<PAGE> 1
As filed with the Securities and Exchange Commission on May 12, 1997
Registration No. 333-_____
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
FIRST FEDERAL CAPITAL CORP.
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(Exact name of Registrant as Specified in its Charter)
<TABLE>
<CAPTION>
WISCONSIN 6711 39-1651288
- --------- ------ ----------
<S> <C> <C>
(State or other jurisdiction of (Primary Standard (I.R.S. Employer
incorporation or organization) Industrial Classification Identification No.)
Code Number)
</TABLE>
605 STATE STREET
LACROSSE, WISCONSIN 54601
(608) 784-8000
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(Address, including Zip Code, and Telephone Number,
including Area Code, of Registrant's Principal Executive Offices)
FIRST FEDERAL SAVINGS BANK
SAVINGS INVESTMENT PLAN
--------------------------
(Full title of the plan)
THOMAS W. SCHINI, PRESIDENT
FIRST FEDERAL CAPITAL CORP.
605 STATE STREET
LACROSSE, WISCONSIN 54601
(608) 784-8000
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(Name, Address, including Zip Code, and Telephone Number, including Area Code,
of Agent for Service)
Copies to:
PATRICK J. MARGET, ESQ.
MICHAEL BEST & FRIEDRICH
100 EAST WISCONSIN AVENUE
SUITE 3300
MILWAUKEE, WISCONSIN 53202
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==========================================================================================================
TITLE OF PROPOSED PROPOSED
SECURITIES MAXIMUM MAXIMUM AMOUNT OF
TO BE AMOUNT TO BE OFFERING PRICE AGGREGATE REGISTRATION
REGISTERED(1) REGISTERED(2) PER SHARE(3) OFFERING FEE(3)
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock
$0.10 par value 45,000 $28.88 $1,299,600 $393.82
per share
- ----------------------------------------------------------------------------------------------------------
</TABLE>
(1) Pursuant to Rule 416(c) under the Securities Act of 1933, as amended
(the "Securities Act"), this Registration Statement covers an
indeterminate amount of interests to be offered or sold pursuant to
the employee benefit plan described herein.
(2) Includes shares of Common Stock which may be contributed to the First
Federal Savings Bank Savings Investment Plan (the "Savings Investment
Plan") and shares of Common Stock that may be purchased under the
Savings Investment Plan at the direction of plan participants.
(3) Estimated solely for the purpose of determining the registration fee
pursuant to Rule 457(h)(1). The proposed maximum offering price per
share is based upon the average of the high and low prices for the
shares of Common Stock as reported on the NASDAQ National Market
System on May 7, 1997.
-------------------------------
This Registration Statement shall become effective automatically upon
the date of filing in accordance with Section 8(a) of the Securities Act, and
17 C.F.R. Section 230.462.
Total Number of Pages: 7
Exhibit Index on Page 7
<PAGE> 3
PART I. INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
ITEMS 1 & 2. PLAN INFORMATION AND REGISTRANT INFORMATION AND
EMPLOYEE PLAN ANNUAL INFORMATION.
The information required by Items 1 & 2 is included in
documents sent or given to participants in the First Federal Savings Bank
Savings Investment Plan (the "Savings Investment Plan") pursuant to Rule
428(b)(1) promulgated by the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Securities
Act"). Such documents are not being filed with the Commission, but constitute
(together with the documents incorporated by reference in this Registration
Statement pursuant to Item 3 of Part II hereof) a prospectus that meets the
requirements of Section 10(a) of the Securities Act. First Federal Capital
Corp. (the "Registrant" or "Company") shall provide a written statement to
participants in the Savings Investment Plan advising them of the availability
without charge, upon written or oral request, of the documents incorporated by
reference in Item 3 of Part II of the Registration Statement and of other
documents required to be delivered to employees pursuant to Rule 428(b), and
shall include the address and telephone number to which the request is to be
directed.
PART II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by the Company with the
Commission are incorporated herein by reference and made a part hereof:
(a) The Company's latest Annual Report on Form 10-K for the year
ended December 31, 1996, which includes the consolidated
financial statements of the Company as of December 31, 1996,
1995 and 1994, the related consolidated statements of
operations, equity and cash flows for each of the three years
in the period ended December 31, 1996, and the consolidated
statements of financial condition at December 31, 1996 and
1995, together with the related notes and Report of
Independent Auditors of the Company (dated January 24, 1997).
(b) All other reports filed pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended, since the end of
the last fiscal year for which financial statements were
included in the report referred to in (a) above.
(c) The Company's Proxy Statement relating to the Company's Annual
Meeting of Shareholders, dated April 23, 1997, filed with the
Commission on March 12, 1997.
(d) The description of the Company's Common Stock and the
Company's Series A Junior Participating Preferred Stock and
Preferred Stock Purchase Rights contained in the Company's
Prospectus, dated October 18, 1995, and included in the
Company's Registration Statement on Form S-4 (File No.
33-98298) which was declared effective by the Commission on
October 18, 1995.
All documents filed by the Company pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, prior to
the filing of a post-effective amendment which indicates that all securities
offered hereby have been sold or which deregisters all securities remaining
unsold, shall be deemed to be incorporated by reference herein and to be a part
hereof from the date of the filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not Applicable.
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<PAGE> 4
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company is incorporated under the Wisconsin Business
Corporation Law ("WBCL"). Under Section 180.0851(1) of the WBCL, the Company
is required to indemnify a director or officer, to the extent such person is
successful on the merits or otherwise in the defense of a proceeding, for all
reasonable expenses incurred in the proceeding if such person was a party
because he or she was a director or officer of the Company. In all other
cases, the Company is required by Section 180.0851(2) to indemnify a director
or officer against liability incurred in a proceeding to which such a person
was a party because he or she was a director or officer of the Company, unless
it is determined that he or she breached or failed to perform a duty owed to
the Company and the breach or failure to perform constitutes: (i) a willful
failure to deal fairly with the Company or its shareholders in connection with
a matter in which the director or officer has a material conflict of interest,
(ii) a violation of criminal law, unless the director or officer had reasonable
cause to believe his or her conduct was unlawful; (iii) a transaction from
which the director or officer derived an improper personal profit, or (iv)
willful misconduct. Section 180.0858(1) provides that, subject to certain
limitations, the mandatory indemnification provisions do not preclude any
additional right to indemnification or allowance of expenses that a director or
officer may have under the Company's articles of incorporation, bylaws, a
written agreement or a resolution of the Board of Directors or shareholders.
Section 180.0859 of the WBCL provides that it is the public
policy of the State of Wisconsin to require or permit indemnification,
allowance of expenses and insurance to the extent required to be permitted
under Sections 180.0850 to 180.0858 of the WBCL, for any liability incurred in
connection with a proceeding involving a federal or state statute, rule or
regulation regulating the offer, sale or purchase of securities.
Section 180.0828 of the WBCL provides that, with certain
exceptions, a director is not liable to a corporation, its shareholders, or any
person asserting rights on behalf of the corporation or its shareholders, for
damages, settlements, fees, fines, penalties or other monetary liabilities
arising from a breach of, or failure to perform, any duty resulting solely from
his or her status as a director, unless the person asserting liability proves
that the breach or failure to perform constitutes any of the four exceptions to
mandatory indemnification under Section 180.0851(2) referred to above.
Under Article VI of the Company's Bylaws, directors and
officers are indemnified against liability, in both derivative and
nonderivative suits, which they may incur in their capacities as such, subject
to certain determinations by the Board of Directors, independent legal counsel
or the shareholders that the applicable standards of conduct have been met.
The scope of such indemnification is substantially the same as permitted and
described in Sections 180.0850 to 180.0858 of the WBCL.
Section 180.0833 of the WBCL provides that with certain
exceptions, directors of the Company against whom claims are asserted with
respect to the declaration of improper dividends or distributions to
shareholders or certain other improper acts which they approved are entitled to
contribution from other directors who approved such actions and from
shareholders who knowingly accepted an improper dividend or distribution, as
provided therein.
The directors and officers of the Company are included in the
directors' and officers' liability insurance policy applicable to First Federal
Savings Bank LaCrosse-Madison, the Company's wholly-owned federally-chartered
stock savings bank subsidiary ("First Federal Savings Bank"). The Company has
not obtained substitute or additional directors' and officers' liability
coverage for liability which may be incurred in their capacity as such. First
Federal Savings Bank's insurance policy provides that, subject to the
applicable liability limits and retention amounts, the insurer will reimburse
directors and officers of First Federal Savings Bank for a "loss" (as defined
in the policy) sustained by a director or officer resulting from any claim made
against them for a "wrongful
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<PAGE> 5
act" (as defined in the policy). The policy also provides that, subject to the
applicable liability limits and retention amounts, the insurer will reimburse
First Federal Savings Bank for a loss for which First Federal Savings Bank has
lawfully indemnified (or is required or permitted by law to indemnify) a
director or officer resulting from any such claim. Subject to certain
exclusions set forth in the policy, "wrongful act" is defined to mean any
actual or alleged error, misstatement, misleading statement, act or omission,
or neglect or breach of duty by the directors or officers in the discharge of
their duties solely in their capacities as such directors or officers.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
The Exhibits to this Registration Statement are listed in the
Exhibit Index on page 6 of this Registration Statement, which Exhibit Index is
incorporated herein by reference.
Pursuant to Item 8(b), in lieu of an opinion of counsel
regarding compliance with the requirements of the Employee Retirement Income
Security Act of 1974, as amended or an Internal Revenue Service ("IRS")
determination letter that the Savings Investment Plan is qualified under
Section 401 of the Internal Revenue Code of 1986, as amended, the Registrant
has submitted the Savings Investment Plan to the IRS in a timely manner and
will make all changes required by the IRS to qualify the Savings Investment
Plan.
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes as follows:
(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 (1)(i) and (1)(ii) do not
apply if the Registration Statement is on Form S-3, Form S-8
or Form F-3, and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by
the Registrant pursuant to Section 13 or 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.
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<PAGE> 6
(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.
(4) 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 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.
(5) 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.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, 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 caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of La Crosse, State of Wisconsin on May
9, 1997.
FIRST FEDERAL CAPITAL CORP.
By: /s/ Thomas W. Schini
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Thomas W. Schini, Executive Vice President
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Thomas W. Schini his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign
any and all amendments (including pre-effective and post-effective amendments)
to this registration statement, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorney-in-fact and agent full power
and authority to do and perform each and every act and thing necessary and
requisite to be done, as fully and to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorney-in-fact and agent may lawfully do or cause to be done by virtue
hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS
AMENDED, THIS REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS
IN THE CAPACITIES AND ON THE DATE INDICATED.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
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<S> <C> <C>
/s/ Thomas W. Schini President, Chairman of the
- ---------------------------------- Board, Chief Executive Officer
Thomas W. Schini and Director
/s/ Jack C. Rusch Chief Financial Officer
- ---------------------------------- (Principal Financial Officer)
Jack C. Rusch
/s/ Michael W. Dosland Controller (Principal Accounting
- ---------------------------------- Officer)
Michael W. Dosland
/s/ Dale A. Nordeen Vice Chairman of the Board
- ---------------------------------- and Director
Dale A. Nordeen
/s/ Henry C. Funk Director
- ----------------------------------
Henry C. Funk May 9, 1997
/s/ John F. Leinfelder Director
- ----------------------------------
John F. Leinfelder
/s/ Richard T. Lommen Director
- ----------------------------------
Richard T. Lommen
/s/ Phillip J. Quillin Director
- ----------------------------------
Phillip J. Quillin
/s/ Don P. Rundle Director
- ----------------------------------
Don P. Rundle
/s/ Patrick J. Luby Director
- ----------------------------------
Patrick J. Luby
Director
- ----------------------------------
David C. Mebane
/s/ Marjorie A. Davenport Director
- ----------------------------------
Marjorie A. Davenport
</TABLE>
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<PAGE> 8
Pursuant to the requirements of the Securities Act of 1933, as
amended, the First Federal Savings Bank Savings Investment Plan has caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in La Crosse, Wisconsin on the 6th day of May, 1997.
FIRST FEDERAL SAVINGS BANK
SAVINGS INVESTMENT PLAN
/s/ Milne J. Duncan
--------------------------------------------
Milne J. Duncan
Administrator of the Savings Investment Plan
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<PAGE> 9
EXHIBIT INDEX
REGULATION S-K
EXHIBIT NO. DESCRIPTION OF DOCUMENT
- -------------- -----------------------
Exhibit 4 First Federal Savings Bank Savings Investment Plan
Exhibit 5 Opinion of Michael Best & Friedrich
Exhibit 23.1 Consent of Ernst & Young LLP
Exhibit 23.2 Consent of Michael Best & Friedrich (included in Exhibit 5)
Exhibit 24 Power of Attorney (included as part of signature page)
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<PAGE> 1
FIRST FEDERAL SAVINGS BANK
SAVINGS INVESTMENT PLAN
REVISED EFFECTIVE JANUARY 1, 1990
7/21/92
<PAGE> 2
TABLE OF CONTENTS
ARTICLE I - INTRODUCTION AND PURPOSE 1
ARTICLE II - DEFINITIONS 2
ARTICLE III - COVERAGE UNDER THE PLAN
A. PARTICIPATION 9
B. TRANSFER IN EMPLOYMENT STATUS 9
C. TERMINATION AND REEMPLOYMENT 10
ARTICLE IV - ACCOUNTS AND CONTRIBUTIONS
A. ACCOUNTS 11
B. CONTRIBUTIONS 11
C. CHANGES IN CONTRIBUTIONS 19
D. ROLLOVER CONTRIBUTIONS 19
E. LIMITATIONS 20
F. RESTORATION PROCEDURES 22
ARTICLE V - INVESTMENT AND ALLOCATIONS
A. INVESTMENT OF ACCOUNTS 24
B. ALLOCATION OF INCOME OR LOSS 24
C. SUBFUNDS 24
ARTICLE VI - VESTING AND DISTRIBUTIONS
A. VESTING 27
B. DISTRIBUTIONS 28
ARTICLE VII - ADMINISTRATION AND NAMED FIDUCIARY
A. PLAN ADMINISTRATION 36
B. NAMED FIDUCIARY, ADMINISTRATOR
AND SERVICE OF LEGAL PROCESS 38
ARTICLE VIII - TRUST AGREEMENT 39
ARTICLE IX - AMENDMENT, TERMINATION, MERGER
A. AMENDMENT 40
B. TERMINATION 41
C. MERGER, CONSOLIDATION OR TRANSFER OF
ASSETS TO OTHER PLANS 41
<PAGE> 3
ARTICLE X - MISCELLANEOUS PROVISIONS
A. BENEFITS NOT ASSIGNABLE 42
B. CONDITIONS OF EMPLOYMENT NOT AFFECTED BY PLAN 42
C. BENEFICIARIES 42
D. FACILITY OF BENEFIT PAYMENT 44
E. APPEALS PROCEDURE 44
F. GENDER 46
G. TOP HEAVY PROVISIONS 46
H. APPLICABLE LAW 48
<PAGE> 4
ARTICLE I
INTRODUCTION AND PURPOSE
First Federal Savings of LaCrosse adopted the First Federal Savings of
LaCrosse Savings Investment Plan (the "Plan") for its eligible Employees
effective January 1, 1987.
Effective January 1, 1990, the Plan is amended and restated as set forth
herein and is renamed the First Federal Savings Bank Savings Investment Plan.
The purpose of the plan is to promote the well-being of eligible Employees
by making available the advantages of Section 401(k) and certain other Sections
of the Internal Revenue Code.
1
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ARTICLE II
DEFINITIONS
As herein used:
(1) "Account" shall mean the aggregate of all records maintained by the
Plan Administrator for purposes of determining a Participant's or Beneficiary's
interest in the Trust Fund and shall include the Pre-Tax Contribution Account,
Company Contribution Account, Profit Sharing Account, Loan Account, and
Rollover Account.
(2) "Accumulated Net Earnings" shall mean Annual Net Earnings from Plan
Years prior to the Plan Year for which Annual Net Earnings are determined under
Subsection (4) below.
(3) "Annual Addition" shall mean the addition to a Participant's account
as described in Article IV.E.2.
(4) "Annual Net Earnings" shall mean the net earnings of the Employer
before provisions for federal and state income taxes and before any
contribution to the Trust Fund, as determined by the Employer using generally
accepted accounting principles consistently applied throughout the period
involved.
(5) "Beneficiary" shall mean the person or persons, who, in accordance
with the Participant's written nomination of Beneficiary filed with the Plan
Administrator, is entitled to receive any amount of benefit in case of the
Participant's death.
(6) "Board" or "Board of Directors" shall mean the Board of Directors of
the Employer, and includes any executive committee thereof authorized to act
for such body.
(7) "Code" shall mean the Internal Revenue Code of 1986, as heretofore or
hereafter amended or supplemented, or as superseded by laws of similar effect,
together with regulations and rulings issued pursuant thereto.
(8) "Committee" shall mean the Committee appointed to administer the Plan
pursuant to Article VII.
(9) "Company" shall mean First Federal Savings Bank or it's parent, First
Federal Capital Corp.
2
<PAGE> 6
(10) "Company Contribution Account" shall mean that portion of a
Participant's Account established under Article IV.A. to which is credited a
Participant's allocations of Company Matching Contributions made under Article
IV.B.2.b, and as adjusted by such amounts properly credited or debited to it
under Article V.B.
(11) "Compensation" shall mean for any Plan Year the total of all
remuneration paid to the Participant by the Employer during such Plan Year.
Compensation shall include all basic salary, overtime pay, commissions,
discretionary bonuses, incentive compensation, amounts contributed by the
Employer to the Participant's Pre-Tax Contribution Account, and amounts
contributed to a Code Section 125 plan and/or a Code Section 403(b) plan.
Compensation shall exclude reimbursement for expenses or special allowances.
Compensation shall exclude any income or gains resulting from transactions
involving stock options of the Employer. Compensation shall also exclude
remuneration paid by the Employer to an Employee for any portions of the Plan
Year during which the Employee was not a Participant, or remuneration paid to a
Participant for any Plan Year which is in excess of a limit of $200,000 as
established and adjusted from time to time pursuant to Section 401(a)(17) of
the Code.
(12) "Disability" shall mean any sickness, accident or other disability
which, in the opinion of the Plan Administrator or a doctor of medicine
selected by the Plan Administrator, substantially prevents the performance and
discharge of duties of customary employment and which condition is likely to be
permanent. Disability shall be deemed to have occurred on the date of delivery
to the Plan Administrator of satisfactory proof of such Disability.
(13) "Early Retirement Date" shall mean any date an Employee severs all
employment with the Employer following attainment of age 55.
(14) "Effective Date" of the Plan shall mean January 1, 1987. The
effective date of this amendment and restatement shall mean January 1, 1990.
(15) "Employee" shall mean a person who is in the employment of the
Employer.
(16) "Employer" shall mean First Federal Savings Bank, or any successor
thereto as may expressly adopt this Plan and agree in writing to continue the
Plan. Employer shall also include any subsidiary or affiliate of First Federal
Savings Bank which adopts the Plan with the approval of the Board.
3
<PAGE> 7
(17) "Forfeitures" shall mean those amounts of a Participant's Profit
Sharing Account forfeited under the provisions of Article VI.A and allocated
pursuant to Article VI.A.
(18) "Hour(s) of Service" shall mean:
(a) Each hour for which an Employee is directly or indirectly paid or
entitled to payment by the Employer for the performance of
duties. These hours shall be credited to the Employee for the
computation period or periods in which the duties are performed;
and
(b) Each hour (up to a maximum of 501 hours for any one continuous
period) for which an Employee is directly or indirectly paid or
entitled to payment by the Employer for reasons (such as
vacation, sickness or disability) other than for the performance
of duties. These hours shall be credited to the Employee for the
computation period or periods in which payment is made or amounts
payable to the Employee become due; and
(c) Each hour for which back pay, irrespective of mitigation of
damages, has been either awarded or agreed to by the Employer.
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 was made.
With respect to paragraphs (b) and (c) above, no credit shall be
given:
(i) On account of payments made or due under a plan maintained solely
for the purpose of complying with applicable workers'
compensation, unemployment compensation or disability insurance
laws; or
(ii) For payments which solely reimburse an Employee for medical or
medically related expenses incurred by the Employee.
Hours of Service shall be credited for any customary period of work,
based on a full-time work schedule or pro rata portion thereof, during which the
Employee has been or may be on authorized leave of absence.
A Participant's absence from service by reasons of leave of absence
authorized by the Employer in writing because of illness, military service, or
for any other reason, will not terminate the Participant's service, provided he
returns to active employment with the Employer within the time specified in his
leave, or if not specified therein, within the time which accords with the
Employer's policy with respect to permitted absences. If the
4
<PAGE> 8
Participant does not return to active employment with the Employer within the
time hereinabove prescribed, his employment will be considered terminated, for
all purposes of the Plan, as of the date on which his leave began except as
provided in Article II(22); provided, however, that nothing in this section
shall be applied to deny a benefit to a Participant under the applicable
provisions of the Plan while on authorized leave of absence, provided he is
otherwise eligible therefor.
The Participant's absence from service because of engagement in
military service will be considered a leave of absence granted by the Employer
and will not terminate his service if he returns to active employment within the
period of time during which he has re-employment rights under any applicable
federal law.
Notwithstanding the foregoing provisions of this Article II(17), the
number of Hours of Service a person completes while, although not employed with
the Employer, he is considered to be a "leased employee" of the Employer or of
a "related person" within the meaning of sections 414(n)(2) and 144(a)(3),
respectively, of the Code, shall also be taken into account.
In determining Hours of Service, the rules contained in
paragraphs (b) and (c) of Regulation 2530.200b-2 issued by the Department of
Labor are incorporated herein by reference and shall be applied in a uniform
and nondiscriminatory manner.
(19) "Key Employee" shall mean an Employee or former Employee as defined
in Article X.G.2.
(20) "Loan Account" shall mean an account established in accordance with
the provisions of Article VI.B.4.
(21) "Net Compensation" shall mean the Compensation of an Employee reduced
by any Employer contributions to a Participant's Pre-Tax Contribution Account.
(22) "Normal Retirement Date" shall mean the date an Employee attains age
65 and completes 5 Years of Eligibility Service.
(23) "One Year Break in Service" shall mean a Plan Year during which an
Employee has less than 501 Hours of Service.
If a Participant begins an absence for maternity or paternity reasons
after December 31, 1984, such Participant will be credited with up to 501 Hours
of Service either
5
<PAGE> 9
in the Plan Year such absence began or in the following Plan
Year, whichever is appropriate to prevent the occurrence of a One Year Break in
Service. An absence from work for maternity or paternity reasons means an
absence due to (1) the pregnancy of the Participant, (2) the birth of a child
of the Participant, (3) the placement of a child in connection with the
adoption of the child by the Participant, or (4) caring for such child
immediately following the birth or placement for adoption.
(24) "Participant" shall mean an Employee who becomes a participant in the
Plan as provided in Article III.A.
(25) "Plan" shall mean the First Federal Savings Bank Savings Investment
Plan as herein set forth or as from time to time amended.
(26) "Plan Administrator" shall mean the Employer or the person or persons
designated and charged with administrative responsibilities pursuant to
Article VII.
(27) "Plan Year" shall mean a twelve month period beginning on January 1
and ending on the following December 31.
(28) "Pre-Tax Contribution Account" shall mean that portion of a
Participant's Account established under Article IV.A to which is credited a
Participant's allocations of Employer contributions made under Article IV.B.1,
and as adjusted by such amounts properly credited or debited to it under
Article V.B.
(29) "Profit Sharing Account" shall mean that portion of a Participant's
Account established under Article IV.A. to which is credited a Participant's
allocations of Profit Sharing contributions made under Article IV.B.2.c., and
as adjusted by such amounts properly credited or debited to it under Article
V.B.
(30) "Qualifying Employer Securities" shall mean those securities of the
Employer permitted to be held as a Plan investment pursuant to and or defined
by the Retirement Act, the Code or regulations issued thereunder.
(31) "Retirement Act" or "Act" shall mean those provisions of the Employee
Retirement Income Security Act of 1974, as may hereafter be amended or
supplemented, or as superseded by laws of similar effect, together with
regulations promulgated pursuant thereto.
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(32) "Rollover Account" shall mean that portion of an Account attributable
to an Employee's Rollover Contributions, as established under Article IV.D and
as adjusted by such other amounts properly credited or debited to it under
Article V.B.
(33) "Top Heavy Plan" shall mean a plan defined in Article X.G.2.
(34) "Trust Agreement" shall mean an agreement as amended, substituted or
replaced from time to time, entered into between the Employer and the Trustee
under which contributions will be received, held, invested and disbursed for
the purposes of the Plan.
(35) "Trustee(s)" shall mean the person or corporation(s) accepting the
appointment of Trustee(s) and acting as such, including any successor
Trustee(s).
(36) "Trust Fund" shall mean all assets of any kind and value, both
principal and income held and administered by the Trustee in accordance with
the terms of the Trust Agreement.
(37) "Valuation Date" shall mean any date upon which a valuation of the
Trust Fund is made. Such valuation shall be made as of each June 30 and
December 31 and such other times as the Employer may determine.
(38) "Vested" or "Vested Interest" shall mean the right to receive
benefits from this Plan as described in Article VI.A.
(39) "Year of Eligibility Service" shall mean a twelve consecutive month
period in which an Employee is credited with 1,000 or more Hours of Service.
The first such period is the twelve consecutive month period commencing with an
Employee's date of hire. The second such period is the Plan Year commencing
within the first eligibility computation period. Each subsequent Plan Year
shall be the measuring period for a Year of Eligibility Service.
(40) "Year of Vesting Service" shall mean any Plan Year during which the
Participant is an Employee of the Employer and completes 1,000 or more Hours of
Service. For the Plan Year during which the Employee is first credited with an
Hour of Service and the Plan Year in which the Employee's service is terminated
by reason of retirement, termination or death, if the Employee earns less than
1,000 hours in such year, then he or she will receive 1/12 of a Year of Vesting
Service for any month such Employee is credited with at least 83 Hours of
Service.
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Only one Year of Vesting Service will be credited to an Employee in any
computation period or year regardless of the number of Hours of Service in
excess of 1,000 during that computation period or year.
Years of Vesting Service shall include service before the Effective Date
of the Plan; provided, however, that in determining the Years of Vesting
Service the Committee may rely on the service records of the Employer or may
require each Employer to certify the number of Years of Vesting Service.
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ARTICLE III
COVERAGE UNDER THE PLAN
A. PARTICIPATION
Each Employee who was a Participant on December 31, 1989 shall continue to
be a Participant. Each other Employee shall become a Participant in the Plan
on the later of (i) the Effective Date or (ii) the January 1 or July 1 next
following the day the Employee attained age 20 and completed one Year of
Eligibility Service.
An Employee who meets the conditions set forth above may elect to have the
Employer make contributions to his Pre-Tax Contribution Account (subject to the
limitations of Article IV.B) effective as of any January 1 or July 1 following
thirty days' written notice on such form as the Plan Administrator may approve.
If an Employee does not elect to have the Employer make contributions to
his Pre-Tax Contribution Account when first eligible to do so, such Employee
may elect to have such contributions made on any subsequent January 1 or July 1
following thirty days' written notice on such form as the Plan Administrator
may approve.
B. TRANSFER IN EMPLOYMENT STATUS
In the event that an Employee transfers from an affiliate or subsidiary
which is not participating in this plan to an employment status which otherwise
qualifies such Employee to become eligible to participate under the Plan, such
Employee shall become a Participant in this Plan after meeting the requirements
of Article III.A and may elect in writing on a form supplied by the Committee,
to have the Employer make contributions to his Pre-Tax Contribution Account
(subject to the limitations of Article IV) effective as of any January 1 or
July 1 following thirty days' written notice to the Committee. Service of the
Employee with an affiliate, subsidiary, or other corporation which is a member
of a controlled group of corporations as defined in Code Section 414(b) or
trades or businesses under common control as defined in Code Section 414(c)
shall constitute service toward a determination of Years of Vesting Service and
Years of Eligibility Service.
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In the event that an Employee transfers to an affiliate, subsidiary or
other corporation which is not participating in the Plan, such an Employee
shall no longer be eligible to be a Participant as of the date of transfer.
C. TERMINATION AND REEMPLOYMENT
A Participant who is reemployed following a One Year Break in Service
shall again become a Participant the January 1 or July 1 following reemployment
provided he otherwise meets the requirements of Article III.A.
Notwithstanding the foregoing provisions of this Article III.C, if an
Employee incurs one or more consecutive One Year Breaks in Service, and if he
was Vested for a benefit under the Plan when he incurred the first One Year
Break in Service, then there shall be added to the total of his Years of
Vesting Service, after he has completed a Year of Vesting Service following the
last of said consecutive One Year Breaks in Service, all of the Years of
Vesting Service he has before he incurred the first One Year Break in Service.
An Employee (i) who was not a Participant, (ii) who terminates employment
and is reemployed, and (iii) who did not have a One Year Break in Service shall
be treated as any other Employee considering such Employee's Hours of Service
and Years of Eligibility Service.
If an Employee incurs one or more consecutive One Year Breaks in Service
and if he was not Vested for a benefit under the Plan when he incurred the
first one Year Break in Service, there shall be added to the total of his Years
of Vesting Service, after he has completed a Year of Vesting Service following
the last of said consecutive One Year Breaks in Service, all of the Years of
Vesting Service he had before he incurred the first One Year Break in Service
if the number of consecutive One Year Breaks in Service is less than the
aggregate number of Years of Vesting Service he had before the first such One
Year Break in Service except if the number of consecutive One Year Breaks in
Service is less than five.
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ARTICLE IV
ACCOUNTS AND CONTRIBUTIONS
A. ACCOUNTS
An Account shall be established on behalf of each Participant. A
Participant's Account shall be comprised of his Pre-Tax Contribution Account,
his Company Contribution Account, his Profit Sharing Account and Rollover
Account, as applicable. Credits or debits to the Participant's Account shall be
determined according to the provisions of this Article IV and Article V. The
Account for each Participant shall be primarily for accounting purposes and
shall not restrict the Trustees in managing and operating the Trust Fund as a
single fund.
B. CONTRIBUTIONS
1. Pre-Tax Contribution. A Participant may elect in writing, on a form
provided by the Committee, a Compensation reduction through payroll
deduction in one percent (1%) increments by period but in no case an amount
in excess of ten percent (10%) of the Participant's Compensation in a Plan
Year. On or after July 1, 1990, the ten percent (10%) in the previous
sentence shall be changed to fifteen percent (15%). The percentage
reduction shall automatically apply to all Compensation as from time to
time adjusted. A Participant's total contributions for the year may be in
less than 1% increments if an adjustment is required to satisfy the
requirement of 401(k) and 401(m) described in Article IV.B.3, the maximum
benefit limit of Article IV.E.1 or the 415 limits of Schedule IV.B.2.
2. Contribution and Allocation. Subject to the limitations set forth in
Articles IV.B.3 and IV.E, the Employer shall contribute to the Trust Fund
for each Plan Year:
a. Pre-Tax Contributions:
The amount by which any Participant's Compensation has been
reduced as set forth in Article IV.B.1 shall be allocated to
such Participant's Pre-Tax Contribution Account.
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b. Employer Matching Contributions:
For each Participant during the Plan Year who is an Employee
as of any Valuation Date and has completed 1,000 Hours of
Service during the Plan Year, an amount equal to 50% of the
first 3% of the Participant's Pre-Tax Contribution as set
forth in Article IV.B.1 shall be allocated to each such
Participant's Company Contribution Account.
c. Profit Sharing Contributions:
Subject to the limitations set forth in Articles IV.B.3 and
IV.E, the Employer may contribute to the Trust Fund for any
Plan Year for each Participant, regardless of whether the
Participant has made Pre-Tax Contributions to the Plan
pursuant to Article IV.B.2.a, if the Participant as of the
end of the Plan Year has completed 1,000 Hours of Service
during the Plan Year and is still an active Employee at the
end of the Plan Year, an amount to the Profit Sharing
Account. This contribution may be made in an amount and
manner as may be determined by the Board of Directors.
Participants' Pre-Tax Contributions made under Article IV.B.2.a, Employer
Matching Contributions made under Article IV.B.2.b and Profit Sharing
Contributions made under Article IV.B.2.c shall be treated as Employer
contributions for purposes of deductibility and tax treatment under the Code.
If a Participant terminates by reason of death, disability or retirement,
such Participant shall receive an Employer Matching Contribution and Profit
Sharing Contribution if the number of Hours of Service completed by the
Participant during the Plan Year equals or exceeds 83-1/3 times the number of
months worked during such Plan Year.
The Employer's contribution allocable to Participants' Pre-Tax
Contribution Account shall be made to the Trust Fund as soon as
administratively possible, but not later than thirty days following the end of
the month in which the Participant would have otherwise received the
Compensation with respect to which such contribution is made. The Employer's
contribution to Participants' Pre-Tax Contribution Accounts shall be made
regardless of whether Annual Net Earnings are sufficient to provide such a
contribution.
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The Employer's contribution allocable to Participants' Company Contribution
Account and/or Profit Sharing Account shall be made to the Trust Fund in one or
more installments, but not less frequently than semi-annually.
All Employer contributions shall be made in cash to the Trust Fund on or
before the last day for filing the Employer's federal income tax return for such
year, including any extensions of time granted for such filing.
3. Adjustment of Contributions: Notwithstanding the preceding provisions
of this section, to the extent deemed necessary by the Committee in order
to maintain the tax-qualified status of the Plan under the rules set forth
in Sections 401(k), 401(m), 415, and 404(a) of the Code, the amount of
contributions made to the Trust Fund by the Employer and allocated to a
Participant's Account may be reduced.
a. Limitations Due to Code Sections 401(k) and 401(m)
A Participant's Pre-Tax Contributions, Company Contributions and
Profit Sharing Contributions shall be subjected to the tests
described below. If necessary to satisfy Sections 401(k) and
401(m) of the Code, the excess Employer Pre-Tax Contributions
and/or the Company Contributions of a Highly Compensated Employee
shall be adjusted as described below:
i. Each Plan Year two "deferral percentages" shall be
calculated for each Participant; one for the Pre-Tax
Contribution Account and one for the Company Contribution
Account. The deferral percentage is calculated by dividing
the amount of Employer Contributions to the respective
Account by the Participant's Gross Compensation for the Plan
Year.
ii. Each Plan Year the average deferral percentage for Highly
Compensated Employees and the average deferral percentage
for Participants who are not considered Highly Compensated
shall be calculated.
The average deferral percentage in each case is the average
of the percentages calculated under subsection (i) for each
of the Employees who was a Participant at any time during
the Plan Year in the particular group.
A Highly Compensated Employee is an Employee who performs
service during the determination year and is described in
one or more of the following groups:
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(a) An Employee who is a 5% owner, as defined in
Section 416(i)(1)(A)(iii), at any time during the
determination year or the look-back year;
(b) An Employee who receives Compensation in excess of
$75,000 (indexed in accordance with Section
415(d)) during the look-back year;
(c) An Employee who receives Compensation in excess of
$50,000 (indexed in accordance with Section (d))
during the look-back year and is a member of the
"Top-Paid Group" (as defined below) for the
look-back year;
(d) An Employee who is an officer, within the meaning
of Section 416(i), during the look-back year and
who receives Compensation in the look-back year
greater than 50% of the dollar limitation in
effect under Section 415(b)(1)(A) for the calendar
year in which the look-back year begins. For this
purpose, no more than fifty (50) Employees (or if
less, the greater of three Employees or ten
percent of the Employees) shall be treated as
officers. If no officer received compensation in
excess of 50% of the annual benefit limit, the
highest paid officer must be considered Highly
Compensated; and
(e) An Employee who is both described in paragraph
(i), (ii), (iii) or (iv) above when these
paragraphs are modified to substitute the
determination year for the look-back year and one
of the 100 Employees who receive the most
Compensation from the Employer during the
determination year.
For purposes of the definition of Highly Compensated
Employee:
(a) The determination year is the Plan Year for which
the determination of who is Highly Compensated is
being made.
(b) The look-back year is the 12-month period
immediately preceding the determination year, or,
if the Employer elects, the calendar year ending
with or within the determination year.
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(c) Compensation is Compensation within the meaning of
Section 415(c)(3) including elective or salary
reduction contributions to a cafeteria plan, cash
or deferred arrangement or tax-sheltered annuity.
(d) Employers aggregated under Section 414(b), (c),
(m), or (o) of the Code are treated as a single
Employer.
The "Top Paid Group" consists of the top 20% of
Employees when ranked on the basis of Compensation
during the Plan Year. To determine the number of
Employees to include in the Top Paid Group, the
following Employees are excluded:
(a) Former Employees;
(b) Those with less than six months of service;
(c) Those who work less than 17-1/2 hours per week;
(d) Those who normally work less than six months per
year;
(e) Those who are covered by a collective bargaining
agreement;
(f) Those under age 21; and
(g) Those who are non-resident aliens without U.S.
Compensation.
A "Non-Highly Compensated Employee" is any Employee
who is not a Highly Compensated Employee.
If an Employee is a family member of either a 5% owner
or one of the top 10 (when ranked by Gross
Compensation) Highly Compensated Employees, then such
Employee's Gross Compensation and contributions are
aggregated with such family members Gross Compensation
and contributions and treated as one Plan Participant
for purposes of the above definition.
A family member, with respect to any Employee, is such
Employee's spouse, lineal ascendants or descendants, or
the spouses of any lineal ascendants or descendants.
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iii. If the requirements of either paragraph (a) or (b) are
satisfied, then no further action is needed under this
section:
(a) The average deferral percentage for Highly
Compensated Employees is not more than 1.25 times
the average deferral percentage for Participants
who are not considered Highly Compensated.
(b) The excess of the average deferral percentage for
Highly Compensated Employees over the average
deferral percentage for Participants who are not
considered Highly Compensated is not more than two
percentage points, and the average deferral
percentage for Highly Compensated Employees is not
more than 2.0 times the average deferral
percentage for Participants who are not considered
Highly Compensated.
At the discretion of the Board, this Plan may be tested
on its own as set forth above, provided the Plan
otherwise meets the requirements of Section 410(b) of
the Code, or this Plan may be tested together with all
other similar plans maintained by the Employer.
iv. If neither of the requirements of subsection (iii) is
satisfied with respect to either the Pre-Tax
Contribution Account or the Company Contribution
Account, then the appropriate contributions with
respect to Highly Compensated Employees shall be
reduced, beginning with the contributions representing
the highest percent of Compensation, to the extent
necessary to meet the requirements of paragraph iii(a)
or iii(b), whichever is met first. An adjustment may
be made before the end of the Plan Year in the rate of
contributions being deposited for any Highly
Compensated Employee. The amount of such adjustment
may be determined solely at the discretion of the
Committee. An adjustment may be made at any time
without regard to the limitations of Article IV.E.
v. This subsection applies for Plan Years beginning
January 1, 1989 and after.
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If for any Plan Year:
(a) the average deferral percentage for Highly
Compensated Employees in the Pre-Tax Contribution
Account exceeds 1.25 times the average deferral
percentage for all other Participants in the
Pre-Tax Contribution Account, and
(b) the average deferral percentage for Highly
Compensated Employees in the Company Contribution
Account exceeds 1.25 times the average deferral
percentage for all other Participants in the
Company Contribution Account,
then the following "non-Highly Compensated sum" and
"Highly Compensated sum" will be calculated.
The "non-Highly Compensated sum" is equal to:
(a) 1.25 times the greater of the average deferral
percentage of Participants not considered Highly
Compensated under the Pre-Tax Contribution Account
or the Company Contribution Account, plus
(b) Two times the lesser of such average deferral
percentages, with a maximum difference of 2.0.
The "Highly Compensated sum" shall be equal to the sum
of the average deferral percentages of Highly
Compensated Employees under the Pre-Tax Contribution
Account and the Company Contribution Account.
If the "Highly Compensated sum" exceeds the "non-Highly
Compensated sum" then, at the Committee's discretion,
either Employer contributions to the Pre-Tax
Contribution Account or the Company Contribution
Account will be reduced in accordance with subparagraph
iv. above until the "Highly Compensated sum" does not
exceed the "non-Highly Compensated sum".
To the extent any contributions to the Plan are reduced and are
required to be refunded as of the end of a Plan Year, the excess
contributions with investment gains attributable thereto shall be refunded
to the Participant by March 15, or as soon as possible thereafter following
the close of the Plan Year in which such excess
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<PAGE> 21
occurred. To the extent any refunds are required to reduce a Participant's
deferral percentage, the amount to be refunded shall be reduced by the
amount of any Excess Deferrals refunded under the provisions of Article
IV.F.1.
To the extent either Pre-Tax Contributions or the Company
Contributions are reduced, (i) the excess contributions with investment
gains attributable thereto shall be refunded to the Participant no later
than March 15 following the close of the Plan Year in which such excess
occurred and (ii) such Contributions described in Article IV.B need not be
in one percent increments.
Failure to correct excess contributions by the close of the Plan Year
following the Plan Year for which they were made will cause the cash or
deferred arrangement to fail to satisfy the requirements of Section
401(k)(3) for the Plan Year for which the excess contributions were made
and for all subsequent years they remain in the trust. Also, the Employer
will be liable for a 10% excise tax on the amount of excess contributions
unless they are corrected within 2-1/2 months after the close of the Plan
Year for which they were made.
4. Employer to Certify Contributions: The Employer shall certify to the
Trustee the amount of its contributions to the Trust and such Employer's
certification shall be conclusive. In the event that the Employer is
unable to determine the correct amount of its contribution within the time
required for payment under the provisions of the Code or the applicable
regulations and rulings, then it shall pay an estimated amount. Any
deficiency shall be paid as soon as determined.
5. Contributions Irrevocable: The Employer's contributions to the Trust
Fund shall be irrevocable except to the extent permitted by the Act or Code
for reasons of mistake of fact, disallowance of all or part of a
contribution as a tax deduction under the Code, or correction of the amount
of contribution to avoid excise tax under the Code. The return of
contributions due to mistake of fact shall be within one year of the
original contribution deposit. The return of contributions due to
disallowance as a deduction shall occur within one year of the
disallowance. All contributions to and assets of the Trust Fund shall be
for the exclusive benefit of the Participants and their
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Beneficiaries; provided, however, assets of the Trust Fund may be used to
defray reasonable expenses of administering the Plan and Trust, if not paid
by the Employer.
C. CHANGES IN CONTRIBUTIONS
A Participant may elect in writing, on a form supplied by the Committee,
to change the rate of Compensation reduction and Pre-Tax Contributions as
described in Article IV.B. Changes will be allowed as of any January 1 or July
1 following thirty days' written notice to the Committee.
A Participant may elect in writing, on a form supplied by the Committee,
to suspend all Pre-Tax Contributions at any time during a Plan Year. The
suspension will be effective on the first day of the month following thirty
days' written notice to the Committee of the suspension.
A Participant who suspends compensation reductions may elect in writing, on
a form supplied by the Committee, to begin compensation reductions again
effective as of any subsequent January 1 or July 1 following thirty days'
written notice to the Committee.
D. ROLLOVER CONTRIBUTIONS
Rollover Contributions may be made by an Employee to the Trust Fund within
sixty days of the date such amount is received by the Employee. With the
approval of the Committee, Rollover Contributions may also be made by direct
transfer to this Plan from the trust of another plan qualified under Code
Section 401(a) including the Employee Stock Ownership Plan maintained by the
Employer. The term "Rollover Contribution" is defined as a contribution of:
a. Any portion of the balance to the credit of an Employee in a
qualified employees' trust or annuity plan paid to such Employee
or, in the case of a direct transfer from the trust of another
qualified plan, payable in one or more distributions which
qualify for treatment as a rollover amount under Section
402(a)(5) of the Code, or
b. The entire amount in an Individual Retirement Account or
Individual Retirement Annuity (as defined in Section 408 of the
Code) maintained for the benefit of the Employee making the
Rollover Contribution, which amount has been distributed from
such Individual Retirement Account or Individual Retirement
Annuity. Such amount will constitute a Rollover Contribution
only if the amount in such Individual Retirement Account or
Individual Retirement Annuity is solely attributable to a
rollover contribution from either a trust described in Section
401(a) of the Code or an annuity plan described in Section 403(a)
of the Code, plus the earnings thereon.
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c. The term Rollover Contribution does not include any amount which
would cause the Plan to be considered a "transferee plan" within
the meaning of Code Section 401(a)(11).
Upon retirement or termination of employment, a Participant in
this Plan may make a Rollover from the Employee Stock Ownership
Plan maintained by the Employer if, and only if, such Participant
maintains an Account in this Plan.
A Rollover Account shall be established under the Plan for an Employee
making a Rollover Contribution, and the Rollover Contribution shall be allocated
to such Rollover Account. The Rollover Account shall always be one hundred
percent (100%) vested. An Employee shall elect, on a form provided by the
Committee, the percentage of the Rollover Contribution which will be invested in
any subfunds within the Trust Fund.
E. LIMITATIONS
1. Limitation of Pre-Tax Contributions. Notwithstanding any other
provisions of this Plan to the contrary, the total Pre-Tax Contributions
made by a Participant to this Plan and any other plan required to be
aggregated under Section 402(g) of the Code in which he participated during
his taxable year may not exceed $7,000 (or such higher amount as may be
established under Section 402(g) of the Code) for such taxable year.
In the event this limit is exceeded with respect to any Participant,
the Participant must notify by March 1 following the close of the
Participant's taxable year either the Employer or the employer sponsoring
any other affected plan (at the Participant's discretion) of the Excess
Deferrals. "Excess Deferrals" are the Participant's Pre-Tax Contributions
to this Plan and any other affected plan in excess of the $7,000 (or such
higher amount allowed) limit. The excess amount shall be eliminated by
returning to such Participant, to the extent necessary, his Pre-Tax
Contributions with investment gains attributable to such excess no later
than the April 15 following the close of such taxable year.
2. Limitation of Annual Additions for This Plan. Notwithstanding any
other provision of this Plan to the contrary, the Annual Addition to a
Participant's Account (exclusive
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of Rollover Amounts under Article IV.D) for any Limitation Year shall not
exceed the lesser of:
a. 25% of the Participant's Net Compensation (as defined in
regulations under Section 415(c)(3) of the Code but specifically
excluding all amounts which a Participant elects to defer in the
Plan Year as a Pre-Tax Contribution for such year, or
b. $30,000 (or such higher amount for the Limitation Year as may be
established by regulations under Section 415(d) of the Code).
The Limitation Year shall be the Plan Year.
"Annual Addition" shall mean the sum for the Limitation Year to which
the allocation pertains (whether or not allocated in such year) of:
a. Employer contributions to the Plan as set forth in Article
IV.B.2.a, Article IV.B.2.b and Article IV.B.2.c; and
b. Forfeitures; and
c. Amounts allocated, after March 31, 1984, to an individual medical
account, as defined in section 415(1)(1) of the Code, which is
part of a defined benefit plan maintained by the Employer, and
amounts derived from contributions paid or accrued after December
31, 1985, in taxable years ending after such date, which are
attributable to post-retirement medical benefits allocated to the
separate account of a Key Employee, as defined in Section
419A(d)(3), under a welfare benefit fund, as defined in Section
419(e), maintained by the Employer.
In the event that a reasonable error was made in estimating a
Participant's Compensation or other limited facts and circumstances which
the Internal Revenue Service finds to be applicable, any amount which would
otherwise be allocated which would result in the Annual Addition limitation
being exceeded with respect to any Participant, the excess amount shall be
eliminated first, by returning to such Participant, to the extent
necessary, the contributions to his or her Pre-Tax Contribution Account;
and second, by holding any remaining excess in a Limitation Account to be
reallocated among the Accounts of Participants pursuant to Article IV.B.2.b
and Article IV.B.2.c as
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of the last day of each succeeding Plan Year until the excess is exhausted,
provided that the Annual Addition limit with respect to any Participant may
not be exceeded in any Limitation Year and provided further that no
allocation of contributions which would be applicable to the Annual
Addition may be credited to such Participant's Account until such excess
has been exhausted.
3. Aggregation of Benefits from Defined Benefit and Defined Contribution
Plans. After a Participant's benefits have been adjusted (if necessary) to
comply with this Article IV.E, then the sum of (a) and (b) will be
computed in accordance with the rules under Code Section 415(e):
a. The Participant's benefit from the Employer's defined benefit
program(s) divided by the lesser of (a) 1.25 multiplied by the
dollar limitation in effect under Section 415(b)(1)(A) of the
Code for such year and (b) 1.40 multiplied by the maximum benefit
in effect under Section 415(b)(1)(B) of the Code for such year.
b. The sum of the Annual Additions to the Participant's account
balance under the Employer's defined contribution program(s)
divided by the sum of the lesser of the following amounts
determined for such Limitation Year and each prior Year of
Vesting Service (a) 1.25 multiplied by the dollar limitation of
Code Section 415(c)(1)(A) and (b) 1.40 multiplied by the maximum
addition under Code Section 415(c)(1)(B).
If the sum exceeds 1.0, the Participant's benefits under this Plan
will be reduced until the sum does not exceed 1.0 by returning
contributions to the Participant in accordance with the procedures set
forth in Article IV.E.2.
F. RESTORATION PROCEDURES
In the event that a Participant's Account was improperly excluded in any
year from an allocation of Employer contributions pursuant to Article IV.B.2,
such Participant's Account shall be restored to its correct status in an amount
as follows:
1. First, an amount which is computed on the same basis as was the
allocation of Employer contributions which were properly
allocated to Participants under Article IV.B.2 in each year for
which restoration is necessary, and
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2. Second, an amount of Trust Fund income, gain or loss which is
computed on the same basis as was the allocation of Trust Fund
income, gain or loss which was properly allocated to
Participants' Accounts under Article V.B in each year for which
restoration is necessary.
The Employer shall contribute an amount which is necessary to fully restore
each improperly excluded Account, whether or not sufficient Annual Net Earnings
existed in the applicable year to cover such additional contribution.
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ARTICLE V
INVESTMENT AND ALLOCATIONS
A. INVESTMENT OF ACCOUNTS
The Trustee shall be responsible for the investment of the assets of the
Trust Fund as provided in the Trust Agreement. However, in no event will the
Trustee be permitted to acquire Qualifying Employer Securities, if immediately
after such acquisition the aggregate fair market value (as defined in the Code)
of all Qualifying Employer Securities held by the Plan exceeds 100% of the fair
market value of the assets of the Plan.
B. ALLOCATION OF INCOME OR LOSS
As of each Valuation Date, the net income and expenses of the Trust Fund
and the increase or decrease in the current market value of the corpus of the
Trust Fund for the valuation period shall be allocated to each Participant's
Pre-Tax Contribution Account, Company Contribution Account, Profit Sharing
Account, and Rollover Account in the same ratio as such Participant's accounts
bear to the total of all Participants' accounts invested in the Trust Fund as
of the Valuation Date. The basis for allocation will be the balance in the
Participant's accounts as of the most recent Valuation Date reduced by any
withdrawals, including distributions and loans, made during the period and
increased by the time-weighted value of any additions to the Participant's
account during the period, including any Employer contributions and loan
principal repayments.
The payment by the Trust Fund to a Participant of a withdrawal,
distribution, or loan as of a Valuation Date shall follow the allocation and
adjustments described in this Article V.B.
C. SUBFUNDS
1. Establishment of Subfunds. At the direction of the Employer, the
Trustee may divide the Trust Fund into two or more subfunds which shall
serve as vehicles for the investment of the individual accounts under the
Trust Fund. Any such subfunds shall be managed either by the Trustee or by
an investment manager or managers appointed by the Employer. The Employer
shall determine with the advice of the Trustee and/or the investment
manager, the general investment characteristics and objectives of each
subfund. The Trustee or investment manager, as the case may be,
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shall have complete investment discretion over each subfund assigned to it,
subject only to the general investment characteristics and objectives
established for the particular subfund. The Employer shall have the power
to direct that additional subfunds be established, and under uniform rules,
to withdraw or limit participation in a particular subfund. In the event
of the establishment of such subfunds, a segregation of the assets of the
Trust Fund with regard to individual accounts shall be required to the
extent of the investment elections made by Participants under Article
V.C.2.
The Trustee may establish, at the direction of the Employer, a subfund
of the Trust which invests in common stock of the Company. The common
stock to be acquired with contributions for investments in such subfund may
be acquired from the Company or from existing stockholders of the Company
in public transactions. Shares of common stock acquired from existing
stockholders in public transactions shall be at then existing market prices
and shares of common stock purchased from the Company shall be at fair
market value, which shall be the closing sale price on the date in question
of a share of common stock on the principal United States securities
exchange registered under the Securities Exchange Act of 1934 on which such
common stock is listed or, if such common stock is not listed on any such
exchange, the closing sale price with respect to a share of such common
stock on the NASDAQ National Market System or any system then in use, or if
no quotations are available, the fair market value on the date in question
of a share of common stock shall be determined by the Trustee in good
faith.
2. Participant Elections. At the discretion of the Employer, and in
accordance with rules and procedures established by the Employer and
applied uniformly to Participants, the Employer may provide under the Trust
Fund for investment elections by Participants. If the Employer so
provides, a Participant may elect in writing, on a form provided by the
Committee, the percentage of his accounts under the Trust Fund, in
increments of 10%, which will be invested in any subfunds within the Fund.
Two types of elections will be available: (i) the direction of future
Pre-Tax Contributions to the Plan; and (ii) the re-allocation of existing
account balances under the Plan. A
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Participant will be allowed to change such elections as of any January 1 or
July 1 thirty days after the receipt of written election by the Committee.
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ARTICLE VI
VESTING AND DISTRIBUTIONS
A. VESTING
The term "Vested" or "Vested Interest" shall mean a nonforfeitable,
noncontingent right of the Participant or his Beneficiaries to a present or
future enjoyment of all or any part of any allocation to the Participant's
accounts, including subsequent Employer contributions allocated thereto. Each
Participant shall always be fully Vested in all amounts credited to the
Participant's Pre-Tax Contribution Account, Rollover Account and Loan Account.
Amounts credited to a Participant's Company Contribution Account and Profit
Sharing Account shall become fully Vested when the Participant attains his
Normal Retirement Date while an Employee, or upon his termination of employment
by reason of death or Disability.
Except as provided above, a Participant shall acquire a fully Vested
Interest in his Company Contribution Account and Profit Sharing Account
according to the following schedule:
Years of Vested
Vesting Service Percentage
--------------- ----------
less than 1 0%
1 - 2 20%
2 - 3 40%
3 - 4 60%
4 - 5 80%
5 or more 100%
All determinations required to be made as to the amount of a Participant's
Vested Interest, except in the case of termination of the Plan, shall be made as
of the Valuation Date immediately following the date on which such determination
is required to be made.
After a Participant's Vested Interest is determined because of termination
of employment for whatever reason, such Vested Interest shall be distributed
according to the provisions of Article VI.B.
Any remainder of a terminating Participant's Company Contribution Matching
Account and Profit Sharing Account which is not Vested in accordance with the
foregoing vesting schedule shall be transferred to a Suspense Account. In the
event more than one
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subfund exists as provided in Article V, the Committee shall determine which one
subfund all Suspense Accounts shall be invested in regardless of Participant
elections under Article V.C.2. The disposition of such Suspense Account shall
be as follows:
a. If the Participant has not been reemployed, the balance in the
Suspense Account shall be forfeited as of the earlier of the last
day of the Plan Year in which the Participant incurs a One Year
Break in Service, or the date the Participant receives a
distribution from the Plan due to termination of employment.
b. Suspense Accounts shall share in the allocation of Trust Fund
income or loss on every Valuation Date unless forfeited on or
prior to such date.
c. If the Participant is reemployed before incurring five
consecutive One Year Breaks in Service, the amount originally
transferred to the Suspense Account and such undistributed Vested
Interest shall be credited to the Participant's Company
Contribution Account as of his reemployment date. In the event
the Participant is reemployed after the Suspense Account has been
forfeited, the forfeited portion of his Account shall be
restored. Such restored amount shall be provided first from the
amount to be forfeited as provided under Article VI.A.d. below,
and to the extent such amounts are insufficient, by an additional
Company Contribution to the Plan.
d. Forfeitures attributable to Company Contribution and Profit
Sharing Accounts as of the last day of the Plan Year shall first
be netted against any reinstatement in accordance with this
Article VI.B.2.c. above. Any remaining amounts shall be used to
reduce the Company Contribution and Profit Sharing Accounts which
are described in Article IV.B.2.
e. In the event more than one Employer adopts this Plan, only those
amounts from the Accounts of its own former Employees shall be
used as described above for each such Employer.
B. DISTRIBUTIONS
1. Time of Distribution. The distribution of a Participant's Vested
Interest shall be made, or in the case of installment payment, shall
commence within 60 days following the close of a Plan Year in which there
occurs the latest of the following events:
a. Death of an actively employed Participant,
b. Disability of an actively employed Participant,
c. Termination or retirement of an actively employed Participant,
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d. The Participant's Normal Retirement Date, or
e. The Participant's or Beneficiary's written request for
distribution.
The amount of all distributions shall be determined as of the
Valuation Date following receipt by the Administrative Committee of the
Participant's or Beneficiary's written request for distribution on a form
provided by the Administrative Committee. The Employer may permit
distributions prior to the Valuation Date following receipt by the
Committee of the Participant's or Beneficiary's written request for
distribution, in which case the distribution shall be based on the prior
Valuation Date account balance plus contributions and/or loan repayments
since such date.
The Administrative Committee shall direct the trustee to distribute
the Participant's Vested Interest in his or her Account if such Vested
Interest is $3,500 or less. The Administrative Committee shall not direct
the Trustee to distribute any benefit if the total value is more than
$3,500 unless such Committee has the receipt of a request from the
Participant or Beneficiary except for such distributions as may be needed
to be made on or after the Required Distribution Date.
In the event no distribution is due because the Participant has no
Vested Interest in any Account under the Plan, such Participant shall be
considered as having received distribution of all amounts due from the
Plan.
2. Required Distribution Date. Notwithstanding the above, if a
Participant whose employment has terminated has not submitted a written
request for distribution prior to the April 1 following the Plan Year
during which the Participant attained age 70-1/2, distribution shall be
made as of such April 1.
If a Participant is a 5% owner of the Employer within the meaning of
Code Section 416(i) at any time during the five Plan Years ending with the
Plan Year during which the Participant attains age 70-1/2, distribution
shall be made not later than the April 1 following the close of the Plan
Year during which such Participant attained age 70-1/2 whether or not the
Participant has terminated at such time.
For Plan Years beginning January 1, 1989 and after, distribution shall
begin no later than the April 1 following the close of the Plan Year during
which a Participant,
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regardless of ownership, attained age 70-1/2 whether or not the Participant
has terminated at such time. However, if the Participant had attained age
70-1/2 as of January 1, 1988 and was not a 5% owner within the meaning of
the preceding paragraph, this paragraph shall not apply.
In the event distribution is due because of the death of the
Participant, distribution shall begin within one year of the death of the
Participant unless the Beneficiary is the Surviving Spouse (within the
meaning of Article X.C) of the Participant, in which case such Surviving
Spouse may elect to defer distribution until what would have been the date
the Participant attained age 70-1/2. Such distribution will be reduced by
any outstanding loan of the Participant at the time of his death. In the
event of the death of the Surviving Spouse before distribution is made, the
distribution shall begin within one year of the death of the Surviving
Spouse. If the death of both the Participant and Surviving Spouse occurred
before distributions began and there is no designated beneficiary, the
entire interest of the Participant shall be distributed within five years
after the death of the Participant and/or Surviving Spouse. If the
Participant dies after distribution of such Participant's interest has
commenced, the remaining interest will continue to be distributed at least
as rapidly as under the method of distribution being used prior to the
Participant's death.
3. Method of Payments. Distribution of benefits shall be made by the
Trustee in a single sum payment or by installments. To the extent a
Participant has directed the Trustees to invest in Qualifying Employer
Securities, the Participant may elect to receive distributions of such
account in cash or in shares. If the distribution includes shares, such
distribution of Qualifying Employer Securities shall be in whole shares,
issued in the name of the Participant, subject to the rights and
obligations of such security holders generally, including any rights or
restrictions imposed on such Qualifying Employer Securities. Fractional
shares shall be converted to cash.
If the distribution is in cash, the Qualifying Employer Securities
shall be converted to cash at fair market value as defined in the Code.
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If the distribution is to be made in installments, they shall be
substantially equal in amount and shall be made, in accordance with
regulations issued under Code Section 401(a)(9) on a monthly, quarterly,
semi-annual or annual basis, for a period not extending beyond either the
Participant's life expectancy or the life expectancy of the Participant and
his Beneficiary. If the Participant's Beneficiary is not his or her
spouse, the period over which such payments are to be made shall be
determined by reference to the applicable table of joint life expectancies
set forth in Treasury Regulation Section 1.401 (a)(9)-2. Prior to April 1
of the calendar year following the calendar year during which the
Participant attains age 70-1/2, such Participant may elect, in writing to
the Plan Administrator, whether the life expectancies for the Participant
and spouse are to be recalculated on an annual basis for purposes of
determining the amount of each installment payment hereunder. Any such
election shall become irrevocable as of the date specified above. If no
such election is made, the life expectancies of the Participant and spouse
shall not be recalculated on an annual basis. Any distribution made to a
Participant after the required distribution date but prior to termination
of employment shall be made in substantially equal monthly, quarterly,
semi-annual or annual installments in amounts which would reasonably be
expected to result in the Participant's Account balances, as of that date
and as thereafter increased by subsequent contributions and Fund earnings
with respect thereto, being distributed in accordance with the provisions
of this Article VI.D.3. Any amount remaining in the Participant's Accounts
on the date on which such Participant terminates employment shall be
distributed in accordance with the other provisions of this Article VI.D.
4. Loans. Loans to Participants shall be allowed if, and only if, the
Committee determines that such loans are to be made.
All loans shall be subject to uniform non-discriminatory rules
established by the Committee within the following guidelines:
a. The maximum amount a Participant may borrow will be 50% of the
sum of the Participant's balance in his Pre-Tax Contribution
Account, Rollover Account, Company Contribution Account and
Profit Sharing Account.
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b. The minimum dollar amount a Participant may borrow will be $1,000
and the maximum will be $50,000.
c. No loans shall be made from or against any Qualifying Employer
Securities allocated to such Participant's Account.
The $50,000 maximum loan limit is reduced by the maximum outstanding
loan balance of the Participant during the last 12 months preceding the
effective date of any new loan.
Each such loan shall be evidenced by a written executed promissory
note. Each loan shall be secured by a pledge of such Participant's Vested
Interest in this Plan or such other security as deemed adequate by the
Trustee at the date of issuance. Each loan shall be repayable according to
a schedule determined by the Trustee at the date of issuance. Such
schedule shall not be for a period greater than five years nor shall such
period extend beyond the Participant's Normal Retirement Date.
The interest rate to be charged on any loan shall be equal to the
prime interest rate charged by such commercial lending institution as the
Committee may select as of the first business day of the month preceding
the month in which the loan proceeds are received.
For the purpose of determining the extent to which a Participant's
accounts are entitled to share in income, gains or losses of the Trust
Fund, or of any subfund within the Trust Fund pursuant to Article V.C, the
Participant's Company Contribution Account, Profit Sharing Account, Pre-Tax
Contribution Account, as appropriate, shall be reduced by the unpaid
balance of any outstanding loans.
A Loan Account shall be established for each Participant receiving a
loan disbursement. The Loan Account shall be adjusted by the amount of any
principal repayments.
In the event a Participant terminates employment with the Employer
prior to repayment of the loan in full, any outstanding principal plus
interest shall become due and payable upon termination. If a Participant
does not repay the amount due in full, then he will be deemed to have
elected a partial distribution equal to the outstanding amount due.
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5. Withdrawals While Employed: A Participant may request in writing, on
an order for withdrawal form provided by the Committee a withdrawal of all
or a portion of his Vested Interest under the Plan while still employed by
the Employer subject to the terms and conditions of this Article VI.B.5.
However, no withdrawal while employed may be made from any subfund invested
in Qualifying Employer Securities.
A withdrawal of the Participant's Vested balance from the
Participant's Company Contribution Account, or the Pre-Tax Contribution
Account, while still employed shall be available only after attaining age
59-1/2, or if before age 59-1/2, upon proof of financial hardship. A
financial hardship withdrawal shall enable a Participant to meet immediate
and heavy needs for which the Participant does not have other reasonably
available sources of funds.
Effective January 1, 1989, financial hardship withdrawals shall be
allowed from the Participant's Pre-Tax contributions and investment
earnings on those contributions through December 31, 1988. Financial
hardship withdrawals shall be allowed from Pre-Tax contributions made after
December 31, 1988 but shall not be allowed from investment earnings on the
Pre-Tax Contribution Account after December 31, 1988.
A Participant shall be presumed to have incurred a financial hardship
for which other sources of funds are not reasonably available for the
following reasons:
a. Payment of uninsured medical expense described in Code Section
213(d) for the Participant, the Participant's spouse, or his
dependents.
b. Purchase of a principal residence for the Participant.
c. Payment of next term's tuition for post-secondary education for
the Participant, the Participant's spouse, or his dependents.
d. Payment necessary to prevent eviction or foreclosure on the
Participant's principal residence.
A Participant will not be deemed to have other reasonably available
sources of funds if the Participant certifies that the financial hardship
cannot be relieved through:
a. Reimbursement or compensation by insurance.
b. Reasonable liquidation of the Participant's, the Participant's
spouse, or his dependents assets.
c. Suspension of pre-tax contributions to the Plan.
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d. Distributions or loans available from any plan of the Employer or
former employer.
e. Loans from commercial sources on reasonable commercial terms.
In addition, such hardship withdrawal may not exceed the amount
necessary to relieve the hardship.
The Committee may rely on a notarized affidavit of a Participant which
states that he has a financial need -- which is specified as to nature and
amount -- and that he has no other funds which are reasonably available
from other sources, except to the extent that the persons to whom the
Committee has delegated the responsibility of administering this provision
have actual knowledge that such representations are not true.
Subject to such rules established by the Committee, a hardship
withdrawal may be made from a Participant's vested balance in his or her Profit
Sharing Account and/or Rollover Account. Withdrawals from the Profit Sharing
Account may not include the amount of any profit sharing contribution made to
the plan within the two years prior to the distribution.
The amount of any withdrawal shall be determined as of the Valuation
Date thirty days following receipt by the Committee of the Participant's
written withdrawal request. Payment of the withdrawal amount to the
Participant shall be made as soon as administratively possible following
the Valuation Date.
6. Distributions With Respect to a Qualified Domestic Relations
Order
An alternate payee under a qualified domestic relations order as
defined in Code Section 414(p) may elect to have the value of his or her
benefit under the Plan paid at anytime regardless of whether the
Participant is still actively employed as of such date and not otherwise
currently entitled to benefit distributions, provided however, that
payments made to the alternate payee before any date otherwise permitted by
the Plan shall only be made in the form of a lump sum distribution, and, if
the total value of the alternate payee's Account exceeds $3,500, only if
the alternate payee consents in writing to such distribution.
If the total value of the alternate payee's account exceeds $3,500 and
such alternate payee elects not to receive a distribution, such alternate
payee shall have his
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or her Account separated from the Participant's Account. In such event,
the alternate payee shall have all the rights available to and be treated
as a Participant who terminated employment as of the Valuation date the
Account was separated or distinguished from the Participant's Account.
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ARTICLE VII
ADMINISTRATION AND NAMED FIDUCIARY
A. PLAN ADMINISTRATION
1. Appointment of Committee Permitted. The Employer shall be the Plan
Administrator and shall assume those responsibilities and possess those
rights set forth in this Article VII.A, provided however, in order to
assist the Employer in the administration of the Plan, the Board reserves
the power to create at any time hereafter by resolution, a Committee which
shall be appointed and shall serve at the pleasure of the Board. Any
member may resign by delivering his written resignation to the Board and to
the Committee. Vacancies in the Committee arising by resignation, death,
removal or otherwise, shall be filled by the Board. Names of the current
members of the Committee are to be made available from the Employer.
2. Powers and Duties. The Committee, if established by the Board, shall
be the Plan Administrator, and shall have all powers necessary to carry out
the provisions of the Plan as set forth in this Article VII.A. Any
determination by the Committee shall be conclusive and binding on all
persons, except as provided in the Plan.
3. Organization and Operation of Committee. The Committee shall act by a
majority of its members at the time in office, and such action may be taken
either by a vote at a meeting or in writing without a meeting.
The Committee may authorize any one or more of its members to execute
any document or documents on behalf of the Committee, in which event the
Committee shall notify the Trustees in writing of such action and the name
or names of its member or members so designated. The Trustees shall be
instructed to accept and rely upon any documents executed by such member or
members as representing action by the Committee until the Committee shall
file with the Trustee a written revocation of such designation.
The Committee may adopt such by-laws and regulations as it deems
desirable for the conduct of its affairs, and may appoint such accountants,
counsel, specialists, and other persons as it deems necessary or desirable
in connection with the administration of this Plan. The Committee shall be
entitled to rely conclusively upon,
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and shall be fully protected in any action taken by it in good faith in
relying upon any opinions or reports which shall be furnished to it by any
such accountant, counsel, or other specialist.
4. Records and Reports. The Committee shall keep a record of all its
proceedings and acts, and shall keep all such books of account, records and
other data as may be necessary for proper administration of the Plan. The
Committee shall notify the Trustees and the Employer of any action taken by
the Committee, and when required, shall notify any other interested person
or persons.
5. Payment of Expenses. Unless otherwise determined by the Employer, the
members of the Committee shall serve without compensation for services as
such, but all expenses of the Committee shall be paid by the Employer but
if not paid by the Employer shall be paid by the Trust. Such expenses
shall include any expenses incident to the functioning of the Committee,
including, but not limited to, fees of accountants, counsel, and other
specialists, and other costs of administering the Plan.
6. Immunity from Liability. No member of the Committee shall incur any
liability for any act or failure to act, excepting only liability for his
own gross negligence or willful misconduct.
The Employer shall indemnify each member of the Committee against any
and all claims, loss, damages, expense, and liability arising from any act
or failure to act, except when the same is judicially determined to be due
to the gross negligence or willful misconduct of such member.
The provisions of this Article VII.A shall not relieve members of the
Committee from any responsibility or liability for any responsibility,
obligation, or duty they may have pursuant to the provisions of the
Retirement Act or Code.
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B. NAMED FIDUCIARY, ADMINISTRATOR AND SERVICE OF LEGAL PROCESS
The Employer shall be the named fiduciary and "administrator", as defined
in the Retirement Act, and shall be responsible for the performance of all
reporting, disclosure and other obligations required or permitted to be
performed by the Plan Administrator under the provisions of the Retirement Act
or Code. However, as set forth in Article VII.A, the Plan Administrator or a
Committee may be appointed to perform some or all of the administrative
functions.
In any legal proceeding, including arbitration, involving the Plan, the
Employer shall be the designated agent for service of legal process.
The Trustees shall be the named fiduciaries with respect to the control,
management and disposition of the assets of the Trust fund.
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ARTICLE VIII
TRUST AGREEMENT
The Employer has entered or concurrently will enter into an agreement under
which a Trustee shall receive, hold, invest and disburse the contributions of
the Employer to the Trust Fund, all in accordance with the terms and provisions
set forth in the Trust Agreement. The Employer, its directors, officers and the
Plan Administrator shall not be liable for any loss or diminution of the Trust
Fund.
The Board of Directors of the Employer shall have the power to remove the
Trustee and appoint a successor at any time in the manner set forth in the Trust
Agreement.
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ARTICLE IX
AMENDMENT, TERMINATION, MERGER
A. AMENDMENT
It is the expectation of the Employer that it will continue the Plan and
the payments of its contributions hereunder indefinitely, but continuance of the
Plan is not assumed as a contractual obligation of the Employer, and the right
is reserved by the Board at any time to reduce, suspend or discontinue its
contributions hereunder. While the Employer may suspend its contributions
hereunder without terminating the Plan, a discontinuance of contributions as
defined by applicable provisions of the Code and the Retirement Act and
regulations promulgated thereunder, will result in fully vesting the rights of
the Participants of such Employer as if there were an actual termination of the
Plan.
Except as herein limited, the Employer may, by resolution of its Board,
amend the Plan at any time to any extent that it may deem advisable. Upon
delivery of such resolution to the Trustees, the Plan shall be deemed to have
been amended in the manner set forth and Participants shall be bound thereby;
provided, however:
(1) that no amendment shall increase the duties or liabilities of the
Trustees without their written consent;
(2) that no amendment shall have the effect of vesting in the Employer any
interest in or control over any of the Funds or properties subject to
the terms of the Trust Agreement;
(3) that no amendment shall have the retroactive effect so as to deprive
any Participant of any benefit already accrued; and
(4) that no amendment made after July 30, 1984 shall eliminate an optional
form of distribution unless permitted by regulations issued under Code
Section 411(d)(6); provided, however, that any amendment may be made
retroactively which is necessary to bring the Plan into conformity
with governmental regulations in order to continue to qualify the Plan
for tax exemption.
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B. TERMINATION
The Plan shall continue for such time as may be necessary to accomplish
the purpose for which it was created but may be terminated at any time with
respect to the Employer by action of its Board. Notice of such termination
shall be given to the Trustee by an instrument in writing executed by the
Employer and acknowledged in the same form as the Trust Agreement, together
with a certified copy of the resolution of the Board of the Employer
authorizing such termination. Upon such termination of the Plan with respect
to the Employer, provided that the Trustee has not received instructions to the
contrary, the Trustee shall liquidate the portion of the Trust applicable to
such Employer and, after paying the reasonable expenses of the Trust, including
expenses involved in the termination, distribute the balance thereof according
to written directions from the Employer or the Plan Administrator.
Upon termination or partial termination of the Plan with respect to the
Employer, the rights of all Employees of such Employer to the amounts credited
to the Participants' accounts, shall be nonforfeitable and administered and
distributed to or for the benefit of the Participants and their Beneficiaries.
In no event shall any part of the principal or income of the Trust Fund be paid
to or for the benefit of the Employer, its successors or creditors.
C. MERGER, CONSOLIDATION OR TRANSFER OF ASSETS TO OTHER PLANS
In the case of any merger or consolidation with, or transfer of assets or
liabilities to, any other plan, each Participant in the Plan shall receive a
benefit immediately after the merger, consolidation, or transfer which is (if
the Plan were then terminated) equal to or greater than the benefit such
Participant would have been entitled to receive immediately before the merger,
consolidation or transfer (if the Plan were then terminated).
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ARTICLE X
MISCELLANEOUS PROVISIONS
A. BENEFITS NOT ASSIGNABLE
The benefits provided hereunder are intended for the personal security of
persons entitled to payments under the Plan, and are not subject in any manner
to their debts or other obligations, and such benefits may not be sold,
transferred, assigned or encumbered in any manner, either voluntarily or
involuntarily except as may be required by law. The preceding sentence shall
also apply to the creation, assignment, or recognition of a right to any benefit
payable with respect to a Participant pursuant to a domestic relations order,
unless such order is determined to be a qualified domestic relations order as
defined in Code Section 414(p), or any domestic relations order entered before
January 1, 1985.
B. CONDITIONS OF EMPLOYMENT NOT AFFECTED BY PLAN
The establishment and maintenance of the Plan will not be construed as
conferring any legal rights upon any person to the continuation of employment
with the Employer, nor will the Plan interfere with the right of the Employer to
discharge any person from its employment.
C. BENEFICIARIES
1. Designation. Each Participant may, from time to time during his
lifetime, designate the Beneficiary(ies) to receive the benefits which may
be payable under the Plan in the event of his death. Each such designation
will revoke all prior designations by such Participant and shall be in
writing on a form provided for that purpose and filed with the Plan
Administrator. Such designation may name one or more primary
Beneficiaries.
If a Participant dies on or after August 23, 1984 and such death
occurs prior to the distribution of benefits under the Plan, such
Beneficiary shall automatically be the Surviving Spouse of the Participant
unless such Surviving Spouse consented in writing to the Participant's
designation of an alternate Beneficiary, and such consent was witnessed by
a Plan representative or notarized.
Prior to the time the Committee accepts the designation of any
non-Spouse Beneficiary, the Participant shall be provided with a written
explanation of:
(1) the terms and conditions of death benefits under the Plan,
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(2) the Participant's right to make and the effect of an election to
waive the Surviving Spouse as the Beneficiary,
(3) the rights of the Participant's Spouse, and
(4) the right to make and the effect of a revocation of a previous
election waiving the Surviving Spouse as Beneficiary.
If the Participant establishes to the satisfaction of the Committee
that a Spouse's written consent cannot be obtained because there is no
Spouse or the Spouse cannot be located, the Spouse's consent requirements
shall be waived.
There shall be no limit on the number of times a Participant may
change a Beneficiary designation in accordance with the above rules prior
to the time of distribution.
2. Disposition of Death Benefits on Failure to Designate Beneficiary. In
the event a Participant shall fail to designate a Beneficiary to receive
his death benefits, or having designated a Beneficiary, shall thereafter
revoke such designation without naming another Beneficiary, or having named
a Beneficiary, such designation shall fail, in whole or in part, by reason
of the prior death of such Beneficiary or by reasons of the death of the
Beneficiary and any contingent Beneficiaries before the receipt of all
payments due, or for any other cause, the aforementioned death benefit of
such Participant or the part thereof as to which such Participant's
designation shall fail, as the case may be, shall be payable upon such
failure to the Surviving Spouse of the Participant, if the Spouse shall
then survive; but if not, then in equal shares to such of the Issue of the
Participant as then survive Per Stirpes and not per capita; but if no
Spouse or Issue then survive, then to the father and mother of such
Participant in equal shares or all thereof to the survivor of them if only
one parent then survives, then to such of the brothers and sisters of such
Participant as then survive in equal shares; but if no Spouse, Issue,
parent, brother or sister of the Participant shall then survive, then such
death benefit or the part thereof as to which such Participant's
designation shall fail, as the case may be, shall be paid to the executor
or administrators of the estate of the deceased Participant.
For purposes of this Article X.C "Surviving Spouse" and "Spouse" mean
a spouse who has been married to the Participant for at least one year at
the date of death and
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who survives the Participant. Also "Per Stirpes" means in equal shares
among living children and the issue of deceased children, the latter taking
by right of representation, and "Issue" means all natural or legal adopted
children.
D. FACILITY OF BENEFIT PAYMENT
1. Applications Required for Benefits. Notwithstanding any provision of
the Plan to the contrary, payment of benefits shall not commence under the
Plan unless and until a proper application therefor shall have been filed
with the Plan Administrator. Each application for benefits shall be in
writing on a form provided by the Plan Administrator for such purpose and
shall be filed with the Plan Administrator within the period, if any,
specified in the applicable provisions of the Plan.
2. Payment of Benefits to Persons under Legal Disability. Whenever and
as often as any person entitled to payments hereunder shall be under a
legal disability, or in the sole judgment of the Plan Administrator, shall
otherwise be unable to apply such payments to his own best interest and
advantage, the Plan Administrator, in his discretion, may direct all or any
portion of such payment to be made to such person, to such person's legal
guardian or conservator, or to such person's spouse or to any other person,
to be expended for his benefit. The decision of the Plan Administrator
shall, in each case, be final and binding upon all persons, and the Plan
Administrator shall not be obliged to see to the proper application or
expenditure of any payments so made. Any payments made pursuant to the
power herein conferred upon the Plan Administrator shall operate as a
complete discharge of the obligations under the Plan in respect thereof of
the Employer, the Plan Administrator, and the Trustee.
E. APPEALS PROCEDURE
In the event the Plan Administrator determines that a person is not
entitled to benefits or is not a Participant in this Plan, or if the Plan
Administrator makes any decision or interpretation adversely affecting the right
of any Participant or Beneficiary, written notice of such determination,
decision or interpretation shall be given to such adversely affected person
within 90 days after such determination, decision or interpretation. If special
circumstances require an extension of time for processing, a decision shall be
rendered as soon as possible but not later than 180 days after a claim for
benefits. Such notice shall be
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written in a manner calculated to be understood by the Participant or
Beneficiary and shall set forth:
(1) The specific reason or reasons for the determination, decision or
interpretation;
(2) Specific reference to the pertinent Plan provisions on which the
determination, decision or interpretation is based;
(3) A description of any additional material or information necessary
for the adversely affected party to perfect his right or an
explanation of why such material or information is necessary; and
(4) An explanation of the Plan's claim review procedures.
In the event a Participant, Beneficiary or other interested person or party
feels himself aggrieved by any determination, decision or interpretation of the
Plan Administrator, except with respect to matters of investment of the Trust
Fund or matters herein expressed to be within the discretion of the Employer,
the Plan Administrator, or the Trustee, the aggrieved party or his authorized
representative may file with the Plan Administrator in writing, within 60 days
of receipt of notice of such determination, decision or interpretation, a
request by the aggrieved party for a full and fair review by the Plan
Administrator of the determination, decision or interpretation. The aggrieved
party or his authorized representative may inspect all pertinent documents and
may submit issues and comments in writing to the Plan Administrator. The Plan
Administrator's decision, on review, shall be in writing, in a manner calculated
to be understood by the aggrieved party, and shall include specific reasons for
the decision and specific references to the pertinent Plan provisions on which
the decision is based. The decision by the Plan Administrator shall be made
promptly and not later than 60 days after the Plan's receipt of a request for
review, unless special circumstances require an extension of time for
processing, in which case a decision shall be rendered as soon as possible but
not later than 120 days after receipt of a request for review.
Any ambiguities arising on account of the interpretation rendered to Hours
of Service, Years of Service, and One Year Break in Service, shall be resolved
in the favor of the Participant.
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F. GENDER
Wherever appropriate, words used herein in the singular may be read in the
plural, or words used herein in the plural may be read in the singular; the
masculine may include the feminine; and the words "hereof", "herein", or
"hereunder", or other similar compounds of the word "here" shall mean and refer
to the entire Plan and not to any particular paragraph or Section of this Plan
unless the context clearly indicates to the contrary.
G. TOP HEAVY PROVISIONS
1. Effective Date. The provisions of this Article X.G may be effective
only for the Plan Years commencing on and after January 1, 1984. The
provisions of this Article X.G will be effective for any Plan Year if and
only if the Plan is deemed to be a Top Heavy Plan for that Plan Year.
2. Top Heavy Plan. The Plan is deemed to be a Top Heavy Plan for any
Plan Year if, as of the Determination Date:
a. The present value of accrued benefits for Key Employees is greater
than or equal to 60% of the present value of accrued benefits for all
Employees, and
b. The Plan is part of a required aggregation group (as defined below)
and the required aggregation group is top heavy.
The "Determination Date" for any Plan Year is the last day of the
preceding Plan Year. However, and notwithstanding the results of the 60%
test, the Plan shall not be considered a Top Heavy Plan for any Plan Year
in which the Plan is a part of a required or permissive aggregation group
(as defined below) which is not top heavy.
The "required aggregation group" of the Employer consists of each plan
of the Employer in which a Key Employee participates in the Plan Year
containing the Determination Date or any of the four preceding Plan Years,
and each other plan of the Employer that enables any plan in which a Key
Employee participates during the period tested to meet the
nondiscrimination requirements of Sections 401(a)(4) and 410 of the Code
are required to be aggregated for Top Heavy testing purposes and are
considered the required aggregation group. All employers aggregated under
Code Sections 414(b), (c), or (m) are considered a single employer.
A "permissive aggregation group" consists of one or more plans that
are not required to be aggregated, but which may be aggregated with a
required aggregation
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group. A plan may be permissively aggregated only if the resulting
aggregation group satisfies the requirements of Sections 401(a)(4) and 410
of the Code.
The present value of accrued benefits consists of the total value of
the Participant's Account plus the actuarial equivalent of the
Participant's accrued benefit under any other Plan maintained by the
Employer which is aggregated with this Plan. It also includes
distributions from this Plan and the other aggregated plans made during the
Plan Year containing the determination date and the four preceding Plan
Years. For the Plan Years beginning January 1, 1985 and after, the accrued
benefit for any individual who has not received any compensation (other
than benefits under the plans) at any time during the five Plan Years
ending on the determination date shall not be included in the present value
of accrued benefits. Payments made to the Beneficiary of a Key Employee
shall be treated as if made to a Key Employee.
A Key Employee is any Employee or former Employee falling within the
definition of key employee under Section 416 of the Code. Subject to such
definition, an Employee or former Employee is deemed to be a Key Employee
for the Plan Year if at any time during the Plan Year or the four preceding
years the Employee is described by one of the following four items:
a. An officer of the Employer having an annual compensation greater than
50% of the maximum annual limit in effect under Code Section
415(b)(1)(A) for such Plan Year. For purposes of this subsection, no
more than fifty Employees (or, if less, the greater of three or ten
percent of the Employees) shall be treated as officers.
b. One of the ten Employees owning the largest interests in the Employer
who has an annual compensation greater than the maximum annual
addition amount in effect under Code Section 415(c)(1)(A) for such
Plan Year. If two Employees have the same interest in the Employer,
the Employee having greater annual compensation from the Employer
shall be treated as having the larger interest.
c. A 5% owner of the Employer.
d. A 1% owner of the Employer with W-2 compensation of more than
$150,000.
3. Compensation. If an Employee is a Key Employee for the Plan Year no
more than $200,000 of Compensation or such larger dollar amount permitted
under the Code shall be recognized for that Plan Year in the determination
of benefits under the Plan.
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4. Maximum Benefits. If the Plan is deemed to be a Top Heavy Plan for
the Plan Year for the purposes of determining the maximum benefits payable
from this Plan and the defined benefit plan as described in Article IV.E.3,
all instances of 1.25 (inferred through reference to Code section 415(e) )
in Article IV.E.3 are replaced with 1.00.
5. Minimum Contribution. If the Plan is deemed to be a Top Heavy Plan
for the Plan Year, all Participants who are not Key Employees are entitled
to a minimum contribution for the Plan Year of 5% of Compensation. The
Employer Contribution set forth in Article IV.B.4 shall provide the minimum
contribution.
6. Minimum Vesting. Notwithstanding the provisions of Article VI.A, if a
Participant received contributions under the Plan pursuant to Article IV
during a Plan Year in which the Plan was Top Heavy, such Participant's
vested percentage in his Account shall not be less than the percentage
determined in accordance with the following table:
Years of Vested Service Vested Percentage
----------------------- -----------------
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%
H. APPLICABLE LAW
The situs of the Trust hereunder is the State of Wisconsin, and the
provisions hereof shall be construed, enforced, and administered in accordance
with the Retirement Act and Code, and, to the extent applicable, the laws of the
State of Wisconsin.
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[MICHAEL BEST & FRIEDRICH LETTERHEAD]
May 9, 1997
First Federal Capital Corporation
605 State Street
P.O. Box 1868
LaCrosse, Wisconsin 54602-1868
RE: REGISTRATION STATEMENT ON FORM S-8
Gentlemen:
You have requested our opinion as to the legality of the participation
interests ("Interests") in the First Federal Savings Bank Savings Investment
Plan ( the "Savings Investment Plan") being registered with the Securities and
Exchange Commission pursuant to a Registration Statement on Form S-8. As your
counsel, we have examined such records and other documents as we deemed
necessary for the purposes of this opinion and considered such questions of law
as we believe to be involved. Based upon such examination and consideration,
it is our opinion that the Interests will, when issued in accordance with the
provisions of the Savings Investment Plan under which they are granted, be
legally issued and will be valid and binding interests in the Savings
Investment Plan.
We give our consent to the filing of this opinion as an Exhibit to the
Registration Statement on Form S-8 and the use of our name in connection
therewith.
Very truly yours,
MICHAEL BEST & FRIEDRICH
<PAGE> 1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement on
Form S-8 pertaining to the First Federal Savings Bank Savings Investment Plan
of our report dated January 24, 1997, with respect to the consolidated
financial statements and schedules of First Federal Capital Corp. included in
its Annual Report on Form 10-K for the year ended December 31, 1996, filed with
the Securities and Exchange Commission.
ERNST & YOUNG LLP
May 9, 1997
Milwaukee, Wisconsin
