Code, a
Participant shall be entitled -
(1) Subject to the last paragraph of this Paragraph (F) (prohibiting
certain transfers to this Plan), to transfer (or cause to be transferred) to the
Trust to be held as part of his account (i) the redemption proceeds of a
retirement bond and/or (ii) all or part of the cash and other property or the
proceeds of the same received by him in one or more distributions together
constituting a Lump Sum distribution from or under another tax qualified trust
or tax qualified plan or an employee annuity or custodial account and/or
(iii) an amount paid or distributed out of an individual retirement account or
individual retirement annuity or retirement bond consisting of a prior rollover
contribution from a tax qualified trust or annuity plan and/or (iv) amounts
distributed from an employee stock ownership plan (within the meaning of Section
4975(e)(7) of the Code) pursuant to a participant's diversification election;
provided, however, that no such transfer will be permitted unless the Committee
determines that such transfer will meet the applicable requirements of the Plan
and will not adversely affect the tax qualified status of the Plan; and/or
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(2) Upon at least 60 days' written notice to the Committee, to cause his
entire account to the extent that it has Vested to be transferred in whole or in
part on his behalf (or to him for retransfer), in the form of cash or other
property or the proceeds of the same (in one or more distributions which,
together with any distributions retained by him, constitute a Lump Sum
distribution), to an individual retirement account, an individual retirement
annuity (other than an endowment contract), a tax qualified trust, or an annuity
plan.
The amount so transferred to or from the Trust is herein called a "Rollover
Contribution." Any Rollover Contribution to the Trust, together with the
earnings thereon, shall be fully Vested but need not be segregated from the
remainder of the Participant's account unless the Trustee otherwise elects or
the Participant or Committee otherwise directs. In the case of a transfer
described in (2) above, made to the Participant for retransfer, he shall not
retransfer the portion described in Section 402(e)(4)(D)(i) of the Code
(constituting in effect his own nondeductible employee contributions).
A Participant also shall be entitled to directly transfer to the Trust any
amount described in Subparagraph (1)(ii) above, provided the tax qualified plan
referred to in said Subparagraph (1)(i) permits such transfer, or (effective
January 1, 1993) any amount described in Subparagraph (4)(i) below and to
directly transfer to another tax qualified plan which provides for the
acceptance of direct transfers any amount described in Subparagraph (2) above;
provided, however, that no such direct transfer to or from this Plan will be
permitted unless the Committee makes the same determination with respect to such
transfer as it must make under Subparagraph (1) above with respect to a Rollover
Contribution.
Notwithstanding the foregoing provisions of this Paragraph (F), except to
the extent permitted under Article VII there shall not be transferred to this
Plan, nor shall this Plan accept, a transfer of assets from (i) a tax qualified
defined benefit plan, (ii) a tax qualified Defined Contribution Plan which is
subject to the funding standards of Section 412 of the Code, including a target
benefit plan, or (iii) any other plan to which clause (iii) of Section
401(a)(11)(B) of the Code applies with respect to a Participant, which transfer
would cause this Plan to be a "direct or indirect transferee" of such a plan
with respect to a Participant within the meaning of such term as defined in
Section 401(a)(11)(B)(iii) of the Code.
(3) This Subparagraph (3) and Subparagraph (4) below apply to
distributions made on or after January 1, 1993. Notwithstanding any provision
of this Agreement to the contrary that would otherwise limit a distributee's
election under this Subparagraph (3), a distributee may elect, at the time and
in the manner prescribed by the Committee, to have any portion of an eligible
rollover distribution paid directly to an eligible retirement plan specified by
the distributee in a direct rollover.
(4) 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 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 includible in gross income
(determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities).
XI-3
<PAGE>
(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 surviving
spouse and the Employee's or former Employee's spouse or former spouse
who is the alternate payee under a qualified domestic relations order,
as defined in Section 414(p) of the Code, are distributees with regard
to the interest of the spouse or former spouse.
(iv) Direct rollover: A direct rollover is a payment by the Plan to
the eligible retirement plan specified by the distributee.
G. SPENDTHRIFT PROVISION. It is the intention and purpose of the parties to
this Agreement to place the absolute title to the Trust Fund in the Trustee
alone, with power and authority to pay out the same only as provided in this
Agreement. Accordingly, the benefits provided by this Agreement may not be
assigned or alienated, within the meaning of Section 206(d)(1) of ERISA and
Section 401(a)(13) of the Code, except as provided in Paragraph (H) below.
H. EXCEPTIONS TO SPENDTHRIFT PROVISION. It is agreed that:
(1) Paragraph (G) above shall not apply to a loan made under Article VI(F)
to a Participant or Beneficiary if such loan is secured by the Participant's
Accrued Vested Benefit (within the meaning of Section 401(a)(13) of the Code)
and by reason of Section 4975(d) of the Code is exempt from the tax on
prohibited transactions imposed by Section 4975 of the Code.
(2) Paragraph (G) above 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, except that effective January 1, 1985
said Paragraph (G) shall not apply if the order is determined by the Committee
to be a qualified domestic relations order (as defined in Section 414(p) of the
Code), and shall not apply to any domestic relations order entered before
January 1, 1985 if the Trust commenced to pay benefits pursuant to such order on
or prior to such date, or if the Trust had not then commenced to pay any such
benefits the Committee determines that such order is valid and compliance with
same will not violate any provision of the Code or adversely affect the tax
qualified status of the Plan. Notwithstanding any restrictions in the Plan
regarding the payment of benefits prior to the date on which a Participant
terminates employment with the Company, the Committee may establish procedures
and conditions under which a qualified domestic relations order may provide for
payment of benefits to an alternate payee (as defined in Section 414(p)(8) of
the Code) on any date subsequent to the entry of such order and subsequent to a
determination by the Committee that such order is a qualified domestic relations
order pursuant to section 414(p) of the Code, whether or not such payment would
be made prior to the Participant's earliest retirement date (as defined in
Section 414(p)(4)(B) of the Code). If procedures established by the Committee
are followed, if conditions established by the Committee are met, and if the
qualified domestic relations order so provides, the Trustee shall pay benefits
to the alternate payee from the vested portion of a Participant's Account
pursuant to the qualified domestic relations order.
(3) If a Participant shall so direct the Committee or Trustee in writing,
amounts may be withheld out of his benefits under the Plan (not in excess of 10%
of any benefit payment) to pay for his chargeable portion of
XI-4
<PAGE>
group medical, hospital, accident or life insurance premiums and other group
programs, not necessarily related to insurance, maintained by the Company for
the convenience or welfare of all or part of its active or retired Employees.
I. EXECUTION OF INSTRUMENTS. Except as in this Agreement otherwise expressly
provided, any instrument or document to be delivered or furnished by the Company
shall be sufficiently executed if executed in the name of the Company by any
officer or officers thereof; or, where furnished or delivered by the Committee,
if executed in the name of the Committee by any member thereof; or where
furnished or delivered by the Trustee, if executed as follows:
(1) If the Trustee consists of two or more Persons, if executed in the
Trustee's name by any such Person, and
(2) In the case of any corporate Trustee (whether or not the sole
Trustee), if executed as Trustee in the name of such corporation by any officer
or officers thereof;
provided, further, that any Administrative Party shall be fully protected in
relying upon any instrument or document so executed; and execution as aforesaid
shall create a strong presumption that any signature so affixed is duly
authorized and that any information contained in such instrument or document is
true and correct.
J. SUCCESSORS, ETC. This Agreement shall be binding upon, and inure to the
benefit of, the Company and (subject to Article X(A)) its successors, the
Trustee and its successors, the Committee as from time to time constituted, and
the Participants and Beneficiaries, their heirs, personal representatives,
successors, and assigns, all in accordance with and subject to the terms of this
Agreement.
K. PAYMENT IN KIND. Benefits payable pursuant to the Plan, whether under
Article V or VI may be paid in cash or in kind, except as in this Agreement
otherwise expressly provided. If paid in kind, the assets distributed shall be
valued in the manner described in Article IX(H).
L. MISCELLANEOUS PROTECTIVE PROVISIONS. It is further agreed, that, except as
otherwise provided in this Agreement or ERISA -
(1) Any Administrative Party may request and rely upon an opinion of
counsel, who may or may not be counsel for the Company, and shall be fully
protected for any action taken, suffered or omitted in good faith reliance upon
such opinion.
(2) No recourse under this Agreement, or for any action or nonaction
hereunder, or for any loss or diminution of the Trust Fund, or for any payment
or nonpayment of benefits, or for any other reason whatsoever relating to the
Plan, shall be had by any Person whomsoever against any individual in his
capacity as stockholder, officer, director or employee of the Company, past,
present or future.
(3) Where the establishment of any fact is in question, any Administrative
Party may in its discretion accept as evidence thereof any properly executed
instrument or document furnished by any other Administrative Party or such other
evidence as may seem reasonable in the circumstances.
M. NO DURESS OR RETALIATION AGAINST PARTICIPANTS, ETC. No Participant or
Beneficiary shall be discharged, fined, suspended, expelled, disciplined, or
discriminated against for exercising any right to which he is entitled under
this Agreement, ERISA, or the federal Welfare and Pension Plan Disclosure Act,
or for the purpose of interfering with the attainment of any right to which such
Participant may become entitled thereunder; nor shall any Participant or
Beneficiary (through the use of fraud, force, violence, or threat of such use)
be restrained, coerced, or intimidated (nor shall there be any attempt so to do)
for the purpose of interfering with or preventing the exercise of any
XI-5
<PAGE>
right to which he is or may become entitled under this Agreement, ERISA, or said
Disclosure Act; nor shall any Person be discharged, fined, suspended, expelled,
or discriminated against because he has given information or has testified or is
about to testify in any inquiry or proceeding relating to ERISA or said
Disclosure Act.
N. RECORD KEEPING, INVESTIGATIONS, ETC. The Company and each Fiduciary,
Committee member, and other appropriate Person shall maintain such books and
records pertaining to the Plan and Trust, make them available for inspection,
file such information, and submit to such investigations as are properly
required by the Secretary of Labor or his delegate pursuant to Section 504 or
505 of ERISA.
O. DISTRIBUTIONS TO MINORS AND INCOMPETENT OR MISSING INDIVIDUALS. If any
individual to whom benefits shall be distributable under the Plan shall be a
minor, adjudged mentally incompetent or cannot reasonably be located, the
Committee may direct the Trustee to distribute such benefits by one or more of
the following methods, to be determined by the Committee: (1) directly to such
minor or incompetent individual; (2) to the guardian of such individual; (3) to
another Person for the use or benefit of such individual; (4) by the Trustee or
Committee, or their agents, expending, or arranging for the expenditure of, such
benefits for the education, health or maintenance of such individual; or (5) to
a bank account established on behalf of such individual. Except as to
(4) above, neither the Committee nor Trustee shall be required to see to the
application of any such distributions. Distributions made pursuant to this
Paragraph (O) shall operate as a complete discharge of the Trustee, the
Committee and the Trust Fund. Also, if the Committee determines after
reasonable efforts to locate an individual who is entitled to a distribution of
all or part of an account balance under the Plan that such individual cannot be
located, the amount payable to such individual may, if the Committee so
determines, be forfeited as of the Anniversary Date falling within the Plan Year
of such determination and be allocated among the accounts of the Participants in
the same manner as a forfeiture under Article IV(Q)(1). However, in such event
if the individual entitled to a distribution of the forfeited amount
subsequently makes a claim for the same, it shall be reinstated out of
forfeitures, if any, for the Plan Year in which the claim is made and/or an
additional contribution to the Trust by the Company for such Plan Year and shall
be paid to such individual in accordance with the Plan.
P. EXPENSES AND COMPENSATION. Subject to Article IX -
(1) Members of the Committee shall serve without compensation, but the
Trustee shall be paid compensation in such amount and manner as may from time to
time be mutually agreed between the Trustee and the Company.
(2) The expenses of the Trustee and Committee, including but not limited
to legal fees and the Trustee's compensation, shall be paid by the Company:
(a) Although it is intended that expenses shall be paid by the
Company, the Trust Fund guarantees that they shall in all events
be paid in full when due, and a lien for such payment is hereby
impressed upon the Trust Fund; provided that no individual
Trustee who already receives full-time pay from the Company shall
receive from the Trust Fund any compensation for his services as
Trustee, excepting reimbursement of expenses properly and
actually incurred.
(b) Notwithstanding any provision to the contrary, any expenses which
the Trustee or Committee may incur with special reference to any
Participant or his account (including any Fixed Account) shall
first be charged against such account to the extent that the same
is sufficient for such purpose. Any balance of said special
expenses shall then be charged to the Company or the Trust Fund
pursuant to (a) above but shall if possible be later reimbursed
to the Company or the
XI-6
<PAGE>
Trust Fund out of future credits to such Participant's account.
Q. TRANSFERRED PAYSOP ACCOUNTS. The shares of Great Lakes Bancorp Stock
transferred to this Plan from the Great Lakes Federal Savings and Loan
Association Payroll Stock Ownership Plan (herein called the "PAYSOP") shall be
held in the Great Lakes Bancorp Stock Fund. The account balances of the
participants in the PAYSOP who did not properly instruct the Trustee of the
PAYSOP regarding distribution of their accounts as of the close of business on
December 31, 1991 shall be transferred to this Plan and shall be maintained as
separate accounts in this Plan to be called "PAYSOP Transfer Accounts". Each
Participant's PAYSOP Transfer Account as of January 1, 1992 shall reflect the
number of shares and fractional shares of Great Lakes Bancorp Stock and cash, if
any, credited to such account. Each such account shall be fully and immediately
vested, shall be distributable to the Participant in accordance with the
provisions of this Plan which apply to Elective Contributions and Matching
Company Contributions, including those provisions of this Plan which apply to
loans, hardship distributions and distributions after age 59-1/2 to Participants
who are employed by the Company, and shall be subject to investment direction of
the Participant subject to the same conditions under which a Participant may
direct the investment of his or her Elective Contributions Account and Matching
Company Contributions Account.
All shares of Great Lakes Bancorp Stock allocated to a Participant's PAYSOP
Transfer Account shall be subject to the requirements and restrictions which
apply to Great Lakes Bancorp Stock held in the Elective Contributions Accounts
and Matching Company Contributions Accounts of Participants, including the
provisions of Article IV(S) relating to the form of payment from an account
credited with Great Lakes Bancorp Stock and the provisions of Article IV(T) and
(U) relating to voting rights and tender offers. Also, any optional form of
benefit under the PAYSOP which must be preserved pursuant to Section 411(d)(6)
of the Code and which is not otherwise provided under this Plan shall be so
preserved with respect to the PAYSOP Transfer Accounts.
XI-7
<PAGE>
ARTICLE XII
INSURANCE PROVISIONS
A. DEFINITIONS. The following words and phrases, wherever capitalized, shall
have the following meanings respectively, unless the context otherwise requires:
(1) "Contract" means any insurance and/or annuity contract issued by an
insurance company in respect of a Participant pursuant to the Plan.
(2) "Insurance Contract" means any type of Contract which is not an
annuity contract.
(3) "Insurer" means such legal reserve life insurance company or companies
as shall issue any Contract which may be purchased pursuant to the Plan.
B. TYPE AND AMOUNT OF CONTRACTS. It is contemplated but not required that all
or part of the Trust Fund may from time to time be invested in Contracts, as a
general investment of the Trust Fund, i.e., on the life of a key employee (as
this term is customarily used in a life insurance context) and payable to the
Trust for the benefit of the Trust as a whole, or otherwise. The portion of the
Trust Fund to be invested in Contracts, the arrangements with respect thereto,
and the type of Contracts to be purchased, shall be entirely within the
Committee's discretion; provided, however, that -
(1) The Committee shall exercise such discretion in a nondiscriminatory
manner as among the respective Participants.
(2) The Committee's discretion hereunder shall not apply to accounts
segregated pursuant to Article IX(O).
(3) The Committee shall not cause Contracts to be purchased in respect of
Participants (which are not general investments of the Trust Fund) otherwise
than in proportion to their respective accounts under the Plan unless a
Participant shall otherwise direct the Committee with respect to a Contract or
Contracts issued or to be issued with respect to such Participant, which any
Participant shall have the right to do if, and only if, the Committee makes this
right available to all Participants by so advising them in writing (whether or
not the Committee causes Contracts to be purchased for other Participants).
(4) That portion of any Participant's account which may be invested in a
whole life insurance Contract or Contracts for such Participant shall be less
than 50% of the aggregate amount of the Company's contributions plus forfeitures
allocated to such account; that portion of any Participant's account which may
be invested in a term life insurance Contract or Contracts for such Participant
shall not exceed 25% of the aggregate amount of the Company's contributions plus
forfeitures allocated to such account; provided, however, that if a portion of
any Participant's account is invested in both whole life and term insurance
Contracts for such Participant, the amount expended for the term life insurance
Contract or Contracts plus one-half (1/2) of the amount expended for the whole
life insurance Contract or Contracts shall not exceed 25% of the aggregate
amount of the Company's contributions plus forfeitures allocated to such
account; and provided further that the foregoing limitations shall not apply to
Contracts which are general investments of the Trust Fund, as aforesaid.
C. APPLICATION AND OWNERSHIP. Applications for Contracts shall be made by the
Trustee at such time or times, in such manner, and to such life insurance
company or companies as the Committee shall designate. Any such application,
and any Contract issued as a result thereof, shall provide that legal ownership
of such Contract shall vest in the Trustee and not in the Participant in respect
of whom it is issued. However, the Trustee shall exercise all rights, options
and privileges under or incident to such Contract only in a manner directed and
approved by the Committee.
XII-1
<PAGE>
D. DIVIDENDS AND REFUNDS. Each such application shall, unless otherwise
directed by the Committee, request that any dividends or refunds on the Contract
shall be used and applied in reduction of the next premium payable thereon,
except that any dividends or refunds due and payable under the Contract upon the
death of the Participant in question shall form a part of the proceeds payable
on death, unless the Contract is a general investment of the Trust Fund.
E. ANNIVERSARY DATE. Except to the extent that the Committee shall otherwise
direct, and the Insurer will permit, the anniversary date of all Contracts
purchased by the Trustee shall be identical.
F. CHOICE OF OPTIONS. In addition to any consultations otherwise required by
this Agreement, the Committee shall consult with each Participant from time to
time and assist him in designating his choice of the options, with respect to
both death and retirement benefits, which may be available under any Contracts
issued in respect of him or which may be available under Article V(A) or (C);
provided, however, that in no event shall any benefits under the Plan be payable
in any form of a life annuity, and provided further that in no event shall any
Participant be permitted to select any option under any Contract which would
violate any restriction on distributions included in Article V(A) or designed to
provide only a minimal benefit to such Participant during his lifetime with the
major benefit to his Beneficiary (such as an option providing for the payment of
interest only to the Participant during his lifetime and the principal to his
Beneficiary upon such Participant's death). In particular, the Committee shall
endeavor so to consult with and assist each Participant within a reasonable time
prior to his retirement.
G. DEATH. In connection with Article VI(A-C), a Participant shall, with
respect to any Contracts purchased under the Plan with respect to him (other
than as general investment of the Trust Fund), designate the Trust as
beneficiary under such Contract to receive the proceeds of the same in a Lump
Sum. Such proceeds shall then be added to the Participant's account balance
under the Plan and be subject to the provisions of Article VI(A-C). However, a
Participant shall with respect to any such Contracts be entitled to designate a
Beneficiary and/or method of a distribution (other than a life annuity) which
differs from that designated in respect of the balance of his account. Upon
being informed thereof by the Committee, the Trustee shall take such steps as
the Insurer may require in order to effectuate the wishes of the Participant;
provided, however, that -
(1) Such designation shall be subject to the limitations set forth in said
Article VI(A-C).
(2) In the event that a valid designation shall not be in existence at the
Participant's death, the method of settlement shall be designated by the
Beneficiary subject to Article VI(C).
(3) Upon the Participant's death, the Trustee shall make the proceeds of
the Contract available to the Beneficiary, according to the method of
distribution selected, either by assigning and delivering the Contract to the
Beneficiary or by collecting the proceeds and paying them over to the
Beneficiary.
H. NORMAL RETIREMENT. If a Participant is entitled to receive benefits under
Article V(A), any benefits available to him on account of any Contracts existing
with respect to him shall be made available as promptly as possible as follows:
(1) During the time when such Participant is still employed, the Committee
shall instruct the Trustee to effectuate a certain option under and/or
conversion of such Contracts, or to surrender such Contracts for cash, which
instructions shall if practicable conform to the Participant's wishes as
expressed in notices and directions properly filed with the Committee or, if
none, then as expressed in consultations with the Committee. The Trustee shall
promptly attempt to carry out the Committee's instructions to the extent
XII-2
<PAGE>
that the same are compatible with the provisions of this Paragraph (H) and with
the rules of the Insurer and the provisions of such Contracts, and the terms of
Article V(A) and (C), but no portion of any Contract shall be used to continue
life insurance protection beyond the date of the Participant's retirement.
(2) Funds in the Participant's account may be used to effectuate any
conversion of Contracts under (1) above, but no such conversion shall be made
unless sufficient funds are available or are suitably supplemented by the
Participant. Any cash resulting from the surrender or conversion of Contracts
shall be included in the Participant's account.
(3) After the Participant has retired and the foregoing acts and things
have been accomplished, the Trustee shall assign and deliver
any then-existing Contracts to the Participant at an assumed value equal to the
aggregate of the net premiums theretofore paid thereon (as determined under
Paragraph (K) below) and, after first deducting such assumed value, shall
distribute the balance of the Participant's Fixed Account (including any cash
resulting from the surrender or conversion of Contracts as contemplated by
(2) above) in accordance with Article V(A).
I. OTHER BENEFITS. If a Participant's employment with the Company shall
terminate otherwise than on account of his death, and Paragraph (H) above is not
applicable, then any benefits available to him on account of any Contracts
existing with respect to him (other than as general investments of the Trust
Fund) shall be made available as promptly as possible as follows:
(1) If in the circumstances all of such Participant's account is to be
forfeited, he shall nonetheless be entitled within 60 days to purchase any such
Contract from the Trustee for cash at the full cash surrender value thereof,
whereupon such Contract shall be assigned and delivered to him, and the cash so
paid shall be forfeited in like manner as the balance of his account. Any
Contract not so purchased shall be converted to cash by the Trustee, which cash
shall be in like manner forfeited.
(2) If in the circumstances no portion of such Participant's account is to
be forfeited, the Trustee in setting aside the assets comprising his Fixed
Account shall include therein such Contracts at an assumed value equal to the
aggregate of the net premiums theretofore paid thereon (as determined under
Paragraph (K) below) and, in conjunction with distributing such assets to the
Participant, shall assign and deliver to him any such Contract.
(3) If in the circumstances part but not all of such Participant's account
is to be forfeited, the Trustee shall proceed as in (2) above; provided,
however, that if the assumed value of such Contracts shall exceed the balance of
such Participant's Fixed Account after forfeitures, the Trustee shall proceed as
follows:
(a) If the Participant shall elect to pay such excess to the Trustee in
cash, then the Trustee shall assign and deliver the Contracts to him
but shall not distribute to him any cash or other assets.
(b) Otherwise the Trustee shall convert such Contracts to cash and shall
distribute to such Participant cash and other assets (not including
Contracts) equal in aggregate value to the balance of his Fixed
Account after forfeitures.
(4) In no event shall any portion of any Contract which is not a general
investment of the Trust Fund be used to continue life insurance protection
beyond the date of the Participant's retirement or other termination of
employment.
J. LOANS; HARDSHIP DISTRIBUTIONS; DISTRIBUTIONS AFTER AGE 59-1/2. In
connection with any distribution or loan to be made to a Participant under
Article VI(E) or (F), the following provisions shall apply to any Contracts
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existing with respect to the Participant in question, as well as the value of
such Contracts (as determined under Paragraph (I)(2) above):
(1) Except with respect to a distribution under Article VI(D), the value
thereof shall be subtracted in determining the balance of the Fixed Account of
the Participant in question for purposes of Article VI(E) or (F).
(2) If under (1) above the Committee shall permit the value of a Contract
to be thus included, then (as part of the distribution in question) said
Contract shall be distributed, processed and accounted for in the same manner as
would be required in the case of a distribution under Paragraph (I)(2) above and
valued in the same manner as would be required in the case of a distribution
under Paragraph (I)(3) above.
K. ACCOUNTING FOR CONTRACTS. In connection with each Participant's account,
the Trustee shall make and preserve a record of all Contracts issued in respect
of such Participant and the amount of the net premiums paid thereon by the
Trustee or the Participant, including any amounts paid upon or as the result of
any conversion of such Contracts. In any instance where a Contract shall be
purchased or exist in respect of a Participant, other than as a general
investment of the Trust Fund, the following provisions shall apply, subject
nevertheless to Article IX(O):
(1) The net premiums paid thereon by the Trust shall be charged against
his account.
(2) Contracts shall be valued at an amount equal to the net premiums paid
by the Trust thereon up to and including the date of valuation, including any
amounts which may have been paid upon or as a result of the conversion thereof.
(3) If any portion of the premium paid for such Contract is attributable
to current life insurance protection in respect of such Participant (and
therefore ordinarily taxable to him), the Participant shall have the option of
reimbursing the Trust for such portion within 30 days after notification
thereof; and if he shall not so reimburse the Trust, then such portion shall be
treated for Trust accounting purposes in a manner similar to a current
distribution of cash to the Participant.
(4) To the extent of any portion of the premium which is attributable to
current life insurance protection (either taxed to or reimbursed by the
Participant), the Contract in question shall be regarded as having been
purchased by the Participant, and any interest therein or in the proceeds
thereof which is attributable to such current life insurance protection (deemed
to have been purchased by the Participant as aforesaid as hereinafter called
"Participant-owned insurance protection") shall be treated as property belonging
to the Participant. In the event that a forfeiture of all or part of his
account or interest in the Trust shall occur, the Trustee, subject to the
directions of the Participant and rules of the Insurer, may -
(a) Cancel the Contract and apply the proceeds pursuant to the forfeiture,
after paying to the Participant or to
his Beneficiary, as the case may be, the cash value attributable to
any continuing Participant-owned insurance protection, or
(b) Transfer the Contract to the Participant or his Beneficiary, as the
case may be, after collecting from such Person the forfeited portion
of any premiums theretofore paid and not attributable to Participant-
owned insurance protection.
(5) In computing premiums paid by the Trust upon or in respect of a
Contract, there shall be excluded any premiums paid or reimbursed by or charged
against (and taxed to) the Participant.
L. PROTECTIVE PROVISIONS. No Insurer shall be deemed a party to the Plan or
this Agreement, and its obligation shall be measured solely by the terms of
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<PAGE>
any Contracts issued by it, except as otherwise required by ERISA. It is
further agreed:
(1) An Insurer may rely upon the identity of the Trustee as shown by its
records until such time as it shall receive at its home office satisfactory
notification of a change in the Trustee's identity.
(2) An Insurer shall deal with the Trustee as the sole and absolute owner
of all Contracts and shall not be obligated to ascertain whether the Trustee is
adhering to the terms of this Agreement and/or the directions of the Committee.
(3) An Insurer may rely upon receipts and releases given by the Trustee
and shall be fully discharged from liability for any action taken or payment
made in accordance with the Trustee's directions and/or with the terms of the
Contract; nor shall an Insurer be obligated to see to the application of any
amount so paid.
(4) The provisions of Article XI(I) are, by way of illustration but not of
limitation, intended for the protection of Insurers. Any signature affixed to
an application or other writing as therein provided shall be conclusive proof to
the Insurer that the individual in respect of whom an application for a Contract
is being made is eligible to have such Contract issued in respect of him as to
the form, benefits and amount requested in such application.
M. REPORTS. If some or all of the benefits under the Plan are purchased from
or guaranteed by an Insurer, insurance service, or similar organization, an
annual report required to be filed with the Internal Revenue Service under
Paragraph VIII(E) shall include a statement from such organization covering the
Plan Year in question and containing the information required by Section 103(e)
of ERISA.
N. MISCELLANEOUS. It is further agreed:
(1) Upon being advised that the proceeds of any Contract have become
payable to the Trustee, the Trustee shall endeavor to collect such sums as may
appear to be due and shall use and disburse them as provided in this Agreement;
provided, however, that the Trustee shall not be required to institute suit or
maintain any litigation or incur any expenses to collect the proceeds of any
Contract unless instructed by the Committee to that effect and unless the
Trustee has been suitably indemnified as set forth in Subparagraph IX(J)(5).
(2) Notwithstanding anything in this Agreement to the contrary, the
Trustee may, after consultation with the Committee, settle, compromise and
adjust claims arising out of Contracts, or any questions as to the validity of
Contracts, upon such terms and conditions as the Trustee may deem proper, and
the decision of the Trustee shall be binding and conclusive upon all parties
interested in the Trust or having any interest in such Contracts.
(3) Any amounts payable under any Contract issued in respect of a
Participant (but not as a general investment of the Trust Fund) which are
payable after his death as death benefits or otherwise shall be paid to the
Beneficiary in the manner, if any, properly designated by such Participant.
(4) Any other amounts payable periodically under any such Contract shall
be paid directly to the Participant without any right to commute such periodic
payments.
(5) No Contracts may be purchased on or after January 1, 1992 but premiums
may continue to be paid with respect to Contracts existing on such date.
XII-5
<PAGE>
ARTICLE XIII
TOP-HEAVY RULES
A. APPLICATION; TOP-HEAVY STATUS. Notwithstanding any other provision of the
Plan to the contrary, the provisions of Article XIII(B) shall apply for any Plan
Year beginning after December 31, 1983 in which the Plan is determined to be
Top-Heavy as of the Determination Date, in accordance with the following:
(1) REQUIRED AGGREGATION OF PLANS. If the Company and any Related
Companies maintain one or more tax qualified plans in addition to this Plan,
then there shall be aggregated for purposes of this Article XIII(A) those of
such plans -
(a) in which a Key Employee is a participant, and
(b) which enable any plan in which a Key Employee is a participant to
meet the nondiscrimination requirements of Section 401(a)(4) of
the Code or the minimum participation standards of Section 410 of
the Code.
All such plans shall be referred to in this Article XIII as the "Required
Aggregation Group". There also may be aggregated with the aforesaid plans and
considered as included in the Required Aggregation Group any other tax qualified
plan which was maintained by the Company or a Related Company within the five
Plan Years ending on the Determination Date and would be part of the Required
Aggregation Group for the Plan Year but for the fact that such plan terminated
before the Determination Date.
(2) PERMISSIVE AGGREGATION OF PLANS. If the Company and any one or more
Related Companies maintain one or more tax qualified plans in addition to this
Plan and any other plan or plans in the Required Aggregation Group then there
may be aggregated with this Plan, or with the plans in the Required Aggregation
Group, any of such additional plans which, when so aggregated, continue to meet
the requirements of Sections 401(a)(4) and 410 of the Code (the "Permissive
Aggregation Group"). There also may be aggregated with the aforesaid plans and
considered as included in the Permissive Aggregation Group any other tax
qualified plan which was maintained by the Company or a Related Company within
the five Plan Years ending on the Determination Date and could be part of the
Permissive Aggregation Group for the Plan Year but for the fact that such plan
terminated before the Determination Date.
(3) KEY EMPLOYEES. Key Employees shall mean and include all employees and
former employees (and the beneficiaries of all employees and former employees)
who are or were one or more of the following during the five Plan Years ending
on the Determination Date:
(a) officers of the Company or any Related Company having annual
compensation greater than 50 percent of the Adjusted Equivalent
of the amount in effect under Section 415(b)(1)(A) of the Code
for such Plan Year, provided that no more than 50 employees (or
if lesser, the greater of (i) three or (ii) 10% of the employees)
shall be treated as officers, and provided that employees
described in Section 414(q)(8) of the Code shall be excluded;
(b) one of the ten employees owning (or considered as owning within
the meaning of Section 318 of the Code) both more than a one-half
percent interest and the largest interests in the Company and any
Related Company, as further defined in Section 416(i)(1)(A)(ii)
of the Code and the Treasury Regulations thereunder, having
annual compensation greater than the dollar limit of Section
415(c)(1)(A), provided that if two or more employees own the same
interest, the employee having greater annual Compensation shall
be treated as owning the greater interest;
XIII-1
<PAGE>
(c) five percent owners of the Company; or
(d) one percent owners of the Company having annual compensation from
the Company and any Related Company of more than $150,000 per
year.
For purposes of (a), (b) and (d) above, compensation means Compensation
plus amounts contributed by the Company pursuant to a salary reduction
arrangement which are excludable from gross income under Section 125, 402(a)(8),
402(h)(1)(B) or 403(b) of the Code. For purposes of (c) and (d) above, "owner"
shall have the same meaning as in Section 416(i)(1)(B) of the Code. Also, for
purposes of determining ownership in the Company under (b), (c) and (d) above,
the aggregation rules of subsections (b), (c) and (m) of Section 414 of the Code
shall not apply.
An employee who is identified as a Key Employee under more than one
category shall nevertheless be counted as one Key Employee. A Non-Key Employee
who is also the beneficiary of a Key Employee shall be counted as a Key
Employee, but only the Accrued Benefit attributable to the Key Employee shall be
counted in determining Top-Heavy status.
(4) ACCRUED BENEFITS. For purposes of this Article XIII(A), Accrued
Benefits for all defined benefit plans required or permitted to be aggregated
under (1) and (2) above shall mean the Actuarial Equivalent (which shall be the
same for all plans being aggregated) of the Accrued Benefit determined as of the
actuarial valuation date preceding or coinciding with the Determination Date.
If there is no method of computing Accrued Benefits that uniformly applies for
all such plans, then solely for the purposes of this Article XIII(A), the
Accrued Benefit of an employee other than a Key Employee shall be determined as
if his benefits accrued not more rapidly than the slowest accrual rate permitted
under the fractional accrual rate of Section 411(b)(1)(C) of the Code.
For all defined contribution plans required or permitted to be so
aggregated, Accrued Benefits shall mean the balance in the employer and employee
contribution accounts (excluding amounts attributable to deductible employee
contributions) as of the Determination Date, and shall for all plans include:
(a) distributions to any employee during the five Plan Years ending
on the Determination Date;
(b) unrelated rollovers (rollovers during the five Plan Years ending
on the Determination Date which were initiated by the employee
and transferred to a plan maintained by an employer other than
the Company or any Related Company) made from this Plan, (or made
to this Plan prior to December 31, 1983); and
(c) related rollovers (rollovers to this Plan which were either not
initiated by the employee or were made from another tax qualified
plan maintained by the Company or any Related Company).
(5) TOP-HEAVY DETERMINATION. There shall be computed, as of the
Determination Date, the sum of all Accrued Benefits for all Key Employees and
the sum of all Accrued Benefits of all employees. Such computation shall be
made separately for each plan required or permitted to be aggregated with this
Plan, as of the determination date (as defined in each such plan) which falls
within the calendar year in which the Determination Date falls. If the
following ratio --
the sum of all Accrued Benefits for all Key Employees
-----------------------------------------------------
the sum of all Accrued Benefits for all Employees
XIII-2
<PAGE>
for this Plan if it is the only tax qualified plan maintained by the Company and
any Related Company, or for all plans in any Required Aggregation Group, is
greater than sixty percent (60%), then this Plan and all plans in any Required
Aggregation Group is (are) Top-Heavy, effective on the first day of the Plan
Year. If such ratio for all tax qualified plans in any Permissive Aggregation
Group is 60% or less, then neither this Plan (nor any other plan in such
Permissive Aggregation Group) is (are) Top-Heavy for the Plan Year. For
purposes of the foregoing computation, there shall be excluded the Accrued
Benefits of:
(a) former Key Employees, i.e., persons who were Key Employees but
who have not fulfilled the definition of Key Employee at any time
during the five Plan Years ending on the Determination Date), and
(b) former employees who have not performed any service for the
Company or a Related Company during the five Plan Years ending on
the Determination Date.
B. EFFECT OF TOP-HEAVY STATUS.
(1) MINIMUM CONTRIBUTION. For any Plan Year in which the Plan is Top-
Heavy the following shall apply:
(a) The amount of Company Contributions and forfeitures allocated
pursuant to Article IV to the account of each Participant who is
a Non-Key Employee and is not a participant in a Defined Benefit
Plan of the Company (or a Related Company) shall not, when
expressed as a percentage of such Participant's Compensation for
such Plan Year, be less than the lesser of:
(i) three percent (3%), or
(ii) the percentage for the Key Employee for whom such percentage
is the highest
minus the amount of Company (or Related Company) contributions
plus forfeitures allocated to such Participant's account(s) under
any other tax qualified Defined Contribution Plan(s) maintained
by the Company or by a Related Company, if any. Notwithstanding
the foregoing, neither Matching Company Contributions nor
Elective Contributions allocated to the accounts of Non-Key
Employees shall be treated as Company Contributions for purposes
of meeting the above minimum contribution requirement.
Subparagraph (ii) above shall not apply in any Plan Year in which this Plan is
required to be aggregated with a tax qualified Defined Benefit Plan in order to
enable such plan to meet the requirements of Sections 401(a)(4) or 410 of the
Code.
(b) For purposes of this paragraph (1) --
(i) The minimum allocations under this paragraph shall be made
to the account of each active and inactive Participant who
is a Non-Key Employee who has not Separated from Service as
of the Anniversary Date falling within such Plan Year and is
not a Participant in a Defined Benefit Plan of the Company
(or a Related Company); and
(ii) This and any other tax qualified Defined Contribution
Plan(s) maintained by the Company or by a Related Company
shall be treated as a single plan.
XIII-3
<PAGE>
(c) For any Plan Year in which the Plan is Top-Heavy the Defined
Benefit Plan of the Company (or Related Company) shall provide
the minimum benefit described in Section 416(c)(1) of the Code
and the Treasury Regulations issued thereunder for each
Participant in this Plan who is a Non-Key Employee and who also
participates in such Defined Benefit Plan.
(2) VESTING. Commencing with the first day of the first Plan Year in
which the Plan is Top-Heavy, Article V(C)(1) shall be amended to read as
follows:
"(1) Such Participant shall be entitled only to a percentage of the
balance in his Supplementary Company Contributions [and the balance of his
Matching Company Contributions Account] Account based upon the number of
his full Years of Service, as follows:
Full Years of Percentage
Service Vesting
------------- ----------
less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 but less than 6 80%
6 or more 100%"
The foregoing Vesting schedule shall apply to all Plan Years after the Plan
first becomes Top-Heavy, whether or not the Plan is Top-Heavy for that Plan
Year. Such Vesting schedule shall not apply to any Participant who fails to
perform an Hour of Service for the Company on or after the day the Plan first
becomes Top-Heavy.
(3) SECTION 415 FRACTION REDUCED TO 1.0 IF PLAN BECOMES SUPER TOP-HEAVY.
For any Plan Year in which the Plan is Top-Heavy, the figure 1.0 shall replace
the figure 1.25 in the definitions of Defined Benefit Plan Fraction and Defined
Contribution Plan Fraction in Article IV(D)(4) (and in Section 415(e)(2)(B) and
(3)(B) of the Code), except for Plan Years as to which the Plan is not Super
Top-Heavy. For purposes of this subparagraph (b), a plan is "Super Top-Heavy"
if (and only if) it fails the ninety percent test mentioned in Section
416(h)(2)(B) of the Code, i.e., if (and only if) it would meet the "Top-Heavy"
definition in Article XIII(A)(5) above if the phrase "sixty percent" therein
were replaced by "ninety percent" wherever it appears.
C. DEFINITIONS. For purposes of this Article XIII, the following definitions
apply:
(1) "Determination Date" means the last day of the preceding Plan Year or,
for the first Plan Year, the last day of such Plan Year.
(2) "Non-Key Employee" means any employee who is not a Key Employee and
the beneficiary of any Non-Key Employee.
(3) "Valuation Date", for purposes of computing the top-heavy ratio, shall
be the Anniversary Date of each year.
XIII-4
