Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________________
Form S-8
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
_________________
The Seagram Company Ltd.--La Compagnie Seagram Ltee
(Exact name of Registrant as specified in its charter)
Canada None
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1430 Peel Street
Montreal, Quebec, Canada H3A 1S9
(Address, including zip code, of Registrant's principal executive office)
The Seagram Company Ltd. 1996 Stock Incentive Plan
The Seagram Company Ltd. Stock Plan for Non-Employee Directors
Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates - Universal Employees
Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates - UNI Employees
Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates - Spencer Employees
Retirement Savings and Investment Plan for Union Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates
Retirement Savings and Investment Plan for Union Employees of
Tropicana Products, Inc. and Affiliates
(Full title of the Plans)
____________________
Robert W. Matschullat
Joseph E. Seagram & Sons, Inc.
375 Park Avenue
New York, New York 10152
(212) 572-7000
(Name, address, including zip code, and telephone number, including area code,
of Registrant's agent for service and authorized representative of Registrant
in the United States)
____________________
Copies to:
George R. Krouse, Jr, Esq.
Sarah E. Cogan, Esq.
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
____________________
<PAGE>
CALCULATION OF REGISTRATION FEE
Proposed
Maximum Proposed
Title of Offering Maximum Amount of
Securities to Amount to Price Aggregate Registration
be Registered be Registered Per Share(1) Offering Price Fee(1)
Common shares
without
nominal or 25,000,000
par value shares(2) $40.6875 $1,017,187,500 $308,238.64
(1) Pursuant to Rule 457 under the Securities Act of 1933 the proposed
maximum offering price per share and the registration fee relating to the
common shares being registered have been based on the average of the high
and low prices of the common shares reported on the New York Stock
Exchange Composite Tape on December 24, 1996.
(2) There is also being registered hereunder such additional undetermined
amount of common shares as may be needed as a result of stock dividends,
stock splits or other similar adjustments of the outstanding common
shares.
In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
Registration Statement also covers an indeterminate amount of interests to be
offered or sold pursuant to the employee benefit plans described herein.
<PAGE>
PART I
Item 1. Plan Information.
Not required to be filed with this Registration Statement.
Item 2. Registrant Information and Employee Plan Annual Information.
Not required to be filed with this Registration Statement.
PART II
Item 3. Incorporation of Documents by Reference.
The following documents filed with the Securities and Exchange Commission
by The Seagram Company Ltd. (the "Company") are hereby incorporated in this
Registration Statement by reference:
(1) The Company's Transition Report on Form 10-K for the transition
period ended June 30, 1996.
(2) All other reports filed by the Company pursuant to Section 13(a)
or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), since June 30, 1996.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act, prior to the filing of a post-effective
amendment which indicates that all securities offered have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be a part
hereof from the date of filing such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Registration Statement
to the extent that a statement contained herein or in any other subsequently
filed document which also is or is deemed to be incorporated by reference
herein modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Registration Statement.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Section 124, Subsections (1) through (4), of the Canada Business
Corporations Act (the "Act") provides as follows:
"124. Indemnification.--(1) Except in respect of an action by or on
behalf of the corporation or body corporate to procure a judgment in
its favour, a corporation may indemnify a director or officer of the
corporation, a former director or officer of the corporation or a
person who acts or acted at the corporation's request as a director or
officer of a body corporate of which the corporation is or was a
shareholder or creditor, and his heirs and legal representatives,
against all costs, charges and expenses, including an amount paid to
settle an action or satisfy a judgment, reasonably incurred by him in
<PAGE>
respect of any civil, criminal or administrative action or proceeding
to which he is made a party by reason of being or having been a
director or officer of such corporation or body corporate, if
(a) he acted honestly and in good faith with a view to the best
interests of the corporation; and
(b) in the case of a criminal or administrative action or
proceeding that is enforced by a monetary penalty, he had
reasonable grounds for believing that his conduct was lawful.
(2) Indemnification in derivative actions.--A corporation may with the
approval of a court indemnify a person referred to in subsection (1) in
respect of an action by or on behalf of the corporation or body
corporate to procure a judgment in its favour, to which he is made a
party by reason of being or having been a director or an officer of the
corporation or body corporate, against all costs, charges and expenses
reasonably incurred by him in connection with such action if he
fulfills the conditions set out in paragraphs (1)(a) and (b).
(3) Indemnity as of right.--Notwithstanding anything in this section,
a person referred to in subsection (1) is entitled to indemnity from
the corporation in respect of all costs, charges and expenses
reasonably incurred by him in connection with the defence of any civil,
criminal or administrative action or proceeding to which he is made a
party by reason of being or having been a director or officer of the
corporation or body corporate, if the person seeking indemnity
(a) was substantially successful on the merits in his defence of
the action or proceeding; and
(b) fulfills the conditions set out in paragraphs (1)(a) and (b).
(4) Directors' and officers' insurance.--A corporation may purchase
and maintain insurance for the benefit of any person referred to in
subsection (1) against any liability incurred by him
(a) in his capacity as a director or officer of the corporation,
except where the liability relates to his failure to act
honestly and in good faith with a view to the best interests of
the corporation, or
(b) in his capacity as director or officer of another body
corporate where he acts or acted in that capacity at the
corporation's request, except where the liability relates to
his failure to act honestly and in good faith with a view to
the best interests of the body corporate."
Sections 7.02 and 7.03 of the General By-Laws of the Company provide as
follows:
"Section 7.02--Indemnity. Without in any manner derogating from or
limiting the mandatory provisions of the Act but subject to the
conditions contained therein, the Corporation shall indemnify a
director or officer of the Corporation, a former director or officer of
the Corporation, or a person who acts or acted at the Corporation's
request as a director or officer of a body corporate of which the
Corporation is or was a shareholder or creditor, and his heirs and
<PAGE>
legal representatives, against all costs, charges and expenses,
including an amount paid to settle an action or satisfy a judgment,
reasonably incurred by him in respect of any civil, criminal or
administrative action or proceeding to which he is made a party by
reason of being or having been a director or officer of the Corporation
or such body corporate, if
(a) he acted honestly and in good faith with a view to the best
interests of the Corporation; and
(b) in the case of a criminal or administrative action or
proceeding that is enforced by a monetary penalty, he has
reasonable grounds for believing that his conduct was lawful.
Section 7.03--Insurance. Subject to the limitations contained in the
Act, the Corporation may purchase and maintain such insurance for the
benefit of the persons mentioned in Section 7.02, as the board may from
time to time determine."
Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended (the "Securities Act"), may be permitted to directors,
officers or 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 Securities 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 against the
Registrant 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 policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
The directors and officers of the Registrant are covered by insurance
policies indemnifying against certain liabilities, including liabilities
arising under the Securities Act, which might be incurred by them in such
capacities and against which they cannot be indemnified by the Registrant.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
4(a) Articles of Amalgamation dated February 1, 1995 between the
Company and Centenary Distillers Ltd. (incorporated by reference
to Exhibit 3(a) of the Company's Annual Report on Form 10-K for
the fiscal year ended January 31, 1995), as amended by Certificate
and Articles of Amendment dated May 31, 1995 (incorporated by
reference to Exhibit 3(a) of the Company's Quarterly Report on
Form 10-Q for the fiscal quarter ended April 30, 1995)
4(b) General By-Laws of the Corporation, as amended (incorporated by
reference to Exhibit 3(b) to the Company's Quarterly Report on
Form 10-Q for the fiscal quarter ended April 30, 1996)
<PAGE>
4(c) The Seagram Company Ltd. 1996 Stock Incentive Plan
4(d) The Seagram Company Ltd. Stock Plan for Non-Employee Directors
4(e) Retirement Savings and Investment Plan for Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates (applicable to the Retirement
Savings and Investment Plan for Employees of Joseph E. Seagram &
Sons, Inc. and Affiliates - Universal Employees, to the Retirement
Savings and Investment Plan for Employees of Joseph E. Seagram &
Sons, Inc. and Affiliates - UNI Employees and to the Retirement
Savings and Investment Plan for Employees of Joseph E. Seagram &
Sons, Inc. and Affiliates - Spencer Employees)
4(f) Trust Agreement dated as of October 1, 1994 between Joseph E.
Seagram & Sons, Inc. and Continental Trust Company (incorporated
by reference to Exhibit 4(d) of the Company's Registration
Statement on Form S-8 (No. 33-99122)) (applicable to the
Retirement Savings and Investment Plan for Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates - Universal Employees, to the
Retirement Savings and Investment Plan for Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates - UNI Employees and to the
Retirement Savings and Investment Plan for Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates - Spencer Employees)
4(g) Adoption Agreement effective January 1, 1997 between Joseph E.
Seagram & Sons, Inc. and The Dreyfus Trust Company (applicable to
the Retirement Savings and Investment Plan for Union Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates)
4(h) Adoption Agreement effective January 1, 1997 between Tropicana
Products, Inc and The Dreyfus Trust Company (applicable to the
Retirement Savings and Investment Plan for Union Employees of
Tropicana Products, Inc. and Affiliates)
4(i) Trust Agreement (applicable to the Retirement Savings and
Investment Plan for Union Employees of Joseph E. Seagram & Sons,
Inc. and Affiliates and to the Retirement Savings and Investment
Plan for Union Employees of Tropicana Products, Inc. and
Affiliates)
4(j) Defined Contribution Plan (applicable to the Retirement Savings
and Investment Plan for Union Employees of Joseph E. Seagram &
Sons, Inc. and Affiliates and to the Retirement Savings and
Investment Plan for Union Employees of Tropicana Products, Inc.
and Affiliates)
5 Opinion of Goodman Phillips & Vineberg
23(a) Consent of Price Waterhouse, chartered accountants
23(b) Consent of Price Waterhouse LLP, independent accountants
24 Power of Attorney
Item 9. Undertakings.
The undersigned Registrant hereby undertakes:
<PAGE>
(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;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this 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 this Registration Statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in this Registration
Statement or any material change to such information set forth in
this Registration Statement;
provided, however, that the undertakings set forth in paragraphs (i) and
(ii) above do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the Registrant pursuant to Section 13 or Section 15(d)
of the Exchange Act that are incorporated by reference in this
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act, each filing of the Registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Exchange Act (and each filing of
each plan's annual report pursuant to Section 15(d) of the Exchange Act)
that is incorporated by reference in this Registration Statement shall be
deemed to be a new registration statement relating to the securities
offered herein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(5) That the Registrant will submit the Retirement Savings and
Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates - Universal Employees, the Retirement Savings and Investment
Plan for Employees of Joseph E. Seagram & Sons, Inc. and Affiliates - UNI
Employees, the Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates - Spencer Employees, the
Retirement Savings and Investment Plan for Union Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates and the Retirement Savings and
Investment Plan for Union Employees of Tropicana Products, Inc. and
Affiliates, and will submit any amendment to such plans, to the Internal
Revenue Service (the "IRS") in a timely manner and will make, all changes
required by the IRS in order to qualify the Plans under Section 401 of
the Internal Revenue Code.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, The Seagram
Company Ltd. certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of New York, State of New York, on the 31st day of
December, 1996.
THE SEAGRAM COMPANY LTD.
(Registrant)
By *
____________________________________________________________________________
Edgar Bronfman, Jr.
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities at The Seagram Company Ltd. indicated on the 31st day of December,
1996.
Principal Executive Officer:
* Director, President
______________________________________________________ and Chief Executive
(Edgar Bronfman, Jr.) Officer
Principal Financial Officer and Agent for Service:
/s/ Robert W. Matschullat Director, Vice
______________________________________________________ Chairman and Chief
(Robert W. Matschullat) Financial Officer
Principal Accounting Officer:
/s/ Edward Falkenberg Vice President and
______________________________________________________ Controller
(Edward Falkenberg)
Directors:
Edgar M. Bronfman*
Charles R. Bronfman*
Samuel Bronfman II*
Matthew W. Barrett*
Frank J. Biondi, Jr.*
William G. Davis*
Paul Desmarais*
Michele J. Hooper*
David L. Johnston*
E. Leo Kolber*
Marie-Josee Kravis*
C. Edward Medland*
Lew R. Wasserman*
John S. Weinberg*
<PAGE>
* By signing his name hereto, Daniel R. Paladino signs this Registration
Statement on behalf of each of the persons indicated above pursuant to a power
of attorney duly executed by such persons and filed with the Securities and
Exchange Commission.
By /s/ Daniel R. Paladino
___________________________________________________
(Daniel R. Paladino, Attorney-in-fact)
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 31st day of December, 1996.
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF JOSEPH E. SEAGRAM &
SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
By /s/ John D. Borgia
___________________________________________________________________________
Member of Administrative Committee
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF JOSEPH E. SEAGRAM &
SONS, INC. AND AFFILIATES - UNI EMPLOYEES
By /s/ John D. Borgia
___________________________________________________________________________
Member of Administrative Committee
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF JOSEPH E. SEAGRAM &
SONS, INC. AND AFFILIATES - SPENCER EMPLOYEES
By /s/ John D. Borgia
___________________________________________________________________________
Member of Administrative Committee
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 31st day of December, 1996.
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF JOSEPH E. SEAGRAM
& SONS, INC. AND AFFILIATES
By /s/ John D. Borgia
___________________________________________________________________________
Member of Committee
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 31st day of December, 1996.
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF TROPICANA
PRODUCTS, INC. AND AFFILIATES
By /s/ Terry K. Danahy
___________________________________________________________________________
Member of Committee
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description of Exhibit
4(a) Articles of Amalgamation dated February 1, 1995
between the Company and Centenary Distillers Ltd.
(incorporated by reference to Exhibit 3(a) of the
Company's Annual Report on Form 10-K for the fiscal
year ended January 31, 1995), as amended by
Certificate and Articles of Amendment dated May 31,
1995 (incorporated by reference to Exhibit 3(a) of the
Company's Quarterly Report on Form 10-Q for the fiscal
quarter ended April 30, 1995)
4(b) General By-Laws of the Corporation, as amended
(incorporated by reference to Exhibit 3(b) to the
Company's Quarterly Report on Form 10-Q for the fiscal
quarter ended April 30, 1996)
4(c) The Seagram Company Ltd. 1996 Stock Incentive Plan
4(d) The Seagram Company Ltd. Stock Plan for Non-Employee
Directors
4(e) Retirement Savings and Investment Plan for Employees
of Joseph E. Seagram & Sons, Inc. and Affiliates
(applicable to the Retirement Savings and Investment
Plan for Employees of Joseph E. Seagram & Sons, Inc.
and Affiliates - Universal Employees, to the
Retirement Savings and Investment Plan for Employees
of Joseph E. Seagram & Sons, Inc. and Affiliates - UNI
Employees and to the Retirement Savings and Investment
Plan for Employees of Joseph E. Seagram & Sons, Inc.
and Affiliates - Spencer Employees)
4(f) Trust Agreement dated as of October 1, 1994 between
Joseph E. Seagram & Sons, Inc. and Continental Trust
Company (incorporated by reference to Exhibit 4(d) of
the Company's Registration Statement on Form S-8 (No.
33-99122)) (applicable to the Retirement Savings and
Investment Plan for Employees of Joseph E. Seagram &
Sons, Inc. and Affiliates - Universal Employees, to
the Retirement Savings and Investment Plan for
Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates - UNI Employees and to the Retirement
Savings and Investment Plan for Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates - Spencer
Employees)
4(g) Adoption Agreement effective January 1, 1997 between
Joseph E. Seagram & Sons, Inc. and The Dreyfus Trust
Company (applicable to the Retirement Savings and
Investment Plan for Union Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates)
<PAGE>
4(h) Adoption Agreement effective January 1, 1997 between
Tropicana Products, Inc and The Dreyfus Trust Company
(applicable to the Retirement Savings and Investment
Plan for Union Employees of Tropicana Products, Inc.
and Affiliates)
4(i) Trust Agreement (applicable to the Retirement Savings
and Investment Plan for Union Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates and to the
Retirement Savings and Investment Plan for Union
Employees of Tropicana Products, Inc. and Affiliates)
4(j) Defined Contribution Plan (applicable to the
Retirement Savings and Investment Plan for Union
Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates and to the Retirement Savings and
Investment Plan for Union Employees of Tropicana
Products, Inc. and Affiliates)
5 Opinion of Goodman Phillips & Vineberg
23(a) Consent of Price Waterhouse, chartered accountants
23(b) Consent of Price Waterhouse LLP, independent
accountants
24 Power of Attorney
THE SEAGRAM COMPANY LTD.
1996 STOCK INCENTIVE PLAN
ARTICLE I
Purpose
The purpose of The Seagram Company Ltd. 1996 Stock Incentive Plan is to
provide selected key employees of The Seagram Company Ltd. and its subsidiaries
an opportunity to benefit from the appreciation in the value of the common
shares of The Seagram Company Ltd., thus providing an increased incentive for
such employees to contribute to the future success and prosperity of The
Seagram Company Ltd., enhancing the value of the common shares for the benefit
of the shareholders and increasing the ability of The Seagram Company Ltd. and
its subsidiaries to attract and retain individuals of exceptional skill.
ARTICLE II
Definitions
The following capitalized terms used in the Plan have the respective
meanings set forth in this Article:
2.1 Act: The United States Securities Exchange Act of 1934, as amended.
2.2 Affiliate: A person or entity controlling, controlled by, or under
common control with, The Seagram Company Ltd.
2.3 Approval Date: The later of the date of approval of the Plan (a) by
the shareholders of The Seagram Company Ltd. and (b) by the
applicable regulatory authorities and stock exchanges, each as
contemplated by Article XVIII of the Plan.
2.4 Award: An Option, Stock Appreciation Right or other award granted
under the Plan.
2.5 Board: The Board of Directors of The Seagram Company Ltd.
2.6 Code: The United States Internal Revenue Code of 1986, as amended.
2.7 Committee: The Seagram Company Ltd. Human Resources Committee or
such other persons designated by the Board.
2.8 Common Shares: The common shares without nominal or par value of The
Seagram Company Ltd.
2.9 Company: The Seagram Company Ltd., any of its Subsidiaries or any
other Affiliate designated by the Board.
2.10 Disability: Inability to engage in any substantial gainful activity
by reason of a medically determinable physical or mental impairment
which constitutes a permanent and total disability, as defined in
Section 22(e)(3) of the Code. The determination whether a Participant
<PAGE>
has suffered a Disability shall be made by the Committee based upon
such evidence as it deems necessary and appropriate.
2.11 Disinterested Persons: Members of the Board who are not full time
employees of the Company and who are eligible to serve as Plan
administrators or to approve Awards under the provisions of Rule 16b-
3 promulgated under the Act. The preceding sentence shall have no
effect if any specification of such persons is eliminated from the
rules promulgated under Section 16 of the Act. This Section 2.11
shall apply only to the Plan and not to any other employee benefit
plan of the Company.
2.12 Employer: The Company that employs the employee or Participant.
2.13 Fair Market Value: The mean between high and low prices of the
Common Shares as reported on the composite tape for securities traded
on the New York Stock Exchange (or, if such exchange is not open on
such date, the immediately preceding date on which such exchange is
open), or, if the Common Shares are not so listed or traded, the mean
between high and low prices of the Common Shares as reported on the
principal United States national securities exchange on which such
shares are listed or admitted to trading (or, if such exchange is not
open on such date, the immediately preceding date on which such
exchange is open), or, if the Common Shares are not so listed or
traded, the mean between the closing bid price and the closing asked
price as quoted on the National Association of Securities Dealers
Automated Quotation System, or such other market in which such prices
are regularly quoted, or, if there have been no published bid or
asked quotations with respect to the Common Shares, the Fair Market
Value shall be the value established by the Committee in good faith
and, in the case of an ISO, in accordance with Section 422 of the
Code.
2.14 ISO: An incentive stock option within the meaning of Section 422 of
the Code.
2.15 Non-ISO: A stock option that is not an ISO.
2.16 Option: A stock option (whether ISO or Non-ISO) granted under the
Plan.
2.17 Option Price: The purchase price of one Common Share under an
Option.
2.18 Participant: A key employee of the Company who has been selected by
the Committee to receive an Award under the Plan.
2.19 Parent Corporation: A parent corporation, as defined in Section
424(e) of the Code.
2.20 Plan: The Seagram Company Ltd. 1996 Stock Incentive Plan, as from
time to time amended.
2.21 Retirement: Separation from service with the Company on or after
attainment of age 65 or, with the prior written consent of the
Company, retirement at an earlier age.
<PAGE>
2.22 Stork Appreciation Right: A stock appreciation right granted under
the Plan.
2.23 Subsidiary: A subsidiary corporation, as defined in Section 424(f)
of the Code.
2.24 Termination Date: With respect to each Award, a date fixed by the
Committee; provided that with respect to an Option, such date shall
not be later than the day preceding the tenth anniversary of its date
of grant.
2.25 Termination For Cause: A Participant's termination of employment
with the Company due to insubordination, willful misconduct, willful
failure to implement corrective actions, misappropriation of any
funds or property of the Company, unreasonable neglect or refusal to
perform duties assigned during employment or the conviction of a
felony.
ARTICLE III
Administration
3.1 Except as otherwise provided in the Plan, the Committee (or any
subcommittee thereof) shall administer the Plan and shall have full power to
grant Awards, construe and interpret the Plan, establish and amend rules and
regulations for its administration, and perform all other acts relating to the
Plan, including the delegation of administrative responsibilities, that it
believes reasonable and proper.
3.2 The Committee shall consist of not less than three persons, (a) all
of whom shall be (i) Disinterested Persons or (ii) if applicable, "non-employee
directors" as defined in the rules promulgated under Section 16 of the Act and
(b) at least two of whom shall be "outside directors" as defined in Section
162(m) of the Code and the regulations promulgated thereunder.
3.3 Subject to the provisions of the Plan, the Committee (or any
Subcommittee thereof) or the Board shall, in its discretion, determine which
employees shall be granted Awards and the terms and conditions of Awards.
3.4 Any decision made, or action taken, by the Committee, any
Subcommittee thereof or the Board arising out of or in connection with the
interpretation and administration of the Plan shall be final and conclusive.
ARTICLE IV
Limitations on the Amount of Award Grants
4.1 Common Shares Subject to the Plan: The total number of Common Shares
upon which Awards may be based shall be 20,000,000, subject to adjustment in
accordance with Article XIV of the Plan. These Common Shares shall be
authorized but unissued Common Shares. For purposes of this Section, a Stock
Appreciation Right granted pursuant to clause (b) of Section 7.1 shall not be
deemed to be an Award separate from the Option, or portion thereof, to which it
relates. For purposes of this Section, an Option, or portion thereof, exercised
through the exercise of such a Stock Appreciation Right shall be treated, to
<PAGE>
the extent settled in Common Shares, as though the Option, or portion thereof,
had been exercised through the purchase of Common Shares, with the result that
the Common Shares subject to the Option, or portion thereof, that was so
exercised shall not be available for future grants of Awards.
4.2 Common Shares to be Granted to a Participant: During the period from
the Approval Date through the sixth anniversary of the Approval Date, the total
number of Common Shares available for grants to any one Participant of (a)
Awards under the Plan and (b) awards under any other plan of the Company which
provides for the grant of Common Shares shall not exceed 5% of the then
outstanding Common Shares on the date when the Plan is adopted by the Board.
4.3 Cash-Only Awards: With respect to any fiscal year of the Company,
the aggregate value (as determined by the Committee) of Awards granted which
are exercisable solely for cash, or which upon maturity are payable solely in
cash, shall not exceed the aggregate salaries paid or accrued with respect to
such fiscal year to all Participants who receive grants of any Awards with
respect to such fiscal year; provided, however, that any such Award which may
be redeemed or exercised only upon a fixed date or dates at least six months
after grant, or incident to death, Retirement, Disability or cessation of
employment shall not be included in the foregoing calculation of the aggregate
value of Awards granted with respect to any fiscal year. This Section 4.3 (or
any part thereof) shall be effective only to the extent that it is required
under the rules promulgated under Section 16 of the Act or any other law, rule
or regulation applicable to the Company.
ARTICLE V
Eligibility
5.1 Awards may be granted to selected key employees of the Company.
ARTICLE VI
Terms of Options
6.1 Option Price: Except as provided in Section 6.3 of the Plan, the
Option Price shall be no less than the Fair Market Value of a Common Share on
the date the Option is granted, but in no event shall the Option Price be less
than that permitted by applicable laws, rules, by-laws or policies of
regulatory authorities or stock exchanges.
6.2 Period of Exercise: The Committee shall determine the dates after
which Options may be exercised in whole or in part; provided, however, that an
Option shall not be exercised prior to the Approval Date nor later than its
Termination Date. The Committee may amend an Option to accelerate the date
after which such Option may be exercised in whole or in part, provided that the
Company has obtained all applicable approvals, if any, of regulatory
authorities and stock exchanges. An Option which has not been exercised on or
prior to its Termination Date shall be cancelled.
6.3 Special Rules Regarding ISOs Granted to Certain Employees:
Notwithstanding any contrary provisions of Sections 6.1 and 6.2 of the Plan, no
ISO shall be granted to any employee who, at the time the Option is granted,
owns (directly or within the meaning of Section 424(d) of the Code) more than
<PAGE>
ten percent of the total combined voting power of all classes of stock of the
Employer or of any Subsidiary or Parent Corporation thereof, unless (a) the
Option Price under such Option is at least 110% of the Fair Market Value of a
Common Share on the date the Option is granted and (b) the Termination Date of
such Option is a date not later than the day preceding the fifth anniversary of
the date on which the Option is granted.
6.4 Manner of Exercise and Payment: Subject to Section 6.2 of the Plan,
an Option, or portion thereof, shall be exercised by delivery of a written
notice of exercise to the Company and payment of the full price of the Common
Shares being purchased pursuant to the Option. A Participant or his or her
legal representative may exercise an Option with respect to less than the full
number of Common Shares for which the Option may then be exercised, but a
Participant must exercise the Option in full Common Shares. The price of Common
Shares purchased pursuant to an Option, or portion thereof, may be paid:
a) in United States dollars in cash or by check, bank draft or money
order payable to the order of the Company;
b) through the delivery of Common Shares with an aggregate Fair Market
Value on the date of exercise equal to the Option Price;
c) with the consent of the Committee, through the withholding of Common
Shares issuable upon exercise with an aggregate Fair Market Value on
the date of exercise equal to the Option Price;
d) through the delivery of irrevocable instructions to a broker to
deliver promptly to the Company an amount equal to the Option Price;
or
e) by any combination of the above methods of payment;
provided, however, that the Company shall not be obligated to purchase or
accept the surrender in payment of any such Common Shares if any such action
would be prohibited by the applicable laws governing the Company or the
Committee shall determine that such action is not in the best interests of the
Company. The Committee shall determine acceptable methods for providing notice
of exercise, for tendering Common Shares or for delivering irrevocable
instructions to a broker and may impose such limitations and prohibitions on
the use of Common Shares or irrevocable instructions to a broker to exercise an
Option as it deems appropriate.
6.5 Notification of Sales of Common Shares: Any Participant who disposes
of Common Shares acquired upon the exercise of an ISO either (a) within two
years after the date of the grant of the ISO under which the Common Shares were
acquired or (b) within one year after the transfer of such Common Shares to the
Participant, shall notify the Company of such disposition and of the amount
realized upon such disposition.
ARTICLE VII
Terms of Stock Appreciation Rights
7.1 Grants of Stock Appreciation Rights: A Stock Appreciation Right may
be granted (a) independent of an Option or (b) in conjunction with an Option,
or portion thereof. A Stock Appreciation Right granted pursuant to clause (b)
<PAGE>
of the preceding sentence may be granted at the time the related Option is
granted or at any time prior to the exercise or cancellation of the related
Option.
7.2 Exercise Price: The exercise price per Common Share of a Stock
Appreciation Right shall be an amount determined by the Committee but in no
event shall such amount be less than the greater of (a) the Fair Market Value
of a Common Share on the date the Stock Appreciation Right is granted or, in
the case of a Stock Appreciation Right granted in conjunction with an Option,
or portion thereof, the Option Price of the related Option and (b) an amount
permitted by applicable laws, rules, by-laws or policies of regulatory
authorities or stock exchanges.
7.3 Period of Exercise: The Committee shall determine the dates after
which Stock Appreciation Rights may be exercised in whole or in part; provided,
however, that a Stock Appreciation Right shall not be exercised prior to the
Approval Date nor later than its Termination Date. The Committee may amend a
Stock Appreciation Right to accelerate the date after which it may be exercised
in whole or in part, provided that the Company has obtained all applicable
approvals, if any, of regulatory authorities and stock exchanges. A Stock
Appreciation Right which has not been exercised on or prior to its Termination
Date shall be cancelled. A Stock Appreciation Right granted in conjunction with
an Option, or portion thereof, shall not be exercised unless such Option, or
portion thereof, is otherwise exercisable, and such a Stock Appreciation Right
shall be cancelled to the extent the Option to which it relates has been
exercised, or has expired, been terminated or been cancelled for any reason.
7.4 Exercise of Stock Appreciation Rights: A Stock Appreciation Right,
or portion thereof, shall be exercised in accordance with such procedures as
may be established by the Committee. Upon the exercise of a Stock Appreciation
Right, the Participant or his or her legal representative shall be entitled to
receive from the Company with respect to each Common Share to which such Stock
Appreciation Right relates an amount equal to the excess of (a) the Fair Market
Value of a Common Share on the date of exercise over (b) the exercise price of
the Stock Appreciation Right. Such amount shall be paid in cash and/or Common
Shares at the discretion of the Committee. The number of Common Shares, if any,
issued as a result of the exercise of a Stock Appreciation Right shall be based
on the Fair Market Value of such Common Shares on the date of exercise. Upon
the exercise of a Stock Appreciation Right, or portion thereof, granted in
conjunction with an Option, or portion thereof, the Option, or portion thereof,
to which such Stock Appreciation Right relates shall be deemed in the case of a
cash payment to have been cancelled and in the case of a payment in Common
Shares to have been exercised.
<PAGE>
ARTICLE VIII
Other Share-Based Awards
8.1 Other Awards of Common Shares and Awards that are valued in whole or
in part by reference to, or are otherwise based on the Fair Marl;et Value of,
Common Shares may be granted under the Plan in the discretion of the Committee.
Such Awards shall be in such form, and dependent on such conditions, as the
Committee shall determine, including, without limitation, the right to receive
one or more Common Shares, or the equivalent cash value of such Common Shares,
upon the completion of a specified period of service, the occurrence of an
event and/or the attainment of performance objectives. Such Awards may be
granted alone or in addition to any other Awards granted under the Plan.
Subject to the provisions of the Plan, the Committee shall determine to whom
and when such Awards will be made. The number of Common Shares to be awarded
under (or otherwise related to) such Awards, whether such Awards shall be
settled in cash, Common Shares or a combination of cash and Common Shares, and
all other terms and conditions of such Awards. Notwithstanding the foregoing,
certain Awards granted under this Section 8.1 of the Plan may be granted in a
manner which is deductible by the Company under Section 162(m) of the Code.
Such Awards (the "Performance-Based Awards") shall be based upon stock price,
market share, sales, earnings per share, return on equity or costs.
ARTICLE IX
Dividend Equivalents
9.1 At or after the grant of an Award, the Committee, in its discretion,
may provide the Participant with dividend equivalents with respect to such
Award.
ARTICLE X
Award Agreements
10.1 All Awards shall be evidenced by written agreements executed by the
Company and the Participant. Such agreements shall be subject to the applicable
provisions of the Plan, and shall contain such provisions as are required by
the Plan and any other provisions the Committee may prescribe; provided that
with respect to Options, those Options that are intended to be ISOs shall be so
designated and all other Options shall be designated Non-ISOs. Notwithstanding
Section 2.13, an Award agreement may provide that Fair Market Value shall be
determined based on the monetary currency of a Participant's country of
residence. Notwithstanding Section 6.4, an Award agreement may require that
payment of the Option Price shall be made in such currency and may otherwise
restrict the manner of exercise and payment of an Option.
ARTICLE XI
Nontransferability of Awards
11.1 Each Award shall, during the Participant's lifetime, be exercisable
only by the Participant, and neither it nor any right hereunder shall be
transferable otherwise than by will, the laws of descent and distribution or be
<PAGE>
subject to attachment, execution or other similar process; provided, however,
that to the extent permitted by applicable law, with respect to any Award, a
Participant may designate a beneficiary pursuant to procedures which may be
established by the Committee. In the event of any attempt by the Participant to
alienate, assign, pledge, hypothecate or otherwise dispose of an Award or of
any right hereunder, except as provided for herein, or in the event of any levy
or any attachment, execution or similar process upon the rights or interest
hereby conferred, the Company may terminate the Award by notice to the
Participant and the Award shall thereupon be cancelled. This Section 11.1 (or
any part thereof) may be altered by the Committee to the extent that it is no
longer required under the rules promulgated under Section 16 of the Act or any
other law, rule or regulation applicable to the Company.
ARTICLE XII
Cessation of Employment of Participant
12.1 Cessation of Employment other than by Reason of Retirement,
Disability, Death or Termination For Cause: If a Participant shall cease to be
employed by the Company other than by reason of Retirement, Disability, death
or Termination For Cause, each Award held by the Participant shall be cancelled
to the extent not previously exercised and all rights hereunder shall terminate
at the end of the three-month period commencing on the last day of the month in
which the cessation of employment occurred.
12.2 Cessation of Employment by Reason of Termination For Cause: If a
Participant shall cease to be employed by the Company by reason of Termination
For Cause, each Award held by the Participant shall be cancelled to the extent
not previously exercised and all rights hereunder shall terminate on the date
of cessation of employment.
12.3 Cessation of Employment by Reason of Retirement or Disability: If a
Participant shall cease to be employed by the Company by reason of Retirement
or Disability, each Award held by the Participant shall be exercisable until
the Termination Date set forth in the Award. Notwithstanding the foregoing, an
Award shall be cancelled if after Retirement, in the sole determination of the
Committee, the Participant (i) engages in activity which is competitive with
that of the Company or its Affiliates or (ii) at any time, divulges to any
person or entity (other than the Company or any of its Affiliates) any of the
trade secrets, methods, processes or other proprietary or confidential
information of the Company or any of its Affiliates.
12.4 Cessation of Employment by Reason of Death: If a Participant shall
die while employed by the Company, or at any time after cessation of employment
by reason of Retirement or Disability, an Award may be exercised at any time or
from time to time prior to the Termination Date set forth in the Award, by the
person or persons to whom the Participant's rights under each Award shall pass
by will or by the applicable laws of descent and distribution. Any person or
persons to whom a Participant's rights under an Award have passed by will or by
the applicable laws of descent and distribution shall be subject to all terms
and conditions of the Plan and the Award applicable to the Participant.
<PAGE>
ARTICLE XIII
Withholding Taxes
13.1 The Company may, in its discretion, require a Participant to pay to
the Company the amount, or make other arrangements (including, without
limitation, the withholding of Common Shares which would otherwise be delivered
as part of or upon exercise of an Award), at the time of exercise or
thereafter, that the Company deems necessary to satisfy its obligation to
withhold federal, provincial, state or local income or other taxes.
ARTICLE XIV
Adjustments
14.1 If (a) the Company shall at any time be involved in a transaction to
which Section 424(a) of the Code is applicable, (b) the Company shall declare a
dividend payable in, or shall subdivide or combine, its Common Shares or (c)
any other event shall occur which in the judgment of the Committee necessitates
action by way of adjusting the terms of the outstanding Awards, the Committee
may take any such action as in its judgment shall be necessary to preserve the
Participant's rights substantially proportionate to the rights existing prior
to such event and, to the extent that such action shall include an increase or
decrease in the number of Awards and/or Common Shares subject to outstanding
Awards, the number of Awards and/or Common Shares available under Article IV
above may be increased or decreased, as the case may be, proportionately. The
judgment of the Committee with respect to any matters referred to in this
Article shall be conclusive and binding upon each Participant. The exercise by
the Committee of its authority under this Article is subject to the approval of
the Board as and when required by applicable laws, rules, by-laws or policies
of regulatory authorities or stock exchanges.
ARTICLE XV
Amendment and Termination of the Plan
15.1 The Board may at any time, or from time to time, suspend or terminate
the Plan in whole or in part or amend it in such respects as the Board may deem
appropriate; provided, however, that no such amendment shall be made without
approval of the shareholders if such approval is required by Rule 16b-3 under
the Act or by any regulatory authorities or stock exchanges.
15.2 No amendment, suspension or termination of the Plan shall, without
the Participant's consent, impair any of the rights or obligations under any
Award theretofore granted to a Participant under the Plan.
15.3 The Committee may amend the Plan, subject to the limitations cited
above, in such manner as it deems necessary to permit the granting of Awards
meeting the requirements of future amendments or issued regulations, if any, to
the Code, the Act or other applicable laws, rules, by-laws or policies of
regulatory authorities or stock exchanges.
15.4 No amendment shall be effective until all applicable approvals, if
any, of regulatory authorities and stock exchanges have been obtained.
<PAGE>
ARTICLE XVI
Government and Other Regulations
16.1 The obligation of the Company to issue, or transfer and deliver,
Common Shares for Awards exercised under the Plan shall be subject to all
applicable laws, regulations, rules, orders and approvals which shall then be
in effect and required by regulatory authorities and any stock exchanges on
which Common Shares are traded.
16.2 Notwithstanding any other provision of the Plan, (a) during any
period in which a Participant is subject to Section 16 of the Act, if the
Participant shall exercise any Award or engage in any other transaction
involving an Award or Common Shares received upon the exercise of an Award, the
Participant shall comply with the rules promulgated under Section 16 of the Act
(and any comparable rules of any other U.S. and non-U.S. regulatory authority),
including, without limitation, rules which restrict the exercise of Awards,
which limit the resale of Common Shares obtained upon exercise of Awards and
which require the reporting of transactions and (b) the Committee may impose
any conditions on an Award necessary to render any transaction involving such
Award exempt under the rules promulgated under Section 16 of the Act.
ARTICLE XVII
Miscellaneous Provisions
17.1 The Plan Does Not Confer Employment or Shareholder Rights: The right
of the Company to terminate at will (whether by dismissal, discharge or
otherwise) the Participant's employment with it at any time is specifically
reserved. Neither the Participant nor any person entitled to exercise the
Participant's rights in the event of the Participant's death shall have any
rights of a shareholder with respect to the Common Shares subject to each
Award, except to the extent that, and until, such Common Shares shall have been
issued upon the exercise or maturity of each Award.
17.2 The Plan Does Not Confer Rights to Assets: Neither the Participant
nor any person entitled to exercise the Participant's rights in the event of
the Participant's death shall have any rights to or interest in any specific
asset of the Company.
17.3 Plan Expenses: Any expenses of administering the Plan shall be borne
by the Company.
17.4 Use of Exercise Proceeds: Cash payments received from Participants
upon the exercise of Options shall be used for the general corporate purposes
of the Company.
17.5 Indemnification: In addition to such other rights of indemnification
as they may have as members of the Board, or the Committee, the members of the
Board and the Committee shall be indemnified by the Company against all costs
and expenses reasonably incurred by them in connection with any action, suit or
proceeding to which they or any of them may be party by reason of any action
taken or failure to act under or in connection with the Plan or any Award
granted thereunder, and against all amounts paid by them in settlement thereof
(provided such settlement is approved by independent legal counsel selected by
the Company) or paid by them in satisfaction of a judgment in any such action,
suit or proceeding, except a judgment based upon a finding of bad faith;<PAGE>
provided that upon the institution of any such action, suit or proceeding, a
Committee or Board member shall, in writing, give the Company notice thereof
and an opportunity, at its own expense, to handle and defend the same before
such Committee or Board member undertakes to handle and defend it on such
member's own behalf.
17.6 Governing Law: The Plan shall be construed, interpreted and the
rights of the Company and Participants (and all other parties) determined in
accordance with the internal laws of the State of New York, without regard to
the conflict of law principles thereof.
ARTICLE XVIII
Shareholder Approval and Effective Dates
18.1 The Plan shall become effective when it is adopted by the Board.
However, if (a) the Plan is not approved by the affirmative vote of the holders
of a majority of the Common Shares present, or represented by proxy, and
entitled to vote at the Annual Meeting of Shareholders of The Seagram Company
Ltd. to be held on May 29, 1996, or at any adjournment thereof or (b) the
necessary regulatory and stock exchange approvals are not obtained within one
year after the date the Plan is adopted by the Board, the Plan and all Awards
shall terminate. Awards may not be granted under the Plan after the sixth
anniversary of the Approval Date.
THE SEAGRAM COMPANY LTD.
STOCK PLAN FOR NON-EMPLOYEE DIRECTORS
1. Purpose. The Seagram Company Ltd. Stock Plan for Non-Employee
Directors (the "Plan") is intended to enhance the Company's ability to attract
and retain talented individuals to serve as members of the Board and to promote
a greater alignment of interests between non-employee members of the Board and
the shareholders of the Company.
2. Definitions. As used in the Plan, the following terms have the
respective meanings:
(a) "Act" means the United States Securities Exchange Act of 1934,
as amended.
(b) "Board" means the Board of Directors of the Company.
(c) "Committee" means the Human Resources Committee of the Company's
Board of Directors, or such other persons designated by the Company's
Board of Directors.
(d) "Common Share" means a common share without nominal or par value
of The Seagram Company Ltd.
(e) "Common Share Award" means an award of Common Shares under the
Plan.
(f) "Company" means The Seagram Company Ltd.
(g) "Deferred Share Unit" means a bookkeeping entry, equivalent in
value to a Common Share, credited in accordance with an election made by
an Eligible Director pursuant to Section 5 or Section 6.
(h) "Election Date" means the date on which an Eligible Director
files an election with the Secretary of the Company pursuant to Section
5(a).
(i) "Eligible Director" means any director who is neither an
employee nor an officer of the Company or any subsidiary of the Company on
the applicable Election Date.
(j) "Fair Market Value" means the mean between high and low prices
of the Common Shares as reported on the composite tape for securities
traded on the New York Stock Exchange (or, if such exchange is not open on
such date, the immediately preceding date on which such exchange is open),
or, if the Common Shares are not so listed or traded, the mean between the
high and low prices of the Common Shares as reported on the principal
Canadian securities exchange on which such shares are listed or admitted
to trading (or, if such exchange is not open on such date, the immediately
preceding date on which such exchange is open) or, if the Common Shares
are not so listed or traded, the mean between the high and low prices of
the Common Shares as reported on the principal United States national
securities exchange on which such shares are listed or admitted to trading
<PAGE>
(or, if such exchange is not open on such date, the immediately preceding
date on which such exchange is open), or, if the Common Shares are not so
listed or traded, the mean between the closing bid price and the closing
asked price as quoted on the National Association of Securities Dealers
Automated Quotation System, or such other market in which such prices are
regularly quoted, or, if there have been no published bid or asked
quotations with respect to the Common Shares, the Fair Market Value shall
be the value established by the Committee in good faith.
(k) "Plan" means The Seagram Company Ltd. Stock Plan for
Non-Employee Directors.
(l) "Purchase Date" means the date on which Common Shares are
purchased pursuant to Section 5(b) in order to pay Common Share Awards
(or, if the Eligible Director has elected to receive Deferred Share Units,
the date on which Common Shares would have been provided had the Eligible
Director chosen to receive Common Share Awards), which shall be, unless
otherwise determined by the Committee, the later of the third business day
following the release of the Company's second quarter results for the
Company fiscal year in which the Eligible Director's annual term commenced
or the third business day following the first release of the Company's
quarterly results that occurs after the Eligible Director's annual term
commenced.
3. Effective Date. The Plan shall be effective as of November 1, 1996.
4. Administration. The Plan shall be administered by the Committee,
which may delegate its duties and powers in whole or in part to any
subcommittee thereof consisting solely of at least two "non-employee directors"
within the meaning of Rule 16b-3 under the Act. The Committee is authorized to
interpret the Plan, to establish, amend and rescind any rules and regulations
relating to the Plan, and to make any other determinations that it deems
necessary or desirable for the administration of the Plan. The Committee may
correct any defect or supply any omission or reconcile any inconsistency in the
Plan in the manner and to the extent the Committee deems necessary or
desirable. Any decision of the Committee in the interpretation and
administration of the Plan, as described herein, shall lie within its sole and
absolute discretion and shall be final, conclusive and binding on all parties
concerned.
5. Payment and Deferral of Annual Retainer. Each Eligible Director shall
receive at least 50% of his or her annual retainer in the form of either Common
Share Awards or Deferred Share Units but may elect, subject to such approvals
and conditions as the Committee may impose, to receive 100% of the annual
retainer in such form.
a. Method of Electing. In order to elect either such form of
payment, the Eligible Director must complete and deliver to the Secretary
of the Company a written election, not later than 30 days after the date
on which his or her annual term as a director commenced, designating the
portion of his or her annual retainer for that year of service as a
director that is to be paid in Common Shares and the portion that is to be
deferred into Deferred Share Units. If no election is made, and no prior
election remains effective, the Eligible Director shall be deemed to have
elected to be paid the annual retainer 50% in Common Share Awards and 50%
in cash.
<PAGE>
b. Common Share Awards. If an Eligible Director elects to receive
all or a portion of his or her annual retainer in the form of Common Share
Awards, the Company shall transfer in cash, net of any applicable
withholdings, the amount which the Eligible Director has elected be paid
in Common Shares to a trust or custodial account, the trustee or custodian
of which (the "Trustee") shall, on the Purchase Date, use such cash to
purchase Common Shares on a securities exchange on which the Common Shares
are listed or traded. Each Eligible Director shall be allocated a number
of Common Shares equal to the cash amount that he or she has elected to
receive in the form of Common Shares, divided by the average cost per
share of the Common Shares purchased by the Trustee pursuant to this
paragraph (the "Average Cost"). Following the Trustee's purchase of the
Common Shares the Trustee shall distribute the Common Shares to the
Eligible Directors within ten days after such purchase or on such other
date as is selected by the Eligible Director. Any fractional shares shall
be paid in cash.
c. Deferred Share Units. If an Eligible Director elects to receive
all or a portion of his or her annual retainer in the form of Deferred
Share Units, such Eligible Director will have Deferred Share Units
credited to an account maintained for the Eligible Director on the books
of the Company, as of the Purchase Date. The number of Deferred Share
Units (including fractional Deferred Share Units) to be credited shall be
determined by dividing the amount of annual retainer to be deferred into
Deferred Share Units by the Average Cost, or if Average Cost has not been
established, by the Fair Market Value.
Deferred Share Units shall be credited with dividend equivalents when
dividends are paid on Common Shares and such dividend equivalents shall be
converted into additional Deferred Share Units based on the Fair Market Value
of Common Shares on the date credited.
6. Payment and Deferral of Meeting and Chairmanship Fees. The Committee
may at its discretion make available to an Eligible Director the ability to
elect to receive his or her fees otherwise payable for (a) attending Board (or
committee) meetings; and/or (b) serving as Chair of a Board committee, in the
form of Deferred Share Units. Any such election shall be subject to such
approvals and conditions as the Committee may impose, including appropriate
adjustments to the Purchase Date to reflect the fact that such fees are payable
periodically during a year (as opposed to once annually for the annual
retainer).
7. Adjustments and Reorganizations. In the event of any stock dividend,
stock split, combination or exchange of shares, merger, consolidation, spin-off
or other distribution (other than normal cash dividends) of Company assets to
shareholders, or any other change affecting shares, such proportionate
adjustments, if any, as the Committee in its discretion may deem appropriate to
reflect such change, shall be made with respect to the number of Deferred Share
Units outstanding under the Plan. In the event the Company is not the
surviving company of a merger, consolidation or amalgamation with another
company or in the event of a liquidation, reorganization and in the absence of
any surviving corporation's assumption of outstanding awards made under the
Plan, the Committee may provide for appropriate settlements of Deferred Share
Units.
8. Termination of Board Service. No sooner than the first business day
of the calendar year following termination of Board service by an Eligible
<PAGE>
Director to whom Deferred Share Units have been granted under the Plan, the
Eligible Director will receive a lump sum payment, net of any applicable
withholdings, (a) in cash equal to the number of Deferred Share Units credited
to his or her account as of such date multiplied by the Fair Market Value of a
Common Share on that day; or (b) in Common Shares equal in number to the
Deferred Share Units credited to the Eligible Director's account. If the
payment is to be made in Common Shares, the Company shall contribute to the
Trustee an amount of cash sufficient to purchase the number of Common Shares to
which the Eligible Director is entitled and the Trustee shall, as soon as
practicable thereafter, purchase those Common Shares on a securities exchange
on which the Common Shares are listed or traded. Any fractional shares shall
be paid in cash based on the Fair Market Value of a Common Share.
9. Transferability of Awards. Deferred Share Units shall not be
transferable or assignable other than by will or the laws of descent and
distribution.
10. No Right to Service. Neither participation in the Plan nor any
action under the Plan shall be construed to give any Eligible Director a right
to be retained in the service of the Company.
11. Unfunded Plan. Unless otherwise determined by the Committee, the
Plan shall be unfunded. To the extent any individual holds any rights by
virtue of a grant awarded under the Plan, such rights (unless otherwise
determined by the Committee) shall be no greater than the rights of an
unsecured general creditor of the Company.
12. Successors and Assigns. The Plan shall be binding on all successors
and assigns of the Company and an Eligible Director, including without
limitation, the estate of such Eligible Director and the executor,
administrator or trustee of such estate, or any receiver or trustee in
bankruptcy or representative of the Eligible Director's creditors.
13. Plan Amendment. The Board may amend the Plan as it deems necessary
or appropriate.
14. Plan Termination. The Board may terminate the Plan at any time.
However, if so terminated, prior awards shall, at the discretion of the Board,
either (a) become immediately payable, or (b) remain outstanding and in effect
in accordance with their applicable terms and conditions.
15. Governing Law. The validity, construction and effect of the Plan and
any actions taken or relating to the Plan shall be governed by the substantive
laws, but not the choice of law rules, of the State of New York.
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF JOSEPH E. SEAGRAM &
SONS, INC. AND AFFILIATES
(As in effect on January 1, 1997)
INTRODUCTION
Joseph E. Seagram & Sons, Inc. ("Seagram") established the Savings and
Investment Plan for Salaried Employees of Joseph E. Seagram & Sons, Inc. and
Subsidiaries (the "Seagram Plan") effective as of August 1, 1985 and has
amended it from time to time. Effective August 1, 1993, Seagram amended the
Seagram Plan and changed its name to the Retirement Savings and Investment Plan
for Salaried Employees of Joseph E. Seagram & Sons, Inc. and Subsidiaries.
Effective December 31, 1994, the Tropicana Employee Savings Trust, originally
effective April 8, 1988, merged into the Seagram Plan. Effective with such
merger, the Plan name was changed to the Retirement Savings and Investment Plan
for Employees of Joseph E. Seagram & Sons, Inc. and Affiliates.
Effective June 5, 1995, Universal Studios, Inc. (formerly MCA INC.), Uni
Distribution Corporation and Spencer Gifts, Inc. became Affiliates of Seagram
(collectively the "Acquired Companies"). Each Acquired Company maintains a
savings/401(k) plan for its eligible employees as follows: (i) Universal
Studios, Inc. maintains the MCA INC. Employee Savings Plan; (ii) Uni
Distribution Corporation maintains the Uni Distribution Corporation Employee
Savings Plan; and (iii) Spencer Gifts, Inc. maintains the Spencer Gifts Inc.
Employee Savings Plan (such plans hereinafter referred to as the "Acquired
Companies' Plans"). To simplify plan administration, each of the Acquired
Companies deems it advisable to amend and continue their respective plans in
the form of the Seagram Plan including certain modifications to the terms of
such Plan to accommodate the benefit provisions applicable solely to eligible
employees of an Acquired Company.
Accordingly, effective as of January 1, 1997, each of the Acquired Companies'
Plans are hereby amended and continued in the form of and controlled by the
provisions of this Plan as it relates to each Acquired Companies' eligible
employees. However, notwithstanding the Acquired Companies' adoption of the
terms of the Seagram Plan with respect to their eligible employees, the Plan as
adopted by each Acquired Company as described herein ("Separate Plan") shall
continue its existence as a separate plan on and after January 1, 1997 and all
assets of each Separate Plan shall be available solely for the benefit of and
used to satisfy the liabilities incurred on behalf of employees covered under
the terms of the applicable Separate Plan. For reference purposes, the four
Separate Plans maintained pursuant to this Plan document on and after January
1, 1997 shall be named as follows:
Prior Plan Name New Plan Name MCA INC. Employee Savings Plan Retirement
Savings and Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates - Universal Employees ("Universal Plan") Uni Distribution
Corporation Employee Savings Plan Retirement Savings and Investment Plan for
Employees of Joseph E. Seagram & Sons, Inc. and Affiliates - Uni Employees
("Uni Plan") Spencer Gifts, Inc. Employee Savings Plan Retirement Savings and
Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and Affiliates
- - Spencer Employees ("Spencer Plan")
Retirement Savings and Investment Plan for Employees of Joseph E. Seagram &
Sons, Inc. and Affiliates Retirement Savings and Investment Plan for Employees
of Joseph E. Seagram & Sons, Inc. and Affiliates With respect to the
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Universal Plan, the Uni Plan and the Spencer Plan, the following definitions
shall replace the definitions in the text:
(i) Universal Plan 1.13 "Company" means Universal Studios, Inc. (formerly MCA
INC.)
and any successor thereto.
1.52 "Plan" means the Retirement Savings and Investment Plan
for Employees of Joseph E. Seagram & Sons, Inc. and Affiliates -
Universal Employees.
(ii) Uni Plan 1.13 "Company" means Uni Distribution Corporation and any
successor thereto.
1.52 "Plan" means the Retirement Savings and Investment Plan
for Employees of Joseph E. Seagram & Sons, Inc. and Affiliates -
Uni Employees.
(iii) Spencer Plan 1.13 "Company" means Spencer Gifts, Inc. and any successor
thereto.
1.52 "Plan" means Retirement Savings and Investment Plan for
Employees of Joseph E. Seagram & Sons, Inc. and Affiliates -
Spencer Employees.
In addition, any company participating in an Acquired Company's Plan prior to
January 1, 1997 shall be a Participating Employer of that Acquired Company's
Separate Plan on and after January 1, 1997 under Section 1.47 of this Plan.
Any provisions of the Plan addressing any group of employees other than the
employees covered under the particular Separate Plan shall be disregarded
except to the extent the provision relate to the person's status as a former
employee covered by that Separate Plan.
This document amends and restates the Retirement Savings and Investment Plan
for Employees of Joseph E. Seagram & Sons, Inc. and Affiliates, the MCA INC.
Employee Savings Plan, the Uni Distribution Corporation Employee Savings Plan
and the Spencer Gifts, Inc. Employee Savings Plan for periods beginning on and
after January 1, 1997. The benefit of any individual who ceased to be a
Participant prior to January 1, 1997 shall be determined in accordance with the
provisions of the applicable plan as in effect on the date such individual
ceased to be a Participant of that plan.
The Plan is intended to be a profit-sharing plan which meets the requirements
for qualification and tax-exemption under Sections 401(a) and 401(k) of the
Internal Revenue Code of 1986, as amended.
ARTICLE I - DEFINITIONS
Each of the following terms when capitalized throughout this document shall
have the meaning ascribed to it below.
1.1 "Account" means the sum of a Participant's After-tax Contributions
Account, Discretionary Contributions Account, Frozen Matching Contributions
Account, Matching Contributions Account, Pre-tax Contributions Account,
Rollover Contributions Account, QMACs Account and QNECs Account, which
constitutes the Participant's total interest in the Trust.
1.2 "Administrative Committee" means the committee appointed in
accordance with Section 10.1.
1.3 "Affiliate" means any corporation or unincorporated trade or business
(other than the Company) while it is:
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(a) A member of a "controlled group of corporations" (within the
meaning of Code Section 414(b)) of which the Company is also a member;
(b) A trade or business whether or not incorporated, under "common
control" (within the meaning of Code Section 414(c)) with the Company;
(c) A trade or business that is a member of an "affiliated service
group" (within the meaning of Code 414(m)); or
(d) Any other entity required to be aggregated with the Company
pursuant to Code 414(o).
1.4 "After-tax Contributions" means contributions made by a Participant
in accordance with his or her Contribution Election pursuant to Section 3.3 or
3.4.
1.5 "After-tax Contributions Account" means the separate subaccount of a
Participant's Account to which Participant's After-tax Contributions and any
income or loss thereon are credited.
1.6 "Beneficiary" means the person designated by a Participant on the
Beneficiary Designation Form or such other person who becomes entitled to a
benefit under the Plan in accordance with Section 8.10.
1.7 "Beneficiary Designation Form" means the form prescribed by the
Administrative Committee for designating Beneficiaries.
1.8 "Board" means the Board of Directors of Seagram.
1.9 "Borrower" means a Participant who has made an application for or who
has received a loan from the Plan in accordance with Section 7.1.
1.10 "Break in Service" means the period commencing on the Participant's
Service Cutoff Date and ending on the Participant's Reemployment Commencement
Date, except that a Break in Service shall not include any period of time when
an individual is not an Employee because he or she is serving in the uniformed
services of the United States if the individual seeks reinstatement as an
Employee while his or her reemployment rights are protected by law. The defined
term "Break in Service" is used solely for purposes of determining vesting.
1.11 "Code" means the Internal Revenue Code of 1986, as amended.
1.12 "Common Shares" means the common shares of The Seagram Company Ltd.,
without nominal or par value.
1.13 "Company" means Seagram and any successor thereto (or such other
company as specified in the Introduction with respect to a Separate Plan).
1.14 "Compensation" means an Employee's W-2 wages as reported or
reportable, but including elective contributions that are made by an Employer
that are not includible in gross income under Code Section 125 and 402(e)(3);
provided, however, that a Participant's Compensation for a Plan Year shall not
exceed the amount specified in Code Section 401(a)(17), as it is adjusted from
time to time for cost of living in accordance with Code Section 415(d). An
Eligible Employee's Contribution Election is expressed as a percentage of
"Salary" and not as a percentage of "Compensation". Discretionary Contributions
shall be allocated on the basis of an Employee's Compensation, as provided in
Section 3.6.
1.15 "Contribution Election" means the election made by a Participant
selecting the percentage of annual Salary to be deferred and contributed to the
Plan by the Employer as a Pre-tax Contribution and/or contributed by the
Participant to the Plan as an After-tax Contribution.
1.16 "Disability" means a physical or mental disability that causes a
Participant to be unable to perform the duties of his or her position of
employment for an indefinite period, that the Administrative Committee
considers will be of long, continued duration, and which enables the
Participant to be eligible to receive disability insurance benefits under
either the Employer's long term disability plan or the Federal Social Security
Act. A Participant shall be considered disabled as of the date the
Administrative Committee determines the Participant has satisfied the
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definition of disability. The Administrative Committee may require a
Participant to submit medical evidence to substantiate his or her condition.
1.17 "Discretionary Contributions" means contributions made by the
Employer for the benefit of a Participant pursuant to Section 3.6.
1.18 "Discretionary Contributions Account" means the separate subaccount
of a Participant's Account to which Discretionary Contributions and any income
or loss thereon are credited.
1.19 "Effective Date" of this restatement means January 1, 1997.
1.20 "Eligible Employee" means each Employee of the Employer who is
allocated to the Separate Line of Business to which the Employer has been
assigned, excluding:
(a) Employees employed on a special basis as determined by the
Administrative Committee;
(b) Employees included in a unit of employees covered by a
collective bargaining agreement between the Employer and their employee
representatives (excluding any representative that is an organization more
than half of whose members are owners, officers or executives of the
Employer) in the negotiation of which retirement benefits were the subject
of good faith bargaining, unless such collective bargaining agreement
provides for participation in the Plan;
(c) Nonresident aliens who receive no earned income (within the
meaning of Code 911(b)) and the regulations thereunder) from the Employer
which constitutes income from sources within the United States (within the
meaning of Code 861(a)(3) and the regulations thereunder);
(d) Leased employees within the meaning of Code 414(n)(2) or 414(o);
(e) Temporary Employees of the Seagram/Tropicana LOB;
(f) Hourly Employees employed in a classification designated by the
Employer from time to time and approved by the Administrative Committee;
(g) Employees of the Seagram/Tropicana LOB whose annual base salary
or regular wages (excluding overtime, bonuses, commissions or other
special or contingent payments) does not exceed $14,602 as of December 31,
1996 (increased on the last day of each Plan Year by 4%);
(h) Employees of the Universal/UNI LOB:
(i) who are employed (A) as temporary recording studio employees of
Duchess Music Corporation or (B) in the Tour Entertainment Costume shop,
or
(ii) whose employment is governed by an artist and repertoire
contract in the music division, or
(iii) who are members of a labor union, guild or other collective
bargaining unit unless the Employees are salaried and are paid in whole or
in part by the Universal/UNI LOB; or
(iv) whose employment is subject to a labor agreement;
(i) Employees of the Spencer LOB who are classified as Highly
Compensated Employees; and
(j) Employees classified as independent contractors, or classified
as employed by an independent contractor, by the Administrative Committee,
and any Employees who are eligible to participate in one or more employee
benefit plans of a third party with whom an Employer has contracted for
the provision of the Employees' services. Notwithstanding anything in
this Section to the contrary, each Tropicana Employee who (i) is a
part-time employee and (ii) has previously satisfied the eligibility
requirements of the Tropicana Employee Savings Trust Plan as of December
31, 1994 under the terms of that Plan as in effect on December 30, 1994
<PAGE>
shall be an Eligible Employee under this Plan. In addition, an employee of
the Universal/UNI LOB who was making pre-tax or after-tax contributions to
the MCA INC. Employee Savings Plan as of December 31, 1996 shall be an
Eligible Employee under this Plan.
1.21 "Eligible Retirement Plan" means an individual retirement account
described in Code 408(a), an individual retirement annuity described in Code
408(b), an annuity plan described in Code 403(a) or a qualified trust described
in Code 401(a). However, with respect to a Participant's Surviving Spouse, an
Eligible Retirement Plan shall be only an individual retirement account or
individual retirement annuity.
1.22 "Eligible Rollover Distribution" means any distribution under the
Plan of all or any portion of a Participant's Account, other than:
(a) A distribution that is one of a series of substantially equal
periodic payments (made not less frequently than annually) made for the
life (or life expectancy) of the Participant (or the Participant's
Surviving Spouse) or the joint lives (or joint life expectancies) of the
Participant (or the Participant's Surviving Spouse) and the Participant's
(or the Participant's Surviving Spouse's) designated beneficiary;
(b) A distribution for a specified period of ten years or more;
(c) A distribution required under Code 401(a)(9); or
(d) The portion of any distribution in excess of the amount that
would be includible in gross income were it not rolled over to an Eligible
Retirement Plan (disregarding for this purpose, the exclusion from income
applicable to net unrealized appreciation when employer securities are
distributed).
1.23 "Employee" means any individual who is employed by the Company or an
Affiliate regardless of whether the individual is an Eligible Employee or a
leased employee within the meaning of Code 414(n)(2) or 414(o) (excluding
persons who are leased employees described in Code 414(n)(5)).
1.24 "Employer" means the Company and any Affiliate which is a
Participating Employer.
1.25 "Employment Commencement Date" means the date on which the Employee
first performs an Hour of Service for the Employer under Section 1.36(a).
1.26 "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
1.27 "Excess Aggregate Contributions" means, with respect to any Plan
Year, the aggregate amount of the sum of the After-tax Contributions
contributed by a Highly Compensated Employee and Matching Contributions made on
behalf of Highly Compensated Employees in excess of the limits set forth in
Sections 14.7 or 14.12.
1.28 "Excess Annual Additions" means Annual Additions, as defined in
Section 15.1(a), that exceed the Code 415 limitation on Annual Additions.
1.29 "Excess Contributions" means, with respect to any Plan Year, the
aggregate amount of Pre-tax Contributions paid to the Trustee for a Plan Year
on behalf of Highly Compensated Employees in excess of the limits set forth in
Section 14.2 or 14.12.
1.30 "Excess Deferrals" means, with respect to any Plan Year, the
aggregate amount of Pre-tax Contributions contributed on behalf of Participants
in excess of the Code Section 402(g) limitation set forth in Section 13.1.
1.31 "Five-percent Owner" means with respect to a corporation, any person
who owns (or is considered as owning within the meaning of Code 318) more than
5% of the outstanding stock of the corporation, or stock possessing more than
5% of the total voting power of the corporation.
<PAGE>
1.32 "Five Year Break in Service" means a Break in Service of 60
consecutive months. The defined term "Five Year Break in Service" is used
solely for purposes of determining vesting.
1.33 "Frozen Matching Contributions" means any Matching Contributions
contributed or allocated in respect of any Plan Year prior to 1995.
1.34 "Frozen Matching Contributions Account" means the separate subaccount
of a Participant's Account to which Participant's Frozen Matching Contributions
and any income or loss thereon are credited.
1.35 "Highly Compensated Employee" means, for any Plan Year commencing on
or after January 1, 1997, any employee of the Company or an Affiliate (whether
or not eligible for membership in the Plan) who (i) was a Five-percent Owner
for such Plan Year or the prior Plan Year, or (ii) for the preceding Plan Year
received Compensation in excess of $80,000 (as adjusted from time to time for
cost of living in accordance with Code 415(d)) and, if the Administrative
Committee so elects, was among the highest 20 percent of employees for the
preceding Plan Year when ranked by Compensation paid for that year excluding,
for purposes of determining the number of such employees, such employees as the
Administrative Committee may determine on a consistent basis pursuant to
Section 414(q) of the Code.
Notwithstanding the foregoing, employees who are nonresident aliens and
who receive no earned income from the Company or an Affiliate which constitutes
income from sources within the United States shall be disregarded for all
purposes of this Section.
The provisions of this Section shall be further subject to such additional
requirements as shall be described in Section 414(q) of the Code and its
applicable regulations. To the extent permitted by regulations, for each Plan
Year, the Administrative Committee may elect to determine an individual's
status as a Highly Compensated Employee under the simplified "snapshot method"
described in Revenue Procedure 93-42.
1.36 "Hour of Service" means, with respect to any applicable computation
period,
(a) each hour for which the Employee is paid or entitled to payment
for the performance of duties for the Company or an Affiliate;
(b) each hour for which the Employee is paid or entitled to payment
by the Company or an Affiliate on account of a period during which no
duties are performed, whether or not the employment relationship has
terminated, due to vacation, holiday, illness, incapacity (including
disability), layoff, jury duty, military duty or leave of absence, but not
more than 501 hours for any single continuous period;
(c) each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by the Company or an Affiliate,
excluding any hour credited under clause (a) or (b), which shall be
credited to the computation period or periods to which the award,
agreement or payment pertains rather than to the computation period in
which the award, agreement or payment is made;
(d) solely for purposes of determining whether an Employee has
incurred a One Year Break in Service under Sections 1.45(a) and 1.82(c),
each hour for which an Employee would normally be credited under paragraph
(a) or (b) above during a period of parental leave but not more than 501
hours for any single continuous period. However, the number of hours
credited to an Employee under this paragraph (d) during the computation
period in which the parental leave began, when added to the hours credited
to an employee under paragraphs (a) through (c) above during that
computation period, shall not exceed 501. If the number of hours credited
<PAGE>
under this paragraph (d) for the computation period in which the parental
leave began is zero, the provisions of this paragraph (d) shall apply as
though the parental leave began in the immediately following computation
period. For this purpose, a parental leave means a period in which the
Employee is absent from work immediately following his or her active
employment because of the Employee's pregnancy, the birth of the
Employee's child or the placement of a child with the Employee in
connection with the adoption of that child by the Employee, or for
purposes of caring for that child for a period beginning immediately
following such birth or placement; and
(e) solely for purposes of determining whether an Employee has
incurred a One Year Break in Service under Sections 1.45(a) and 1.82(c),
each hour for which an Employee would normally be credited under paragraph
(a) or (b) above, and not otherwise credited under paragraph (d) above,
during a period of leave for the birth, adoption or placement of a child,
to care for a spouse or an immediate family member with a serious illness
or for the Employee's own illness pursuant to the Family and Medical Leave
Act of 1993 and its regulations.
Hours of Service to be credited to an individual under paragraphs (b),
(c), (d) and (e) above will be calculated by the Administrative Committee by
reference to the individual's most recent work schedule (or at the rate of
eight hours per day in the event the Administrative Committee is unable to
establish such schedule).
No hours shall be credited on account of any period during which the Employee
performs no duties and receives payment solely for the purpose of complying
with unemployment compensation, workers' compensation or disability insurance
laws.
The Hours of Service credited shall be determined as required by Title 29
of the Code of Federal Regulations, Sections 2530.200b-2(b) and (c), and the
rules set forth in such Sections are hereby incorporated by reference.
1.37 "Investment Committee" means the committee appointed in accordance
with Section 10.4.
1.38 "Investment Election" means the election by which a Participant
directs the investment of his or her Account in accordance with Section 4.2.
1.39 "Investment Funds" means the funds as described in Article IV into
which Participants (or, as provided by the Plan, the Investment Committee) may
direct the Trustee to place an Account or such other investment vehicles as the
Investment Committee may, in its sole discretion, determine.
1.40 "Matching Contributions" means any Employer contributions (or
forfeitures allocated) to a Participant's Account on the basis of the amount of
a Participant's Pre-tax Contributions, or with respect to any Participants who
are Tropicana Employees or Universal/Spencer Employees, on the basis of
After-tax Contributions.
1.41 "Matching Contributions Account" means the separate subaccount of a
Participant's Account to which Participant's Matching Contributions (other than
QMACs and Frozen Matching Contributions) and any income or loss thereon are
credited.
1.42 "Non-highly Compensated Employee" means an Employee who is not a
Highly Compensated Employee.
1.43 "Normal Retirement Age" means the earlier of (i) age 65, or (ii) for
Participants who are also participants in the Pension Plan for the Employees of
Joseph E. Seagram & Sons, Inc. and Subsidiaries, the earliest date that a
participant could retire under such plan and receive an early or normal
retirement benefit.
<PAGE>
1.44 "Nonelective Contributions" means a contribution made by the Employer
to the Plan that is not a Pre-tax Contribution or a Matching Contribution.
1.45 "One Year Break in Service" means
(a) With respect to determining an Employee's Years of Eligibility
Service, a Plan Year after the Plan Year in which the Employee first
becomes employed during which he or she does not complete more than 500
Hours of Service; and
(b) With respect to determining an Employee's Years of Vesting
Service, a Break in Service of 12 consecutive months.
1.46 "Participant" means an individual who has commenced participation as
determined under Section 2.1 or who has received an allocation of Discretionary
Contributions under Section 3.6, but not terminated participation as determined
under Section 2.1(e).
1.47 "Participating Employer" means any Affiliate (a) which at any time
has, with the approval of the Administrative Committee, filed with the
Administrative Committee a certified copy of a resolution of its board of
directors adopting the Plan, and (b) some or all of the Employees or former
Employees of which are Participants in the Plan.
1.48 "Period of Service" means the period commencing on the Employee's
Employment Commencement Date or Reemployment Commencement Date and ending on
the next Service Cutoff Date. Periods of Service shall include years and
completed months. A Participant's Period of Service shall include any Period of
Severance that is less than 12 consecutive months. In addition, any periods of
employment recognized under this Plan, the Universal Plan, the Uni Plan or the
Spencer Plan on behalf of any Employee shall be recognized under all such plans
for purposes of determining an Employee's Years of Vesting Service to the
extent such service is not otherwise recognized under the terms of the Plan and
provided further such service would have been recognized had it been rendered
as an Employee of an Employer. The defined term "Period of Service" is used
solely for purposes of determining vesting.
1.49 "Period of Severance" means the period of time commencing on an
Employee's Service Cutoff Date and ending on the date an Employee again
performs an Hour of Service with the Employer under Section 1.36(a). The
defined term "Period of Severance" is used solely for purposes of determining
vesting.
1.50 "Plan" means the Retirement Savings and Investment Plan for Employees
of Joseph E. Seagram & Sons, Inc. and Affiliates (or such other plan as
specified in the Introduction with respect to a Separate Plan).
1.51 "Plan Year" means the calendar year.
1.52 "Pre-tax Contributions" means contributions made by an Employer on
behalf of a Participant in accordance with his or her Contribution Election
pursuant to Section 3.2 or 3.4.
1.53 "Pre-tax Contributions Account" means the separate subaccount of a
Participant's Account to which Pre-tax Contributions and any income or loss
thereon are credited.
1.54 "Principal Residence Loan" means a loan which is made to a
Participant by the Plan, in accordance with Section 7.5, to acquire or
construct any dwelling unit which, within a reasonable time will be used (such
use to be determined at the time the loan is made) as the principal residence
of the Participant.
1.55 "QMACs" means Matching Contributions (a) in which a Participant is
100% vested, as of the date they are allocated; (b) which may not be
distributed to a Participant except on account of a Participant's Retirement,
death, Disability or Separation from Service; and (c) which the Employer
chooses to treat as Pre-tax Contributions in accordance with Section 14.6.
<PAGE>
1.56 "QMACs Account" means the separate subaccount of a Participant's
Account to which Participant's QMACs and any income or loss thereon are
credited.
1.57 "QNECs" means Nonelective Contributions (other than Discretionary
Contributions and Matching Contributions) (a) in which a Participant is 100%
vested, as of the date they are allocated, (b) which may not be distributed to
a Participant except on account of Participant's Retirement, death, Disability
or Separation from Service; and (c) which the Employer chooses to treat either
as Pre-tax Contributions or Matching Contributions in accordance with
Section 14.6.
1.58 "QNECs Account" means the separate subaccount of a Participant's
Account to which Participant's QNECs and any income or loss thereon are
credited.
1.59 "Reemployment Commencement Date" means the date on which an Employee
first performs an Hour of Service for the Employer following a Period of
Severance.
1.60 "Retirement" means Separation from Service after attainment of age
60, or when eligible to commence the receipt of benefits under any defined
benefit pension plan sponsored by an Employer (other than a lump sum
distribution which the plan administrator of such plan can distribute to the
Participant without the Participant's consent) or, solely in the case of a
Tropicana Employee, when such Employee would be eligible to commence receipt of
benefits under the Pension Plan for the Employees of Joseph E. Seagram & Sons,
Inc. and Subsidiaries, if the Employee's service as a Tropicana Employee had
been rendered as a Seagram Employee.
1.61 "Retirement Savings Action Line" means the interactive telephone
system established by the Employer that permits Participants to manage their
Account, including, but not limited to, the ability to change their
Contribution Elections, (in accordance with Section 3.1(c)) and Investment
Elections (in accordance with Section 4.2), to apply for a loan in accordance
with Article VII, and, effective January 1, 1995, to (a) commence participation
in the Plan, in accordance with Section 2.1; (b) apply for an in-service
withdrawal in accordance with Article VI; and (c) request a distribution, in
accordance with Article VIII.
1.62 "Rollover Contributions" means a contribution made in accordance with
Section 3.7, by an Eligible Employee or a Participant to the Plan which
consists of a cash distribution from a qualified plan under Code 401(a) or a
qualified annuity under Code Section 403(a) and is an "eligible rollover
distribution" as defined in Code 402(c)(4) or prior to January 1, 1993, an
amount which may be rolled over in accordance with Section 402(a)(5) of the
Code, as in effect prior to the Unemployment Compensation Amendments of 1992.
For purposes of this Section, amounts may not be rolled over from individual
retirement account ("IRA") if the IRA contains any funds derived from sources
other than a rollover from a qualified plan under Code 401(a).
1.63 "Rollover Contributions Account" means the separate subaccount of a
Participant's Account or an Account established on behalf of an Eligible
Employee to which Rollover Contributions and any income or loss thereon are
credited.
1.64 "Salary" means:
(a) Seagram Employees. With respect to any Seagram Employee, such
Employee's base salary by the Employer in any year, determined prior to
any reduction pursuant to Section 3.1 or pursuant to a cafeteria plan
under Code Section 125, and including holiday pay, disability pay (other
than long-term disability payments), funeral pay, jury duty pay, military
leave pay, salary adjustment pay (provided that lump sum merit increases
will only be included through January 31, 1998), shift differentials,
retro pay, sick leave pay, vacation pay, personal pay, parental pay, but
<PAGE>
excluding overtime (including supervisor's overtime), commissions
(including route commissions), grievance pay, incentive awards, MIP
awards, performance bonuses, PFP awards, start-up pay, workers'
compensation accruals, on call pay, lead pay, reimbursements or other
expense allowances, fringe benefits (cash and noncash), moving expenses,
deferred compensation, welfare benefits, non-cash remuneration,
remuneration paid in currency other than U.S. dollars, severance or
separation pay (whether paid before or after a Participant's Separation
from Service), amounts paid under any long-term incentive plan, tax
protection payments or foreign service over base allowances or premiums,
retirement bonuses, contributions (except for Pre-tax Contributions) to
and benefits and distributions under the Plan or under any employee
benefit plan or any plan or program of deferred compensation, including
without limitation any pension, profit sharing, stock bonus, employee
stock ownership, stock option or incentive program, or dividends paid on
any common stock of the Employer included within or issued under any such
plan or program, and stock options or income or gains from the exercise
thereof.
(b) Tropicana Employees. With respect to any Tropicana Employee, such
Employee's base salary by the Employer in any year, determined prior to
any reduction pursuant to Section 3.1 or pursuant to a cafeteria plan
under Code Section 125, and including overtime, commissions, shift
differentials, holiday pay, disability pay (other than long-term
disability payments), grievance pay, funeral pay, jury duty pay, military
leave pay, salary adjustment pay, retro pay, incentive awards, MIP awards,
performance bonuses, PFP awards, start-up pay, route commissions,
supervisor's overtime, on call pay, sick leave pay, vacation pay, personal
pay, birthday pay, lead pay, parental pay, but excluding reimbursements or
other expense allowances, fringe benefits (cash and noncash), moving
expenses, deferred compensation, welfare benefits, non-cash remuneration,
workers' compensation accruals, remuneration paid in currency other than
U.S. dollars, severance or separation pay (whether paid before or after a
Participant's Separation from Service), amounts paid under any long-term
incentive plan, tax protection payments or foreign service over base
allowances or premiums, retirement bonuses, contributions (except for
Pre-tax Contributions) to and benefits and distributions under the Plan or
under any employee benefit plan or any plan or program of deferred
compensation, including without limitation any pension, profit sharing,
stock bonus, employee stock ownership, stock option or incentive program,
or dividends paid on any common stock of the Employer included within or
issued under any such plan or program, and stock options or income or
gains from the exercise thereof.
(c) Universal/Spencer Employees. With respect to any
Universal/Spencer Employee, such Employee's base salary by the Employer in
any year, determined prior to any reduction pursuant to Section 3.1 or
pursuant to a cafeteria plan under Code Section 125, and including
overtime, commissions, shift differentials, holiday pay, grievance pay,
funeral pay, jury duty pay, military leave pay, salary adjustment pay,
retro pay, performance bonuses, route commissions, supervisor's overtime,
sick leave pay, incentive awards, MIP awards, vacation pay, personal pay,
birthday pay, lead pay, parental pay, but excluding disability pay,
start-up pay, workers' compensation accruals, reimbursements or other
expense allowances, fringe benefits (cash and noncash), moving expenses,
deferred compensation, welfare benefits, non-cash remuneration,
remuneration paid in currency other than U.S. dollars, severance or
separation pay (whether paid before or after a Participant's Separation
from Service), amounts paid under any long-term incentive plan, tax
<PAGE>
protection payments or foreign service over base allowances or premiums,
retirement bonuses, contributions (except for Pre-tax Contributions) to
and benefits and distributions under the Plan or under any employee
benefit plan or any plan or program of deferred compensation, including
without limitation any pension, profit sharing, stock bonus, employee
stock ownership, stock option or incentive program, or dividends paid on
any common stock of the Employer included within or issued under any such
plan or program, and stock options or income or gains from the exercise
thereof.
(d) A Participant's Salary on which contributions are based for a
Plan Year shall not exceed the amount specified in Code 401(a)(17), as it
is adjusted from time to time for cost of living in accordance with Code
415(d).
1.65 "Seagram" means Joseph E. Seagram & Sons, Inc. and any successor
thereto.
1.66 "Seagram Employee" means any Employee of the Seagram/Tropicana LOB
other than a Tropicana Employee.
1.67 "Seagram Stock Fund" means the investment option offered under the
Plan which is invested primarily in Common Shares.
1.68 "Seagram/Tropicana LOB" means the business units comprising the
Seagram/Tropicana separate line of business as determined by Seagram in
accordance with Code 414(r). For purposes of the Plan, an Employee shall be
deemed an Employee of the Seagram/Tropicana LOB if the Employee is allocated to
that line of business in accordance with Code 414(r) and the regulations issued
thereunder.
1.69 "Separation from Service" means the termination of the Employee's
relationship with the Employer.
1.70 "Service Cutoff Date" means the earliest of: (a) the Employee's
Separation from Service date; (b) the last day of the 24 month period following
the date the Employee is first absent from employment on account of layoff or a
leave of absence taken on account of the Employee's pregnancy, the birth of
Employee's child, the placement of a child with the Employee in connection with
adoption proceedings, or for purposes of caring for such child for the period
immediately following such birth or placement; and (c) the date that an
Employee fails to return from a family or medical leave under the Family and
Medical Leave Act of 1993. The defined term "Service Cutoff Date" is used
solely for purposes of determining vesting.
1.71 "Separate Lines of Business" means the Seagram/Tropicana LOB, the
Universal/UNI LOB, or the Spencer LOB, singly or collectively, as the context
so requires.
1.72 "Service Entry Employee" means:
(a) an Employee of the Spencer LOB, or
(b) an Employee of the Universal/UNI LOB who is also
(i) a non-salaried employee of Hilltop Services, Inc.,
(ii) an employee assigned to the temporary clerical services pool
(excluding those employed by Universal City Studios Tour),
(iii) an employee classified as a seasonal or temporary employee of
the Universal City Studios Tour,
(iv) an employee of the Memphis or Reno locations of UNI Resources,
Inc. and UNI Distribution Corp., or
(v) an employee classified as an intern under the personnel
practices of the Universal/UNI LOB.
1.73 "Spencer LOB" means the business units comprising the Spencer
separate line of business as determined by Seagram in accordance with Code
414(r). For purposes of the Plan, an Employee shall be deemed an Employee of
<PAGE>
the Spencer LOB if the Employee is allocated to that line of business in
accordance with Code 414(r) and the regulations issued thereunder.
1.74 "Spouse" means the person to whom an Employee is lawfully married.
1.75 "Surviving Spouse" means the Spouse of a Participant on the date of
the Participant's death.
1.76 "Tropicana Employee" means any Employee of the Seagram/Tropicana LOB
employed by (a) Tropicana Products, Inc., any subsidiary of Tropicana Products,
Inc., or the Tropicana Products Sales Division of either Seagram or Distillers
Products Sales Corporation, and (b) each other Employee of an Employer
designated by the Administrative Committee as a "Tropicana Employee".
1.77 "Trust" means the trust fund or funds which holds the assets of the
Plan and are established by the Trust Agreement.
1.78 "Trust Agreement" means the trust agreement or agreements entered
into between Seagram and the Trustee from time to time that provides for the
holding of Plan assets.
1.79 "Trustee" means the person or persons appointed in accordance with
Section 9.1.
1.80 "Universal/Spencer Employee" means an Employee of the Universal/UNI
LOB or Spencer LOB.
1.81 "Universal/UNI LOB" means the business units comprising the
Universal/UCS/UNI separate line of business as determined by Seagram in
accordance with Code 414(r). For purposes of the Plan, an Employee shall be
deemed an Employee of the Universal/UNI LOB if the Employee is allocated to
that line of business in accordance with Code 414(r) and the regulations issued
thereunder.
1.82 "Year of Eligibility Service" means, with respect to a Service Entry
Employee, the 12-month period of employment with the Company or any Affiliate,
whether or not as an Eligible Employee, beginning on the date he or she first
completes an Hour of Service upon hire or rehire following a One Year Break in
Service, or any Plan Year beginning after that date, in which he or she first
completes at least 1,000 Hours of Service; provided, however, that:
(a) a Service Entry Employee shall also be credited with one Year of
Eligibility Service if the Employee completes 1,000 Hours of Service
during his "employment year" which includes January 1, 1997. The term
"employment year" means the 12 consecutive month period beginning on the
date an Employee first completes an Hour of Service and on each
anniversary of that date;
(b) if an Employee is absent from the service the Company or any
Affiliate because of service in the uniformed services of the United
States and he or she returns to service with the Company or an Affiliate
having applied to return while his or her reemployment rights were
protected by law, the absence shall be included in his or her Eligibility
Service; and
(c) if an Employee's employment terminates and he or she is
subsequently reemployed after he has incurred a One Year Break in Service,
his or her Years of Eligibility Service earned prior to his or her
reemployment shall be disregarded upon his or her reemployment if:
(i) he or she was not partially or fully vested under the provisions
of Section 5.2 upon his or her prior termination; and
(ii) the number of his or her consecutive One Year Breaks in Service
equals or exceeds five.
1.83 "Year of Vesting Service" means a twelve consecutive month Period of
Service. The defined term "Year of Vesting Service" is used solely for purposes
of determining vesting.
<PAGE>
ARTICLE II - PARTICIPATION
2.1 Commencing Participation
(a) Entry Date. Subject to the provisions of paragraph (f) below:
(i) An Employee, other than a Service Entry Employee, may become a
Participant as soon as administratively practicable following the later of
(A) the date such Employee performs one Hour of Service under Section
1.36(a), or (B) the date such Employee becomes an Eligible Employee.
(ii) An Employee who is a Service Entry Employee may become a
Participant as soon as administratively practicable following the later of
(A) the date the Employee completes one Year of Eligibility Service, or
(B) the date the Employee becomes an Eligible Employee.
(b) Eligible Employees Who Make Rollover Contributions. An Eligible
Employee who makes a Rollover Contribution but who does not otherwise
elect to participate in the Plan or who is not otherwise eligible to
participate under Section 2.1(a)(ii) in the case of a Service Entry
Employee, shall be considered a Participant in the Plan for all purposes
except that such Participant shall not be entitled to (i) have Matching
Contributions made on his or her behalf, (ii) have any forfeitures
allocated to his or her Account, and (iii) in the case of a Service Entry
Employee who has not completed one Year of Eligibility Service, elect to
make Pre-tax Contributions or After-tax Contributions or have
Discretionary Contributions made on his or her behalf under the Plan.
(c) Cessation of Eligible Employee Status. A Participant who ceases
to be an Eligible Employee (regardless of whether he or she also Separates
from Service) shall not be permitted to make any After-tax Contributions
to the Plan or to have any Pre-tax Contributions or Matching Contributions
made to the Plan on his or her behalf.
(d) Resumption of Eligible Employee Status. If a Participant or an
Eligible Employee who had met the applicable eligibility requirements
under Section 2.1 but who elected not to participate, ceases to be an
Eligible Employee and again resumes Eligible Employee status, such
Participant or Eligible Employee, as the case may be, may resume or
commence making After-tax Contributions and having Pre-tax Contributions
and Matching Contributions made on his or her behalf by contacting the
Retirement Savings Action Line (or, if unable to use the Retirement
Savings Action Line, delivering the Administrative Committee a
Contribution Election and Investment Election, in writing, on a form
prescribed by the Administrative Committee for such purpose). If any other
person is reemployed as an Eligible Employee, he or she shall become a
Participant in accordance with the provisions of Section 2.1.
(e) Termination of Participation. A Participant shall cease to be a
Participant in the Plan upon the earlier of:
(i) The payment to him or her of all vested benefits due to him or
her under the Plan;
(ii) His or her Separation from Service with no vested benefits under
the Plan; or
(iii) His or her death.
(f) Special Plan Provisions Applicable to Universal/Spencer
Employees. Notwithstanding any other provision of the Plan to the
contrary, due to the changes in Trustee and investment options effective
<PAGE>
as of January 1, 1997, investment rate changes, investment transfer
changes, withdrawals, loans and distributions with respect to
Universal/Spencer Employees shall be suspended during the period January
1, 1997 through February 17, 1997. Any payments which would have been made
during that period but for the provisions of this paragraph shall be made
as soon as practicable following February 17, 1997. In addition, an
Universal/Spencer Employee who was not a contributing member of this Plan
as of December 31, 1996 shall not be deemed an Eligible Employee until
February 18, 1997 unless his initial enrollment date under this Plan was
January 1, 1997. A Universal/Spencer Employee's Contribution Election on
file as of December 22, 1996 shall continue in effect for the period
January 1, 1997 to February 17, 1997 and may not be changed or revoked
during that period.
ARTICLE III - CONTRIBUTIONS AND ALLOCATIONS
3.1 Contribution Elections.
(a) Each Participant who wishes to make a Contribution Election
shall contact the Retirement Savings Action Line and specify, in the case
of Pre-tax Contributions, the percentage of Salary to be reduced, and/or
in the case of After-tax Contributions, the percentage of Salary to be
contributed to the Plan.
(b) A Participant's Contribution Election shall be effective as soon
as administratively practicable following the date the Plan receives the
Participant's Contribution Election; provided, however, that no
Contribution Election shall be effective prior to the date the Employee
becomes a Participant (or in the case of a Participant who ceases to be an
Eligible Employee and then again becomes an Eligible Employee, the first
date such Employee again becomes an Eligible Employee). A Participant may
only make a Contribution Election with respect to Salary that becomes
currently available after the date of such Contribution Election.
(c) A Participant may amend (to either increase or decrease the
percentage of his or her annual Salary reduced or contributed to the Plan)
or revoke his or her Contribution Election on a prospective basis by
contacting the Retirement Savings Action Line. Changes in a Participant's
Contribution Election shall be effective as soon as administratively
practicable following the date the Plan receives the Participant's revised
Contribution Election.
(d) A Participant's Contribution Election shall automatically apply
to any increases or decreases in the Participant's Salary.
(e) Notwithstanding anything in this Section 3.1 to the contrary, in
the event that a Participant is unable to use the Retirement Savings
Action Line to make or change a Contribution Election, the Administrative
Committee shall permit the Participant to make or change such election in
writing on a form prescribed by the Administrative Committee for such
purpose.
3.2 Pre-tax Contributions
(a) Highly Compensated Employees. Subject to the limitations of
Articles XIII, XIV and XV, each Participant who is both an Eligible
Employee and a Highly Compensated Employee may elect to reduce his or her
Salary by at least 1% and not more than 10% (in whole percentages) and
have that amount contributed to the Plan by the Company as Pre-tax
Contributions.
<PAGE>
(b) Non-highly Compensated Employees.
(i) Seagram and Tropicana Employees.
Subject to the limitations of Articles XIII and XV, each Participant who
is an Eligible Employee, a Seagram or Tropicana Employee, and a Non-highly
Compensated Employee may elect to reduce his or her Salary by at least 1% and
not more than 17% (in whole percentages) and have that amount contributed to
the Plan by the Company as Pre-tax Contributions.
(ii) Universal/Spencer Employees.
Subject to the limitations of Article XIII and XV, each Participant who is
an Eligible Employee, a Universal/Spencer Employee and a Non-highly Compensated
Employee may elect to reduce his or her Salary by at least 1% and not more than
14% (in whole percentages) and have that amount contributed to the Plan by the
Company as Pre-tax Contributions.
(c) Maximum Pre-tax Contributions.
(i) Seagram and Tropicana Employees.
In no event may the aggregate percentage of Salary reduced by a Seagram or
Tropicana Employee pursuant to this Section when added to the percentage of
Salary contributed by such Employee pursuant to Section 3.3 exceed 17% of
Salary.
(ii) Universal/Spencer Employees.
In no event may the aggregate percentage of Salary reduced pursuant to
this Section by a Universal/Spencer Employee who is a Highly Compensated
Employee when added to the percentage of Salary contributed by such Employee
pursuant to Section 3.3 exceed 10% of Salary. Further, in no event may the
aggregate percentage of Salary reduced pursuant to this Section by a
Universal/Spencer Employee who is a Non-highly Compensated Employee when added
to the percentage of Salary contributed by such Employee pursuant to Section
3.3 exceed 14% of Salary.
3.3 After-tax Contributions
(a) Contribution Percentage.
(i) Seagram and Tropicana Employees.
Subject to the limitations of Articles XIII, XIV and XV, each Participant
who is an Eligible Employee and a Seagram or Tropicana Employee may elect to
contribute from 1% to 17% (in whole percentages) of his or her Salary;
provided, however, that in no event may the aggregate percentage of Salary
contributed pursuant to this Section when added to the percentage of Salary
reduced pursuant to Section 3.2 exceed 17% of Salary.
(ii) Universal/Spencer Employees.
Subject to the limitations of Articles XIII, XIV and XV, each Participant
who is an Eligible Employee, a Universal/Spencer Employee and a
Highly-Compensated Employee, may elect to contribute from 1% to 10% (in whole
percentages) of his or her Salary, provided, however, that in no event may the
aggregate percentage of Salary contributed pursuant to this Section when added
to the percentage of Salary reduced pursuant to Section 3.2 exceed 10% of
Salary.
Further, subject to the limitations of Articles XIII and XV, each
Participant who is an Eligible Employee, a Universal/Spencer Employee and a
Non-highly Compensated Employee may elect to contribute from 1% to 14% (in
whole percentages) of his or her Salary, provided, however, that in no event
<PAGE>
may the aggregate percentage of Salary contributed pursuant to this Section
when added to the percentage of Salary reduced pursuant to Section 3.2 exceed
14% of Salary.
(b) Method of Contribution. After-tax Contributions may only be
contributed by payroll deduction.
3.4 Floating Rate Contribution Election.
In lieu of electing specific reduction and contribution percentages
pursuant to Sections 3.2 and 3.3, a Participant may make a "floating rate"
election. A Participant who makes a floating rate contribution election shall
designate the aggregate percentage of Salary to be reduced and/or contributed
to the Plan. The percentage shall be first applied so that the Participant will
defer as a Pre-tax Contribution, the maximum amount of Salary permitted to be
reduced under Section 3.2 (but not in excess of the percentage selected by the
Participant). Thereafter, the percentage shall be applied so that the
Participant will contribute, as an After-tax Contribution, the maximum amount
of Salary permitted to be contributed under Section 3.3 (but not in excess of
the percentage selected by the Participant).
3.5 Matching Contributions
(a) Seagram Employees. Subject to Articles XIV and XV, for each Plan
Year the Company shall make Matching Contributions to the Matching
Contributions Accounts of Participants who are Seagram Employees equal to
25% of the first 6% of Participants' Pre-tax Contributions, but in no
event more than $1,125. For purposes of applying the $1,125 annual maximum
limitation for a Plan Year, if a Participant receives an allocation of
employer matching contributions under the Universal Plan, UNI Plan, or
Spencer Plan for the Plan Year in which he becomes a Participant in this
Plan, those employer matching contributions contributed prior to the date
he becomes a Participant will be counted in applying the $1,125 annual
contribution limit for the Plan Year.
(b) Tropicana Employees. Subject to Articles XIV and XV, for each
Plan Year the Company shall make Matching Contributions to the Matching
Contributions Accounts of Participants who are Tropicana Employees equal
to 50% of the first 6% of Participants' Pre-tax Contributions and
After-tax Contributions.
(c) Universal/Spencer Employees. Subject to Articles XIV and XV, for
each Plan Year the Company shall make Matching Contributions to the
Matching Contributions Accounts of Participants who are Universal/Spencer
Employees equal to 40% of the first 5% of Participants' Pre-tax
Contributions and After-tax Contributions.
(d) Notwithstanding anything in this Section 3.5 to the contrary, no
Matching Contributions shall be made with respect to Pre-tax Contributions
which are Excess Deferrals or Excess Contributions or, for Tropicana
Employees or Universal/Spencer Employees, with respect to After-tax
Contributions which are Excess Aggregate Contributions. For this purpose
Excess Deferrals and Excess Contributions relate first to Pre-tax
Contributions and After-tax Contributions for the Plan Year not otherwise
eligible for a Matching Contribution.
3.6 Discretionary Contributions.
For each Plan Year, each Separate Line of Business, in its complete
discretion, may make a "profit-sharing contribution" to the Plan on behalf of
each Eligible Employee who has met the applicable eligibility requirements of
Section 2.1 and who is an Employee of the applicable Separate Line of Business
on the last day of the Plan Year. The portion of the profit sharing
<PAGE>
contribution to be allocated shall be determined by multiplying the amount of
such contribution by a fraction the numerator of which is such Eligible
Employee's Compensation from the applicable Separate Line of Business in such
Plan Year and the denominator of which is the Compensation of all Employees of
the applicable Separate Line of Business eligible to receive a Discretionary
Contribution with respect to such Plan Year. All profit sharing contributions
made by a Separate Line of Business shall be paid to the Trustee no later than
the last day prescribed by law for the filing of the Employer's federal income
tax return (including extensions thereof) for the taxable year which includes
the last day of the Plan Year with respect to which the contribution was made.
3.7 Rollover Contributions.
A Participant or an Eligible Employee may request that the Plan accept a
Rollover Contribution by filing the form prescribed by the Administrative
Committee for such purpose. The Administrative Committee may, in its
discretion, accept such Rollover Contribution provided the contribution is an
"eligible rollover distribution" as defined in Code Section 402(c)(4). Rollover
Contributions and any earnings and losses thereon shall be credited to a
Rollover Contributions Account.
3.8 QNECs.
For each Plan Year, the Administrative Committee may, in its sole
discretion, direct a Separate Line of Business to contribute QNECs for the
benefit of all Participants who are Employees of such Separate Line of Business
entitled to receive an allocation of contributions, other than Highly
Compensated Employees. At the election of the Investment Committee, QNECs may
be treated as Pre-tax Contributions for the purposes of applying the actual
deferral percentage test of Section 14.2, or determining the multiple use
limitation of Section 14.12, or as Matching Contributions for purposes of the
Actual Contribution Percentage test of Section 14.7, or the multiple use
limitation of Section 14.12 in accordance with Section 14.6.
3.9 QMACs.
For each Plan Year, the Administrative Committee may, in its sole
discretion, direct a Separate Line of Business to contribute QMACs for the
benefit of all Participants who are Employees of the Separate Line of Business,
who are entitled to receive an allocation of contributions and are Non-highly
Compensated Employees. At the election of the Investment Committee, QMACs may
be treated as Pre-tax Contributions for the purposes of applying the actual
deferral percentage test of Section 14.2 or determining the multiple use
limitation of Section 14.12 in accordance with Section 14.6.
3.10 Military Leave
Notwithstanding any provision of this Plan to the contrary, contributions,
benefits and service credit with respect to qualified military service will be
provided in accordance with Code 414(u).
3.11 Maximum Annual Contribution Limit Applicable to Universal/Spencer
Employees who are Highly Compensated Employees
Notwithstanding the foregoing provisions of this Article III, in no event may
the annual contributions contributed by or on behalf of an Universal/Spencer
Employee who is a Highly Compensated Employee under this Plan for a Plan Year
exceed the maximum amount permissible under Code Section 415(c) for that year
reduced by any contributions to be made on the Participant's behalf under the
Universal Studios, Inc. Profit Sharing Trust and the Spencer Gifts Profit
Sharing Plan, and any amounts accrued on the Participant's behalf (other than
hypothetical earnings) under the Universal Studios, Inc. Supplemental Executive
<PAGE>
Retirement Plan (the "offset plans") for that Plan Year. For purposes of this
Section 3.11, the amount of contributions to be made or the amounts which will
accrue, as the case may be, under the offset plans for a Plan Year on behalf of
a Universal/Spencer Employee shall be approximated by the Administrative
Committee as of the first day of the Plan Year, or as soon as administratively
practicable thereafter, assuming the Participant will remain in service and
receive compensation for the entire Plan Year. The Administrative Committee may
implement rules limiting the contributions which may be made by or on behalf of
some or all Universal/Spencer Employees who are Highly Compensated Employees so
that this limitation is satisfied.
3.12 Contributions Subject to Deductibility.
The Employer's obligation to make any contributions under this Plan is
expressly conditioned on its ability to deduct such contributions under Code
404.
3.13 Allocation of Contributions.
(a) Pre-tax Contributions, Matching Contributions, and After-tax
Contributions shall be allocated to Participants' Pre-tax Contributions
Account, Matching Contributions Account, and After-tax Contributions
Account, respectively, on or as soon as practicable after each pay day.
(b) Discretionary Contributions, QNECs, and QMACs shall be allocated
to Participants' Discretionary Contributions Account, QNECs Account, and
QMACs Account, respectively, no later than the last day prescribed by law
for the filing of the Employer's federal income tax return (including
extensions thereof) for the taxable year which includes the last day of
the Plan Year.
(c) Rollover Contributions shall be allocated to the Participant's
Rollover Contributions Account as soon as practicable after the date such
Rollover Contribution is made.
(d) The Employer may pay its contribution for each Plan Year in one
or more installments without interest.
(e) Subject to the consent of the Trustee, the Employer may make its
contribution in property other than cash, provided the contribution of
property is not a non-exempt prohibited transaction under the Code or
under ERISA.
3.14 Valuation; Earnings and Losses.
Participants' Accounts shall be valued, and earnings and losses allocated,
daily except that loans, in-service withdrawals, distributions, and certain
repayments shall not be valued until processed.
3.15 Return of Contributions.
Upon written demand by the Employer, the Trustee shall return any Pre-tax
Contributions, Matching Contributions, Discretionary Contributions, QNECs and
QMACs contributed by the Employer to this Plan under the following
circumstances:
(a) If a contribution was made due to a mistake of fact, the
contribution may be returned, adjusted for losses but not earnings, within
one year after it was contributed.
(b) If a contribution is determined not to be deductible under
Section 404 of the Code, the portion of the contribution that was
disallowed may be returned to the Employer, adjusted for losses but not
earnings, within one year after the disallowance (except that such
contribution shall be adjusted for neither losses nor earnings and shall
only be returned within one year after the disallowance if the
<PAGE>
contribution was made by Tropicana Products, Inc. or any participating
employer in the Tropicana Employee Savings Trust prior to January 1,
1995).
(c) If Pre-tax Contributions are returned to the Company in
accordance with this Section 3.15, Participants' Contribution Elections
with respect to such returned contributions shall be void retroactively to
the beginning of the period for which such contributions were made. The
Pre-tax Contributions so returned shall be distributed in cash to those
Participants for whom such contributions were made.
(d) The Trustee may require the Employer to furnish whatever
evidence the Trustee deems necessary to enable the Trustee to confirm that
the amount the Employer has requested be returned is properly returnable.
ARTICLE IV - INVESTMENTS
4.1 Participant Investment Provisions
(a) Each Participant shall, in accordance with the procedures set
forth in Section 4.2, have the right to direct the Trustee with respect to
the investment or re-investment of the assets comprising the Participant's
Account among the Investment Funds.
(b) In the event the Participant does not direct the Trustee
regarding the investment or re-investment of the Participant's Account,
the Trustee shall invest any new contributions made to the Participant's
Account in accordance with the Participant's most recently submitted
Investment Election; provided, however, that if it is not possible to
continue to invest in accordance with the Participant's Investment
Election (for example, because the Investment Committee has ceased to
offer the investment), the Investment Committee shall determine the manner
in which the Participant's Account shall be invested.
4.2 Investment Elections.
(a) Investment Elections shall specify, in multiples of 5%, how the
Participant's Account and contributions should be invested in the
available Investment Funds. Notwithstanding the preceding sentence, an
Eligible Employee's or Participant's initial Investment Election with
respect to a Rollover Contribution (i) shall be denominated in dollar
amounts (rather than percentages), and (ii) shall separately specify how
such Rollover Contributions should be invested in the available Investment
Funds. A Participant's Investment Election shall be effective as soon as
administratively practicable following the date the Plan receives the
Participant's Investment Election.
(b) Participants may make or change their Investment Elections by
contacting the Retirement Savings Action Line. A Participant's change in
Investment Election shall be effective with respect to new contributions
only, unless the Participant also makes a new Investment Election with
respect to amounts in his or her existing Account. Changes in a
Participant's Investment Election shall be effective as soon as
administratively practicable after the date the Plan receives the
Participant's revised Investment Election.
(c) Notwithstanding anything in this Section 4.2 to the contrary, in
the event that a Participant is unable to use the Retirement Savings
Action Line to make or change a Investment Election, the Administrative
Committee shall permit the Participant to make or change such election in
writing on a form prescribed by the Administrative Committee for such
purpose.
<PAGE>
(d) Each Participant is solely responsible for his or her selection
of Investment Funds. None of the Trustee, the Administrative Committee,
the Investment Committee, Seagram, the Employer or any of the officers or
supervisors of the Company are empowered or authorized to advise a
Participant regarding the Participant's Investment Election. The fact that
the Investment Committee selects the Investment Funds offered under this
Plan shall not be construed as a recommendation that Participants invest
in such Investment Fund.
4.3 Investment Funds.
(a) The Investment Committee shall select Investment Funds from time
to time in accordance with the investment policies and objectives
established by Seagram. Subject to such policies and objectives, the
Investment Committee shall have the right to cease offering any Investment
Fund or to add any Investment Fund at any time.
(b) Pending allocation to the Investment Funds, contributions to the
Plan may be held uninvested or may, on an interim basis, be invested, in
whole or in part, in cash or cash equivalents. Dividends, interest, and
other distributions received on the assets held by the Trustee in respect
of any Investment Fund shall be reinvested in the respective fund.
4.4 Investment of Loan Repayments and Restoration of Forfeitures.
Any loan repayments and repayments in connection with forfeiture
restorations in accordance with Section 5.6, shall be invested in the
Investment Funds that have been selected by the Participant for new
contributions as in effect on the date such repayments or contributions are
received.
4.5 Special Investment Restrictions For Officers & Directors.
Any Participant who is an officer or director of The Seagram Company Ltd.
as defined for the purposes of Section 16 of the Securities Exchange Act of
1934, as amended, is prohibited from directing investment of contributions or
existing Account balances into the Seagram Stock Fund.
ARTICLE V - VESTING
5.1 Pre-tax Contributions, After-tax Contributions, and Rollover
Contributions.
A Participant shall be at all times 100% vested in amounts credited to his
or her Pre-tax Contributions Account, After-tax Contributions Account, Rollover
Contributions Account, QNECs Account and QMACs Account.
5.2 Matching Contributions and Discretionary Contributions.
(a) General Vesting Schedule. Amounts credited to a Participant's
Matching Contributions Account (excluding amounts vested pursuant to
paragraph (c) below) and Discretionary Contributions Account shall become
vested in accordance with the following schedule:
Years of Vesting Service Vested Percentage
Less than 1 0%
At least 1, but less than 2 20%
At least 2, but less than 3 40%
At least 3, but less than 4 60%
At least 4, but less than 5 80%
5 or more 100%
<PAGE>
(b) Frozen Matching Contributions Vesting Schedule.
(i) Seagram Employees. Amounts credited to the Frozen Matching
Contributions Account of any Participant who is a Seagram Employee on
December 31, 1994 shall become 100% vested on such date.
(ii) Tropicana Employees. Amounts credited to the Frozen Matching
Contributions Account of any Participant who is a Tropicana Employee on
December 31, 1994 shall become vested in accordance with the following
schedule:
Years of Vesting Service Vested Percentage
Less than 1 0%
At least 1, but less than 3 40%
At least 3, but less than 4 60%
At least 4, but less than 5 80%
5 or more 100%
(c) Universal/Spencer Vesting Provision. A Participant who is an
Universal/Spencer Employee shall be 100% vested in that portion of his or
her Matching Contributions Account standing to his credit in his company
contribution account on December 31, 1990 under the Plan.
(d) Special Vesting Provision for Certain Tropicana Employees. A
Participant who was initially employed as a Tropicana Employee during 1993
or 1994 shall have amounts credited to his or her Matching Contributions
Account vested in accordance with the following schedule:
Years of Vesting Service Vested Percentage
Less than 1 0%
At least 1, but less than 3 40%
At least 3, but less than 4 60%
At least 4, but less than 5 80%
5 or more 100%
Notwithstanding anything in this Section 5.2 to the contrary, a
Participant shall be 100% vested in his or her Matching Contributions Account,
Discretionary Contributions Account, and Frozen Matching Contributions Account
upon the Participant's death, Disability, or attainment of age 60 while the
Participant is an Employee.
5.3 Vesting Upon Reemployment After a Break in Service.
(a) If an Employee Separates from Service and again becomes an
Employee, his or her Years of Vesting Service rendered prior to his or her
Separation from Service shall be restored to him or her upon his or her
reemployment as an Employee for purposes of determining his or her vested
percentage in the amount credited to his or her Matching Contributions
Account and Discretionary Contributions Account subsequent to his or her
return.
(b) A former Participant who (i) Separated from Service prior to the
date he or she was 100% vested, (ii) again becomes an Employee, and (iii)
restores his or her Account in accordance with Section 5.6, shall have his
or her prior Years of Vesting Service taken into account for purposes of
vesting in his or her Account balance so restored as described below:
(i) General Rule. If a former Participant who Separated from Service
prior to the time he or she was 100% vested in his or her Account again
becomes an Employee prior to incurring a Five Year Break in Service, such
<PAGE>
Employee's prior Years of Vesting Service shall be taken into account for
purposes of determining his or her vested percentage in his or her
restored Account balance provided such Employee's Account is restored in
accordance with Section 5.6.
(ii) Restoration of Frozen Matching Contributions Attributable to
Seagram Employees. If a former Participant who Separated from Service
again becomes an Employee and has Frozen Matching Contributions restored
to his or her Account, then such Employee shall become vested in such
contributions as follows:
(A) If a reemployed Participant has a total of five Years of Vesting
Service, the Participant shall be 100% vested in his or her restored Frozen
Matching Contributions Account;
(B) Notwithstanding Section 5.3(b)(i), if any Frozen Matching
Contributions restored were contributed to a Participant's Account when he or
she was a Seagram Employee, the Participant shall become fully vested in the
Frozen Matching Contributions if following the date that such restored Frozen
Matching Contributions were first contributed to the Plan, the Participant has
two Years of Vesting Service in which the Participant does not incur a Break in
Service.
5.4 Forfeitures.
(a) If a Participant Separates from Service prior to the time he or
she is 100% vested in his or her Account, and such Participant does not
receive a distribution from the Plan, the non-vested portion of the
Participant's Account shall be forfeited upon the Participant's incurrence
of a Five Year Break in Service.
(b) If a Participant Separates from Service and receives a
distribution from the Plan of the vested portion of his or her Account
prior to incurring a Five Year Break in Service at a time when the
Participant was not 100% vested in his or her Account, the non-vested
portion of the Participant's Account shall be forfeited upon the date of
the distribution.
(c) For purposes of this Section 5.4, a Participant who Separates
from Service at a time when he or she is 0% vested in his or her Matching
Contributions Account and Discretionary Contributions Account shall be
deemed to have received a distribution upon Separation from Service.
5.5 Allocation of Forfeitures.
Subject to any required restoration under Section 5.6 and Section
8.11, any amount forfeited under Section 5.4 shall be used to reduce Employer
Matching Contributions for the Plan Year in which such forfeiture occurs.
Except in the case of a Participant whose Account is restored in the Plan Year
of the forfeiture, a Participant shall not be entitled to an allocation of a
forfeiture of any portion of his or her Account.
5.6 Restoration of Forfeited Account.
(a) A Participant or former Participant who received a distribution
from the Plan of the vested portion of his or her Account who again
becomes an Employee before incurring a Five Year Break in Service may
restore the non-vested portion forfeited in accordance with Section 5.4,
by repaying the full amount of the distribution (excluding amounts
attributable to the Participant's After-tax Contributions and Rollover
Contributions, except that the Participant may elect to repay to the Plan
all or part of those amounts as well). Any repayment must be in cash and
paid to the Trustee in a lump sum within five years after the
Participant's Reemployment Commencement Date.
<PAGE>
(b) If a former Participant who Separated from Service at a time
when he or she was 0% vested in his or her Matching Contributions Account
and Discretionary Contributions Account, again becomes an Employee prior
to incurring a Five Year Break in Service, the former Participant's
forfeited Account shall be restored on the date he or she once again
becomes an Employee without the need for any repayment.
(c) Any nonvested amounts restored pursuant to this Section 5.6
shall be restored as of the last day of the month coincident with or
immediately following the date of repayment or reemployment, as the case
may be.
(d) Amounts restored pursuant to this Section shall generally be
allocated to a Participant's After-tax Contributions Account; provided,
however, if the distribution has not been included in the Participant's
gross income for federal income taxes, the Participant's repayment shall
be allocated to the accounts from which they were distributed. Restored
amounts shall be reinvested as provided in Section 4.4.
(e) The Administrative Committee shall restore the forfeited portion
of a Participant's Account from the amount of forfeitures that the
Employer would have otherwise allocated to Participants. To the extent the
amount of available forfeitures is insufficient to enable the
Administrative Committee to make the required restoration, the Employer
must contribute, without regard to any requirement or condition of
Articles XIII through XVI, the additional amount necessary to enable the
Administrative Committee to make the required restoration.
5.7 Special Provisions Applicable to Certain Participants Who Become
Employed by MAI-Metro
(a) A Participant who terminates employment with Tropicana Products
Sales Division of Joseph E. Seagram & Sons, Inc. and Distillers Products
Sales Corporation, on September 30, 1996 and becomes employed by
MAI-Metro, L.C. (the "New Employer") on October 1, 1996 and whose name is
listed in Exhibit I of the Agreement between those two companies effective
as of October 1, 1996 (the "Transferred Participants"), shall be 100%
vested in his or her Matching Contributions Account, Discretionary
Contributions Account, and Frozen Matching Contributions Account on and
after September 30, 1996.
(b) The Trustee shall transfer the assets and liabilities
attributable to the Transferred Participants' Accounts under this Plan
directly to a qualified defined contribution profit sharing plan and trust
maintained by the New Employer (the "Transferee Plan"). The transfer shall
be made as soon as practicable following the Participant's employment by
the New Employer or, if later, the date Seagram receives either a copy of
a favorable determination letter issued by the Internal Revenue Service
confirming the Transferee Plan's qualification for favorable tax treatment
under Code 401(a) or an opinion of legal counsel for the New Employer
substantially to the effect that the Transferee Plan is a qualified plan
under Code Section 401(a). Following such transfer of assets and
liabilities, the Transferred Participants' Accounts shall cease to be a
liability of this Plan and shall become a liability of the Transferee Plan
and shall be administered in accordance with the provisions of the
Transferee Plan and applicable law. The transfer of assets and liabilities
shall be made in accordance with the provisions of ERISA and the Code.
<PAGE>
ARTICLE VI - IN-SERVICE WITHDRAWALS
6.1 Withdrawal of After-tax Contributions.
A Participant may elect to withdraw all or a portion of the amounts
credited to his or her After-tax Contributions Account, including earnings.
Notwithstanding the preceding sentence, a Participant may not withdraw any
matched After-tax Contributions which were contributed to the Plan (i) on or
after January 1, 1997, and (ii) within the 6-month period preceding the date of
withdrawal.
6.2 Withdrawal of Rollover Contributions.
A Participant who has withdrawn all of the amounts credited to his or her
After-tax Contributions Account, may withdraw all or a portion of the amounts
which have been credited to his or her Rollover Contributions Account more than
two years prior to the date of the withdrawal, including earnings.
6.3 Withdrawal of Frozen Matching, Matching or Discretionary
Contributions.
(a) A Participant who (i) is an Employee, (ii) is vested in all or a
portion of his or her Frozen Matching Contributions Account, Matching
Contribution Account and Discretionary Contribution Account, and (iii) has
withdrawn the entire amount available under Sections 6.1 and 6.2, may
withdraw all or a portion of the vested portion of his or her Frozen
Matching Contributions Account, Matching Contributions Account or
Discretionary Contributions Account, including any earnings, contributed
two years immediately preceding the date of withdrawal.
(b) A Participant who (i) is a Universal/Spencer Employee as of
December 31, 1996, (ii) is vested in all or a portion of his or her
Matching Contributions Account, and (iii) has withdrawn the entire amount
available under Sections 6.1, 6.2 and 6.3(a) above, may withdraw all or a
portion of the remaining vested portion of his or her Matching
Contributions Account, including any earnings, contributed under the Plan
within two years immediately preceding the date of withdrawal and prior to
January 1, 1997; provided, however, that if the Participant elects to
receive such a distribution the Company shall not make any Matching
Contributions with respect to any Pre-tax Contributions contributed on
such Participant's behalf or any After-tax Contributions contributed by
such Participant for the six month period following the effective date of
such withdrawal.
6.4 Withdrawal of Pre-tax Contributions, QNECs, QMACs.
Except as otherwise provided in this Article VI, a Participant who is an
Employee shall not be entitled to withdraw any Pre-tax Contributions, QNECs or
QMACs from the Plan. If a Participant who has Separated from Service again
becomes an Employee after applying for a distribution of all or a portion of
his or her Account but prior to the date the Trustee has made such
distribution, the Participant shall not receive a distribution of any Pre-tax
Contributions, QNECs or QMACs.
6.5 Withdrawals After Attaining Age 59-1/2.
Notwithstanding anything to the contrary in this Article VI, if a
Participant attains age 59-1/2 while he or she is an Employee, a Participant
may elect to withdraw all or a portion of the following portions of his or her
Account in the following order of priority:
<PAGE>
(a) The Participant's After-tax Contributions Account, excluding any
matched After-tax Contributions made on or after January 1, 1997 and
within the 6-month period preceding the date of withdrawal;
(b) The Participant's Rollover Contributions Account;
(c) The vested portion of the Participant's Frozen Matching
Contributions Account, Matching Contributions Account and Discretionary
Contributions Account;
(d) The Participant's Pre-tax Contributions Account, QNECs Account,
and QMACs Account.
6.6 Hardship Withdrawals.
(a) A Participant who has withdrawn the total amount available for
withdrawal under Sections 6.1 through 6.5 may receive a hardship
withdrawal of all or a portion of his or her (i) matched After-tax
Contributions which have been credited to his or her After-tax
Contributions Account on or after January 1, 1997 and within six months
prior to the date of the withdrawal, (ii) his or her Pre-tax Contributions
Account (other than any post-1988 earnings on such account), and (iii) the
Rollover Contributions that have been credited to his or her Rollover
Contributions Account for less than two years, provided the Participant
furnishes proof, satisfactory to the Administrative Committee, that the
withdrawal is necessary to alleviate an immediate and heavy financial need
(as determined in accordance with Section 6.6(b) below) and that the
amount of the withdrawal does not exceed the amount necessary to satisfy
such financial need (as determined in accordance with Section 6.6(c)
below). The determination by the Administrative Committee of the existence
of an immediate and heavy financial need and of the amount necessary to
meet such need shall be made in a nondiscriminatory and uniform manner.
The Administrative Committee shall not allow a hardship withdrawal to be
made to a Participant unless the requirements of this Section 6.6 are
satisfied.
(b) Subject to Section 6.6(c), a Participant shall be deemed to have
an immediate and heavy financial need if the Participant needs the
hardship withdrawal for one of the following reasons:
(i) Medical expenses described in Code 213(d) which are incurred by
the Participant, the Participant's Spouse or dependents (as defined in
Code 152), or necessary for such persons to obtain medical care described
in Code 213(d);
(ii) Costs directly related to the purchase of a principal residence
for the Participant (excluding mortgage payments);
(iii) Payment of tuition and related educational fees for the next 12
months of post-secondary education for the Participant or for the
Participant's Spouse or dependents (as defined in Code Section 152);
(iv) Payments necessary to prevent the eviction of the Participant
from his or her principal residence or to prevent foreclosure on the
mortgage of the Participant's principal residence;
(v) Any need prescribed by the Internal Revenue Service in a revenue
ruling, notice or other document of general applicability which satisfies
the safe harbor definition of hardship; or
(vi) Any need determined by the Administrative Committee to
constitute the type of need which would authorize a hardship distribution
under Code Section 401(k) and applicable regulations.
The determination of whether a Participant has met the requirements for a
hardship withdrawal shall be made on the basis of all the relevant facts and
circumstances. Notwithstanding the foregoing, a financial need shall not fail
<PAGE>
to qualify as immediate and heavy merely because such need was reasonably
foreseeable or voluntarily incurred by the Participant.
(c) A request for a hardship withdrawal made pursuant to this
Section 6.6 shall be deemed to be necessary to satisfy an immediate and
heavy financial need of a Participant if:
(i) The distribution is not in excess of the amount of the
Participant's immediate and heavy financial need (including any amounts
necessary to pay any federal, state or local income taxes or penalties
reasonably anticipated to result from such distribution); and
(ii) The Participant has obtained all distributions (other than
hardship withdrawals) and all nontaxable loans currently available under
the Plan and all other plans maintained by the Company and any Affiliate.
(iii) In making its determination that a hardship withdrawal is
necessary to satisfy an immediate and heavy financial need, the
Administrative Committee may, unless it has actual knowledge to the
contrary, rely on a written statement by the Participant that the need
cannot be reasonably relieved (i) through the reimbursement or
compensation by insurance or otherwise, (ii) by liquidation of the
Participant's assets, (iii) by cessation of deferrals or contributions to
the Plan, or (iv) by other distribution or nontaxable (at the time of the
loan) loans from plans maintained by the Employer or by any other employer
(or by borrowing from commercial sources on reasonable commercial terms)
in an amount sufficient to satisfy the need. For purposes of this Section,
taking any of the foregoing actions shall not be deemed to reasonably
relieve a need if the effect of taking any such action would be to
increase the amount of the need.
(d) Notwithstanding any provision of the Plan to the contrary, a
Participant who receives a hardship withdrawal shall not be permitted to
make After-Tax Contributions or have Pre-tax or Matching Contributions
made on his or her behalf for a period of 12 months following the date the
Plan distributes the hardship withdrawal.
6.7 In-Service Withdrawal Procedures and Restrictions.
(a) Participants shall request an in-service withdrawal form from
the Plan by contacting the Retirement Savings Action Line (or if unable to
use the Retirement Savings Action Line, in writing, on a form prescribed
by the Administrative Committee for such purpose). A completed in-service
withdrawal form must be filed with the Administrative Committee.
(b) In-service withdrawals shall be distributed as soon as
administratively practicable following the date the Administrative
Committee receives the in-service withdrawal form referred to in paragraph
(a) above.
(c) In-service withdrawals shall be taken from the Investment Funds
in which the Participant's Account is invested on a pro rata basis, except
that any funds in the Coca-Cola Stock Fund referred to in Appendix A shall
be the last funds withdrawn. All withdrawals shall be paid in cash.
(d) The minimum amount or value of an in-service withdrawal is $100
or, if less, the total amount or value available for withdrawal.
(e) A Participant shall be limited to two in-service withdrawals,
other than hardship withdrawals, per calendar year.
ARTICLE VII - LOANS
7.1 General Rule.
A Participant who is an Employee of the Company or an Affiliate may borrow
a portion of his or her vested Account by submitting an application to the
Administrative Committee. A Participant may take one loan each calendar
<PAGE>
quarter, except that a Participant may not have more than one Principal
Residence Loan outstanding nor more than a total of three loans from the Plan
outstanding at any time. Loans shall be made available to all eligible
Participants on a reasonably equivalent basis and shall not be made available
to Highly Compensated Employees, officers or shareholders in an amount greater
than is made available to other Participants. Each loan shall be evidenced by a
written promissory note signed by the Borrower. A Participant may initiate the
loan process by contacting the Retirement Savings Action Line (or if unable to
use the Retirement Savings Action Line, in writing, on a form prescribed by the
Administrative Committee for such purpose).
7.2 Amount of Loan.
A loan may be made in an amount (not less than $1,000) which, when added
to the outstanding balance of all prior loans to the Borrower under the Plan
does not exceed the lesser of (i) $50,000 reduced by the excess, if any, of (A)
the highest outstanding balance of loans from the Plan during the one-year
period ending on the day before the date such loan was made, over (B) the
outstanding balance of loans from the Plan on the date on which such loan was
made; or (ii) one-half of the present value of the Borrower's non-forfeitable
accrued benefit under the Plan. For purposes of applying the limitation in (i)
above, the Plan and all other "qualified employer plans" (as defined in Code
Section 72(p)(4)) maintained by the Company or an Affiliate shall be treated as
a single plan.
7.3 Interest Rate and Security.
(a) Loans shall be made at the prime rate as of the first day of the
month in which such loan is made (or the first business day immediately
following such date), as announced in the Wall Street Journal (or to the
extent the Wall Street Journal ceases to be published, such other
newspaper selected by the Administrative Committee) plus one percentage
point, or such other interest rate as may later be designated by the
Administrative Committee for subsequent loans.
(b) Loans shall be secured by the vested portion of the Borrower's
Account. Immediately after the origination of each loan no more than 50%
of the Participant's vested Account may be used as security for the loan.
7.4 Source of Loans.
(a) Amounts borrowed shall be distributed from the Borrower's
subaccounts, in the following order of priority: (i) Rollover
Contributions Account; (ii) Vested portion of Matching Contributions
Account and Discretionary Contributions Account; (iii) After-tax
Contributions Account; and (iv) Pre-tax Contributions Account, QNECs
Account, and QMACs Account, except that any amounts in any of the
subaccounts which are invested in the Coca-Cola Stock Fund referred to in
Appendix A shall be the last funds withdrawn.
(b) Loans shall be taken from the Investment Funds in which the
Borrower's subaccounts are invested on a pro rata basis, except that any
funds invested in the Coca-Cola Stock Fund referred to in Appendix A shall
be the last funds withdrawn.
7.5 Repayment and Term.
(a) Loans shall be amortized in substantially level payments, made
not less frequently than quarterly, for a period of not less than twelve
months and not more than five years; provided, however, that a Principal
Residence Loan may be amortized over a period not to exceed twenty-five
years and, provided, further, that loan repayments will be suspended under
the Plan as permitted under Code 414(u)(4). A Participant requesting a
Principal Residence Loan for a term shall provide copies of any documents<PAGE>
relating to the purchase of such principal residence which the
Administrative Committee may deem necessary to verify that the proceeds of
such loan will be used to acquire or construct a principal residence.
(b) Loans shall be repaid by means of payroll deduction from the
Borrower's Salary; provided, however, that if at any time a Participant is
not receiving Salary from the Company or an Affiliate, the loan repayment
shall be made in accordance with the terms and procedures established by
the Administrative Committee and applied on a uniform, nondiscriminatory
basis. A Participant may repay an outstanding loan in full at any time
without penalty.
Amounts repaid shall be returned to the subaccount from which they are
borrowed in the reverse order from the order in which they were borrowed and
shall be reinvested as provided in Section 4.4.
7.6 Default.
If a Borrower defaults on a loan, the amount of the loan (plus any accrued
interest) shall be deemed distributed, and the value of Borrower's Account
reduced accordingly as of the date of default; provided, however, that if the
amount borrowed was distributed from the Participant's Pre-tax Contributions
Account, QNECs Account or QMACs Account, such deemed distribution shall not
occur until the earlier of the date the Participant Separates from Service or
attains age 59-1/2.
7.7 Additional Rules.
The Administrative Committee may establish rules and procedures regarding
loans to Participants which may be more restrictive than the rules and
procedures set forth in this Article VII. Any such rules and procedures must be
applied on a uniform, nondiscriminatory basis.
ARTICLE VIII - DISTRIBUTIONS
8.1 Eligibility for Distribution Upon Separation From Service.
A Participant who Separates from Service on account of death, Disability
or Retirement shall be entitled to receive a lump sum distribution of 100% of
his or her Account. A Participant who Separates from Service for reasons other
than death, Disability or Retirement shall be entitled to receive a lump sum
distribution of the vested portion of his or her Account. If a Participant
Separates from Service for reasons other than Disability or Retirement and the
value of the Participant's Account exceeds (or at the time of any prior Plan
distribution to such Participant has exceeded) $3,500, the Participant may
elect to defer receipt of the lump sum distribution until the April 1st
following the calendar year he or she attains age 70.
8.2 Distributions Upon Retirement or Disability.
If a Participant Separates from Service on account of his or her
Disability or Retirement and the value of the Participant's Account exceeds (or
at the time of any prior Plan distribution to such Participant exceeded)
$3,500, the Participant may elect to defer receipt of his or her Account until
the April 1st following the calendar year he or she attains age 70-1/2. A
Participant may elect to receive his or her Account in a lump sum or in
variable quarterly installments over a period ranging from 1 year to 10 years
(in whole years). If the Participant elects to receive a distribution in
quarterly installments, the amount distributed each quarter shall be an amount
determined by multiplying the value of the Participant's Account by a fraction,
the numerator of which is one and the denominator of which is the total number
of quarterly payments yet unpaid (or such larger amount as may be required to
<PAGE>
be distributed under Code 401(a)(9)). A Participant who elects to receive
quarterly installments or to defer the receipt of a distribution may revoke
such election at any time and in lieu thereof elect to receive a lump sum
distribution of the balance of his or her Account.
8.3 Distribution Upon Death.
(a) Except as otherwise provided in Section 8.3(b), if a Participant
dies prior to the time distribution of his or her Account has commenced,
the Participant's Account shall be paid to his or her Beneficiary in one
lump sum.
(b) If at the time of a Participant's death, the Participant was an
Employee and the value of the Participant's Account exceeds (or at the
time of any prior Plan distribution to such Participant exceeded) $3,500,
the Participant's Beneficiary may elect within 30 days after the
Participant's death (or such later time as the Administrative Committee
shall prescribe) to either defer receipt of a lump sum distribution until
the fifth anniversary of the Participant's death or to receive a
distribution in the form of variable quarterly payments, the amount of
which payments shall be determined in the same manner as described in
Section 8.2(b); provided, however, that if a Beneficiary is the
Participant's Surviving Spouse, the Beneficiary may elect to defer receipt
of a lump sum distribution until the April 1st following the date the
Participant would have attained age 70-1/2; provided, further, that a
Beneficiary may not elect to receive quarterly payments over a 10 year
period if the Beneficiary's life expectancy does not exceed 10 years. A
Beneficiary who elects to receive quarterly installments or to defer the
receipt of a distribution may revoke such election at any time and in lieu
thereof elect to receive a lump sum distribution of the balance of his or
her Account.
(c) If a Participant dies after distribution of his or her Account
has commenced, the remaining portion of such Participant's Account shall
be distributed to the Participant's Beneficiary no less rapidly than under
the form of distribution elected by the Participant; provided, however,
that the Beneficiary may, by written notice to the Administrative
Committee, elect to receive all or a portion of the distribution or the
remainder thereof in a lump sum.
(d) The Administrative Committee may require and rely upon such
proof of death and such evidence of the right of any Beneficiary or other
person to receive the value of a deceased Participant's Account as the
Administrative Committee may deem proper and its determination of death
and of the right of that Beneficiary or other person to receive payment
shall be conclusive.
8.4 Commencement of Payments.
Distributions shall be paid as soon as practicable after the Participant's
Separation from Service or such later payment date as the Participant or
Beneficiary shall have elected in accordance with the provisions of this
Article VIII; provided, however, that if the value of a Participant's Account
exceeds (or at the time of any prior distribution has exceeded) $3,500 and if
the Participant has not attained age 62, no distribution shall be made without
the Participant's consent. Notwithstanding anything in this Plan to the
contrary, in no event shall a distribution be made later than the 60th day
following the end of the Plan Year in which a Participant's Separation from
Service occurs, or if later, the year in which the Participant attains Normal
Retirement Age, unless the Participant elects otherwise in accordance with the
provisions of this Article VIII. Participants may request a distribution form
by contacting the Retirement Savings Action Line (or, in the event a
<PAGE>
Participant is unable to use the Retirement Savings Action Line, in writing, on
a form prescribed by the Administrative Committee).
8.5 Form of Payment.
Except as otherwise provided in Appendix A or this Article VIII,
distributions shall be in one lump sum cash payment.
8.6 Amount of Distribution.
The amount of any distribution to be made based on the value of a
Participant's Account, or a portion thereof, shall be determined with reference
to the value of such Account (or portion thereof) when the distribution is
processed.
8.7 Mandatory Distributions.
(a) If, upon Separation from Service, the vested portion of a
Participant's Account equals $3,500 or less (and at the time of any prior
Plan distribution has not exceeded $3,500), the Administrative Committee
shall direct the Trustee to distribute the Participant's Account in a lump
sum to the Participant as soon as practicable after the date such
Separation of Service occurred.
(b) Notwithstanding any other provision of this Plan, a Participant
in active service who is a Five-percent Owner must begin receiving
distributions from his or her Account no later than the April 1st
following the calendar year in which the Participant attains age 70-1/2.
If a Participant who has attained age 70-1/2 elects to commence receipt of
his or her Account in quarterly installments, the Administrative Committee
shall direct the Trustee to distribute to the Participant the greater of:
(i) The amount determined using the methodology set forth in Section 8.2,
or (ii) the amount required to be distributed under Code
Section 401(a)(9).
(c) In the event a Participant, other than a Participant described
in paragraph (b) above, is receiving payments while in service in
accordance with the provisions of Code Section 401(a)(9) as of December
31, 1996, the Participant may elect to suspend payments while he or she
remains in service in accordance with such uniform rules as the
Administrative Committee shall adopt. In addition, if a Participant who is
an Universal/Spencer Employee had begun to receive payments under the Plan
prior to December 31, 1996 in accordance with the provisions of Code
Section 401(a)(9), payments shall continue under this Plan on the same
basis as provided under the Plan prior to December 31, 1996 unless the
Participant elects otherwise in accordance with the preceding sentence.
8.8 Direct Rollovers.
A Participant (or a Beneficiary that is the Participant's Surviving
Spouse) may elect to have any portion of an Eligible Rollover Distribution paid
directly to an Eligible Retirement Plan specified in writing by such
Participant (or Surviving Spouse).
8.9 Qualified Domestic Relations Orders.
The Administrative Committee shall establish reasonable procedures to
determine the qualified status of a domestic relations order in accordance with
the requirements of Code 414(p) and ERISA Section 206(d). An alternate payee
under a qualified domestic relations order may receive a distribution from this
Plan prior to the date the Participant to whom the order relates attains the
earliest retirement age under the Plan.
<PAGE>
8.10 Beneficiary Designation.
(a) A Participant may from time to time designate a Beneficiary to
receive the value of his or her Account following the Participant's death
by filing a Beneficiary Designation Form with the Administrative
Committee. Notwithstanding the preceding sentence, if a Participant dies
leaving a Surviving Spouse before complete distribution of his or her
Account, the Participant's Beneficiary shall be the Participant's
Surviving Spouse, unless such Surviving Spouse has consented to the
designation of another Beneficiary, in a writing witnessed by a notary
public, a Plan representative or as otherwise provided by applicable law;
provided, however, the Spouse's consent shall not be required if:
(i) The Participant and his or her Spouse were not married
throughout the one year period ending on the date of the Participant's
death;
(ii) The Administrative Committee is unable to locate the
Participant's Spouse;
(iii) The Participant is legally separated or the spouse has abandoned
the Participant and the Participant has a court order to that effect; or
(iv) Other circumstances exist under which the Secretary of the
Treasury will excuse the consent requirement.
If the Participant's Spouse is legally incompetent to give consent, the
Spouse's legal guardian may give consent (even if the Participant is the legal
guardian).
(b) If a Participant fails to name a Beneficiary or if the
Beneficiary named by a Participant predeceases him or her, then the
Administrative Committee shall direct the Trustee to pay the Participant's
Account to the Participant's estate.
(c) If the Beneficiary does not predecease the Participant, but dies
prior to complete distribution of the Participant's Account, the
Administrative Committee shall direct the Trustee to pay the amounts
remaining in the Participant's Account to the Beneficiary's estate.
(d) If the Administrative Committee, after reasonable inquiry, is
unable within one year to determine whether or not any designated
Beneficiary survived the event that entitled him or her to receive a
distribution of any benefit under the Plan, the Administrative Committee
shall conclusively presume that such Beneficiary died prior to the date he
or she was entitled to a distribution.
8.11 Incompetent or Lost Distributee.
(a) If the Administrative Committee determines that a Participant or
Beneficiary entitled to a distribution hereunder is unable to care for his
or her affairs because of illness or accident or because he or she is a
minor, then, unless a claim is made for the benefit by a duly appointed
legal representative, the Committee may direct that such distribution be
paid to such distributee's spouse, child, parent or other blood relative,
or to a person with whom such distributee resides. Any such payment, when
made, shall be a complete discharge of the liabilities of the Plan
therefore.
(b) In the event that the Administrative Committee, after reasonable
and diligent effort, cannot locate any person to whom a payment or
distribution is due under the Plan, and no other distributee has become
entitled to such distribution pursuant to any provision of the Plan, the
Participant's Account in respect of which such payment or distribution is
to be made shall be forfeited six months after the date in which such
payment or distribution first becomes due or such later date as the
Administrative Committee prescribes (but in all events prior to the time
<PAGE>
such Account would otherwise escheat under any applicable State law);
provided, however, that any Account so forfeited shall be reinstated, in
accordance with paragraph (e) of this Section, if such person subsequently
makes a valid claim for such benefit.
(c) The Administrative Committee shall be deemed to have made a
reasonable and diligent effort to locate a person if it has sent
notification describing the relative values of the optional forms of
benefit available under the Plan (including any right to defer such
distribution) and the risk of forfeiture of such benefit by certified or
registered mail to the last known address of such person.
(d) Any amount forfeited under this Section 8.11 shall be used to
reduce Employer Matching Contributions for the Plan Year in which such
forfeiture occurs.
(e) If a Participant or Beneficiary whose Account is forfeited
pursuant to paragraph (b) of this Section makes a valid claim for
benefits, the Administrative Committee shall restore the Participant's
Account to the same dollar amount as the dollar amount forfeited,
unadjusted for any gains or losses occurring subsequent to the date of the
forfeiture. Such amounts shall be restored from the amount of forfeitures
that the Employer would have otherwise allocated to Participants. To the
extent the amount of available forfeitures is insufficient to enable the
Administrative Committee to make the required restoration, the Employer
must contribute, without regard to any requirement or condition of
Articles XIII through XVI the additional amount necessary to enable the
Administrative Committee to make the required restoration.
(f) Accounts restored under this Section 8.11 shall be distributed
no later than 60 days after the close of the Plan Year in which the
Account is restored.
ARTICLE IX - INVESTMENT OF THE TRUST
9.1 Trust Agreement.
(a) The assets of the Plan shall be held in the Trust by one or more
Trustees selected by Seagram and pursuant to the terms of a Trust
Agreement. The Trust Agreement shall provide that:
(b) Subject to Participants' Investment Elections, the assets of the
Trust shall be invested and reinvested in such investments as either the
Trustee or investment managers appointed by Seagram deem advisable from
time to time;
(c) The Investment Committee has concurrent authority, exercisable
at its sole discretion, to direct the Trustee as to the sale or purchase
of particular assets;
(d) The Trustee has the authority to vote the Common Shares, either
in person or by proxy, in accordance with the Investment Committee's
instructions;
(e) The Trustee has the authority to sell all or a portion of the
Common Shares held by the Trust in accordance with the Investment
Committee's instructions; and
(f) The Trustee has the authority to acquire Common Shares through
purchases on the open market, and, if Seagram so provides in writing, to
acquire Common Shares in such other manner as Seagram shall authorize.
9.2 Appointment of Investment Managers.
Seagram shall have authority to appoint investment managers to manage all
or a portion of the Trust. In the event an investment manager is appointed, the
Trustee shall not have discretionary authority over the Trust assets managed by
<PAGE>
the investment manager. Any investment manager appointed by Seagram or the
Investment Committee shall be:
(i) An investment adviser under the Investment Advisers Act of 1940;
(ii) A bank as defined in the Investment Advisors Act of 1940; or
(iii) An insurance company qualified to perform investment management
services under the laws of more than one State, and must acknowledge in
writing that it is a fiduciary with respect to the Plan.
9.3 Investment Manager Powers.
Subject to the Investment Elections made by Participants and to the
investment management agreement, an investment manager shall have the power to
invest and reinvest the Trust assets (including the authority to acquire and
dispose of Plan assets) for which it has been given discretionary authority, as
it deems advisable.
9.4 Power to Direct Investments.
Seagram retains no authority or responsibility over the management,
acquisition or disposition of Plan assets except with respect to Seagram's
power to select, retain and replace Trustees, investment managers and members
of the Investment Committee and in the determination of the Plan's investment
policies and objectives.
9.5 Exclusive Benefit Rule.
Except as otherwise provided in the Plan, no part of the corpus or income
of the funds of the Plan shall be used for, or diverted to, purposes other than
for the exclusive benefit of Participants and other persons entitled to
benefits under the Plan. No person shall have any interest in or right to any
part of the assets held under the Plan, or any right in, or to, any part of the
assets held under the Plan, except to the extent expressly provided by the
Plan.
ARTICLE X - PLAN ADMINISTRATION
10.1 Appointment of Administrative Committee.
The Plan shall be administered by Seagram through an Administrative
Committee which shall be appointed by Seagram and may be removed by Seagram,
for any reason, at its discretion. The Administrative Committee shall consist
of not less than three members, except that the Administrative Committee may
temporarily function with less than three members due to the resignation or
removal of one or more of its Administrative Committee members provided all
actions not previously allocated to any of the Administrative Committee members
who have not resigned or been removed are taken unanimously. Unless Seagram
otherwise provides, any member of the Administrative Committee who is an
Employee of Seagram, the Company or an Affiliate at the time of his or her
appointment shall be deemed to have resigned from the Administrative Committee
when no longer an Employee. Employees of Seagram, the Company or an Affiliate
shall receive no compensation for their services rendered to or as members of
the Administrative Committee but the Employer shall pay all direct expenses of
the Administrative Committee, except to the extent paid by the Trust (as
permitted by ERISA).
10.2 Action by Administrative Committee.
(a) The Administrative Committee shall act by a majority of its
members, except that the Administrative Committee may allocate its
responsibilities among one or more of its members and may delegate its
<PAGE>
responsibilities to any person or persons selected by it. Administrative
Committee action may be taken either by vote at a meeting (including a
meeting by telephone conference) or in writing without a meeting and shall
be evidenced by a written resolution or memorandum signed by at least two
members or by one member and the Secretary of the Administrative
Committee.
(b) The Administrative Committee may authorize in writing any person
to execute any document or documents on its behalf, and any interested
person, upon receipt of notice of such authorization directed to it, may
thereafter accept and rely upon any document executed by such authorized
person until the Administrative Committee shall deliver to such interested
person a written revocation of such authorization.
(c) A member of the Administrative Committee who is also a
Participant shall not vote or act upon any matter relating to himself or
herself (except for matters that relate to Participants generally).
10.3 Powers and Duties of the Administrative Committee.
The Administrative Committee shall have full discretion to construe the
terms of the Plan and interpret its provisions and shall also have the right,
power, duty and responsibility to perform all administrative functions and make
all administrative decisions with respect to the Plan including, the right,
power, duty and responsibility to:
(i) Determine all questions of fact or interpretations that may
arise under the Plan with any such determination to be conclusively
binding upon all interested parties;
(ii) Direct the Trustee to pay benefits under the Plan and to
withhold appropriate amounts in accordance with applicable law;
(iii) Promulgate rules as it shall deem necessary and proper for the
administration of the Plan;
(iv) Determine the rights of eligibility of an Employee to
participate in the Plan;
(v) Direct the Trustee regarding the establishment and maintenance
of Participant Accounts;
(vi) Establish a claims procedure;
(vii) Review and render decisions regarding claims for benefits under
the Plan;
(viii) Cause the Plan to comply with the reporting and disclosure
requirements of ERISA;
(ix) Recommend Plan amendments it deems appropriate; and
(x) Engage the service of agents, independent counsel, consultants
and advisers which it deems advisable to assist it with the performance of
its duties, and, to the extent not paid by the Employer, to compensate
them out of Plan assets.
In addition to the foregoing, the Administrative Committee shall have all
the rights, powers, duties and responsibilities granted or imposed upon it
elsewhere in the Plan.
10.4 Appointment of Investment Committee.
Seagram may appoint, and shall have the power to remove, for any reason,
an Investment Committee to administer the investment functions of the Plan. The
Investment Committee shall consist of not less than 3 nor more than 5 members,
except that the Investment Committee may temporarily function with less than
three members due to the resignation or removal of one or more of its members,
provided all actions not previously allocated to any of the Investment
Committee members who have not resigned or been removed are taken unanimously.
Unless Seagram otherwise provides, any member of the Investment Committee who
is an Employee of Seagram, the Company or an Affiliate at the time of his or
<PAGE>
her appointment shall be considered to have resigned from the Investment
Committee when no longer an Employee. Employees of Seagram, the Company or an
Affiliate shall receive no compensation for their services rendered to or as
members of the Investment Committee but the Employer shall pay all direct
expenses of the Investment Committee, except to the extent paid by the Trust
(as permitted by ERISA). If Seagram does not appoint an Investment Committee or
if an Investment Committee has been removed by Seagram and no other Investment
Committee appointed, the Administrative Committee shall assume the powers,
duties, and responsibilities of the Investment Committee hereunder.
10.5 Action by the Investment Committee.
(a) The Investment Committee shall act by a majority of its members,
except that the Investment Committee may allocate its responsibilities
among one or more of its members and may delegate its responsibilities to
any person or persons selected by it. Investment Committee action may be
taken either by vote at a meeting (including a meeting by telephone
conference) or in writing without a meeting and shall be evidenced by a
written resolution or memorandum signed by at least two members or by one
member and the Secretary of the Investment Committee.
(b) The Investment Committee may authorize in writing any person to
execute any document or documents on its behalf, and any interested
person, upon receipt of notice of such authorization directed to it, may
thereafter accept and rely upon any document executed by such authorized
person until the Investment Committee shall deliver to such interested
person a written revocation of such authorization.
(c) Member of the Investment Committee who is also a Participant
shall not vote or act upon any matter relating to himself or herself
(except for matters that relate to Participants generally).
10.6 Investment Committee Powers and Duties.
The Investment Committee shall have the exclusive responsibility for
implementing the Plan's investment and funding policies and objectives by
communicating them to the Plan's Trustee and investment managers. In addition,
subject to the investment polices and objectives established by Seagram, the
Investment Committee shall have the right, power, duty, and responsibility to:
(i) Recommend changes to the Plan's investment and funding policies
and objectives to Seagram, from time to time, as it deems appropriate;
(ii) Monitor and evaluate the performance of the Trustee and
investment managers and report regularly, at least annually, to Seagram
with respect to the Investment Committee's findings and recommendations;
(iii) Subject to Participants' Investment Elections, direct an
investment manager or a Trustee with respect to the sale or purchase of
particular assets, provided, that the Investment Committee shall only have
the power to direct an investment manager to the extent permitted by
Seagram's agreement with such investment managers;
(iv) Direct the Trustee regarding the voting and tendering of Common
Shares, except that if Seagram determines that a conflict of interest
exists (including a tender offer (as such term is used in Section 14(d) of
the Securities Exchange Act of 1934) by a person or entity which is not an
Employer) between the Investment Committee's fiduciary duties to the Plan
and the Committee member's individual responsibilities to the Employer,
the Participants, rather than the Investment Committee, shall direct the
Trustee, on a form prescribed by the Investment Committee, as to the
voting and tendering of the Common Shares which are credited to their
Account and the Trustee shall vote or tender the Common Shares for which
no instructions have been received in the same manner on a proportionate
<PAGE>
basis, as the Common Shares for which instructions have been received; and
(v) Engage the service of agents, independent counsel, consultants
and advisers which it deems advisable to assist it with the performance of
its duties, and, to the extent not paid by the Employer, to compensate
them out of Plan assets.
In addition to the foregoing, the Investment Committee shall have all the
rights, powers, duties and responsibilities granted or imposed upon it
elsewhere in the Plan.
10.7 Powers and Duties of Seagram.
Seagram shall have the exclusive responsibility for:
(i) The selection and retention of the Plan's Trustee;
(ii) The selection and retention of the Plan's investment managers;
(iii) The determination of the Plan's investment and funding policies
and objectives;
(iv) The selection and retention of members of the Administrative
Committee and Investment Committee; and
(v) The determination that a conflict of interest exists, requiring
that voting of Common Shares held in the Plan be passed through to
Participants whose Accounts are invested, in whole or in part, in Common
Shares;
(vi) The determination that a tender offer (as such term is defined
in Section 14(d) of the Securities Exchange Act of 1934) exists, requiring
the pass through to Participants whose Accounts are invested, in whole or
in part, in Common Shares of certain investment decisions; and
(vii) The authorization of the Trustee to acquire Common Shares in a
manner other than through the purchase of shares on the open market.
In addition to the foregoing, Seagram shall have all the rights, powers,
duties and responsibilities granted or imposed upon it elsewhere in the Plan.
10.8 Action by Seagram.
Seagram shall act by the Board. Action taken by Seagram shall be evidenced
by a Board resolution certified in writing by the secretary or assistant
secretary of Seagram.
10.9 Designation of Fiduciary Authority.
The Administrative Committee, Investment Committee and Seagram may
designate persons, including persons other than "named fiduciaries" as defined
in ERISA Section 402(a)(2), to carry out its rights, powers, duties and
responsibilities. Any person, corporation or other entity may serve in more
than one fiduciary capacity under the Plan.
10.10 Reliance on Advisors.
The Administrative Committee, Investment Committee and Seagram shall be
entitled to rely upon the advice, opinions, reports, statements and
certificates of counsel, consultants, accountants and other experts retained by
them.
10.11 Indemnification of Fiduciaries.
(a) The Employer shall indemnify and save harmless each member of the
Administrative Committee and the Investment Committee, and each officer,
employee and agent of Seagram or the Company from and against any and all
loss resulting from liability to which he or she may be subject by reason
of any act or conduct (except actions taken in bad faith) or negligence
<PAGE>
(except for gross negligence) taken in his or her official capacity in the
administration of the Plan or Trust. This indemnification shall include
all expenses reasonably incurred in defending a fiduciary. This
indemnification is not intended to relieve any member of the
Administrative Committee or the Investment Committee from any liability he
or she may have under ERISA for breach of a fiduciary duty or otherwise
under part 4 of Title I of ERISA.
(b) This section shall not extend to the Trustee unless it is
specifically extended to the Trustee by separate written agreement
executed by the Trustee and Seagram.
ARTICLE XI - AMENDMENT AND TERMINATION
11.1 Right to Amend.
Subject to Section 11.2, Seagram reserves the right to amend the Plan for
any reason, at any time, by action in writing, effective retroactively or
otherwise.
11.2 Limitations on Plan Amendment.
No Plan amendment shall:
(i) Make it possible for any part of the Trust to be used for, or
diverted to, purposes other than the payment of Plan benefits and expenses
for the exclusive benefit of Participants and other persons entitled to
benefits under the Plan;
(ii) Decrease the Account of any Participant, except as required to
comply with the requirements of Article XIII, XIV, or XV;
(iii) Decrease the vested percentage of any Participant in his or her
Account, as in effect on the date the amendment is adopted, or, if later,
the effective date of the amendment;
11.3 Right to Terminate the Plan or Discontinue Contributions.
Seagram reserves the right to terminate the Plan or completely discontinue
contributions under the Plan for any reason, at any time. Action taken by
Seagram to terminate the Plan or discontinue contributions shall be in writing
and shall be effective as of the date set forth in such writing.
11.4 Effect of Termination or Discontinuance of Contributions.
As of the date of a complete termination of the Plan or the complete
discontinuance of contributions to the Plan, each Participant who is then an
Employee shall become 100% vested in his or her Account. Upon termination, all
Accounts shall be distributed to or for the benefit of the Participant or
continued in trust for his or her benefit, as the Administrative Committee
shall direct. After distribution of all Accounts under the Plan, any amounts
remaining in the suspense account established under Section 15.2(c) shall
revert to the Employer, as permitted by the Code.
11.5 Effect of a Partial Termination.
As of the date of a partial termination, each affected Participant who is
then an Employee shall become 100% vested in his or her Account and the
Accounts of Participants affected by the partial termination shall be
distributed to or for the benefit of such Participants or continued in trust
for their benefit, as the Administrative Committee shall direct.
11.6 Additional Participating Employers.
If a company becomes an Affiliate, the company may become a Participating
Employer provided such company, with the approval of the Administrative
<PAGE>
Committee, files a certified copy of a resolution of its board of directors
adopting the Plan. If an Affiliate becomes a Participating Employer pursuant to
the previous sentence or if as a result of a merger, consolidation or the
acquisition of all or a portion of the assets or business of another company,
individuals become Eligible Employees, Seagram shall determine the extent, if
any, that the Plan will recognize the service of such individuals with such
employer prior to the time they became Eligible Employees. Such determination
shall be made in a manner which is consistent with the rules regarding the
continued qualification of the Plan and Trust as tax-exempt under the Code.
11.7 Withdrawal of a Participating Employer.
A Participating Employer may withdraw from the Plan upon six month's prior
written notice to the Administrative Committee (unless the Administrative
Committee approves a shorter notice period). If a Participating Employer
discontinues or suspends contributions to the Plan upon behalf of its employees
or if a Participating Employer shall become insolvent or bankrupt, or be
dissolved, such Participating Employer shall be deemed to have withdrawn from
the Plan. If a Participating Employer ceases to be an Affiliate, such
Participating Employer shall continue to be a Participating Employer unless and
until the Company demands, in writing, that such Participating Employer
withdraw from the Plan. If the Company demands that a Participating Employer
withdraw from the Plan, such withdrawal shall be automatically effective six
months after such demand.
11.8 Plan Merger.
The Employer may not merge or consolidate the Plan with, or transfer any
assets or liabilities to, any other plan, unless each Participant would (if the
Plan then terminated) receive a benefit immediately after the merger,
consolidation or transfer, which is equal to or greater than the benefit he or
she would have been entitled to receive immediately before the merger,
consolidation or transfer if the Plan had then terminated.
ARTICLE XII - MISCELLANEOUS PROVISIONS
12.1 Action by the Employer or Seagram.
Except as otherwise provided herein, any action required to be taken by an
Employer or Seagram pursuant to the terms of the Plan shall be taken by its
board of directors or a committee thereof or any person or persons duly
empowered to exercise the powers of the Employer or Seagram, as the case may
be, with respect to the Plan.
12.2 No Right to Be Retained in Employment.
Nothing contained in this Plan shall give any Participant or Employee the
right to be retained in the employment of the Employer or affect the right of
any Employer to dismiss any Participant or Employee.
12.3 Non-Alienation of Benefits.
To the extent permitted by law, the right of any Participant or
Beneficiary to any benefit or to any payment hereunder shall not be subject to
assignment, alienation, attachment, or other legal, equitable, or other
process, and any attempt to assign, alienate, attach, or otherwise encumber
such benefit or payment shall be void, except that payment shall be made in
accordance with a "qualified domestic relations order" that meets the
requirements of Code 414(p) and ERISA Section 206(d), under the procedures
developed in accordance with Section 8.9.
<PAGE>
12.4 Requirement to Provide Information to Administrative Committee.
Prior to the time any amount shall be distributed under the Plan, a
Participant or other person entitled to benefits must file with the
Administrative Committee such information as the Administrative Committee shall
require to establish his or her rights and benefits under the Plan.
12.5 Source of Benefit Payments.
Benefits provided under the Plan shall be paid or provided for solely from
the Trust, and neither the Company, an Employer, Seagram, the Administrative
Committee, the Investment Committee, the Trustee, or any investment manager
shall assume any liability therefor.
12.6 Construction.
Articles and Sections of the Plan are for convenience of reference only
and shall be disregarded in applying the provisions of the Plan. Unless the
context of the Plan specifically provides otherwise, the singular and plural
shall be interchangeable.
12.7 Governing Law.
The Plan is intended to qualify under Code 401(a) and 401(k) and to comply
with ERISA and shall be construed and interpreted in a manner consistent with
the requirements of these laws. The Plan and the rights of all persons under
the Plan shall be further construed and administered in accordance with the
laws of the State of New York to the extent not superseded by Federal law.
ARTICLE XIII - LIMITATION ON PRE-TAX CONTRIBUTIONS
13.1 Code 402(g) Limitation on Pre-tax Contributions.
An Employee's Pre-tax Contributions plus elective deferrals made under any
other Plan of the Employer for a calendar year may not exceed $9,500 (as
adjusted for cost of living in accordance with Code 415(d)).
13.2 Treatment of Excess Deferrals.
(a) If, during the Plan Year, the Administrative Committee
determines that continued contribution of Pre-tax Contributions for the
Plan Year on behalf of an Employee would exceed the Code 402(g)
limitation, the Employer shall not make any additional Pre-tax
Contributions with respect to such Employee for the remainder of that Plan
Year.
(b) If, during the Plan Year, the Administrative Committee
determines that Pre-tax Contributions made on behalf of an Employee exceed
the Code Section 402(g) limitation, the Administrative Committee shall
distribute the amount of such Excess Deferral, adjusted for allocable
income and losses, no later than the April 15th following the Plan Year in
which such Excess Deferrals were made.
(c) The Administrative Committee shall reduce the amount of Excess
Deferrals for a Plan Year distributable to the Employee by the amount of
Excess Contributions if any, previously distributed to the Employee with
respect to the Plan Year for which such Excess Deferrals and Excess
Contributions were made.
(d) Income or loss attributable to Excess Deferrals, shall be
determined in a uniform and nondiscriminatory manner which reasonably
reflects the manner used by the Plan to allocate income to Participants'
Accounts.
<PAGE>
13.3 Coordination With Other Arrangements In Which Salary Is Deferred.
If an Employee participates in another plan under which he or she makes
elective deferrals pursuant to a Code Section 401(k) arrangement, elective
deferrals under a simplified employee pension, or salary reduction
contributions to a tax-sheltered annuity, he or she may submit a written claim
to the Administrative Committee for Excess Deferrals made to this Plan with
respect to the calendar year. Any such claim must be submitted by the Employee
no later than the March 1st following the close of particular calendar year in
which such elective deferrals were made and must specify the amount of the
Employee's Pre-tax Contributions under this Plan which are Excess Deferrals. If
the Administrative Committee receives a timely claim, it shall distribute the
Excess Deferrals the Employee has assigned to this Plan (as adjusted for
allocable income or loss), in accordance with Section 13.2.
ARTICLE XIV - NONDISCRIMINATION RULES
14.1 Definitions Applicable to the Nondiscrimination Rules.
For purposes of this Article XIV, the following terms when capitalized and
used in this Article XIV shall have the meaning ascribed to them in this
Section 14.1.
(a) "Actual Contribution Percentage" means the ratio (expressed as a
percentage), of the sum of the After-tax Contributions made by a
Participant and the Matching Contributions made on behalf of an Eligible
Employee for the Plan Year to the Eligible Employee's Compensation for the
Plan Year.
(b) "Actual Deferral Percentage" means the ratio (expressed as a
percentage) of Pre-tax Contributions made on behalf of an Eligible
Employee for the Plan Year to the Eligible Employee's Compensation for the
Plan Year.
A Non-highly Compensated Employee's Actual Deferral Percentage does
not include elective deferrals made to this Plan or to any other Plan
maintained by the Employer, to the extent such Pre-tax Contributions exceed the
limitation on Pre-tax Contributions set forth in Article XIII.
(c) "Average Actual Deferral Percentage" means, for any group of
Eligible Employees who are Participants or eligible to be Participants,
the average (expressed as a percentage) of the Actual Deferral Percentages
for each of the Eligible Employees in that group, including those for whom
no Pre-tax Contributions were made.
(d) "Average Actual Contribution Percentage" means, for any group of
Eligible Employees who are Participants or eligible to be Participants,
the average (expressed as a percentage) of the Actual Contribution
Percentages for each of the Eligible Employees in that group, including
those who made no After-tax Contributions and for whom no Matching
Contributions were made.
14.2 Actual Deferral Percentage Test.
(a) With respect to each Plan Year commencing on or after January 1,
1997 (the "Testing Year") the Average Actual Deferral Percentage for
Eligible Employees who are Participants or eligible to be Participants
must satisfy one of the following tests:
(i) The Average Actual Deferral Percentage for the Testing Year for
Highly Compensated Employees who are Participants or eligible to be
Participants for the Testing Year shall not exceed the Average Actual
Deferral Percentage for the preceding Plan Year for Non-highly Compensated
<PAGE>
Employees who are Participants or eligible to be Participants for the
Testing Year multiplied by 1.25; or
(ii) The Average Actual Deferral Percentage for the Testing Year for
Highly Compensated Employees who are Participants or eligible to be
Participants for the Testing Year shall not exceed the Average Actual
Deferral Percentage for the preceding Plan Year for Non-highly Compensated
Employees who are Participants or eligible to be Participants for the
Testing Year multiplied by 2; provided that the Average Actual Deferral
Percentage for such Highly Compensated Employees does not exceed the
Average Actual Deferral Percentage for such Non-highly Compensated
Employees by more than two percentage points.
Notwithstanding the above, the Employer may elect to use the Average
Actual Deferral Percentage for Non-highly Compensated Employees for the Testing
Year rather than the preceding Plan Year provided such election once made may
not be changed except as provided by the Secretary of the Treasury.
14.3 More Than One Employer-Sponsored Plan Subject to the Actual Deferral
Percentage Test.
For purposes of this Article XIV, the Actual Deferral Percentage for any
Highly Compensated Employee who is a participant under two or more arrangements
described in Code 401(k) sponsored by the Company or any Affiliate shall be
determined as if all such arrangements (other than arrangements that may not be
aggregated under applicable regulations) were one Code 401(k) arrangement. If
the Code 401(k) arrangements in which the Highly Compensated Employee
participates have different plan years, the aggregate Actual Deferral
Percentage shall be determined by counting the deferrals made to such
arrangements in the plan years ending in the same calendar year.
14.4 Recharacterization of Pre-tax Contributions.
If Excess Contributions have been made on behalf of a Highly Compensated
Employee for the Plan Year, the Administrative Committee may recharacterize the
Excess Contributions as After-tax Contributions (or voluntary contributions
under another qualified plan if such plan has the same plan year), provided
such recharacterization occurs within 2-1/2 months of the Plan Year being
tested. The Administrative Committee may not include Pre-tax Contributions (or
other elective deferrals) in the Actual Contribution Percentage test, unless
the Plan which includes the Pre-tax Contributions (or other elective deferrals)
satisfies the Actual Deferral Percentage test both with and without the
recharacterized Excess Deferrals included in the Actual Contribution Percentage
test.
14.5 Treatment of Excess Contributions.
(a) Excess Contributions (adjusted for allocable income or loss)
which are not recharacterized in accordance with Section 14.4 shall be
distributed to the appropriate Highly Compensated Employee no later than
12 months after the close of the Plan Year in which such Excess
Contribution arose. To the extent administratively possible, Excess
Contributions shall be distributed within 2-1/2 months after the close of
the Plan Year in which such Excess Contributions arose, so as to avoid the
imposition of an excise tax.
(b) The income (or loss) allocable to Excess Contributions shall be
determined by using a uniform and nondiscriminatory method which
reasonably reflects the manner used by the Plan to allocate earnings or
losses to Participants' Accounts.
<PAGE>
14.6 QNECs and QMACs.
The Administrative Committee may determine the Actual Deferral Percentages
of Eligible Employees by taking into account QNECs or QMACs and may determine
the Actual Contribution Percentages of Eligible Employees by taking into
account QNECs (other than QNECs used in the Actual Deferral Percentage test)
made to this Plan or to any other qualified Plan maintained by the Employer
provided that each of the following requirements are met:
(a) The amount of Nonelective Contributions, including those QNECs
treated as Pre-tax Contributions for purposes of the Actual Deferral
Percentage Test, satisfies Code 401(a)(4).
(b) The amount of Nonelective Contributions, including those QNECs
treated as Pre-tax Contributions for purposes of the Actual Deferral
Percentage Test and those QNECs treated as Matching Contributions for
purposes of the Actual Contribution Test, satisfies Code 401(a)(4).
(c) The Matching Contributions, including those QMACs treated as
Pre-tax Contributions for purposes of the Actual Deferral Percentage Test,
satisfy the requirements of Code 401(a)(4).
(d) The QNECs and QMACs are (i) allocated to the QNECs Account and
QMACs Account, respectively, of Eligible Employees who are Participants as
of a date within the Plan Year; (ii) not contingent upon the Eligible
Employee's continued participation in the Plan subsequent to the date of
the allocation; and (iii) made to the Trust no later than the 12 month
period immediately following the Plan Year to which such contribution
relates.
(e) The Administrative Committee may not include in the Actual
Deferral Percentage test any QNECs or QMACs under another qualified plan
unless that plan has the same plan year as this Plan.
(f) If, pursuant to this Section, the Administrative Committee has
elected to include QMACs and/or QNECs in calculating the Average Actual
Deferral Percentage, the Administrative Committee shall first treat Excess
Contributions as attributable proportionately to Pre-tax Contributions and
to QMACs allocated on the basis of those Pre-tax Contributions, if any. If
the total amount of a Highly Compensated Employee's Excess Contributions
for the Plan Year exceeds the Employee's Pre-tax Contributions and QMACs
attributable to such contributions, if any, for the Plan Year, the
Administrative Committee shall next treat the remaining portion of his
Excess Contributions as attributable to QNECs, if any.
(g) The Administrative Committee shall reduce the amount of Excess
Contributions for a Plan Year distributable to a Highly Compensated
Employee by the amount of Excess Deferrals if any, previously distributed
to that Employee for the Employee's taxable year ending in that Plan Year.
14.7 Actual Contribution Percentage Test.
With respect to each Plan Year commencing on or after January 1, 1997 (the
"Testing Year") the Average Actual Contribution Percentage for Eligible
Employees who are Participants or eligible to be Participants must satisfy one
of the following tests:
(a) The Average Actual Contribution Percentage for the Testing Year
for Highly Compensated Employees who are Participants or eligible to be
Participants for the Testing Year shall not exceed the Average Actual
Contribution Percentage for the preceding Plan Year for Non-highly
Compensated Employees who are Participants or eligible to be Participants
for the Testing Year multiplied by 1.25; or
(b) The Average Actual Contribution Percentage for the Testing Year
for Highly Compensated Employees who are Participants or eligible to be
Participants for the Testing Year shall not exceed the Average Actual
Contribution Percentage for the preceding Plan Year for Non-highly
<PAGE>
Compensated Employees who are Participants or eligible to be Participants
for the Testing Year multiplied by 2; provided that the Average Actual
Contribution Percentage for such Highly Compensated Employees does not
exceed the Average Actual Deferral Percentage for such Non-highly
Compensated Employees by more than two percentage points.
Notwithstanding the foregoing, the Employer may elect to use the Average
Actual Contribution Percentage for Non-highly Compensated Employees for the
Testing Year rather than the preceding Plan Year provided that such election
once made may not be changed except as provided by the Secretary of the
Treasury.
14.8 More Than One Plan Subject to the Actual Contribution Test.
For purposes of this Article XIV, the Actual Contribution Percentage for
any Highly Compensated Employee who is a participant under two or more
arrangements sponsored by the Company or any Affiliate to which matching
contributions (other than qualified matching contributions) or Employee
contributions are made shall be determined as if all such arrangements (other
than arrangements that may not be aggregated under applicable regulations) were
one such arrangement. If the arrangements in which such Highly Compensated
Employee participates have different plan years, the aggregate Actual
Contribution Percentage shall be determined by counting the matching
contributions and Employee contributions made to such arrangements in the plan
years ending in the same calendar year.
14.9 Required Plan Aggregation for Purposes of the Actual Deferral
Percentage and Actual Contribution Tests.
If the Employer treats two or more plans as a unit for coverage or
nondiscrimination purposes, the Employer must combine the Code Section 401(k)
arrangements for purposes of determining whether each such arrangement
satisfies the Actual Deferral Percentage test and must combine the arrangements
under which matching contributions or Employee contributions are made;
provided, however, that aggregation shall not be required with respect to
arrangements within plans with different plan years; and provided, further,
that an employee stock ownership plan (or the employee stock ownership plan
portion of a plan) shall not be aggregated with a non-employee stock ownership
plan (or non-employee stock ownership plan portion of a plan).
14.10 Required Plan Disaggregation for Purposes of the Actual Deferral
Percentage and Actual Contribution Tests.
If the Employer operates qualified separate lines of business under Code
414(r), then to the extent required by law the Employer will disaggregate the
Code Section 401(k) arrangements for each Separate Line of Business for
purposes of determining whether each such arrangement satisfies the Actual
Deferral Percentage Test and will disaggregate the arrangements under which
matching contributions or employee contributions are made with respect to each
such Separate Line of Business.
14.11 Treatment of Excess Aggregate Contributions.
(a) Excess Aggregate Contributions plus any income and minus any
loss allocable thereto, which are not recharacterized in accordance with
Section 14.4 shall be distributed to the appropriate Highly Compensated
Employee no later than 12 months after the close of the Plan Year in which
such Excess Aggregate Contribution arose. To the extent administratively
possible, Excess Aggregate Contributions shall be distributed within 2-1/2
<PAGE>
months after the close of the Plan Year in which such Excess Contributions
arose, so as to avoid an excise tax.
(b) The income (or loss) allocable to Excess Aggregate Contributions
shall be determined by using a uniform and nondiscriminatory method which
reasonably reflects the manner used by the Plan to allocate income to
Participants' Accounts.
(c) The Administrative Committee shall treat a Highly Compensated
Employee's allocable share of Excess Aggregate Contributions in the
following priority: (1) First, as After-tax Contributions; (2) Then, as
Matching Contributions allocable to Excess Contributions determined under
the Actual Deferral Percentage test; (3) Then, on a pro rata basis, as
Matching Contributions and as the Pre-tax Contributions relating to those
Matching Contributions which the Administrative Committee has included in
the Actual Contribution Percentage test, if any; and (4) Last, as QNECs
used in the Actual Contribution Percentage test.
(d) To the extent the Highly Compensated Employee's Excess Aggregate
Contributions are attributable to Matching Contributions, with respect to
which the Highly Compensated Employee is not 100% vested, the
Administrative Committee shall distribute only the vested portion and
forfeit the nonvested portion. The vested portion of the Highly
Compensated Employee's Excess Aggregate Contributions attributable to
Matching Contributions is the total amount of such Excess Aggregate
Contributions (as adjusted for allocable income or loss) multiplied by his
or vested percentage (determined as of the last day of the Plan Year for
which the Matching Contributions were made). The Plan shall allocate
forfeited Excess Aggregate Contributions to reduce Employer Matching
Contributions for the Plan Year in which such forfeiture occurs.
14.12 Multiple Use Limitation.
If both the Average Actual Deferral Percentage of Highly Compensated
Employees exceeds 125% of the Average Actual Deferral Percentage of Non-highly
Compensated Employees pursuant to Section 14.2 and the Average Actual
Contribution Percentage of Highly Compensated Employees exceeds 125% of the
Average Actual Contribution Percentage of Non-highly Compensated Employees
pursuant to Section 14.7, then the sum of the Average Actual Deferral
Percentage and the Average Actual Contribution Percentage shall not exceed the
greater of:
(a) The sum of (i) 125% of the greater of the Average Actual
Deferral Percentage or the Average Actual Contribution Percentage for all
Non-highly Compensated Employees who are Participants or eligible to be
Participants, and (ii) the lesser of 200% of, or two percentage points
plus, the lesser of the Average Actual Deferral Percentage or the Average
Actual Contribution Percentage of the Non-highly Compensated Employees who
are Participants or eligible to be Participants; or
(b) The sum of (i) 125% of the lesser of the Average Actual Deferral
Percentage or the Average Contribution Percentage for all Non-highly
Compensated Employees who are Participants or eligible to be Participants,
and (ii) the lesser of 200% of, or two percentage points plus, the greater
of the Average Actual Deferral Percentage or the Average Actual
Contribution Percentage for such Non-highly Compensated Employees.
For purposes of this Section 14.12, the Average Actual Deferral Percentage
and Average Actual Contribution Percentage for a Plan Year shall be the
percentages determined under Section 14.2 or 14.7, as applicable, for such
year.
<PAGE>
If, after applying the multiple use limitation of this Section, the
Administrative Committee determines the Plan has failed to satisfy the multiple
use limitation, the Administrative Committee shall correct the failure by
either recharacterizing Excess Deferrals under Section 14.4 or distributing the
excess amount as Excess Aggregate Contributions under Section 14.5.
ARTICLE XV- CODE 415 LIMITATION
15.1 Definitions Applicable to the Code 415 Limitation.
For purposes of this Article XV, the following terms when capitalized and
used in this Article XV shall have the meaning ascribed to them in this Section
15.1.
(a) "Annual Additions" means the sum credited to a Participant for
any Limitation Year of (i) Employer contributions, (ii) Employee
contributions, (iii) forfeitures, (iv) for purposes of Section 15.2(a)(2)
only, amounts allocated to an individual medical account (as defined in
Code 415(l)(2)), which is part of a pension or annuity plan maintained by
the Company or a 415 Affiliate and (v) for purposes of Section 15.2(a)(2)
only, amounts derived from contributions that are attributable to
post-retirement medical benefits allocated to the separate account of a
key employee (as defined in Code 419A(d)(3)) under a welfare benefit fund
(as defined in Code 419(e)) maintained by the Company or a 415 Affiliate.
The term Annual Additions shall not include Rollover Contributions made to
the Plan or amounts restored or repaid to the Plan in accordance with Code
411(a)(7)(B) and (C) and Article V of the Plan. Except to the extent
provided in the Code and Treasury regulations, Annual Additions include
Excess Contributions, Excess Aggregate Contributions, regardless of
whether the Plan distributes or forfeits such excess amounts. Excess
Deferrals are not Annual Additions unless distributed after the April 15th
following the Plan Year in which such Excess Deferrals were made.
(b) "Defined Benefit Plan" means any plan of the type defined in
Code 414(j) maintained by the Company or any 415 Affiliate which is
described in Code 415(k)(1).
(c) "Defined Benefit Plan Fraction" means, for any Participant a
fraction (determined as of the last day of the Limitation Year), the
numerator of which is the Projected Annual Benefit of the Participant
(under all Defined Benefit Plans, whether or not terminated), and the
denominator of which is the lesser of:
(i) 1.25 multiplied by the dollar limitation in effect under Code
415(b)(1)(A) for such Limitation Year; or
(ii) 1.4 multiplied by 100% of Participant's average 415 Compensation
for the three consecutive calendar Years of Service (or all of the
Participant's Years of Service, if the Participant has less than three
Years of Service) during which the Participant had the highest aggregate
415 Compensation.
If the Participant accrued benefits in one or more Defined Benefit
Plans which were in existence on May 5, 1986, the dollar limitation used in the
denominator of this fraction shall not be less than the sum of the annual
benefits under such Defined Benefit Plans which the Participant had accrued as
of the end of the 1986 Limitation Year, determined without regard to any change
in the terms or conditions of the Plan made after May 5, 1986, and without
regard to any cost of living adjustment occurring after May 5, 1986. This rule
applies only if the Defined Benefit Plans individually and in the aggregate
<PAGE>
satisfied the requirements of Code 415 as in effect at the end of the 1986
Limitation Year.
(d) "Defined Contribution Plan" means any plan of the type defined
in Code 414(i) maintained by the Company or any 415 Affiliate which is
described in Code 415(k)(1).
(e) "Defined Contribution Plan Fraction" means, for any Participant,
a fraction, determined as of the last day of the Limitation Year and for
all prior years, the numerator of which is the sum of the Annual Additions
credited to the Participant under all Defined Contribution Plans (whether
or not terminated), and the denominator of which is the sum of the lesser
of the following amounts determined for the current Limitation Year and
for each of the Participant's prior Years of Service
(i) 1.25 multiplied by the dollar limitation in effect under Code
415(c)(1)(A) for such Limitation Year; or
(ii) 1.4 multiplied by 25% of Participant's 415 Compensation.
For purposes of determining the Defined Contribution Plan Fraction, the
Administrative Committee shall not recompute Annual Additions in Limitation
Years beginning prior to January 1, 1987. The Plan continues any transitional
rules applicable to the determination of the defined contribution plan fraction
under the Employer's Plan as of the end of the 1986 Limitation Year.
(f) "415 Affiliate" means an Affiliate, as defined in Section 1.3;
provided, however, that for purposes of determining whether a corporation
is a member of a "controlled group of corporations" (within the meaning of
Code 414(b) of which the Company is also a member) the phrase "more than
50 percent" shall be substituted for the phrase "at least 80 percent"
wherever the latter phrase appears in Code 1563(a)(1).
(g) "415 Compensation" means Compensation, but excluding for
Limitation Years commencing prior to January 1, 1998, elective
contributions that are made by an Employer that are not includible in
gross income under Code 125 and 402(e)(3).
(h) "Limitation Year" means the Plan Year.
(i) "Projected Annual Benefit means the Participant's annual benefit
under a Defined Benefit Plan payable in the form of a single life annuity
computed in the assumptions (i) that the Participant will remain employed
until the Participant's "normal retirement age" under the applicable plan
(or, if later, his or her current age), and (ii) that the Participant's
415 Compensation will remain at its current level until that time.
15.2 Code 415 Limitation on Annual Additions.
(a) Notwithstanding any other provision of the Plan to the contrary,
Annual Additions credited under the Plan and all other Defined
Contribution Plans maintained by the Company or a 415 Affiliate with
respect to each Participant for any Limitation Year shall not exceed the
lesser of:
(i) $30,000, as adjusted from time to time for cost of living in
accordance with Code 415(d), or
(ii) 25% of the Participant's 415 Compensation for such Limitation
Year.
(b) If the Administrative Committee determines during a Plan Year
that a Participant will likely exceed the limit imposed by Section 15.2(a)
(assuming that a Participant's Contribution Election remains in effect for
the remainder of the Limitation Year, and based on the Administrative
<PAGE>
Committee's estimate of a Participant's 415 Compensation and any
Discretionary Contribution to be allocated to the Participant for the
Limitation Year), the Administrative Committee may adjust the
Participant's Annual Additions and take the following actions in the
following order of priority:
(i) Reduce or eliminate the Participant's unmatched After-tax
Contributions;
(ii) Reduce or eliminate the Participant's unmatched Pre-tax
Contributions;
(iii) Reduce or eliminate the Participant's matched After-tax
Contributions and corresponding Matching Contributions;
(iv) Reduce or eliminate the Participant's matched Pre-tax
Contributions and any corresponding Matching Contributions; and
(v) Reduce or eliminate the Discretionary Contributions allocable to
the Participant and allocate such amount to other Participants eligible to
receive a Discretionary Contribution.
If an allocation of Employer contributions would result in an Excess
Annual Addition to the Participant's Account (other than an Excess Annual
Addition which results from the application of the nondiscrimination rules
under Article XIV), the Administrative Committee may reallocate the Excess
Annual Addition to the remaining Participants who are eligible for an
allocation of Employer contributions for the Plan Year in which the Limitation
Year ends. The Administrative Committee shall reallocate the Excess Annual
Additions pursuant to the allocation method under the Plan as if the
Participant whose Account otherwise would receive such Excess Annual Addition
were not eligible for an allocation of Employer contributions. As soon as
administratively feasible after the end of the Plan Year, the Administrative
Committee shall determine the actual limit which should have applied to the
Participant under Section 15.2(a) based on the Participant's actual 415
Compensation for such Limitation Year.
If after the end of a Plan Year, the Administrative Committee determines
that the Annual Additions credited under the Plan with respect to a Participant
for any Limitation Year exceed the limitations of Section 15.2(a) as a result
of (i) the allocation of forfeitures, (ii) a reasonable error in estimating the
Participant's 415 Compensation for the Limitation Year, (iii) a reasonable
error in determining the amount of Pre-tax Contributions that the Participant
may contribute or (iv) any other circumstance permitted pursuant to the
regulations and rulings promulgated under Code Section 415, then the amount of
contributions credited to the Participant's Accounts in that Plan Year shall be
adjusted to the extent necessary to satisfy that limitation in accordance with
the following order of priority:
(i) The Participant's unmatched After-tax Contributions shall be
reduced to the extent necessary. The amount of the reduction shall be
returned to the Participant, together with any earnings on the
contributions to be returned.
(ii) The Participant's unmatched Pre-tax Contributions shall be
reduced to the extent necessary. The amount of the reduction shall be
returned to the Participant, together with any earnings on the
contributions to be returned.
(iii) The Participant's matched After-tax Contributions and
corresponding Matching Contributions shall be reduced to the extent
necessary. The amount of the reduction attributable to the Participant's
matched After-tax Contributions shall be returned to the Participant,
<PAGE>
together with any earnings on those contributions to be returned. The
amount attributable to the Matching Contributions shall be forfeited and
used to reduce Employer contributions for the Participant for the next
Limitation Year (and succeeding Limitation Years, as necessary) if the
Participant is covered by the Plan at the end of the Limitation Year. If
the Participant is not covered by the Plan as of the end of the Limitation
Year, then the excess Annual Additions shall be held unallocated in a
suspense account for the Limitation Year and allocated and reallocated in
the next Limitation Year to all of the remaining Participants entitled to
allocation of Contributions, but only to the extent that such allocation
or reallocation would not cause the Annual Additions to such Participants
to violate the limitations of Code 415 for such Limitation Year. If a
suspense account is in existence at any time during a Limitation Year, all
amounts in the suspense account must be allocated or reallocated before
any Employer contributions or Employee contributions which would
constitute Annual Additions may be made to the Plan for the Limitation
Year (and succeeding Limitation Years, as necessary) in accordance with
the rules set forth in Prop. Reg. 1.415-6(b)(6)(i). If a suspense account
is in effect, it shall not share in investment gains or losses.
(iv) The Participant's matched Pre-tax Contributions and
corresponding Matching Contributions shall be reduced to the extent
necessary. The amount of the reduction attributable to the Participant's
matched Pre-tax Contributions shall be returned to the Participant,
together with any earnings on those contributions to be returned. The
amount attributable to the Matching Contributions shall be forfeited and
applied in the same manner as Matching Contributions under clause (iii)
above.
(v) The Participant's Discretionary Contributions shall be reduced
to the extent necessary. The amount of the reduction shall be forfeited
and applied in the same manner as Matching Contribution under clause (iii)
above.
(c) If a Participant also participates in any other Defined
Contribution Plan which is subject to the limitation set forth in Section
15.2(a) above and, as a result, such limitation would be exceeded with
respect to the Participant in any Limitation Year, any reduction or other
permissible method necessary to ensure compliance with such limitation
first shall be made under this Plan in accordance with the terms hereof.
If after such correction a further reduction is necessary to ensure that
the limitation set forth in Section 15.2(a) is not exceeded, Annual
Additions credited under such other plan or plans with respect to the
Participant shall be reduced in accordance with the provisions of such
plan or plans.
(d) If a Participant is also a participant in a Defined Benefit
Plan, then the Annual Additions credited with respect to the Participant
in any Limitation Year shall be limited as provided in Section 15.3 below.
(e) The determination of whether the Plan satisfies the requirements
of this Section 15.2 with respect to a Participant shall be made in
accordance with Code 415 and the regulations thereunder, the provisions of
which are hereby incorporated by reference and shall override the
provisions of the Plan to the extent inconsistent therewith.
15.3 Combined Code 415 Limitation.
(a) If a Participant is also a participant in a Defined Benefit
Plan, the sum of the Participant's Defined Benefit Plan Fraction and
<PAGE>
Defined Contribution Plan Fraction for any Limitation Year commencing
before January 1, 2000 shall not exceed 1.0.
(b) In the event that a reduction is required to insure that the sum
of the above fractions with respect to a Participant in any Limitation
Year does not exceed 1.0, such reduction shall be made by reducing the
Participant's annual benefit under the Defined Benefit Plan.
(c) The Administrative Committee shall redetermine the Defined
Contribution Plan Fraction and the Defined Benefit Plan fraction as of the
end of the 1986 Limitation Year, in accordance with this Section. If the
sum of the redetermined fractions exceeds 1.0, the Administrative
Committee shall permanently subtract from the numerator of the Defined
Contribution Plan Fraction an amount equal to the product of (1) the
excess of the sum of the fractions over 1.0, times (2) the denominator of
the defined contribution plan fraction. In making the adjustment, the
Administrative Committee shall disregard any accrued benefit under the
Defined Benefit Plan which is in excess of the participant's accrued
benefit under the Defined Benefit Plan as of the end of the 1986
Limitation Year.
(d) The provisions of this Section 15.3 shall cease to be effective
on and after January 1, 2000.
15.4 Incorporation by Reference.
Notwithstanding anything contained in this Article XV to the contrary, the
determination of whether the Plan satisfies the requirements of Article XV
shall be made in accordance with Code 415 and the regulations thereunder, as
may be amended, the provisions of which are hereby incorporated by reference
and shall override the provisions of the Plan to the extent inconsistent
therewith. In addition, the Administrative Committee, in its sole discretion,
may determine the amounts required to be taken into account under Article XV by
such alternative methods as shall be permitted under applicable regulations or
rulings.
ARTICLE XVI - TOP HEAVY PROVISIONS
16.1 Definitions Applicable to the Top Heavy Provisions.
For purposes of this Article XVI, the following terms when capitalized and
used in this Article XVI shall have the meaning ascribed to them in this
Section 16.1.
(a) "Aggregation Group" means in the case of a Plan that is not part
of either a Required Aggregation Group or a Permissive Aggregation Group,
the Employer. In the case of a Plan that is part of a Required Aggregation
Group but not part of a Permissive Aggregation Group, the Required
Aggregation Group. In the case of a Plan that is part of a Required
Aggregation Group and part of Permissive Aggregation Group, either the
Required Aggregation Group or the Permissive Aggregation Group, as
determined by the Administrative Committee.
(b) "Determination Date" means, with respect to a Plan Year, the
last day of the preceding Plan Year or, in the case of the first Plan
Year, the last day of the Plan Year.
(c) "Key Employee" means, as of any Determination Date, any Employee
or former Employee who for the Plan Year in the Determination Period or
any of the four preceding Plan Years:
<PAGE>
(i) Has Compensation in excess of 50% of the defined benefit plan
dollar amount prescribed in Code 415(b)(1)(A), as adjusted for cost of
living in accordance with Code 415(d), and is an officer of the Employer;
(ii) Has Compensation in excess of the defined contribution plan
dollar amount prescribed in Code 415(c)(1)(A), as adjusted for cost of
living in accordance with Code 415(d), and is one of the Employees owning
(or deemed to own within the meaning of Code 318) the ten largest
interests in the Employer;
(iii) Is a Five-percent Owner of the Employer; or
(iv) Is a One-percent Owner of the Employer and has Compensation of
more than $150,000.
The number of officers taken into account under clause (i) shall not
exceed the greater of 3 or 10% of the total number of Employees (after
application of the Code 414(q) exclusions), and in any event shall not exceed
50 officers.
The term Key Employee shall also include the Beneficiary of a Key
Employee. The Administrative Committee shall determine who is a Key Employee in
accordance with Code 416(i)(1).
(d) "Non-Key Employee" means an Employee who is not a Key Employee.
(e) "One-percent Owner" means with respect to a corporation, any
person who owns (or is considered as owning within the meaning of Code
Section 318) more than 1% of the outstanding stock of the corporation, or
stock possessing more than 1% of the total voting power of the
corporation.
(f) "Participant" includes an Eligible Employee of the Plan who does
not participate in the Plan.
(g) "Permissive Aggregation Group" means each plan in the Required
Aggregation Group and any other qualified plan or plans maintained by the
Company or an Affiliate if such group of plans, when considered together,
would meet the requirements of Code 401(a)(4) and 410.
(h) "Required Aggregation Group" means, with respect to a Plan Year
for which a determination is being made, (i) this Plan, (ii) each other
qualified plan of the Company and any Affiliate in which at least one Key
Employee is a participant, and (iii) any other qualified plan of the
Company or any Affiliate which enables any plan described in subparagraphs
(i) and (ii) above to meet the requirements of Code 401(a)(4) or 410.
(i) "Top Heavy Plan" means the Plan, if any of the following
conditions exists:
(1) The Top Heavy Ratio for the Plan exceeds 60% and the Plan
is not part of any Required Aggregation Group or Permissive Aggregation Group;
(2) If the Plan is a part of a Required Aggregation Group but
is not part of a Permissive Aggregation Group, the Top Heavy Ration for the
Required Aggregation Group exceeds 60%;
(3) If the Plan is a part of a Required Aggregation Group and
part of a Permissive Aggregation Group, the Top Heavy Ratio for the Permissive
Aggregation Group exceeds 60%.
(j) "Top Heavy Ratio" means, with respect to the plans taken into
consideration, a fraction, the numerator of which is the present value of
the accrued benefits for all Key Employees under the Defined Benefit Plans
of the Aggregation Group as of the Determination Date for each plan plus
the sum of account balances for all Key Employees under the Defined
Contribution Plans of the Aggregation Group, in each case as of the
<PAGE>
respective Determination Date (including any part of any accrued benefit
or account balance distributed in the five-year period ending on the
Determination Date), and the denominator of which is the sum of the
present value of all accrued benefits for all Non-Key Employees under the
Defined Benefit Plans of the Aggregation Group plus the sum of all account
balances of all Non-Key Employees under Defined Contribution Plans of the
Aggregation Group, in each case as of the respective Determination Date
for each plan (including any part of any accrued benefit or account
balance distributed in the five-year period ending on the Determination
Date), all determined in accordance with Code Section 416.
For purposes of this definition:
The accrued benefit and account balances of Key Employees under plans that
terminated within the 5 year period ending on the Determination Date (including
amounts which were distributed during such period) are taken into account for
purposes of determining the Top Heavy Ratio.
The account balances and accrued benefits of a Participant (1) who is not
a Key Employee but who was a Key Employee in a prior year, or (2) who has not
been credited with at least one Hour of Service at any time during the
five-year period ending on the Determination Date, shall be disregarded.
Generally, the Administrative Committee shall calculate the present value
of accrued benefits under Defined Benefit Plans or simplified employee pension
plans included within the group in accordance with the terms of those plans and
Code Section 416. If a Participant in a defined benefit plan is a Non-Key
Employee, however, the Administrative Committee shall determine such Non-Key
Employee's Accrued Benefit under the accrual method, if any, which is
applicable uniformly to all Defined Benefit Plans or, if there is no uniform
method, in accordance with the slowest accrual rate permitted under the
fractional rule accrual method described in Code 411(b)(1)(C).
To calculate the present value of benefits under a Defined Benefit Plan,
the Administrative Committee shall use the interest and mortality assumptions
prescribed by the Defined Benefit Plans to value benefits for top heavy
purposes.
If an aggregated plan does not have a valuation date coinciding with the
Determination Date, the Administrative Committee shall value the accrued
benefit or account balance under such aggregated plan as of the most recent
valuation date falling within the twelve-month period ending on the
Determination Date, except as Code 416 and applicable Treasury regulations
require for the first and second plan year of a Defined Benefit Plan.
The Administrative Committee shall calculate the value of account balances
and accrued benefits with reference to the Determination Dates for the
respective aggregated plans that fall within the same calendar year.
16.2 Application of Article XVI.
If the Plan is determined to be a Top Heavy Plan as of any Determination
Date, then it shall be subject to the rules set forth in the balance of this
Article XVI, beginning with the first Plan Year commencing after such
Determination Date.
16.3 Minimum Vesting.
(a) If the Plan is determined to be a Top Heavy Plan for a Plan
Year, then with respect to each Participant who completes an Hour of
<PAGE>
Service during such Plan Year, such Participant's vested interest in his
Account, determined at any time that the Plan continues to be a Top Heavy
Plan, shall be no less than as determined under the following table:
Years of Vesting Service Vested Percentage
Less than 3 years 0%
3 years or more 100%
(b) If the Plan subsequently is determined to no longer be a Top
Heavy Plan, then the above minimum vesting schedule shall not apply to any
portion of a Participant's Account which is accrued on or after the first
day of the first Plan Year in which the Plan is no longer a Top Heavy
Plan, provided that any Participant with three or more Years of Vesting
Service as of the first date on which the Plan is no longer a Top Heavy
Plan may elect to continue to be vested in accordance with the above
minimum vesting schedule during the period that the Plan is not a Top
Heavy Plan.
16.4 Minimum Contributions.
(a) Subject to paragraph (b) of this Section, if the Plan is
determined to be a Top Heavy Plan for a Plan Year, minimum Employer
contributions (including forfeitures) shall be made, on behalf of each
Participant who has not Separated from Service as of the end of the Plan
Year and who is not a Key Employee, of not less than the lesser of the
following percentage of the Key Employee's 415 Compensation for the Plan
Year, as defined in Section 15.1(g).
(i) 3%, or
(ii) the highest percentage of Employer contributions (excluding any
elective deferrals under a Code 401(k) arrangement or any Employer
matching contributions necessary to satisfy the nondiscrimination
requirements of Code Section 401(k) or of Code Section 401(m) and
including forfeitures and amounts contributed pursuant to a salary
reduction agreement) made under the Plan for the Plan Year on behalf of a
Key Employee.
However, if a Defined Benefit Plan which benefits a Key Employee depends
on this Plan to satisfy the nondiscrimination rules of Code Section 401(a)(4)
or the coverage rules of Code 410 (or another plan benefiting the Key Employee
so depends on such defined benefit plan), the allocation is 3% of the Non-Key
Employee's Compensation for the Plan Year regardless of the contribution rate
for the Key Employees.
(b) If the Plan is determined to be Top Heavy and the Top Heavy
Ratio for the Plan Year exceeds 90%, then paragraph (a) of this Section
shall be determined by substituting 4% for 3% each time it appears.
(c) If, for a Plan Year, there are no allocations of Employer
contributions or forfeitures for any Key Employee to the Plan, no minimum
allocation shall be required with respect to the Plan Year, except as
otherwise may be required because of another plan in the Aggregation
Group.
(d) The minimum allocation required under this Section 16.4 shall be
made after Employer contributions and forfeitures are made.
(e) Notwithstanding paragraph (a) above, this Section 16.4 shall not
apply to any Participant to the extent that such Participant is covered
under any other qualified plan of the Company or an Affiliate and such
<PAGE>
other plan provides the minimum allocation or benefit requirement
applicable to Top Heavy plans.
16.5 Adjustment to Combined Limitation.
If the Plan is determined to be a Top Heavy Plan for a Plan Year and the
Employer does not make the required minimum contribution under Section 16.4,
then the limits in Section 15.3 shall be determined by substituting "1.0" for
"1.25" wherever it appears in Code Section 415(e)(2)(B) or 415(e)(3)(B).
APPENDIX A
Special Rules Related to Certain Assets
Formerly Held in the Wine Spectrum Plan
(a) The Plan contains a frozen Coca-Cola Stock Fund, comprised primarily
of the common stock of the Coca-Cola Company ("Coca-Cola Stock") which was
transferred from the Thrift Plan for Employees of the Wine Spectrum Companies,
effective November 1, 1987. No Participant may make an Investment Election
directing deferrals or contributions to the Coca-Cola Stock Fund and any
dividends shall be automatically transferred to such Investment Fund or Funds
as the Investment Committee shall designate from time to time. Participants may
make an Investment Election transferring all or a portion of their Account from
the Coca-Cola Stock Fund to other funds, in accordance with the Plan's
provisions for making Investment Elections.
(b) Notwithstanding anything in this Plan to the contrary, the
distribution or in-service withdrawal of any portion of a Participant's Account
invested in the Coca-Cola Stock Fund may be paid in shares of Coca-Cola Stock,
if the Participant so elects.
With respect to any Seagram Employee, such Employee's base salary by the
Employer in any year, determined prior to any reduction pursuant to Section 3.1
or pursuant to a cafeteria plan under Code Section 125, and including holiday
pay, disability pay, funeral pay, jury duty pay, military pay, salary
adjustment pay (provided that lump sum merit increases will only be included
through January 31, 1998), retro pay, sick leave pay, vacation pay, personal
pay, parental pay, but excluding overtime (including supervisor's overtime),
commissions (including route commissions), shift differentials, grievance pay,
incentive awards, MIP awards, performance bonuses, PFP awards, start-up pay,
workers' compensation accruals, on call pay, lead pay, reimbursements or other
expense allowances, fringe benefits (cash and noncash), moving expenses,
deferred compensation, welfare benefits, non-cash remuneration, remuneration
paid in currency other than U.S. dollars, severance pay (whether paid before or
after a Participant's Separation from Service), amounts paid under any
long-term incentive plan, tax protection payments or foreign service over base
allowances or premiums, retirement bonuses, contributions (except for Pre-tax
Contributions) to and benefits and distributions under the Plan or under any
employee benefit plan or any plan or program of deferred compensation,
including without limitation any pension, profit sharing, stock bonus, employee
stock ownership, stock option or incentive program, or dividends paid on any
common stock of the Employer included within or issued under any such plan or
program, stock options or income or gains from the exercise thereof.
With respect to any Tropicana Employee, such Employee's base salary by the
Employer in any year, determined prior to any reduction pursuant to Section 3.1
or pursuant to a cafeteria plan under Code Section 125, and including overtime,
<PAGE>
commissions, shift differentials, holiday pay, disability pay, grievance pay,
funeral pay, jury duty pay, military pay, salary adjustment pay, retro pay,
incentive awards, MIP awards, performance bonuses, PFP awards, start-up pay,
route commissions, supervisor's overtime, workers' compensation accruals, on
call pay, sick leave pay, vacation pay, personal pay, birthday pay, lead pay,
parental pay, but excluding reimbursements or other expense allowances, fringe
benefits (cash and noncash), moving expenses, deferred compensation, welfare
benefits, non-cash remuneration, remuneration paid in currency other than U.S.
dollars, severance pay, whether paid before or after a Participant's Separation
from Service, amounts paid under any long-term incentive plan, tax protection
payments or foreign service over base allowances or premiums, retirement
bonuses, contributions (except for Pre-tax Contributions) to and benefits and
distributions under the Plan or under any employee benefit plan or any plan or
program of deferred compensation, including without limitation any pension,
profit sharing, stock bonus, employee stock ownership, stock option or
incentive program, or dividends paid on any common stock of the Employer
included within or issued under any such plan or program, amounts which are
permitted by the Code to be excluded by the Participant in computing his or her
gross income (except for Pre-tax Contributions), amounts received under the
Employer's short term disability policy procedure, and stock options or income
or gains from the exercise thereof.
With respect to any Universal/Spencer Employee, such Employee's base
salary by the Employer in any year, determined prior to any reduction pursuant
to Section 3.1 or pursuant to a cafeteria plan under Code Section 125, and
including overtime, commissions, shift differentials, holiday pay, grievance
pay, funeral pay, jury duty pay, military pay, salary adjustment pay, retro
pay, performance bonuses, route commissions, supervisor's overtime, sick leave
pay, vacation pay, personal pay, birthday pay, lead pay, parental pay, but
excluding disability pay, incentive awards, MIP awards, start-up pay, workers'
compensation accruals, reimbursements or other expense allowances, fringe
benefits (cash and noncash), moving expenses, deferred compensation, welfare
benefits, non-cash remuneration, remuneration paid in currency other than U.S.
dollars, severance pay, whether paid before or after a Participant's Separation
from Service, amounts paid under any long-term incentive plan, tax protection
payments or foreign service over base allowances or premiums, retirement
bonuses, contributions (except for Pre-tax Contributions) to and benefits and
distributions under the Plan or under any employee benefit plan or any plan or
program of deferred compensation, including without limitation any pension,
profit sharing, stock bonus, employee stock ownership, stock option or
incentive program, or dividends paid on any common stock of the Employer
included within or issued under any such plan or program, and stock options or
income or gains from the exercise thereof.
ADOPTION AGREEMENT
The Employer named in Section I.A. below hereby establishes or restates a
Profit Sharing Plan ("Plan") and Trust, consisting of such sums as shall be
paid to the Trustee(s) under the Plan, the investments thereof and earnings
thereon. The terms of the Plan and Trust are set forth in this Adoption
Agreement and the applicable provisions of the Plan Document, and the Dreyfus
Trust Agreement, both as amended from time to time, which are hereby adopted
and incorporated herein by reference.
I. BASIC PROVISIONS
A. Employer's Name: JOSEPH E. SEAGRAM & SONS, INC.
Address: 800 THIRD AVENUE, 13TH FLOOR
NEW YORK CITY, NY 10022-7699
B. Employer is a (X) corporation; ( ) S Corporation;
( ) partnership; ( ) sole proprietor;
( ) other: [....]
C. Employer's Tax ID Number: 13-1285240
D. Employer's fiscal year: JULY 1 - JUNE 30
E. Plan Name: RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION
EMPLOYEES OF JOSEPH E. SEAGRAM & SONS, INC. AND
AFFILIATES
F. If this is a new Plan, the Effective Date of the Plan is: JANUARY 1,
1997
If this is an amendment and restatement of an existing Plan, enter
the original Effective Date [....]. The effective date of this
amended Plan is [....].
G. The Trustee shall be:
(X) The Dreyfus Trust Company
( ) Other: (Name) [....]
(Address) [....]
(Address) [....]
(Phone #) [....]
H. The first Plan Year shall be [....] through [....]. Thereafter, the
Plan Year shall mean the 12-consecutive-month period commencing on
JANUARY 1 and ending on DECEMBER 31.
I. Service with the following predecessor employer(s): N/A
shall be credited for purposes of: [ ] eligibility; [ ] vesting.
<PAGE>
Note: Such Service must be credited if the adopting Employer
maintains the plan of the predecessor employer.
J. The following employer(s) aggregated with the Employer under Sections
414(b), (c), (m) or (o) of the Internal Revenue Code ("Code") shall
be Participating Employers in the Plan: [....]
K. Are all employers aggregated with the Employer under Sections 414(b),
(c), (m) or (o) of the Code participating in this Plan?
( ) Yes (X) No
II. HOURS OF SERVICE
A. For Eligibility Purposes.
Hours of Service under the Plan will be determined for all Employees on
the basis of the method selected below:
( ) On the basis of actual hours for which an Employee is paid or
entitled to payment.
( ) On the basis of days worked. An Employee will be credited with ten
(10) Hours of Service for any day such Employee would be credited
with at least one (1) Hour of Service during the day under the Plan.
( ) On the basis of weeks worked. An Employee will be credited with
forty-five (45) Hours of Service for any week such Employee would be
credited with at least one (1) Hour of Service during the week under
the Plan.
( ) On the basis of semi-monthly payroll periods. An Employee will be
credited with ninety-five (95) Hours of Service for any semi-monthly
payroll period such Employee would be credited with at least one (1)
Hour of Service under the Plan.
( ) On the basis of months worked. An Employee will be credited with one
hundred ninety (190) Hours of Service for any month such Employee
would be credited with at least one (1) Hour of Service under the
Plan.
(X) On the basis of elapsed time.
B. For Vesting Purposes.
Hours of Service under the Plan will be determined for all Employees on
the basis of the method selected below:
( ) On the basis of actual hours for which an Employee is paid or
entitled to payment.
( ) On the basis of days worked. An Employee will be credited with ten
(10) Hours of Service for any day such Employee would be credited
with at least one (1) Hour of Service during the day under the Plan.
<PAGE>
( ) On the basis of weeks worked. An Employee will be credited with
forty-five (45) Hours of Service for any week such Employee would be
credited with at least one (1) Hour of Service during the week under
the Plan.
( ) On the basis of semi-monthly payroll periods. An Employee will be
credited with ninety-five (95) Hours of Service for any semi-monthly
payroll period such Employee would be credited with at least one (1)
Hour of Service under the Plan.
( ) On the basis of months worked. An Employee will be credited with one
hundred ninety (190) Hours of Service for any month such Employee
would be credited with at least one (1) Hour of Service under the
Plan.
(X) On the basis of elapsed time.
III. ELIGIBLE EMPLOYEES
All Employees shall be Eligible Employees, except:
( ) Employees included in a unit of Employees covered by a collective
bargaining agreement between the Employer and employee
representatives, if retirement benefits were the subject of good
faith bargaining. For this purpose, the term "employee
representatives" does not include any organization more than half of
whose members are Employees who are owners, officers, or executives
of the Employer.
(X) Employees who are nonresident aliens and who receive no earned income
from the Employer which constitutes income from sources within the
United States.
(X) Employees included in the following classification(s): EMPLOYEES NOT
COVERED BY THE COLLECTIVE BARGAINING AGREEMENT BETWEEN JOSEPH E.
SEAGRAM & SONS, INC. UNITED FOOD & COMMERCIAL WORKERS INTERNATIONAL
UNION
(X) Employees of the following employers aggregated with the Employer
under Sections 414(b), (c), (m) or (o) of the Code: EMPLOYEES NOT
EMPLOYED BY JOSEPH E. SEAGRAM & SONS, INC.
(X) Individuals required to be considered Employees under Section 414(n)
of the Code.
( ) Employees who, subject to determination by the Committee that such
election will not affect the plan's qualification, make a one-time
irrevocable election not to participate in the Plan for purposes of
the following:
[ ] Employer Discretionary Contributions.
[ ] Elective Deferrals/Thrift Contributions/Combined Contributions.
Note: The term Employee includes all employees of the Employer and any
employer required to be aggregated with the Employer under
<PAGE>
Sections 414(b), (c), (m) or (o) of the Code, and individuals
considered employees of any such employer under Section 414(n)
or (o) of the Code.
IV. AGE AND SERVICE REQUIREMENTS
Each Eligible Employee shall become a Participant on the Entry Date
coincident with or following completion of the following requirements:
Age: (X) No age requirement.
( ) The attainment of age [....] (not to exceed age 21).
Service: ( ) No service requirement.
( ) For Employer Discretionary Contributions only -- The
completion of [....] (not to exceed 1 unless 100% immediate
vesting is elected, in which case, may not exceed 2)
Eligibility Years of Service. If the Eligibility Years of
Service is or includes a fractional year, an Employee shall
not be required to complete any specific number of Hours of
Service to receive credit for such fractional year.
If more than 1 Eligibility Year of Service is required,
Participants must be 100% immediately vested.
(X) For all other contributions --The completion of 1/12 (not
to exceed 1) Eligibility Year of Service.
AND
Effective
Date: ( ) Each Eligible Employee who is employed on the
Effective Date shall become a Participant on the
Effective Date. Each Eligible Employee employed
after the Effective Date hall become a Participant
on the Entry Date coincident with or following
completion of the age and service requirements
specified above.
( ) Each Eligible Employee who is employed on the effective
date of this amended plan shall become a Participant as of
such date. Each Eligible Employee employed after the
effective date shall become a Participant on the entry date
coincident with or following completion of the age and
service requirements specified above.
V. ELIGIBILITY YEARS OF SERVICE
A. For Employer Discretionary Contributions, in order to be credited
with an Eligibility Year of Service, an Employee shall complete
[....] (not to exceed 1,000) Hours of Service.
Note: Not applicable if elapsed time method of crediting service for
eligibility purposes is elected.
<PAGE>
B. For all other contributions, in order to be credited with an
Eligibility Year of Service, an Employee shall complete [....] (not
to exceed 1,000) Hours of Service.
Note: Not applicable if elapsed time method of crediting service for
eligibility purposes is elected.
Note: In the case of an Employee in the Maritime Industry, for
purposes of Eligibility Years of Service, refer to Section 1.24 of
the Plan.
VI. ENTRY DATE
The Entry Date shall mean:
( ) For the first Plan Year only, the initial Entry Date shall be
;
thereafter:
( ) Annual Entry. The first day of the Plan Year. [Note: If Annual
Entry is selected, the age and service requirements cannot exceed
20 1/2 and 1/2 Eligibility Year of Service.]
( ) Dual Entry. The first day of the Plan Year and the first day of the
seventh month of the Plan Year.
( ) Quarterly Entry. The first day of the Plan Year and the first day of
the fourth, seventh and tenth months of the Plan Year.
(X) Monthly Entry. The first day of the Plan Year and the first day of
each following month of the Plan Year.
( ) Other:
(Note: Eligible Employees must commence
participation no later than the earlier of: a) the beginning of the
Plan Year after meeting the age and service requirements, or b) 6
months after the date the Employee meets the age and service
requirements).
VII. COMPENSATION
A. Except for purposes of "annual additions" testing under Section 415
of the Code, Compensation shall mean all of each Participant's:
(X) Information required to be reported under Sections 6041, 6051, and
6052 of the Code. (Wages, tips and other compensation box on Form W-
2). Compensation is defined as wages as defined in Section 3401(a)
and all other payments of compensation to the Employee by the
Employer (in the course of the Employer's trade or business) for
which the Employer is required to furnish the Employee a written
statement under Sections 6041(d), 6051(a)(3) and 6052 of the Code.
Compensation must be determined without regard to any rules under
Section 3401(a) that limit the remuneration included in wages based
on the nature or location of the employment or services performed
<PAGE>
(such as the exception for agricultural labor in Section 3401(a)(2)
of the Code). This definition of Compensation shall exclude amounts
paid or reimbursed by the Employer for moving expenses incurred by an
Employee, but only to the extent that at the time of the payment it
is reasonable to believe that these amounts are deductible by the
Employee under Section 217 of the Code.
( ) Section 3401(a) wages. Compensation is defined as wages within the
meaning of Section 3401(a) of the Code for purposes of income tax
withholding at the source but determined without regard to any rules
that limit the remuneration included in wages based on the nature or
location of the employment or the services performed (such as the
exception for agricultural labor in Section 3401(a)(2) of the Code).
( ) Section 415 safe-harbor compensation. Compensation is defined as
wages, salaries, and fees for professional services and other amounts
received (without regard to whether or not an amount is paid in cash)
for personal services actually rendered in the course of employment
with the Employer to the extent that the amounts are includible in
gross income (including, but not limited to, commissions paid
salesmen, compensation for services on the basis of a percentage of
profits, commissions on insurance premiums, tips, bonuses, fringe
benefits, and reimbursements or other expense allowances under a
nonaccountable plan (as described in Section 1.62-2(c)), and
excluding the following:
(a) Employer contributions to a plan of deferred compensation which
are not includible in the Employee's gross income for the
taxable year in which contributed, or Employer contributions
under a simplified employee pension plan described in Section
408(k), or any distributions from a plan of deferred
compensation regardless of whether such amounts are includible
in the gross income of the Employee;
(b) Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the
Employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture;
(c) Amounts realized from the sale, exchange or other disposition of
stock acquired under a qualified stock option; and
(d) Other amounts which receive special tax benefits, such as
premiums for group-term life insurance (but only to the extent
that the premiums are not includible in the gross income of the
Employee), or contributions made by the Employer (whether or not
under a salary reduction agreement) towards the purchase of an
annuity contract described in Section 403(b) of the Code
(whether or not the contributions are actually excludable from
the gross income of the Employee).
which is actually paid to the Participant during the following
applicable period:
( ) the portion of the Plan Year in which the Employee is a
Participant in the Plan.
<PAGE>
(X) the Plan Year.
( ) the calendar year ending with or within the Plan Year.
(X) Compensation shall be reduced by all of the following items (even if
includible in gross income): reimbursements or other expense
allowances, fringe benefits (cash and noncash), moving expenses,
deferred compensation and welfare benefits.
Compensation (X) shall; ( ) shall not include Employer contributions made
pursuant to a salary reduction agreement with an Employee which are not
includible in the gross income of the Employee by reason of Sections 125,
402(e)(3), 402(h)(1)(B) or 403(b) of the Code.
If the Employer's contributions to the Plan are not allocated on an
integrated basis, the following may be excluded from the definition of
Compensation selected above for any year in which the Plan is not Top
Heavy:
(X) bonuses
(X) overtime
(X) commissions
( ) amounts in excess of $ [....]
(X) GRIEVANCE PAY, INCENTIVE AWARD, START UP, WORKER COMPENSATION
ACCRUAL, ON CALL PAY, PERSONAL PAY, PARENTAL PAY
For any Self-Employed Individual covered under the Plan, Compensation
means Earned Income.
B. For purposes of "annual additions" testing under Section 415 of the
Code, Compensation for any Limitation Year shall mean all of each
Participant's:
(X) Information required to be reported under Sections 6041, 6051 and
6052 of the Code. (Wages, tips and other compensation box on Form W-
2) Compensation is defined as wages as defined in Section 3401(a) and
all other payments of compensation to the Employee by the Employer
(in the course of the Employer's trade or business) for which the
Employer is required to furnish the Employee a written statement
under Sections 6041(d) and 6051(a)(3) of the Code. Compensation must
be determined without regard to any rules under Section 3401(a) that
limit the remuneration included in wages based on the nature or
location of the employment or services performed (such as the
exception for agricultural labor in Section 3401(a)(2) of the Code).
This definition of Compensation shall exclude amounts paid or
reimbursed by the Employer for moving expenses incurred by an
Employee, but only to the extent that at the time of the payment it
is reasonable to believe that these amounts are deductible by the
Employee under Section 217 of the Code.
( ) Section 3401(a) wages. Compensation is defined as wages within the
meaning of Section 3401(a) of the Code for purposes of income tax
withholding at the source but determined without regard to any rules
<PAGE>
that limit the remuneration included in wages based on the nature or
location of the employment or the services performed (such as the
exception for agricultural labor in Section 3401(a)(2) of the Code).
( ) Section 415 safe-harbor compensation. Compensation is defined as
wages, salaries, and fees for professional services and other amounts
received (without regard to whether or not an amount is paid in cash)
for personal services actually rendered in the course of employment
with the Employer to the extent that the amounts are includible in
gross income (including, but not limited to, commissions paid
salesmen, compensation for services on the basis of a percentage of
profits, commissions on insurance premiums, tips, bonuses, fringe
benefits, and reimbursements or other expense allowances under a
nonaccountable plan (as described in Section 1.62-2(c)), and
excluding the following:
(a) Employer contributions to a plan of deferred compensation which
are not includible in the Employee's gross income for the
taxable year in which contributed, or Employer contributions
under a simplified employee pension plan described in Section
408(k), or any distributions from a plan of deferred
compensation regardless of whether such amounts are includible
in the gross income of the Employee;
(b) Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the
Employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture;
(c) Amounts realized from the sale, exchange or other disposition of
stock acquired under a qualified stock option; and
(d) Other amounts which receive special tax benefits, such as
premiums for group-term life insurance (but only to the extent
that the premiums are not includible in the gross income of the
Employee), or contributions made by the Employer (whether or not
under a salary reduction agreement) towards the purchase of an
annuity contract described in Section 403(b) of the Code
(whether or not the contributions are actually excludable from
the gross income of the Employee).
which is actually paid or includible in gross income during such
Limitation Year.
For any Self-Employed Individual covered under the Plan, Compensation
means Earned Income.
VIII. LIMITATION YEAR
Limitation Year shall mean the twelve (12) consecutive-month period:
(X) Identical to the Plan Year.
( ) Identical to the Employer's fiscal year ending with or within the
Plan Year of reference.
<PAGE>
( ) As fixed by a resolution of the Board of Directors of the Employer,
or the Employer if no Board of Directors exists.
IX. NORMAL RETIREMENT AGE
Normal Retirement Age shall mean:
(X) Age 65 (not to exceed 65).
( ) Age [....] (not to exceed 65), or the [....] (not to exceed the 5th)
anniversary of the date the Participant commenced participation in
the Plan, if later.
X. EARLY RETIREMENT AGE
Early Retirement Age shall mean:
(X) There shall be no early retirement provision in this Plan.
( ) Age [....].
( ) Age [....] and [....] Years of Service.
XI. EMPLOYER AND EMPLOYEE CONTRIBUTIONS
A. Types and allocation of Contributions
1. Employer Discretionary Contributions
(X) Not permitted.
( ) Permitted.
( ) An amount fixed by appropriate action of the
Employer.
( ) [....]% of Compensation of Participants for the Plan
Year (not to exceed 15%).
( ) [....]% of Compensation of Participants for the Plan
Year, plus an additional amount fixed by appropriate
action of the Employer (in total not to exceed 15%).
Employer Discretionary Contributions ( ) shall; ( ) shall not be
integrated with Social Security.
If integrated with Social Security:
a. ( ) The Permitted Disparity Percentage shall be
[....]%.
b. ( ) The Permitted Disparity Percentage shall be
determined annually by appropriate action of the
Employer.
<PAGE>
c. ( ) The Integration Level shall be:
( ) the Taxable Wage Base.
( ) $ (a dollar amount less than the
Taxable Wage Base).
( ) % (not to exceed 100% of the Taxable
Wage Base).
Note: The Permitted Disparity Percentage cannot exceed
the lesser of: (i) the base contribution, or
(ii) the greater of 5.7% or the tax rate under
Section 3111(a) of the Code attributable to the
old age insurance portion of the Old Age,
Survivors and Disability Income provisions of
the Social Security Act (as in effect on the
first day of the Plan Year). If the Integration
Level selected above is other than the Taxable
Wage Base ("TWB"), the 5.7% factor in the
preceding sentence must be replaced by the
applicable percentage determined from the
following table.
If the Integration Level is:
The Applicable
more than but not more than Factor is
$0 X* 5.7%
X* 80% of TWB 4.3%
80% of TWB Y** 5.4%
*X = the greater of $10,000 or 20% of TWB
**Y = any amount more than 80% of TWB, but less than
100% of TWB
Allocation of Employer Discretionary Contributions.
In order to share in the allocation of Employer Discretionary
Contributions (and forfeitures, if forfeitures are reallocated
to Participants) an Active Participant:
( ) Need not be employed on the last day of the Plan Year.
( ) Must be employed on the last day of the Plan Year, unless
the Participant terminates employment on account of:
( ) Death.
( ) Disability.
( ) Attainment of Early Retirement Age.
( ) Attainment of Normal Retirement Age.
( ) Employer approved leave of absence.
<PAGE>
( ) Must have ( ) 501 Hours of Service; ( ) [....] Hours of
Service (cannot exceed 1,000). (Note: Not applicable if
elapsed time method of crediting service is elected.
2. Elective Deferrals
(X) Not permitted.
( ) Permitted.
A Participant may elect to have his or her Compensation reduced
by:
( ) An amount not in excess of [....]% of Compensation [cannot
exceed the dollar limitation of Section 402(g) of the Code
for the calendar year].
( ) An amount not in excess of $[....] of Compensation [cannot
exceed the dollar limitation of Section 402(g) of the Code
for the calendar year].
( ) An amount not to exceed the dollar limitation of Section
402(g) of the Code for the calendar year.
( ) An amount not in excess of (Note: The percent for the
Highly Compensated Employee cannot exceed the percent for
the Non-Highly Compensated Employee):
% of Compensation [cannot exceed the dollar
limitation of Section 402(g) of the Code for the
calendar year] for each Highly Compensated Employee;
and
% of Compensation [cannot exceed the dollar
limitation of Section 402(g) of the Code for the
calendar year] for each Non-Highly Compensated
Employee.
A Participant may elect to commence Elective Deferrals the next
pay period following: [....] (enter date or period --at least
once each calendar year).
A Participant may modify the amount of Elective Deferrals as of
[....] (enter date or period --at least once each calendar
year).
A Participant ( ) may; ( ) may not base Elective Deferrals on
cash bonuses that, at the Participant's election, may be
contributed to the CODA or received by the Participant in cash.
Such election shall be effective as of the next pay period
following [....] or as soon as administratively feasible
thereafter.
Participants who claim Excess Elective Deferrals for the
preceding calendar year must submit their claims in writing to
the plan administrator by [....] (enter date between March 1 and
April 15).
<PAGE>
A Participant ( ) may; ( ) may not elect to recharacterize
Excess Contributions as Thrift Contributions. (Note: Available
only if Thrift Contributions are permitted.)
Participants who elect to recharacterize Excess Contributions
for the preceding Plan Year as Thrift Contributions must submit
their elections in writing to the Committee by [....] (enter
date no later than 2 1/2 months after close of Plan Year).
3. Thrift Contributions
(X) Not permitted.
( ) Permitted.
Participants shall be permitted to make Thrift
Contributions from [....]% (not less than 1) to [....]%
(not more than 10) of their total aggregate Compensation.
A Participant may elect to commence Thrift Contributions
the next pay period following [....] (enter date or period-
-at least once each calendar year).
The Change Date for a Participant to modify the amount of
Thrift Contributions shall be as of [....] (enter date or
period -- at least once each calendar year).
4. Elective Deferrals and Thrift Contributions, combined ("Combined
Contributions")
( ) Not Permitted.
(X) Permitted.
A Participant may elect to make Combined Contributions
which do not exceed 17% of Compensation. (Note: Elective
Deferrals can not exceed the dollar limitation of Section
402(g) of the Code for the calendar year).
A Participant may elect to commence contributions the next
pay period following: JANUARY 1, FEBRUARY 1, MARCH 1, APRIL
1, MAY 1, JUNE 1, JULY 1, AUGUST 1, SEPTEMBER 1, OCTOBER 1,
NOVEMBER 1, DECEMBER 1 (enter date or period --at least
once each calendar year).
A Participant may modify his amount of Combined
Contributions as of EACH PAYROLL PERIOD (enter date or
period --at least once each calendar year).
A Participant ( ) may; (X) may not base Elective Deferrals
on cash bonuses that, at the Participant's election, may be
contributed to the CODA or received by the Participant in
cash. Such election shall be effective as of the next pay
period following [....] or as soon as administratively
feasible thereafter.
<PAGE>
Participants who claim Excess Elective Deferrals for the
preceding calendar year must submit their claims in writing
to the plan administrator by MARCH 1 (enter date between
March 1 and April 15).
A Participant (X) may; ( ) may not elect to recharacterize
Excess Contributions as Thrift Contributions.
Participants who elect to recharacterize Excess
Contributions for the preceding Plan Year as Thrift
Contributions must submit their elections in writing to the
Committee by FEBRUARY 1 (enter date no later than 2 1/2
months after close of the Plan Year).
5. Matching Contributions
(X) Not permitted.
( ) Permitted.
( ) The Employer shall or may (in the event that the
Matching Contribution amount is within the discretion
of the Employer) make Matching Contributions to the
Plan with respect to (any one or a combination of the
following may be selected):
( ) Elective Deferrals.
( ) Thrift Contributions.
( ) Combined Contributions.
Such Matching Contributions will be made on behalf of:
( ) All Participants who make such contribution(s).
( ) All Participants who are Non-Highly Compensated
Employees who make such contribution(s).
The amount of such Matching Contributions made on behalf of
each such Participant shall be:
(i) Elective Deferrals (any one or a combination of the
following may be selected) -
( ) An amount or percentage fixed by appropriate
action of the Employer.
( ) [....] of the Elective Deferrals.
( ) [....]% of the first [....]% of Compensation
contributed as an Elective Deferral, plus
[....]% of the next [....]% of Compensation
contributed as an Elective Deferral, plus
<PAGE>
[....]% of the next [....]% of Compensation
contributed as an Elective Deferral.
The Employer shall not match Elective Deferrals as
provided above in excess of $[....] or in excess of
[....] of the Participant's Compensation.
The Employer shall not match Elective Deferrals made
by the following class(es) of Employees: [....]
(ii) Thrift Contributions (any one or a combination of the
following may be selected)-
( ) An amount or percentage fixed by appropriate
action of the Employer.
( ) $[....] for each dollar of Thrift Contributions.
( ) [....]% of the Thrift Contributions.
( ) [....]% of the first [....]% of Compensation
contributed, plus [....]% of the next [....]% of
Compensation contributed, plus [....]% of the
remaining Compensation contributed.
The Employer shall not match Thrift Contributions as
provided above in excess of $[....] or in excess of
[....]% of the Participant's Compensation.
The Employer shall not match Thrift Contributions
made by the following class(es) of Employees: [...]
(iii) Combined Contributions (any one or a combination
of the following may be selected).
( ) An amount fixed by appropriate action of the
Employer.
( ) [....]% of Combined Contributions.
( ) [....]% of Elective Deferrals, plus [....]% of
Thrift contributions.
( ) [....]% of the first [....]% of Compensation
contributed, plus [....]% of the next [....]% of
Compensation contributed, plus [....]% of the
remaining Compensation contributed.
The Employer shall not match Combined Contributions as
provided above in excess of $[....] or in excess of [....]%
of the Participant's Compensation.
The Employer shall not match Combined Contributions made by
the following class(es) of Employees: [....]
Matching Contributions shall be made each:
<PAGE>
( ) Payroll period.
( ) Month.
( ) Quarter.
( ) Plan Year.
Allocation of Matching Contributions --
In order to share in the allocation of Matching Contributions
(and forfeitures, if forfeitures are reallocated to
participants) a Participant:
( ) Must be employed on the last day of the payroll
period.
( ) Must be employed on the last day of the Month.
( ) Must be employed on the last day of the Quarter.
( ) Must be employed on the last day of the Plan Year.
unless the Participant terminates employment on account of:
( ) Death.
( ) Disability.
( ) Attainment of Early Retirement Age.
( ) Attainment of Normal Retirement Age.
( ) Employer approved leave of absence.
( ) Must have ( ) 501 Hours of Service; ( ) [....]
Hours of Service (cannot exceed 1,000). Note: Not
applicable if elapsed time method of crediting
service is elected.
6. Qualified Matching Contributions
(X) Not permitted.
( ) Permitted.
( ) The Employer shall or may (in the event that the
Qualified Matching Contribution amount is within
the discretion of the Employer) make Qualified
Matching Contributions.
Qualified Matching Contributions will be made on behalf of:
( ) All Participants who make Elective Deferrals.
<PAGE>
( ) All Participants who are Non-Highly Compensated
Employees and who make Elective Deferrals.
The amount of such Qualified Matching Contributions made on
behalf of each Participant shall be (any one or a
combination of the following may be selected):
( ) An amount or percentage fixed by appropriate action
by the Employer.
( ) [....]% of the Elective Deferrals.
The Employer shall not match Elective Deferrals as provided
above in excess of $[....] or in excess of [....]% of the
Participant's Compensation.
7. Qualified Nonelective Contributions
(X) Not permitted.
( ) The Employer shall have the discretion to contribute
Qualified Nonelective Contributions for any Plan Year in an
amount to be determined each year by the Employer.
Qualified Nonelective Contributions will be made on behalf
of (select as appropriate):
( ) All Eligible Employees.
( ) All Participants who make Elective Deferrals.
( ) All Participants who are Non-Highly Compensated
Employees and who make Elective Deferrals.
( ) All Participants who are Non-Highly Compensated
Employees.
( ) All Non-Key Employees.
B. Forfeitures (Do not complete if 100% immediate vesting is elected).
Forfeitures of Employer Discretionary Contributions, Matching
Contributions or Excess Aggregate Contributions shall be:
( ) Allocated to participants in the manner provided in Sections 4.2
and 4.7(d)(2) of the Plan.
( ) Used to reduce:
( ) any future Employer contributions.
( ) Plan expenses.
C. Contributions Not Limited by Net Profits
Indicate for each type of Employer contribution allowed under the
Plan whether such contributions are to be limited to Net Profits of
<PAGE>
the Employer for the taxable year of the Employer ending with or
within the Plan Year:
( ) Yes ( ) No Employer Discretionary Contributions
( ) Yes (X) No Elective Deferrals
( ) Yes ( ) No Qualified Nonelective Contributions
( ) Yes ( ) No Matching Contributions
( ) Yes ( ) No Qualified Matching Contributions.
XII. DISTRIBUTIONS AND IN-SERVICE WITHDRAWALS
A. Accounts shall be distributable upon a Participant's separation from
service, death, or Total and Permanent Disability, and, in addition:
(X) Termination of the Plan without establishment or maintenance of
a successor plan.
( ) The disposition to an entity that is not an Affiliated Employer
of substantially all of the assets used by the Employer in a
trade or business, but only if the Employer continues to
maintain the Plan and only with respect to participants who
continue employment with the acquiring corporation.
(X) Upon attainment of the Plan's Normal Retirement Age.
( ) The disposition to an entity that is not an Affiliated Employer
of the Employer's interest in a subsidiary, but only if the
Employer continues to maintain the Plan and only with respect to
Participants who continue employment with such subsidiary.
( ) Vested portion of Employer Discretionary Contributions on
account of a Participant's financial hardship to the extent
permitted by Section 4.9 of the Plan.
( ) Vested portion of Employer Matching Contributions on account of
a Participant's financial hardship to the extent permitted by
Section 4.9 of the Plan.
B. In addition to A above, Elective Deferrals, Qualified Nonelective
Contributions and Qualified Matching Contributions (as applicable)
and income allocable to such amounts shall be distributable:
(X) Upon the Participant's attainment of age 59 1/2.
(X) On account of a Participant's financial hardship, to the extent
permitted by Section 4.9 of the Plan (Elective Deferrals Only).
C. In-service withdrawals from a Participant's: ( ) Employer
Discretionary Contribution Account; ( ) Matching Contribution
Account; ( ) Transfer Account, if any ( ) shall; ( ) shall not be
permitted upon the attainment of age 59 1/2. (Permitted only if the
Plan is not integrated with Social Security and a Participant's
<PAGE>
Employer Discretionary Contribution Account and Matching Contribution
Accounts are 100% vested at time of distribution.)
D. Distribution of benefits upon separation of service, retirement or
death of a Participant ( ) shall; (X) shall not be subject to the
Automatic Annuity rules of Section 8.2 of the Plan.
E. (Complete only if the Plan is not subject to the Automatic Annuity
rules of Section 8.2.) Check the appropriate optional forms of
benefit that shall be available under the Plan (if left blank, the
provisions of Section 8.6(a) of this Plan shall apply):
[ ] Single lump sum payment.
[ ] Installment payments pursuant to Section 8.6(a) of the
Plan.
F. The following optional forms of benefit shall be available in
addition to the optional forms of benefit available under Section 8.6
of the Plan (Note: If the Plan is not subject to the Automatic
Annuity rules of Section 8.2 and the Participant is permitted to
select an annuity as an optional form of benefit, then the Automatic
Annuity rules of Section 8.2 shall apply to such participant):
[Note: If the Plan is an amendment and restatement of an existing
Plan, optional forms of benefit protected under Section 411(d)(6) of
the Code may not be eliminated, unless permitted by IRS Regulations
Sections 1.401(a)-(4) and 1.411(d)-4].
XIII. VESTING SERVICE
In order to be credited with a year of Service for vesting purposes, a
Participant shall complete [....] (not to exceed 1,000) Hours of Service.
(Not applicable if elapsed time method of crediting service for vesting
purposes is elected).
Note: In the case of Employees in the Maritime Industry, for purposes of a
year of Service, refer to Section 1.56 of the Plan.
XIV. VESTING SERVICE -EXCLUSIONS
All of an Employee's years of Service with the Employer shall be counted
to determine the vested interest of such Employee except:
( ) Years of Service before age 18.
( ) Years of Service before the Employer maintained this Plan or a
predecessor plan.
( ) Years of Service before the effective date of ERISA if such Service
would have been disregarded under the Service Break rules of the
prior plan in effect from time to time before such date. For this
<PAGE>
purpose, Service Break rules are rules which result in the loss of
prior vesting or benefit accruals, or deny an Employee's eligibility
to participate by reason of separation or failure to complete a
required period of Service within a specified period of time.
XV. VESTING SCHEDULES
The vested interest of each Employee (who has an Hour of Service on or
after January 1, 1989) in his Employer-derived account balance shall be
determined on the basis of the following schedules:
A. Employer Discretionary Contributions.
( ) 100% immediately vested. [Note: Mandatory if more than 1
Eligibility Year of Service is required.]
( ) 100% immediately vested after [....] (not to exceed 5) years of
Service.
( ) [....]% (not less than 20%) vested for each year of Service,
beginning with the [....] (not more than the 3rd) year of
Service until 100% vested.
( ) Other: [....] (Must be at least as favorable as any one of the
above 3 options).
AND
( ) Effective Date Vesting. Each Employee who is a Participant on
the Effective Date shall be 100% immediately vested.
B. Matching Contributions.
( ) 100% immediately vested. [Note: Mandatory if more than 1
Eligibility Year of Service is required.]
( ) 100% immediately vested after [....] (not to exceed 5) years of
Service.
( ) [....]% (not less than 20%) vested for each year of Service,
beginning with the [....] (not more than the 3rd) year of
Service until 100% vested.
( ) Other: [....] (Must be at least as favorable as any one of the
above 3 options).
AND
( ) Effective Date Vesting. Each Employee who is a Participant on
the Effective Date shall be 100% immediately vested.
C. Top Heavy Minimum Vesting Schedules.
One of the following schedules will be used for years when the Plan
is or is deemed to be Top-Heavy.
<PAGE>
( ) 100% immediately vested after [....] (not to exceed 3) years of
Service.
( ) 20% vested after 2 years of Service, plus [....]% vested (not
less than 20%) for each additional year of Service until 100%
vested.
(X) Other: 20% vested for each year of Service, beginning with the
1ST year of Service until 100% vested. (Note: must be at least
as favorable as either of the two schedules in this Section C).
If the vesting schedule under the Plan shifts in or out of the
Minimum Schedule above for any Plan Year because of the Plan's
Top-Heavy status, such shift is an amendment to the vesting schedule
and the election in Section 7.3 of the Plan applies.
XVI. LIFE INSURANCE
Life insurance ( ) shall; (X) shall not be a permissible investment.
XVII. LOANS
Loans (X) shall; ( ) shall not be permitted.
XVIII. TOP-HEAVY PROVISIONS
A. Top Heavy Status
( ) The provisions of Article XIII of the Plan shall always apply.
(X) The provisions of Article XIII of the Plan shall only apply in
Plan Years after 1983, during which the Plan is or becomes
Top-Heavy.
B. Minimum Allocations
If a Participant in this Plan who is a Non-Key Employee is covered
under another qualified plan maintained by the Employer, the minimum
Top Heavy allocation or benefit required under Section 416 of the
Code shall be provided to such Non-key Employee under:
(X) this Plan.
( ) the Employer's other qualified defined contribution plan.
( ) the Employer's qualified defined benefit plan.
C. Determination of Present Value
If the Employer maintains a defined benefit plan in addition to this
Plan, and such plan fails to specify the interest rate an mortality
table to be used for purposes of establishing present value to
compute the Top-Heavy Ratio, then the following assumptions shall be
used:
<PAGE>
Interest Rate: 8%
Mortality Table: 1983 GROUP ANNUITY TABLE
XIX. LIMITATION ON ALLOCATIONS
If the adopting Employer maintains or has ever maintained another
qualified plan in which any Participant in this Plan is (or was) a
Participant or could possibly become a Participant, the adopting
Employer must complete this Section. The Employer must also complete
this Section if it maintains a welfare benefit fund, as defined in
Section 419(e) of the Code, or an individual medical account, as
defined in Section 415(l)(2) of the Code, under which amounts are
treated as Annual Additions with respect to any Participant in the
Plan.
(a) If the Participant is covered under another qualified defined
contribution plan maintained by the Employer, other than a
Master or Prototype Plan, Annual Additions for any Limitation
Year shall be limited to comply with Section 415(c) of the Code:
( ) in accordance with Sections 6.4(e) -(j) as though the other
plan were a Master or Prototype Plan.
( ) by freezing or reducing Annual Additions in the other
qualified defined contribution plan.
( ) other:
(b) If a Participant is or has ever been a Participant in a
qualified defined benefit plan maintained by the Employer, the
"1.0" aggregate limitation of Section 415(e) of the Code shall
be satisfied by:
(X) freezing or reducing the rate of benefit accrual under the
qualified defined benefit plan.
( ) freezing or reducing the Annual Additions under this Plan
(or, if the Employer maintains more than one qualified
defined contribution plan, as indicated in (a) above).
( ) other:
XX. INVESTMENTS
(X) Participants (X) shall; ( ) shall not be permitted to direct the
investment of their Accounts in the investment options selected by
the Employer or the Committee.
( ) Investment of participant Accounts shall be directed consistent with
rules and procedures established by the Committee. Such rules shall
be applied to all Participants in a uniform and nondiscriminatory
basis.
<PAGE>
XXI. TRANSFERS
Transfers pursuant to Section 10.3 of the Plan ( ) shall; (X) shall not be
permitted.
If permitted, indicate additional prior plan provisions, if applicable:
[....].
XXII. ROLLOVERS
Rollovers pursuant to Section 10.3 of the Plan (X) shall; ( ) shall not be
permitted.
XXIII. EMPLOYER REPRESENTATIONS
The Employer hereby represents that:
It is aware of, and agrees to be bound by, the terms of the Plan.
<PAGE>
IN WITNESS WHEREOF, the Employer and the Trustee have executed this
instrument the ____________________________ day of _________________________,
19__________. If applicable, the appropriate corporate seal has been affixed
and attested to.
JOSEPH E. SEAGRAM & SONS, INC.
_________________________________
Name of Business Entity
_________________________________
Signature (Sole Proprietors only)
By:______________________________
JOHN D. BORGIA, EXECUTIVE VICE
PRESIDENT, HUMAN RESOURCES
Name and Title (Corporations or Partnerships)
ATTEST:
_____________________________
Secretary (Corporations only)
THE DREYFUS TRUST COMPANY
______________________________
Name(s) of Trustee(s)
______________________________
Signature (Individual Trustee)
______________________________
Signature (Individual Trustee)
By:_______________________________________
Name and Title (Corporate Trustee only)
ADOPTION AGREEMENT
The Employer named in Section I.A. below hereby establishes or restates a
Profit Sharing Plan ("Plan") and Trust, consisting of such sums as shall be
paid to the Trustee(s) under the Plan, the investments thereof and earnings
thereon. The terms of the Plan and Trust are set forth in this Adoption
Agreement and the applicable provisions of the Plan Document and the Dreyfus
Trust Agreement, both as amended from time to time, which are hereby adopted
and incorporated herein by reference.
I. BASIC PROVISIONS
A. Employer's Name: TROPICANA PRODUCTS, INC.
Address: 1001 13TH AVENUE EAST
BRADENTON, FL 34208
B. Employer is a (X) corporation; ( ) S Corporation;
( ) partnership; ( ) sole proprietor;
( ) other: [....]
C. Employer's Tax ID Number: 13-3346705
D. Employer's fiscal year: JULY 1 - JUNE 30
E. Plan Name: RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION
EMPLOYEES OF TROPICANA PRODUCTS, INC. AND AFFILIATES
F. If this is a new Plan, the Effective Date of the Plan is: JANUARY 1,
1997
If this is an amendment and restatement of an existing Plan, enter
the original Effective Date [....]. The effective date of this
amended Plan is [....].
<PAGE>
G. The Trustee shall be:
(X) The Dreyfus Trust Company
( ) Other: (Name) [....]
(Address) [....]
(Address) [....]
(Phone #) [....]
H. The first Plan Year shall be [....] through [....]. Thereafter, the
Plan Year shall mean the 12-consecutive-month period commencing on
JANUARY 1 and ending on DECEMBER 31.
I. Service with the following predecessor employer(s): N/A
shall be credited for purposes of: [ ] eligibility; [ ] vesting.
Note: Such Service must be credited if the adopting Employer
maintains the plan of the predecessor employer.
J. The following employer(s) aggregated with the Employer under Sections
414(b), (c), (m) or (o) of the Internal Revenue Code ("Code") shall
be Participating Employers in the Plan: TROPICANA PRODUCTS SALES
DIVISION OF JOSEPH E. SEAGRAM & SONS, INC. AND TROPICANA PRODUCTS
SALES DIVISION OF DISTILLERS PRODUCTS SALES CORPORATION
K. Are all employers aggregated with the Employer under Sections 414(b),
(c), (m) or (o) of the Code participating in this Plan?
( ) Yes (X) No
II. HOURS OF SERVICE
A. For Eligibility Purposes.
Hours of Service under the Plan will be determined for all Employees on
the basis of the method selected below:
( ) On the basis of actual hours for which an Employee is paid or
entitled to payment.
( ) On the basis of days worked. An Employee will be credited with ten
(10) Hours of Service for any day such Employee would be credited
with at least one (1) Hour of Service during the day under the Plan.
( ) On the basis of weeks worked. An Employee will be credited with
forty-five (45) Hours of Service for any week such Employee would be
credited with at least one (1) Hour of Service during the week under
the Plan.
( ) On the basis of semi-monthly payroll periods. An Employee will be
credited with ninety-five (95) Hours of Service for any semi-monthly
payroll period such Employee would be credited with at least one (1)
Hour of Service under the Plan.
<PAGE>
( ) On the basis of months worked. An Employee will be credited with one
hundred ninety (190) Hours of Service for any month such Employee
would be credited with at least one (1) Hour of Service under the
Plan.
(X) On the basis of elapsed time.
B. For Vesting Purposes.
Hours of Service under the Plan will be determined for all Employees on
the basis of the method selected below:
( ) On the basis of actual hours for which an Employee is paid or
entitled to payment.
( ) On the basis of days worked. An Employee will be credited with ten
(10) Hours of Service for any day such Employee would be credited
with at least one (1) Hour of Service during the day under the Plan.
( ) On the basis of weeks worked. An Employee will be credited with
forty-five (45) Hours of Service for any week such Employee would be
credited with at least one (1) Hour of Service during the week under
the Plan.
( ) On the basis of semi-monthly payroll periods. An Employee will be
credited with ninety-five (95) Hours of Service for any semi-monthly
payroll period such Employee would be credited with at least one (1)
Hour of Service under the Plan.
( ) On the basis of months worked. An Employee will be credited with one
hundred ninety (190) Hours of Service for any month such Employee
would be credited with at least one (1) Hour of Service under the
Plan.
(X) On the basis of elapsed time.
III. ELIGIBLE EMPLOYEES
All Employees shall be Eligible Employees, except:
( ) Employees included in a unit of Employees covered by a collective
bargaining agreement between the Employer and employee
representatives, if retirement benefits were the subject of good
faith bargaining. For this purpose, the term "employee
representatives" does not include any organization more than half of
whose members are Employees who are owners, officers, or executives
of the Employer.
(X) Employees who are nonresident aliens and who receive no earned income
from the Employer which constitutes income from sources within the
United States.
(X) Employees included in the following classification(s): EMPLOYEES NOT
COVERED BY THE COLLECTIVE BARGAINING AGREEMENT(S) BETWEEN TROPICANA
PRODUCTS, INC. AND: (1) GLASS, MOLDERS, POTTERY, PLASTICS AND ALLIED
WORKERS INTERNATIONAL UNION (AFL-CIO, CLC) AND IT LOCAL UNION NO.
<PAGE>
208; (2) AMERICAN FLINT GLASS WORKERS UNION AFL-CIO AND ITS LOCAL
UNION NO. 46. EMPLOYEES NOT COVERED BY THE COLLECTIVE BARGAINING
AGREEMENT(S) BETWEEN TROPICANA PRODUCTS SALES AND DISTRICT LODGE NO.
15 OF THE INTERNATIONAL ASSOCIATION OF MACHINISTS AND AEROSPACE
WORKERS AFL-CIO (IAM #15).
(X) Employees of the following employers aggregated with the Employer
under Sections 414(b), (c), (m) or (o) of the Code: EMPLOYEES NOT
EMPLOYED BY TROPICANA PRODUCTS, INC. OR TROPICANA PRODUCTS SALES
DIVISION OF JOSEPH E. SEAGRAM & SONS, INC. AND TROPICANA SALES
DIVISION OF DISTILLERS PRODUCTS SALES CORPORATION.
(X) Individuals required to be considered Employees under Section 414(n)
of the Code.
( ) Employees who, subject to determination by the Committee that such
election will not affect the plan's qualification, make a one-time
irrevocable election not to participate in the Plan for purposes of
the following:
[ ] Employer Discretionary Contributions.
[ ] Elective Deferrals/Thrift Contributions/Combined Contributions.
Note: The term Employee includes all employees of the Employer and any
employer required to be aggregated with the Employer under
Sections 414(b), (c), (m) or (o) of the Code, and individuals
considered employees of any such employer under Section 414(n)
or (o) of the Code.
IV. AGE AND SERVICE REQUIREMENTS
Each Eligible Employee shall become a Participant on the Entry Date
coincident with or following completion of the following requirements:
Age: (X) No age requirement.
( ) The attainment of age [....] (not to exceed age 21).
Service: ( ) No service requirement.
( ) For Employer Discretionary Contributions only -- The
completion of [....] (not to exceed 1 unless 100% immediate
vesting is elected, in which case, may not exceed 2)
Eligibility Years of Service. If the Eligibility Years of
Service is or includes a fractional year, an Employee shall
not be required to complete any specific number of Hours of
Service to receive credit for such fractional year.
If more than 1 Eligibility Year of Service is required,
Participants must be 100% immediately vested.
(X) For all other contributions -- The completion of 1/12 (not
to exceed 1) Eligibility Year of Service.
AND
<PAGE>
Effective
Date: ( ) Each Eligible Employee who is employed on the
Effective Date shall become a Participant on the
Effective Date. Each Eligible Employee employed
after the Effective Date hall become a Participant
on the Entry Date coincident with or following
completion of the age and service requirements
specified above.
( ) Each Eligible Employee who is employed on the effective
date of this amended plan shall become a Participant as of
such date. Each Eligible Employee employed after the
effective date shall become a Participant on the entry date
coincident with or following completion of the age and
service requirements specified above.
V. ELIGIBILITY YEARS OF SERVICE
A. For Employer Discretionary Contributions, in order to be credited
with an Eligibility Year of Service, an Employee shall complete
[....] (not to exceed 1,000) Hours of Service.
Note: Not applicable if elapsed time method of crediting service for
eligibility purposes is elected.
B. For all other contributions, in order to be credited with an
Eligibility Year of Service, an Employee shall complete [....] (not
to exceed 1,000) Hours of Service.
Note: Not applicable if elapsed time method of crediting service for
eligibility purposes is elected.
Note: In the case of an Employee in the Maritime Industry, for
purposes of Eligibility Years of Service, refer to Section 1.24 of
the Plan.
VI. ENTRY DATE
The Entry Date shall mean:
( ) For the first Plan Year only, the initial Entry Date shall be
;
thereafter:
( ) Annual Entry. The first day of the Plan Year. [Note: If Annual
Entry is selected, the age and service requirements cannot exceed
20 1/2 and 1/2 Eligibility Year of Service.]
( ) Dual Entry. The first day of the Plan Year and the first day of the
seventh month of the Plan Year.
( ) Quarterly Entry. The first day of the Plan Year and the first day of
the fourth, seventh and tenth months of the Plan Year.
<PAGE>
(X) Monthly Entry. The first day of the Plan Year and the first day of
each following month of the Plan Year.
( ) Other:
(Note: Eligible Employees must commence
participation no later than the earlier of: a) the beginning of the
Plan Year after meeting the age and service requirements, or b) 6
months after the date the Employee meets the age and service
requirements).
VII. COMPENSATION
A. Except for purposes of "annual additions" testing under Section 415
of the Code, Compensation shall mean all of each Participant's:
(X) Information required to be reported under Sections 6041, 6051, and
6052 of the Code. (Wages, tips and other compensation box on Form W-
2). Compensation is defined as wages as defined in Section 3401(a)
and all other payments of compensation to the Employee by the
Employer (in the course of the Employer's trade or business) for
which the Employer is required to furnish the Employee a written
statement under Sections 6041(d), 6051(a)(3) and 6052 of the Code.
Compensation must be determined without regard to any rules under
Section 3401(a) that limit the remuneration included in wages based
on the nature or location of the employment or services performed
(such as the exception for agricultural labor in Section 3401(a)(2)
of the Code). This definition of Compensation shall exclude amounts
paid or reimbursed by the Employer for moving expenses incurred by an
Employee, but only to the extent that at the time of the payment it
is reasonable to believe that these amounts are deductible by the
Employee under Section 217 of the Code.
( ) Section 3401(a) wages. Compensation is defined as wages within the
meaning of Section 3401(a) of the Code for purposes of income tax
withholding at the source but determined without regard to any rules
that limit the remuneration included in wages based on the nature or
location of the employment or the services performed (such as the
exception for agricultural labor in Section 3401(a)(2) of the Code).
( ) Section 415 safe-harbor compensation. Compensation is defined as
wages, salaries, and fees for professional services and other amounts
received (without regard to whether or not an amount is paid in cash)
for personal services actually rendered in the course of employment
with the Employer to the extent that the amounts are includible in
gross income (including, but not limited to, commissions paid
salesmen, compensation for services on the basis of a percentage of
profits, commissions on insurance premiums, tips, bonuses, fringe
benefits, and reimbursements or other expense allowances under a
nonaccountable plan (as described in Section 1.62-2(c)), and
excluding the following:
(a) Employer contributions to a plan of deferred compensation which
are not includible in the Employee's gross income for the
taxable year in which contributed, or Employer contributions
under a simplified employee pension plan described in Section
408(k), or any distributions from a plan of deferred
<PAGE>
compensation regardless of whether such amounts are includible
in the gross income of the Employee;
(b) Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the
Employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture;
(c) Amounts realized from the sale, exchange or other disposition of
stock acquired under a qualified stock option; and
(d) Other amounts which receive special tax benefits, such as
premiums for group-term life insurance (but only to the extent
that the premiums are not includible in the gross income of the
Employee), or contributions made by the Employer (whether or not
under a salary reduction agreement) towards the purchase of an
annuity contract described in Section 403(b) of the Code
(whether or not the contributions are actually excludable from
the gross income of the Employee).
which is actually paid to the Participant during the following applicable
period:
( ) the portion of the Plan Year in which the Employee is a
Participant in the Plan.
(X) the Plan Year.
( ) the calendar year ending with or within the Plan Year.
(X) Compensation shall be reduced by all of the following items (even if
includible in gross income): reimbursements or other expense
allowances, fringe benefits (cash and noncash), moving expenses,
deferred compensation and welfare benefits.
Compensation (X) shall; ( ) shall not include Employer contributions made
pursuant to a salary reduction agreement with an Employee which are not
includible in the gross income of the Employee by reason of Sections 125,
402(e)(3), 402(h)(1)(B) or 403(b) of the Code.
If the Employer's contributions to the Plan are not allocated on an
integrated basis, the following may be excluded from the definition of
Compensation selected above for any year in which the Plan is not Top
Heavy:
( ) bonuses
( ) overtime
( ) commissions
( ) amounts in excess of $ [....]
( ) [....]
For any Self-Employed Individual covered under the Plan, Compensation
means Earned Income.
<PAGE>
B. For purposes of "annual additions" testing under Section 415 of the
Code, Compensation for any Limitation Year shall mean all of each
Participant's:
(X) Information required to be reported under Sections 6041, 6051 and
6052 of the Code. (Wages, tips and other compensation box on Form W-
2) Compensation is defined as wages as defined in Section 3401(a) and
all other payments of compensation to the Employee by the Employer
(in the course of the Employer's trade or business) for which the
Employer is required to furnish the Employee a written statement
under Sections 6041(d) and 6051(a)(3) of the Code. Compensation must
be determined without regard to any rules under Section 3401(a) that
limit the remuneration included in wages based on the nature or
location of the employment or services performed (such as the
exception for agricultural labor in Section 3401(a)(2) of the Code).
This definition of Compensation shall exclude amounts paid or
reimbursed by the Employer for moving expenses incurred by an
Employee, but only to the extent that at the time of the payment it
is reasonable to believe that these amounts are deductible by the
Employee under Section 217 of the Code.
( ) Section 3401(a) wages. Compensation is defined as wages within the
meaning of Section 3401(a) of the Code for purposes of income tax
withholding at the source but determined without regard to any rules
that limit the remuneration included in wages based on the nature or
location of the employment or the services performed (such as the
exception for agricultural labor in Section 3401(a)(2) of the Code).
( ) Section 415 safe-harbor compensation. Compensation is defined as
wages, salaries, and fees for professional services and other amounts
received (without regard to whether or not an amount is paid in cash)
for personal services actually rendered in the course of employment
with the Employer to the extent that the amounts are includible in
gross income (including, but not limited to, commissions paid
salesmen, compensation for services on the basis of a percentage of
profits, commissions on insurance premiums, tips, bonuses, fringe
benefits, and reimbursements or other expense allowances under a
nonaccountable plan (as described in Section 1.62-2(c)), and
excluding the following:
(a) Employer contributions to a plan of deferred compensation which
are not includible in the Employee's gross income for the
taxable year in which contributed, or Employer contributions
under a simplified employee pension plan described in Section
408(k), or any distributions from a plan of deferred
compensation regardless of whether such amounts are includible
in the gross income of the Employee;
(b) Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the
Employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture;
(c) Amounts realized from the sale, exchange or other disposition of
stock acquired under a qualified stock option; and
<PAGE>
(d) Other amounts which receive special tax benefits, such as
premiums for group-term life insurance (but only to the extent
that the premiums are not includible in the gross income of the
Employee), or contributions made by the Employer (whether or not
under a salary reduction agreement) towards the purchase of an
annuity contract described in Section 403(b) of the Code
(whether or not the contributions are actually excludable from
the gross income of the Employee).
which is actually paid or includible in gross income during such
Limitation Year.
For any Self-Employed Individual covered under the Plan, Compensation
means Earned Income.
VIII. LIMITATION YEAR
Limitation Year shall mean the twelve (12) consecutive-month period:
(X) Identical to the Plan Year.
( ) Identical to the Employer's fiscal year ending with or within the
Plan Year of reference.
( ) As fixed by a resolution of the Board of Directors of the Employer,
or the Employer if no Board of Directors exists.
IX. NORMAL RETIREMENT AGE
Normal Retirement Age shall mean:
(X) Age 65 (not to exceed 65).
( ) Age [....] (not to exceed 65), or the [....] (not to exceed the 5th)
anniversary of the date the Participant commenced participation in
the Plan, if later.
X. EARLY RETIREMENT AGE
Early Retirement Age shall mean:
(X) There shall be no early retirement provision in this Plan.
( ) Age [....].
( ) Age [....] and [....] Years of Service.
XI. EMPLOYER AND EMPLOYEE CONTRIBUTIONS
A. Types and allocation of Contributions
1. Employer Discretionary Contributions
<PAGE>
(X) Not permitted.
( ) Permitted.
( ) An amount fixed by appropriate action of the Employer.
( ) [....]% of Compensation of Participants for the Plan
Year (not to exceed 15%).
( ) [....]% of Compensation of Participants for the Plan
Year, plus an additional amount fixed by appropriate
action of the Employer (in total not to exceed 15%).
Employer Discretionary Contributions ( ) shall; ( ) shall not be
integrated with Social Security.
If integrated with Social Security:
a. ( ) The Permitted Disparity Percentage shall be
[....]%.
b. ( ) The Permitted Disparity Percentage shall be
determined annually by appropriate action of the
Employer.
c. ( ) The Integration Level shall be:
( ) the Taxable Wage Base.
( ) $ (a dollar amount less than the
Taxable Wage Base).
( ) % (not to exceed 100% of the Taxable Wage
Base).
Note: The Permitted Disparity Percentage cannot exceed
the lesser of: (i) the base contribution, or (ii)
the greater of 5.7% or the tax rate under Section
3111(a) of the Code attributable to the old age
insurance portion of the Old Age, Survivors and
Disability Income provisions of the Social
Security Act (as in effect on the first day of
the Plan Year). If the Integration Level
selected above is other than the Taxable Wage
Base ("TWB"), the 5.7% factor in the preceding
sentence must be replaced by the applicable
percentage determined from the following table.
If the Integration Level is:
___________________________
The Applicable
more than but not more than Factor is
_________ _________________ _________
$0 X* 5.7%
X* 80% of TWB 4.3%
80% of TWB Y** 5.4%
<PAGE>
*X = the greater of $10,000 or 20% of TWB
**Y = any amount more than 80% of TWB, but less than
100% of TWB
Allocation of Employer Discretionary Contributions.
In order to share in the allocation of Employer Discretionary
Contributions (and forfeitures, if forfeitures are reallocated
to Participants) an Active Participant:
( ) Need not be employed on the last day of the Plan Year.
( ) Must be employed on the last day of the Plan Year, unless
the Participant terminates employment on account of:
( ) Death.
( ) Disability.
( ) Attainment of Early Retirement Age.
( ) Attainment of Normal Retirement Age.
( ) Employer approved leave of absence.
( ) Must have ( ) 501 Hours of Service; ( ) [....] Hours of
Service (cannot exceed 1,000). (Note: Not applicable if
elapsed time method of crediting service is elected.
2. Elective Deferrals
(X) Not permitted.
( ) Permitted.
A Participant may elect to have his or her Compensation reduced
by:
( ) An amount not in excess of [....]% of Compensation [cannot
exceed the dollar limitation of Section 402(g) of the Code
for the calendar year].
( ) An amount not in excess of $[....] of Compensation [cannot
exceed the dollar limitation of Section 402(g) of the Code
for the calendar year].
( ) An amount not to exceed the dollar limitation of Section
402(g) of the Code for the calendar year.
( ) An amount not in excess of (Note: The percent for the
Highly Compensated Employee cannot exceed the percent for
the Non-Highly Compensated Employee):
% of Compensation [cannot exceed the dollar
limitation of Section 402(g) of the Code for the
calendar year] for each Highly Compensated Employee; and
<PAGE>
% of Compensation [cannot exceed the dollar
limitation of Section 402(g) of the Code for the
calendar year] for each Non-Highly Compensated
Employee.
A Participant may elect to commence Elective Deferrals the next
pay period following: [....] (enter date or period -- at least
once each calendar year).
A Participant may modify the amount of Elective Deferrals as of
[....] (enter date or period -- at least once each calendar
year).
A Participant ( ) may; ( ) may not base Elective Deferrals on
cash bonuses that, at the Participant's election, may be
contributed to the CODA or received by the Participant in cash.
Such election shall be effective as of the next pay period
following [....] or as soon as administratively feasible
thereafter.
Participants who claim Excess Elective Deferrals for the
preceding calendar year must submit their claims in writing to
the plan administrator by [....] (enter date between March 1 and
April 15).
A Participant ( ) may; ( ) may not elect to recharacterize
Excess Contributions as Thrift Contributions. (Note: Available
only if Thrift Contributions are permitted.)
Participants who elect to recharacterize Excess Contributions
for the preceding Plan Year as Thrift Contributions must submit
their elections in writing to the Committee by [....] (enter
date no later than 2 1/2 months after close of Plan Year).
3. Thrift Contributions
(X) Not permitted.
( ) Permitted.
Participants shall be permitted to make Thrift
Contributions from [....]% (not less than 1) to [....]%
(not more than 10) of their total aggregate Compensation.
A Participant may elect to commence Thrift Contributions
the next pay period following [....] (enter date or period-
-at least once each calendar year).
The Change Date for a Participant to modify the amount of
Thrift Contributions shall be as of [....] (enter date or
period -- at least once each calendar year).
4. Elective Deferrals and Thrift Contributions, combined ("Combined
Contributions")
( ) Not Permitted.
<PAGE>
(X) Permitted.
A Participant may elect to make Combined Contributions
which do not exceed 17% of Compensation. (Note: Elective
Deferrals can not exceed the dollar limitation of Section
402(g) of the Code for the calendar year).
A Participant may elect to commence contributions the next
pay period following: JANUARY 1, FEBRUARY 1, MARCH 1, APRIL
1, MAY 1, JUNE 1, JULY 1, AUGUST 1, SEPTEMBER 1, OCTOBER 1,
NOVEMBER 1, DECEMBER 1 (enter date or period -- at least
once each calendar year).
A Participant may modify his amount of Combined
Contributions as of EACH PAYROLL PERIOD (enter date or
period -- at least once each calendar year).
A Participant ( ) may; (X) may not base Elective Deferrals
on cash bonuses that, at the Participant's election, may be
contributed to the CODA or received by the Participant in
cash. Such election shall be effective as of the next pay
period following [....] or as soon as administratively
feasible thereafter.
Participants who claim Excess Elective Deferrals for the
preceding calendar year must submit their claims in writing
to the plan administrator by MARCH 1 (enter date between
March 1 and April 15).
A Participant (X) may; ( ) may not elect to recharacterize
Excess Contributions as Thrift Contributions.
Participants who elect to recharacterize Excess
Contributions for the preceding Plan Year as Thrift
Contributions must submit their elections in writing to the
Committee by FEBRUARY 1 (enter date no later than 2 1/2
months after close of the Plan Year).
5. Matching Contributions
( ) Not permitted.
(X) Permitted.
(X) The Employer shall or may (in the event that the
Matching Contribution amount is within the discretion
of the Employer) make Matching Contributions to the
Plan with respect to (any one or a combination of the
following may be selected):
( ) Elective Deferrals.
( ) Thrift Contributions.
(X) Combined Contributions.
Such Matching Contributions will be made on behalf of:
<PAGE>
(X) All Participants who make such contribution(s).
( ) All Participants who are Non-Highly Compensated
Employees who make such contribution(s).
The amount of such Matching Contributions made on behalf of
each such Participant shall be:
(i) Elective Deferrals (any one or a combination of the
following may be selected) -
( ) An amount or percentage fixed by appropriate
action of the Employer.
( ) [....] of the Elective Deferrals.
( ) [....]% of the first [....]% of Compensation
contributed as an Elective Deferral, plus
[....]% of the next [....]% of Compensation
contributed as an Elective Deferral, plus
[....]% of the next [....]% of Compensation
contributed as an Elective Deferral.
The Employer shall not match Elective Deferrals as
provided above in excess of $[....] or in excess of
[....]% of the Participant's Compensation.
The Employer shall not match Elective Deferrals made
by the following class(es) of Employees: [....]
(ii) Thrift Contributions (any one or a combination of the
following may be selected)-
( ) An amount or percentage fixed by appropriate
action of the Employer.
( ) $[....] for each dollar of Thrift Contributions.
( ) [....]% of the Thrift Contributions.
( ) [....]% of the first [....]% of Compensation
contributed, plus [....]% of the next [....]% of
Compensation contributed, plus [....]% of the
remaining Compensation contributed.
The Employer shall not match Thrift Contributions as
provided above in excess of $[....] or in excess of
[....]% of the Participant's Compensation.
The Employer shall not match Thrift Contributions
made by the following class(es) of Employees: [...]
(iii) Combined Contributions (any one or a combination
of the following may be selected).
<PAGE>
( ) An amount fixed by appropriate action of the
Employer.
(X) 25% of Combined Contributions.
( ) [....]% of Elective Deferrals, plus [....]% of
Thrift contributions.
( ) [....]% of the first [....]% of Compensation
contributed, plus [....]% of the next [....]% of
Compensation contributed, plus [....]% of the
remaining Compensation contributed.
The Employer shall not match Combined Contributions as
provided above in excess of [....] or in excess of 2% of
the Participant's Compensation.
The Employer shall not match Combined Contributions made by
the following class(es) of Employees: DISTRICT LODGE NO. 15
OF THE INTERNATIONAL ASSOCIATION OF MACHINISTS AND
AEROSPACE WORKERS, AFL-CIO (IAM #15) UNTIL JANUARY 1, 1999.
Matching Contributions shall be made each:
(X) Payroll period.
( ) Month.
( ) Quarter.
( ) Plan Year.
Allocation of Matching Contributions --
In order to share in the allocation of Matching Contributions
(and forfeitures, if forfeitures are reallocated to
participants) a Participant:
( ) Must be employed on the last day of the payroll
period.
( ) Must be employed on the last day of the Month.
( ) Must be employed on the last day of the Quarter.
( ) Must be employed on the last day of the Plan Year.
unless the Participant terminates employment on account of:
( ) Death.
( ) Disability.
( ) Attainment of Early Retirement Age.
( ) Attainment of Normal Retirement Age.
<PAGE>
( ) Employer approved leave of absence.
( ) Must have ( ) 501 Hours of Service; ( ) [....] Hours
of Service (cannot exceed 1,000). Note: Not
applicable if elapsed time method of crediting
service is elected.
6. Qualified Matching Contributions
(X) Not permitted.
( ) Permitted.
( ) The Employer shall or may (in the event that the
Qualified Matching Contribution amount is within
the discretion of the Employer) make Qualified
Matching Contributions.
Qualified Matching Contributions will be made on behalf of:
( ) All Participants who make Elective Deferrals.
( ) All Participants who are Non-Highly Compensated
Employees and who make Elective Deferrals.
The amount of such Qualified Matching Contributions made on
behalf of each Participant shall be (any one or a
combination of the following may be selected):
( ) An amount or percentage fixed by appropriate action
by the Employer.
( ) [....]% of the Elective Deferrals.
The Employer shall not match Elective Deferrals as provided
above in excess of $[....] or in excess of [....]% of the
Participant's Compensation.
7. Qualified Nonelective Contributions
(X) Not permitted.
( ) The Employer shall have the discretion to contribute
Qualified Nonelective Contributions for any Plan Year in an
amount to be determined each year by the Employer.
Qualified Nonelective Contributions will be made on behalf
of (select as appropriate):
( ) All Eligible Employees.
( ) All Participants who make Elective Deferrals.
( ) All Participants who are Non-Highly Compensated
Employees and who make Elective Deferrals.
<PAGE>
( ) All Participants who are Non-Highly Compensated
Employees.
( ) All Non-Key Employees.
B. Forfeitures (Do not complete if 100% immediate vesting is elected).
Forfeitures of Employer Discretionary Contributions, Matching
Contributions or Excess Aggregate Contributions shall be:
( ) Allocated to participants in the manner provided in Sections 4.2
and 4.7(d)(2) of the Plan.
(X) Used to reduce:
(X) any future Employer contributions.
( ) Plan expenses.
C. Contributions Not Limited by Net Profits
Indicate for each type of Employer contribution allowed under the
Plan whether such contributions are to be limited to Net Profits of
the Employer for the taxable year of the Employer ending with or
within the Plan Year:
( ) Yes ( ) No Employer Discretionary Contributions
( ) Yes (X) No Elective Deferrals
( ) Yes ( ) No Qualified Nonelective Contributions
( ) Yes (X) No Matching Contributions
( ) Yes ( ) No Qualified Matching Contributions.
XII. DISTRIBUTIONS AND IN-SERVICE WITHDRAWALS
A. Accounts shall be distributable upon a Participant's separation from
service, death, or Total and Permanent Disability, and, in addition:
(X) Termination of the Plan without establishment or maintenance of
a successor plan.
( ) The disposition to an entity that is not an Affiliated Employer
of substantially all of the assets used by the Employer in a
trade or business, but only if the Employer continues to
maintain the Plan and only with respect to participants who
continue employment with the acquiring corporation.
(X) Upon attainment of the Plan's Normal Retirement Age.
( ) The disposition to an entity that is not an Affiliated Employer
of the Employer's interest in a subsidiary, but only if the
Employer continues to maintain the Plan and only with respect to
Participants who continue employment with such subsidiary.
<PAGE>
( ) Vested portion of Employer Discretionary Contributions on
account of a Participant's financial hardship to the extent
permitted by Section 4.9 of the Plan.
(X) Vested portion of Employer Matching Contributions on account of
a Participant's financial hardship to the extent permitted by
Section 4.9 of the Plan.
B. In addition to A above, Elective Deferrals, Qualified Nonelective
Contributions and Qualified Matching Contributions (as applicable)
and income allocable to such amounts shall be distributable:
(X) Upon the Participant's attainment of age 59 1/2.
(X) On account of a Participant's financial hardship, to the extent
permitted by Section 4.9 of the Plan (Elective Deferrals Only).
C. In-service withdrawals from a Participant's: ( ) Employer
Discretionary Contribution Account; (X) Matching Contribution
Account; ( ) Transfer Account, if any (X) shall; ( ) shall not be
permitted upon the attainment of age 59 1/2. (Permitted only if the
Plan is not integrated with Social Security and a Participant's
Employer Discretionary Contribution Account and Matching Contribution
Accounts are 100% vested at time of distribution.)
D. Distribution of benefits upon separation of service, retirement or
death of a Participant ( ) shall; (X) shall not be subject to the
Automatic Annuity rules of Section 8.2 of the Plan.
E. (Complete only if the Plan is not subject to the Automatic Annuity
rules of Section 8.2.) Check the appropriate optional forms of
benefit that shall be available under the Plan (if left blank, the
provisions of Section 8.6(a) of this Plan shall apply):
[ ] Single lump sum payment.
[ ] Installment payments pursuant to Section 8.6(a) of the
Plan.
F. The following optional forms of benefit shall be available in
addition to the optional forms of benefit available under Section 8.6
of the Plan (Note: If the Plan is not subject to the Automatic
Annuity rules of Section 8.2 and the Participant is permitted to
select an annuity as an optional form of benefit, then the Automatic
Annuity rules of Section 8.2 shall apply to such participant):
[Note: If the Plan is an amendment and restatement of an existing
Plan, optional forms of benefit protected under Section 411(d)(6) of
the Code may not be eliminated, unless permitted by IRS Regulations
Sections 1.401(a)-(4) and 1.411(d)-4].
<PAGE>
XIII. VESTING SERVICE
In order to be credited with a year of Service for vesting purposes, a
Participant shall complete [....] (not to exceed 1,000) Hours of Service.
(Not applicable if elapsed time method of crediting service for vesting
purposes is elected).
Note: In the case of Employees in the Maritime Industry, for purposes of a
year of Service, refer to Section 1.56 of the Plan.
XIV. VESTING SERVICE - EXCLUSIONS
All of an Employee's years of Service with the Employer shall be counted
to determine the vested interest of such Employee except:
( ) Years of Service before age 18.
( ) Years of Service before the Employer maintained this Plan or a
predecessor plan.
( ) Years of Service before the effective date of ERISA if such Service
would have been disregarded under the Service Break rules of the
prior plan in effect from time to time before such date. For this
purpose, Service Break rules are rules which result in the loss of
prior vesting or benefit accruals, or deny an Employee's eligibility
to participate by reason of separation or failure to complete a
required period of Service within a specified period of time.
XV. VESTING SCHEDULES
The vested interest of each Employee (who has an Hour of Service on or
after January 1, 1989) in his Employer-derived account balance shall be
determined on the basis of the following schedules:
A. Employer Discretionary Contributions.
( ) 100% immediately vested. [Note: Mandatory if more than 1
Eligibility Year of Service is required.]
( ) 100% immediately vested after [....] (not to exceed 5) years of
Service.
( ) [....] (not less than 20%) vested for each year of Service,
beginning with the [....] (not more than the 3rd) year of
Service until 100% vested.
( ) Other: [....] (Must be at least as favorable as any one of the
above 3 options).
AND
( ) Effective Date Vesting. Each Employee who is a Participant on
the Effective Date shall be 100% immediately vested.
<PAGE>
B. Matching Contributions.
( ) 100% immediately vested. [Note: Mandatory if more than 1
Eligibility Year of Service is required.]
( ) 100% immediately vested after [....] (not to exceed 5) years of
Service.
(X) 20% (not less than 20%) vested for each year of Service,
beginning with the 1ST (not more than the 3rd) year of Service
until 100% vested.
( ) Other: [....] (Must be at least as favorable as any one of the
above 3 options).
AND
( ) Effective Date Vesting. Each Employee who is a Participant on
the Effective Date shall be 100% immediately vested.
C. Top Heavy Minimum Vesting Schedules.
One of the following schedules will be used for years when the Plan
is or is deemed to be Top-Heavy.
( ) 100% immediately vested after [....] (not to exceed 3) years of
Service.
( ) 20% vested after 2 years of Service, plus [....]% vested (not
less than 20%) for each additional year of Service until 100%
vested.
(X) Other: 20% vested for each year of Service, beginning with the
1ST year of Service until 100% vested. (Note: must be at least
as favorable as either of the two schedules in this Section C).
If the vesting schedule under the Plan shifts in or out of the
Minimum Schedule above for any Plan Year because of the Plan's
Top-Heavy status, such shift is an amendment to the vesting schedule
and the election in Section 7.3 of the Plan applies.
XVI. LIFE INSURANCE
Life insurance ( ) shall; (X) shall not be a permissible investment.
XVII. LOANS
Loans ( ) shall; (X) shall not be permitted.
XVIII. TOP-HEAVY PROVISIONS
A. Top Heavy Status
( ) The provisions of Article XIII of the Plan shall always apply.
<PAGE>
(X) The provisions of Article XIII of the Plan shall only apply in
Plan Years after 1983, during which the Plan is or becomes
Top-Heavy.
B. Minimum Allocations
If a Participant in this Plan who is a Non-Key Employee is covered
under another qualified plan maintained by the Employer, the minimum
Top Heavy allocation or benefit required under Section 416 of the
Code shall be provided to such Non-key Employee under:
(X) this Plan.
( ) the Employer's other qualified defined contribution plan.
( ) the Employer's qualified defined benefit plan.
C. Determination of Present Value
If the Employer maintains a defined benefit plan in addition to this
Plan, and such plan fails to specify the interest rate and mortality
table to be used for purposes of establishing present value to
compute the Top-Heavy Ratio, then the following assumptions shall be
used:
Interest Rate: 8%
Mortality Table: 1983 GROUP ANNUITY TABLE
XIX. LIMITATION ON ALLOCATIONS
If the adopting Employer maintains or has ever maintained another
qualified plan in which any Participant in this Plan is (or was) a
Participant or could possibly become a Participant, the adopting
Employer must complete this Section. The Employer must also complete
this Section if it maintains a welfare benefit fund, as defined in
Section 419(e) of the Code, or an individual medical account, as
defined in Section 415(l)(2) of the Code, under which amounts are
treated as Annual Additions with respect to any Participant in the
Plan.
(a) If the Participant is covered under another qualified defined
contribution plan maintained by the Employer, other than a
Master or Prototype Plan, Annual Additions for any Limitation
Year shall be limited to comply with Section 415(c) of the Code:
( ) in accordance with Sections 6.4(e) - (j) as though the
other plan were a Master or Prototype Plan.
( ) by freezing or reducing Annual Additions in the other
qualified defined contribution plan.
( ) other:
(b) If a Participant is or has ever been a Participant in a
qualified defined benefit plan maintained by the Employer, the
<PAGE>
"1.0" aggregate limitation of Section 415(e) of the Code shall
be satisfied by:
(X) freezing or reducing the rate of benefit accrual under the
qualified defined benefit plan.
( ) freezing or reducing the Annual Additions under this Plan
(or, if the Employer maintains more than one qualified
defined contribution plan, as indicated in (a) above).
( ) other:
XX. INVESTMENTS
(X) Participants (X) shall; ( ) shall not be permitted to direct the
investment of their Accounts in the investment options selected by
the Employer or the Committee.
( ) Investment of participant Accounts shall be directed consistent with
rules and procedures established by the Committee. Such rules shall
be applied to all Participants in a uniform and nondiscriminatory
basis.
XXI. TRANSFERS
Transfers pursuant to Section 10.3 of the Plan ( ) shall; (X) shall not be
permitted.
If permitted, indicate additional prior plan provisions, if applicable:
[....].
XXII. ROLLOVERS
Rollovers pursuant to Section 10.3 of the Plan (X) shall; ( ) shall not be
permitted.
XXIII. EMPLOYER REPRESENTATIONS
The Employer hereby represents that:
It is aware of, and agrees to be bound by, the terms of the Plan.
<PAGE>
IN WITNESS WHEREOF, the Employer and the Trustee have executed this
instrument the ____________________________ day of ____________________,
19__________. If applicable, the appropriate corporate seal has been
affixed and attested to.
TROPICANA PRODUCTS, INC.
_________________________________
Name of Business Entity
_________________________________
Signature (Sole Proprietors only)
By:____________________________________
TERRY K. DANAHY, SENIOR VICE PRESIDENT,
HUMAN RESOURCES
Name and Title (Corporations or Partnerships)
ATTEST:
_____________________________
Secretary (Corporations only)
THE DREYFUS TRUST COMPANY
_________________________
Name(s) of Trustee(s)
______________________________
Signature (Individual Trustee)
______________________________
Signature (Individual Trustee)
By:_______________________________________
Name and Title (Corporate Trustee only)
DREYFUS TRUST AGREEMENT
THIS TRUST AGREEMENT is made by and between the Employer whose name is set
forth on the attached adoption agreement (the "Adoption Agreement") and the
person designated as Trustee in the Adoption Agreement (the "Trustee").
W I T N E S S E T H:
WHEREAS, the Employer has adopted the qualified employee retirement plan
described in the Adoption Agreement (the "Plan") for the exclusive benefit of
its employees who are participants in such Plan (collectively the
"Participants" and individually a "Participant") and their beneficiaries; and
WHEREAS, the Employer desires to appoint the Trustee as a "nondiscretionary
trustee" (within the meaning of Section VI(g) of Prohibited Transaction Class
Exemption 77-9 under Section 408(a) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA")) for the limited purposes hereinafter set
forth; and
WHEREAS, the Trustee desires to act as such a nondiscretionary trustee of the
Plan for the limited purposes hereinafter set forth;
NOW, THEREFORE, the Employer hereby establishes a fund with the Trustee that
shall be held, managed and controlled by the Trustee without distinction
between principal and income (the "Trust Fund") upon the terms and conditions
hereinafter set forth:
ARTICLE 1
CONCERNING THE TRUST FUND
Section 1.1. The Plan, this Trust Agreement and the Trust Fund created
hereunder are intended to meet all the applicable requirements of Sections
401(a) and 501(a) of the Internal Revenue Code of 1986, as amended (the "Code")
and ERISA. The Employer assumes full responsibility to establish and maintain
the Plan as a plan meeting the qualification requirements of Section 401(a) of
the Code and hereby agrees to notify the Trustee promptly in the event of any
change in such qualified status. Copies of all documents related to the Plan
including, without limitation, the Plan, amendments to the Plan and the most
recent determination letter received from the Internal Revenue Service with
respect to the Plan (or an opinion of counsel satisfactory to the Trustee as to
the plan's qualified status), upon request will be provided to the Trustee by
the Employer.
Section 1.2. The Employer certifies and represents to the Trustee that there
are no duties imposed on the Trustee under the terms of the Plan that are not
consistent with the provisions of this Trust Agreement.
Section 1.3. The Trustee agrees to accept contributions that are paid to it by
the Employer (as well as rollover contributions and transfers from other
qualified retirement plans) in accordance with the terms of the Plan. The
Trustee shall be entitled to rely upon the determination of the fiduciary named
in the Plan as having the authority to control and manage the administration of
the Plan and its delegates, designers, agents and employees (the "Committee")
that all assets received by the Trustee are properly contributed or transferred
<PAGE>
in accordance with the terms of the Plan. Such contributions shall be in cash
or in such other form that may be acceptable to the Trustee. All contributions
received by the Trustee and all other receipts of the Trustee, whether by way
of dividends, interest or otherwise, for the account of the Trust Fund shall be
held, managed and controlled by the Trustee pursuant to the terms of this Trust
Agreement without distinction between principal and income and may be
commingled, and held and invested and, with all disbursements therefrom,
accounted for by the Trustee, as a single fund. The Employer hereby agrees
that the Employer and the Committee shall have the exclusive responsibility,
and the Trustee shall not have any responsibility or duty under this Trust
Agreement, to determine whether the amount, timing and type of any contribution
by the Employer or any Participant is in accordance with the terms of the Plan
or applicable law, or for the collection of any contributions under the Plan.
Section 1.4 The Trustee, solely from assets held in the Trust Fund, shall make
payments in such amounts and for such proper purposes as may be specified in
the Committee's Directions (as defined in Section 2.1 herein). The Employer
hereby agrees that the Committee shall have the exclusive responsibility, and
the Trustee shall not have any responsibility or duty, under this Trust
Agreement for determining that the Committee's Directions are in accordance
with the terms of the Plan and applicable law, including without limitation,
determining the amount, timing or method of payment or the identity of each
person to whom such payments shall be made. The Trustee shall have no
responsibility or duty to determine the tax effect of any payment or to see to
the application of any payment, but shall be responsible for the proper
application of amounts withheld from distributions for payment of taxes to the
appropriate authorities.
Section 1.5. The Trustee shall have no duties or obligations with respect to
the Trust Fund unless such duties or obligations have been specifically
undertaken by the Trustee by the express terms of the Trust Agreement or except
to the extent such duties or obligations are required under applicable laws.
<PAGE>
ARTICLE II
INVESTMENT AND ADMINISTRATION OF THE FUND
Section 2.1.1. In accordance with the provisions of ERISA, the Trustee shall
have exclusive authority and discretion to manage and control the Trust Fund;
provided, however, that the Trustee's authority and discretion with respect to
the Trust Fund shall at all times, except to the extent that an Investment
Manager has been appointed pursuant to Section 2.5, be subject to the proper,
written directions of the Committee which are made in accordance with the terms
of the Plan and which are not contrary to ERISA (the "Committee's Directions").
The Trustee shall be entitled to rely entirely on the Committee's Directions,
shall be under no duty to determine or make inquiry whether the Committee's
Directions received by it are in accordance with the provisions of the Plan or
applicable law, and shall have no liability and shall be fully indemnified by
the Employer for any action taken in accordance with, or any failure to act in
the absence of, the Committee's Directions.
Section 2.1.2. If the Committee advises the Trustee that the Plan provides for
individual accounts and permits each Participant to direct the investment of
the assets in the Participant's account, then, pursuant to the Committee's
Directions, the Trustee shall invest the assets in such account among the
investment options established pursuant to Section 2.3 as directed by each such
Participant in accordance with such procedures as are acceptable to the
Trustee. If such procedures include the effecting of exchanges among the
investment options established pursuant to Section 2.3 or otherwise directing
the investment of the assets allocated to a Participant's account by use of the
telephone system maintained for such purpose by the trustee or its agent, the
Trustee shall be entitled to rely on any telephonic direction reasonably
believed by it to be genuine from any person representing himself or herself to
be a Participant directing the investment of assets in his or her account,
provided that the Trustee employs reasonable procedures for processing such
directions, such as requiring a form of personal identification, to confirm
that telephonic directions are genuine. If the Trustee does not follow such
procedures, it may be liable for any losses due to processing unauthorized or
fraudulent directions. Subject to the foregoing, the Trustee shall be entitled
to rely entirely on Participants' directions, shall be under no duty to
determine or make inquiry whether Participants' directions are in accordance
with the provisions of the Plan or applicable law, and shall have no liability
and shall be fully indemnified by the Employer for any action taken in
accordance with, or any failure to act in the absence of, Participants'
directions.
Section 2.2 Except to the extent an Investment Manager has been appointed
pursuant to Section 2.5, the Committee shall have authority and discretion to
select the nature and amount of the investments to be made under the Plan.
Subject to Section 2.5, the Trustee shall invest, reinvest and dispose of the
assets comprising the Trust Fund in accordance with the Committee's Directions.
The Committee shall exercise such authority and discretion solely in the
interest of the Participants and their beneficiaries and (1) for the exclusive
purpose of (a) providing benefits to the Participants and their beneficiaries
and (b) defraying reasonable expenses of administering the Plan, (2) with the
care, skill, prudence and diligence under the circumstances then prevailing
that a prudent person acting in a like capacity and familiar with such matters
would use in the conduct of an enterprise of a like character and with like
aims, (3) by diversifying the investments of the Plan so as to minimize the
risk of large losses, unless under the circumstances it is clearly prudent not
to do so and (4) in accordance with the terms of the Plan and with applicable
<PAGE>
law. The Trustee shall have no duty hereunder to review the investments held
in the Trust Fund. The Trustee shall not make suggestions or otherwise render
investment advice to the Committee or any Participant with respect to
investment, reinvestment, or disposition of assets held in the Trust Fund.
Section 2.3. Except to the extent required under applicable law, the authority
and discretion of the Trustee with respect to the Trust Fund shall be limited
to the following nondiscretionary powers which, with the exception of those
powers set forth in Section 2.3(0), shall be exercised solely in accordance
with the Committee's Directions or, to the extent provided in Section 2.1.2,
the directions of Participants or, to the extent provided in Section 2.5, the
directions of an Investment Manager:
(a) To open and maintain accounts for the Plan, and to the extent that
the Plan is a "defined contribution plan" (within the meaning of
Section 3(34) of ERISA), individual accounts for each of the
Participants.
(b) To receive contributions from the Employer and to credit
contributions made by the Employer to the individual accounts of
Participants established pursuant to paragraph (a) above.
(c) To invest contributions made by the Employer and other assets of the
Plan in shares of any investment company sponsored, managed, advised,
administered or distributed by The Dreyfus Corporation or any of its
affiliates (the "Dreyfus Funds"), in equity securities issued by the
Employer or an affiliate which are publicly traded and which are
"qualifying employer securities" within the meaning of Section
407(d)(5) of ERISA ("Employer Stock"), in any collective investment
fund maintained by a bank or trust company as a "group trust" for the
collective investment of employee benefit plans qualified under
Section 401(a) of the Code, and such other investments as may be
acceptable to the Trustee and as agreed to in writing by The Dreyfus
Corporation ("Sponsor") and the Committee (the Dreyfus Funds and such
other investments shall be collectively referred to as the
"Investments"); and to reinvest dividends and other distributions in
the Dreyfus Funds or other Investments provided, however, that if the
Plan is established pursuant to one of the Sponsor's prototype plan
documents, investments shall be subject to such investment
limitations or minimum requirements for investments in Dreyfus Funds
as may be imposed by the Sponsor. The Employer hereby agrees that
the Trustee shall not be restricted in making such investments to
investments that are authorized by governing state laws (as
determined under Section 9.5) for the investment of trust funds. If
Plan assets are invested in any group trust, the terms of the group
trust agreement or other governing document are hereby incorporated
by reference and made a part of the Trust Agreement as long as the
group trust remains exempt from taxation under Section 501(a) of the
Code. The Trustee shall not be responsible in any way respecting the
form, terms, payment provisions or issuer of any insurance contract
which it is directed to purchase and/or hold to provide for the
payment of benefits, or for performing any functions under any such
insurance contract which it may be directed to purchase and/or hold
as contract holder thereunder (other than the execution of any
documents incidental thereto and transfer or receipt of funds
thereunder in accordance with the Committee's Directions).
<PAGE>
(d) To redeem, transfer or exchange shares of the Dreyfus Funds, to sell,
exchange, convey, transfer or otherwise dispose of any other
Investments; and to make, execute and deliver to the purchasers
thereof good and sufficient legal documents of conveyance therefor,
and all assignments, transfers and other legal instruments, either
necessary or convenient for passing the title and ownership of the
Investments, and no person dealing with the Trustee shall be bound to
see to the application of the purchase money or to inquire into the
validity, expediency or propriety of any such sale or disposition.
(e) To make distributions from the Trust Fund to Participants and their
beneficiaries.
(f) Except as otherwise stated in Section 2.4, to deliver notices,
prospectuses and proxy statements to Participants or to the Employer,
and to vote in person or by proxy with respect to any securities held
by the Trust Fund in accordance with the written directions of the
Committee or of the Participants, as the case may be; and in
accordance with such power, to exercise subscription, conversion and
other rights and options and to take action or refrain from taking
any action with respect to any reorganization, consolidation, merger,
dissolution or other recapitalization or refinancing to the extent
that the exercise of such rights and options or the taking or
refraining from such actions may be deemed by the Trustee to be
necessary or proper to protect the best interests of the Trust Fund.
(g) To maintain records of contributions, investments, distributions and
other transactions, and to report such transactions to the Employer
or such other persons as may be designated by the Employer.
(h) To make necessary filings with the Internal Revenue Service, the
Department of Labor and other governmental agencies.
(i) To hold any part of the Trust Fund in cash or cash balances.
(j) To hold custody of the assets of the Plan; and with respect to any
such assets held in custody by the Trustee, to cause any investment
of the Trust Fund to be registered in the name of the Trustee or the
name of its nominee or nominees or to retain such investment
unregistered or in a form permitting transfer by delivery, provided
that the books and records of the Trustee shall at all times show
that all such investments are part of the Trust Fund.
(k) To apply for, purchase, hold or transfer any life insurance,
retirement income, endowment or annuity contract.
(l) To consult and employ any suitable agent(s) to act on behalf of the
Trustee and to contract for legal, accounting, clerical and other
services deemed necessary by the Trustee to administer the Trust Fund
according to the terms of this Trust Agreement and the instructions
of the Committee.
(m) To make loans from the Trust Fund to Participants in amounts and on
terms approved by the Committee; and Employer hereby agrees that the
Committee shall have the sole responsibility, and the Trustee shall
not have any duty or responsibility, for computing and collecting any
loan repayments required to be made under the Plan.
<PAGE>
(n) To pay from the Trust Fund all taxes imposed or levied with respect
to the Trust Fund or any part thereof under existing or future laws,
and to contest the validity or amount of any tax, assessment, claim
or demand respecting the Trust Fund or any part thereof.
(o) To pay out of the Trust Fund (i) all brokerage fees and transfer tax
expenses and other expenses incurred in connection with the sale or
purchase of investments, (ii) the Trustee's compensation and (iii)
all other expenses of administering the Plan and the Trust Fund
including, without limitation, any payments authorized by Section 1.4
of this Agreement, unless promptly paid to the Trustee, or otherwise,
by the Employer. The Trustee shall have the authority to pay all
fees and expenses described in this Section 2.3(0) out of the Trust
Fund in the event such fees and expenses are not promptly paid by the
Employer and the Trustee is not in receipt of Committee Direction to
make such payments.
(p) To do all such acts, and to exercise all such rights and privileges,
although not specifically mentioned herein, as the Trustee may deem
necessary or proper to carry out any of the nondiscretionary powers
set forth herein or otherwise in the best interests of the Trust Fund
and required by applicable law.
Section 2.4. Investments in Employer Stock shall be subject to the following
notwithstanding any other provision in this Trust Agreement:
(a) In accordance with the Committee's Directions, the Trust Fund may be
invested in Employer Stock without regard to the ten percent (10%)
limitation with respect to the acquisition and holding of employer
securities set forth in Section 407(a)(2) of ERISA if the Plan
qualifies as an "eligible individual account plan" under Section
407(d)(3) of ERISA.
(b) The Committee shall be responsible for determining the
appropriateness under the fiduciary responsibility and other
applicable provisions of ERISA of acquiring and holding Employer
Stock. The Trustee shall not be liable for any loss, or by reason of
any breach, which arises from following directions with respect to
the acquisition and holding of Employer Stock.
(c) Subject to the provisions of Section 2.4(d), the Trustee shall
purchase and sell Employer Stock in accordance with such procedures
and guidelines as annexed hereto as Schedule A.
(d) At the Committee's Directions, the Trustee shall purchase or sell
Employer Stock on the open market or from or to the Employer. In
addition, the Employer may contribute Employer Stock in lieu of cash
to the Trust Fund. In the event the Trustee uses one of its
affiliates to effect the purchase or sale of Employer Stock, the
Trustee and such affiliate shall comply with the provisions of
Prohibited Transaction Class Exemption 86-128. In the event that the
Committee directs the Trustee to use a particular broker or dealer to
effect the purchase or sale of Employer Stock, the Committee shall
represent to the Trustee that such direction (i) is for the exclusive
benefit of Participants and Beneficiaries of the Plan, and (ii) shall
not constitute, or cause the Trust Fund to be engaged in, a
"prohibited transaction" as defined in Section 406 of ERISA. In the
<PAGE>
event the Trustee purchases or sells Employer Stock from or to the
Employer, such purchase or sale shall be for "adequate consideration"
as defined in Section 3(18) of ERISA and no commission shall be
charged. In the event that the Employer contributes Employer Stock
in lieu of cash to the Trust Fund, such transfer shall be for
"adequate consideration" as defined in Section 3(18) of ERISA and no
commission shall be charged.
(e) The Employer represents and warrants that it has filed and will file
with the Securities and Exchange Commission and with all applicable
state agencies or authorities all required registration statements
relating to shares of Employer Stock and other interests which may be
issued under the Plan. The Employer acknowledges that it is and
shall be responsible for, and that the Trustee shall not be
responsible for, preparing or filing such registration statements or
for the accuracy of statements contained therein, or for preparing or
filing any other reports, statements or filings required under
federal or state securities laws with respect to the Trust Fund's
investment in Employer Stock.
(f) The Employer shall provide the Trustee with all proxy solicitation
materials proposed to be sent to stockholders or if the issuer of
Employer Stock held in the Trust Fund files preliminary proxy
solicitation materials with the Securities and Exchange Commission,
the Employer shall cause a copy of all materials to be simultaneously
sent to the Trustee. The Trustee shall vote the shares of Employer
Stock consistent with its current policies and procedures.
(g) In the event of a tender or exchange offer for any Employer Stock
held in the Trust Fund, the Participants rather than the Trustee
shall vote as to the tender or exchange offer. The Trustee shall use
its best efforts to distribute or cause to be distributed to each
affected Participant in a timely manner all information and materials
that are distributed to the stockholders of the issuer of the
Employer Stock in connection with the offer and directions as to how
the Participant may instruct the Trustee whether or not to tender or
exchange the Employer Stock credited to the Participant's account
(both vested and non-vested). Alternatively, the Trustee may agree
that the notification of Participants and distribution of the
information, materials and directions described above are to be
effected by the Employer or its designee. In such event, the
Employer shall provide the Trustee with a copy of all information,
materials and directions provided to Participants and shall certify
to the Trustee that the information, materials and directions have
been mailed or otherwise sent to each affected Participant. The
Trustee, in its discretion, may prepare or amend any instruction form
sent to Participants. Instructions shall be returnable to the
Trustee or its designee. Each Participant shall be entitled to
direct the Trustee to tender or exchange shares (including fractional
interest in shares) of Employer Stock credited to such Participant's
account (both vested and non-vested). Upon timely receipt of
instructions, the Trustee shall act with respect to Employer Stock as
instructed. Instructions received by the Trustee from Participants
shall be held by the Trustee in strict confidence and shall not,
except as may be required by law, be divulged or released to any
person including officers or employees of the Employer or members of
the Committee; provided, however, that the Trustee may advise the
<PAGE>
Employer, upon request, of the total number of shares of Employer
Stock that have been tendered or exchanged. The Trustee shall not
make recommendations to Participants on whether to tender or
exchange. The Trustee shall not tender or exchange shares of
Employer Stock credited to a Participant's account for which it has
not received instructions from the Participant. The Trustee shall
not be obligated to solicit a response from Participants from whom it
has not received instructions. The Trustee shall tender or exchange
that number of shares of Employer Stock not credited to Participants'
accounts which is determined (after giving effect to the withdrawal
of any shares of Employer Stock before the expiration of the offer or
any earlier date set by the Trustee) by multiplying the total number
of shares of Employer Stock not credited to Participants' accounts by
a fraction of which the numerator is the number of shares of Employer
Stock credited to Participants' accounts for which the Trustee has
received instructions from Participants to tender or exchange and of
which the denominator is the total number of shares of Employer Stock
credited to Participants' accounts. A Participant who has instructed
the Trustee to tender or exchange shares of Employer Stock credited
to such Participant's account may, at any time prior to the
expiration of the offer or any earlier date set by the Trustee,
instruct the Trustee to withdraw a specified number of shares from
the offer. A Participant shall not be limited as to the number of
instructions that the Participant may give to the Trustee. If a
Participant instructs the Trustee to tender or exchange shares of
Employer Stock credited to the Participant's account, the Trustee
shall credit to each account of such Participant from which the
shares were taken the consideration received by the Trustee for the
shares of Employer Stock tendered or exchanged from that account.
Pending receipt of Committee Directions or, to the extent provided in
Section 2.1.2 of the Trust Agreement, instructions from the
Participant as to the investment of such proceeds, the Trustee shall
invest any cash consideration in such money market mutual fund as is
designated in writing by the Committee.
(g) For purposes of this Section 2.4, the number of shares of Employer
Stock deemed "credited" to a Participant's account shall be
determined as of the last preceding valuation date for which an
allocation has been completed and Employer Stock has actually been
credited to Participants' accounts. The Trustee may, in its
discretion, require a special valuation of Participant accounts and
crediting of Employer Stock.
(h) In the event that the Trustee, in its discretion, determines that
time constraints make it unlikely that Participant tender or exchange
instructions can be received in a timely fashion, the Trustee shall
notify the Committee and the Committee or its designee shall be
responsible for such matter, and the Trustee shall vote proxies or
respond to a tender or exchange offer in accordance with the
Committee's Directions.
(i) All costs incurred by the Trustee in handling proxy and tender or
exchange offer matters, including without limitation all costs
associated with the printing and mailing of Participant instruction
forms and other materials and attorneys' fees, shall be expenses of
the Trust Fund within the meaning of Section 6.1 of the Trust
Agreement.
<PAGE>
Section 2.5. If permitted by the Plan, the Employer or the Committee may
appoint one or more investment managers within the meaning of Section 3(38) of
ERISA ("Investment Manager") to direct investments with respect to all or part
of the Trust Fund. Any Investment Manager so appointed shall be (i) an
investment adviser registered as such under the Investment Advisers Act of
1940, or (ii) a bank, as defined in that Act, or (iii) any insurance company
qualified to perform investment management services under the laws of more than
one state. Any Investment Manager so appointed shall, in writing, certify to
the Employer that it is qualified to act in such capacity under clause (i),
(ii) or (iii) of the preceding sentence, accept its appointment as Investment
Manager, acknowledge that it is a fiduciary with respect to the Plan, and
certify the identity of the person or persons authorized to give instructions
or directions on its behalf. The Employer shall certify to the Trustee that it
has appointed each Investment Manager in accordance with the provisions of the
Plan and ERISA, and instruct the Trustee as to the portion of the Plan that is
to be managed by each Investment Manager. The Trustee may continue to rely
upon all certifications and agreements made under this Section 2.5 unless
otherwise notified in writing by the Employer or the Investment Manager, as the
case may be. The Trustee shall be entitled to rely entirely on an Investment
Manager's directions, shall be under no duty to determine or make inquiry
whether an Investment Manager's directions received by it are in accordance
with the provisions of the Plan or applicable law, and shall have no duty to
review or recommend the sale, retention, or other disposition of any asset
purchased or retained in accordance with an Investment Manager's directions.
The Trustee shall have no liability for any loss to the Trust Fund resulting
from the purchase, sale, or retention of any asset in accordance with an
Investment Manager's directions, or resulting from not having sold such assets
so purchased or retained in the absence of an Investment Manager's directions,
to make such sale or take any other action. The Trustee shall be fully
indemnified by the Employer for any action taken in accordance with, or any
failure to act in the absence of, an Investment Manager's directions.
ARTICLE III
DUTIES AND RESPONSIBILITIES
Section 3.1.1. The Trustee shall discharge its duties and responsibilities
under this Trust Agreement solely in the interest of Participants and their
beneficiaries, and
(a) for the exclusive purpose of providing benefits to the Participants
and their beneficiaries and defraying the reasonable expenses of
administering the Plan;
(b) with the care, skill, prudence, and diligence under the circumstances
then prevailing that a prudent person acting in a like capacity and
familiar with such matters would use in the conduct of an enterprise
of a like character and with like aims.
Section 3.1.2. In the event that the Employer designates The Dreyfus Trust
Company ("The Trust Company") as the Trustee in the Adoption Agreement hereto,
and the Trustee has been designated as an additional Trustee for the Plan, The
Trust Company as Trustee shall have no responsibilities other than as set forth
herein, and this Trust Agreement shall constitute a supplemental trust
agreement. The duties of The Trust Company shall be limited to assets held in
the Trust Fund, and The Trust Company shall have no duties with respect to
assets held by any other person including, without limitation, any other
<PAGE>
trustee for the Plan. The Employer hereby agrees that The Trust Company shall
not serve as, and shall not be deemed to be, a co-trustee under any
circumstances.
Section 3.1.3. Subject to the limitations set forth in Section 3.1.2 herein,
in the event that more than one individual Trustee has been designated in the
Adoption Agreement, the action of such individual Trustees shall be determined
by vote of the majority of such individual Trustees; provided, however, that
any one of such individual Trustees may execute any applications for insurance
or annuity contracts provided for herein and documents necessary for the
exercise of ownership rights thereunder and may perform other such ministerial
acts; and further provided, that the Trustees may enter into an agreement
allocating among themselves specific responsibilities, obligations and duties.
Section 3.1.4. The Trustee shall be solely responsible for its own acts and
omissions. The Trustee shall have no duty to question, or otherwise inquire
into, the performance of another fiduciary with respect to duties allocated to
such other fiduciary under the Plan. The Trustee shall not be responsible for
the breach of any other such fiduciary unless the Trustee (i) participates
knowingly in, or knowingly undertakes to conceal, an act or omission of such
other fiduciary, knowing such act or omission is a breach, (ii) has actual
knowledge of a breach by such other fiduciary and fails to make reasonable
effort under the circumstances to remedy the breach or (iii) has failed to
perform its own specific fiduciary duties and thereby has enabled another
fiduciary to commit a breach.
Section 3.2. The Trustee shall keep full and accurate records of all receipts,
investments, disbursements and other transactions hereunder, including such
specific records as may be agreed upon in writing between the Company, the
Committee and the Trustee. All such records shall be open to inspection during
the Trustee's normal business hours by any authorized representative of the
Employer or the Committee upon reasonable prior notice to the Trustee.
Section 3.3. Within 90 days after the end of each Plan Year, as that term is
defined in the Plan, or within 90 days after its removal or resignation, or the
termination of the Plan or this Trust Agreement, the Trustee shall file with
the Committee a written account of the administration of the Trust Fund showing
all transactions effected by the Trustee subsequent to the period covered by
the last such accounting, if any, to the end of such Plan Year or date of such
removal or resignation, or the termination of the Plan or this Trust Agreement,
and all property held at its fair market value at the end of the accounting
period. Upon approval of such accounting by the Committee, neither the Employer
nor the Committee shall be entitled to any further accounting by the Trustee.
The Committee shall approve such accounting by written notice of approval
delivered to the Trustee or by failure to express objection to such accounting
in writing delivered to the Trustee within 60 days from the date on which the
accounting is mailed to the Committee and, in either case, the Trustee shall be
forever released and discharged from all liability and accountability with
respect to the propriety of its acts and transactions as to which the Committee
shall within such 60 day period file with the Trustee no such written
objections.
Section 3.4. The Trustee may from time to time consult with counsel and shall
be entitled to rely entirely upon the advice of counsel with respect to any act
or omission.
<PAGE>
Section 3.5. In the event of any disagreement resulting in conflicting
instructions to, or adverse claims or demands upon, the Trustee with respect to
payments or instructions, the Trustee shall be entitled, at its option, to
refuse to comply with any such instruction, claim or demand so long as such
disagreement shall continue, and in the exercise of such refusal, the Trustee
may elect not to make any payment or other disposition of assets held pursuant
to this Trust Agreement. The Trustee shall not be or become liable in any way
for its failure or refusal to comply with any such conflicting instructions or
adverse claims or demands, and it shall be entitled to continue to refrain from
acting until such conflicting or adverse instructions, claims or demands (a)
shall have been adjusted by agreement and it shall have been notified in
writing therefor or (b) shall have been finally determined in a court of
competent jurisdiction.
Section 3.6. The Trustee shall not, by act, delay, omission or otherwise, be
deemed to have waived any right or remedy it may have either under this Trust
Agreement or generally, and no waiver shall be valid unless it is contained in
a written instrument signed by the Trustee and only to the extent expressly set
forth therein. A waiver by the Trustee under the terms of this Trust Agreement
shall not be construed as a bar to, or waiver of, the same or any other such
right or remedy that it would otherwise have on any other occasion.
Section 3.7. The Trustee will not be compelled to do any act under this Trust
Agreement or to take any action toward the execution or enforcement of the
Trust Fund created hereunder or to prosecute or defend any suit in respect
thereof, unless indemnified by the Employer to its satisfaction against any
loss, costs, liability and expense; and the Trustee will be fully indemnified
by the Employer for any liability or obligation to any person that results from
any failure on the part of the Employer or the Committee to perform any of
their respective obligations under the Plan or under the terms of this Trust
Agreement, or for any error or omission whatsoever on the part of the Committee
or the Employer.
Section 3.8. Unless resulting from the Trustee's own negligence or willful
misconduct, the Employer shall indemnify the Trustee and save it harmless from,
against, for and in respect of any and all damages, losses, obligations,
liabilities, liens, deficiencies, costs and expenses (including, without
limitation, attorney's fees and other costs and expenses incident to any suit,
action, investigation, claim or proceedings) suffered, sustained, incurred or
required to be paid by the Trustee in connection with the Plan or this Trust
Agreement. The provisions of this Section 3.8 shall survive termination of
this Trust Agreement.
ARTICLE IV
PROHIBITION OF DIVERSION
Section 4.1. Except as provided in Section 4.2 herein, at no time prior to the
satisfaction of all liabilities with respect to Participants and their
beneficiaries under the Plan shall any part of the corpus or income of the Fund
be used for, or diverted to, purposes other than for the exclusive benefit of
Participants or their beneficiaries, or for defraying reasonable expenses of
administering the Plan.
Section 4.2.1. Notwithstanding the provisions of Section 4.1, but subject to
the provisions of Section 4.2.2 herein, contributions made by the Employer
<PAGE>
under the Plan shall be returned to the Employer under the following conditions
and only as the Trustee is instructed in writing by the Committee:
(a) If a contribution is made by mistake of fact, such contribution shall
be returned to the Employer within one year of the payment of such
contributions;
(b) To the extent that contributions to the Plan are specifically
conditioned upon their deductibility under the Code, and a deduction
is disallowed for any such contribution, it shall be returned to the
Employer within one year after the disallowance of the deduction; and
(c) To the extent that contributions to the Plan are specifically
conditioned on initial qualification of the Plan under the Code, and
the Plan is determined to be disqualified, contributions and the
earnings thereon made in respect of any period subsequent to the
effective date of such disqualification shall be returned to the
Employer within one year after the date of denial of qualification,
provided that the Employer makes timely application to the Internal
Revenue Service for a determination of the qualified status of the
Plan.
Section 4.2.2 Earnings attributable to any contributions returned to the
Employer under Sections 4.2.1(a) and 4.2.1 (b) shall not be returned to the
Employer. Losses attributable to any contributions returned to Employer under
Section 4.2.1 shall reduce the amount to be so returned.
ARTICLE V
COMMUNICATION WITH COMMITTEE AND THE EMPLOYER
Section 5.1. Except as otherwise specifically provided herein, any action by
an Employer that is a corporation pursuant to any of the provisions of this
Trust Agreement shall be evidenced by (1) a resolution of its board of
directors (the "Board") certified to the Trustee over the signature of its
Secretary or Assistant Secretary or other duly authorized agent under the
corporate seal, if any, or (2) by appropriate written authorization of any
person or committee to which the Board has delegated the authority to take such
action. Any action by an Employer that is a partnership or a sole
proprietorship shall be evidenced by a written certification of a general
partner of the partnership or the sole proprietor, as the case may be. The
Trustee shall be entitled to rely entirely on, and shall be fully indemnified
by the Employer for acting in accordance with, any such resolution,
certification or other authorization.
Section 5.2. The Employer shall provide to the Trustee a certificate, signed
by an authorized officer of the Employer, that contains (a) the name, (b)
specimen signature and (c) a description of the specific powers and duties, of
each member of the Committee. The Employer shall give prompt written notice of
any change in the identity, powers or duties of any member of the Committee,
and the Trustee shall be entitled to rely entirely on its failure to receive
such notice as a certification of the Employer that a designated member of the
Committee and such member's duties and powers have not been changed. The
Trustee shall have no duty to inquire into the qualifications of any member of
the Committee.
<PAGE>
Section 5.3. The Committee's Directions shall be communicated to the Trustee
in a certificate that sets forth the action of the Committee, signed by the
person then acting as Chairman or Secretary of the Committee, or in a written
statement signed by any two or more members of the Committee or any person or
agent designated to act on behalf of the Committee. Such person or agent shall
be so designated either under the provisions of the Plan or in a certificate by
the Committee that contains (a) the name, (b) specimen signature and (c) a
description of the specific powers and duties of each such person or agent.
The Committee shall give prompt written notice of any change in the identity,
powers and duties of any such person or agent, and the Trustee shall be
entitled to rely entirely on its failure to receive such notice as a
certification of the Committee that the identity, powers and duties of such
person or agent have not been changed.
Section 5.4. The Trustee shall have no liability hereunder for any action
taken in good faith in reliance upon any instructions, directions,
certifications and communications believed by the Trustee to be genuine and to
have been signed or communicated by the proper person.
ARTICLE VI
TRUSTEE'S COMPENSATION; EXPENSES
Section 6.1. The Trustee shall receive reasonable compensation for its
services in accordance with its schedule of compensation in effect when such
services are rendered. The Trustee may amend the schedule from time to time,
which amendment shall become effective no earlier than 30 days after written
notice is sent to the Employer. The Trustee shall also be entitled to
reimbursement for all reasonable expenses incurred by it in the performance of
its duties hereunder including, without limitation, any expenses incurred in
the consultation or employment of any agent pursuant to Section 2.3(l). Any
such compensation or expenses and any income or other taxes which may be levied
against the Trust Fund shall be paid out of the Trust Fund, unless paid
directly by the Employer.
ARTICLE VII
RESIGNATION AND REMOVAL OF TRUSTEE
Section 7.1. The Trustee may resign at any time by written notice to the
Employer which shall be effective 30 days after delivery to the Employer of
such notice, provided that a successor Trustee shall have been appointed by the
Employer; provided, however, that such notice may be waived by the Employer.
Section 7.2. The Trustee may be removed by the Employer at any time upon 30
days' prior written notice to the Trustee, provided that a successor Trustee
shall have been appointed by the Employer; provided, however, that such notice
may be waived by the Trustee.
Section 7.3. The appointment of a successor Trustee hereunder shall be
accomplished by and shall take effect upon the delivery to the resigning or
removed Trustee, as the case may be, of written notice from the Employer
appointing such successor Trustee, and an acceptance in writing of the
successor Trustee. Any successor Trustee may be either a corporation
authorized and empowered to exercise trust powers or one or more individuals.
All of the provisions set forth herein with respect to the Trustee shall relate
to each successor Trustee so appointed with the same force and effect as if
<PAGE>
such successor Trustee had been originally named herein as the Trustee
hereunder. If a successor Trustee shall not have been appointed within 30 days
after delivery to the Employer of notice of the Trustee's resignation pursuant
to Section 7.1, the resigning Trustee may apply to a court of competent
jurisdiction for the appointment of a successor Trustee.
Section 7.4. Upon the appointment of a successor Trustee, the resigning or
removed Trustee shall transfer and deliver the Trust Fund to such successor
Trustee, after reserving such reasonable amounts as are necessary to provide
for its reasonable expenses in the settlement of its account, the amount of any
compensation due to it and any sums chargeable against the Trust Fund for which
it may be liable. If the sums so reserved are not sufficient for such
purposes, the resigning or removed Trustee shall be entitled to reimbursement
for any deficiency from the Employer or out of the Trust Fund.
Section 7.5. At the time the Trust Fund shall have been transferred and
delivered to a successor trustee and the accounts of the Trustee have been
approved pursuant to Section 3.3 herein, the Trustee shall be released and
discharged from all further accountability or liability for the Trust Fund and
shall not be responsible in any way for the further disposition of the Trust
Fund or any part thereof.
ARTICLE VIII
AMENDMENT AND TERMINATION OF THE TRUST AND PLAN
Section 8.1. The Employer may terminate this Agreement at any time upon 30
days' prior written notice delivered to the Trustee; provided that such
termination by the Employer is subject to the condition that a new trustee
assumes the responsibilities and functions of the Trustee as set forth herein;
and provided, further, that the trusteeship shall, if terminated by the
Employer, continue thereafter for such period as may be necessary for the
complete divestiture to a newly appointed trustee of all assets held in the
Trust Fund.
Section 8.2. If the Plan is terminated in whole or in part, or if the Employer
permanently discontinues its contributions to the Plan, the Trustee shall
distribute the Fund or any part thereof in accordance with the Committee's
Directions. Upon the Employer's termination of the Plan in whole or in part or
the revocation or termination of this Trust Agreement, the Trustee shall have
the right to have its accounts approved. When the Trust Fund shall have been
so applied or distributed, and the accounts of the Trustee shall have been
approved pursuant to Section 3.3 herein, the Trustee shall not be responsible
in any way for the further disposition of the Trust Fund (or that part thereof
so applied or distributed, if the Plan is terminated only in part). The
Trustee shall have the right to withhold distribution or application of any
part of the Trust Fund unless and until written approval of any such
termination has been granted by the Internal Revenue Service and, if the Plan
is subject to the jurisdiction of the Pension Benefit Guaranty Corporation (the
"PBGC"), (a) the period of time set forth in Section 4041(b)(2)(C) of ERISA has
elapsed and the PBGC has not issued any notice of noncompliance or (b) the PBGC
has notified the Plan Administrator that the requirements or a distress
termination have been met pursuant to Section 4041(c)(3)(A) of ERISA. Assets
of the Trust Fund shall not be returned to the Employer unless and until the
Employer has delivered to the Trustee (a) a certification of an enrolled
actuary stating that there is an amount remaining in the Trust Fund that is not
required for the payment of the benefits provided under the Plan for
<PAGE>
participants or their beneficiaries and (b) an opinion of counsel satisfactory
to the Trustee, stating that such return of assets is permitted under the terms
of the Plan and applicable law.
Section 8.3. This Trust Agreement may be amended or modified by a written
agreement signed by the parties hereto or by the Trustee upon 60 days' prior
written notice to the Employer.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 9.1. This Trust Agreement shall be adopted by execution of the
Adoption Agreement.
Section 9.2. In the event that any provision of this Trust Agreement is deemed
or held to be unlawful or invalid for any reason, such event shall not
adversely affect any other provision contained herein unless such illegality
shall make impossible or impracticable the functioning of this Trust Agreement,
and in such case, the appropriate parties shall immediately amend this Trust
Agreement.
Section 9.3. The titles and headings of the Sections in this instrument are
placed herein for convenience of reference only. In the event of any conflict,
the text of this instrument, rather than such titles or headings, shall control
the interpretation of any of the terms and provisions contained herein.
Section 9.4. Except as otherwise specifically provided herein, all notices or
other communications required or permitted to be given pursuant to this
Agreement shall be given in writing and delivered by personal delivery or sent
by U.S. first class mail, postage prepaid, addressed to their last respective
address of record.
Section 9.5. The construction, validity and administration of this Trust
Agreement shall be governed by the laws of the state where the Trustee has its
principal place of business, except to the extent that such laws are preempted
by ERISA.
PLAN DOCUMENT
DEFINED CONTRIBUTION PLAN
<PAGE>
ARTICLE I.
DEFINITIONS
1.1 "Account" shall mean any one of the accounts maintained by the
Committee for each Participant in accordance with Section 4.5.
1.2 "Act" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
1.3 "Actual Deferral Percentage" shall mean the ratio (expressed as a
percentage) of Elective Deferrals (including Excess Elective
Deferrals), Qualified Matching Contributions, and Qualified Nonelective
Contributions paid over to the Fund on behalf of an Eligible
Participant for the Plan Year to the Eligible Participant's
Compensation for the Plan Year. The Actual Deferral Percentage of an
Eligible Participant who does not make an Elective Deferral, and who
does not receive an allocation of a Qualified Matching Contribution or
a Qualified Nonelective Contribution, is zero.
1.4 "Adoption Agreement" shall mean the document executed by the adopting
Employer which contains all the options which may be selected and which
incorporates this Plan by reference.
1.5 "Affiliated Employer" shall mean any corporation which is a member of a
controlled group of corporations (as defined in section 414(b) of the
Code) which includes the Employer; any trade or business (whether or
not incorporated) which is under common control (as defined in section
414(c) of the Code) with the Employer; any organization (whether or not
incorporated) which is a member of an affiliated service group (as
defined in section 414(m) of the Code) which includes the Employer; and
any other entity required to be aggregated with the Employer pursuant
to regulations under section 414(o) of the Code.
1.6 "Anniversary Date" unless otherwise defined in the Adoption Agreement,
shall mean the first day of the Plan Year. If the initial Plan Year is
less than a 12 month period, the Anniversary Date shall mean the first
day of the 12 consecutive month period designated as the Plan Year in
the Adoption Agreement.
1.7 "Annuity Starting Date" shall mean the first day of the first period
for which an amount is paid as an annuity or any other form.
1.8 "Average Actual Deferral Percentage" shall mean the average (expressed
as a percentage) of the Actual Deferral Percentages of the Eligible
Participants in a group.
1.9 "Average Contribution Percentage" shall mean the average (expressed as
a percentage) of the Contribution Percentages of the Eligible
Participants in a group.
1.10 "Beneficiary" or "Beneficiaries" shall mean one or more persons
designated as such by a Participant to receive his interest in the Fund
in the event of the death of the Participant.
1.11 "Board of Directors" shall mean the Board of Directors of the Employer
if the Employer is an incorporated business entity.
<PAGE>
1.12 "CODA" shall mean a cash or deferred arrangement qualified under
section 401(k) of the Code.
1.13 "Code" shall mean the Internal Revenue Code of 1986, as amended.
1.14 "Committee" shall mean the person or persons appointed by the Employer
to administer the Plan in accordance with Article XII.
1.15 "Compensation", unless otherwise specified in the Adoption Agreement,
shall mean, in the case of an Employee other than a Self-Employed
Individual, his wages as defined in section 3401(a) of the Code and all
other payments of compensation to the Employee by the Employer (in the
course of the Employer's trade or business) for which the Employer is
required to furnish the Employee a written statement under sections
6041(d) and 6051(a)(3) of the Code, determined without regard to any
rules under section 3401(a) of the Code that limit the remuneration
included in wages based on the nature or location of the employment or
the services performed, which are actually paid during the applicable
period. In the case of a Self-Employed Individual, Compensation shall
mean his Earned Income. Unless otherwise specified in the Adoption
Agreement, the applicable period shall be the Plan Year. If elected by
the employer in the Adoption Agreement, Compensation shall also include
Employer contributions made pursuant to a salary reduction agreement
with an Employee which are not currently includible in the gross income
of the Employee by reason of the application of sections 125,
402(e)(3), 402(h)(1)(B) or 403(b) of the Code. Compensation shall
include Excess Contributions which are recharacterized in accordance
with Section 3.6(d) to the extent that Elective Deferrals are included
in Compensation.
Solely for purposes of determining Actual Deferral Percentages and
Contribution Percentages, Compensation, if the Plan is a
non-standardized plan, shall be determined without regard to any
exclusions which may be elected in the Adoption Agreement. Solely for
purposes of determining Actual Deferral Percentages and Contribution
Percentages, the applicable period for determining the amount of an
Employee's Compensation shall be limited to the period during which the
Employee was an Eligible Participant.
For Plan Years beginning on or after January 1, 1989, annual
Compensation shall not include amounts in excess of $200,000, as
adjusted by the Secretary of the Treasury at the same time and in the
same manner as under section 415(d) of the Code except that the dollar
increases in effect on January 1 of any calendar year is effective for
Plan Years beginning in such calendar year and the first adjustment to
the $200,000 limitation is effective on January 1, 1990.
For Plan Years beginning on or after January 1, 1994, the annual
Compensation of each Participant taken into account for determining all
benefits provided under the Plan for any Plan Year shall not exceed
$150,000, as adjusted for increases in the cost-of-living in accordance
with section 401(a)(17)(B) of the Code. The cost-of-living adjustment
in effect for a calendar year applies to the applicable period
beginning in such calendar year.
If an applicable period consists of fewer than 12 months, the annual
Compensation limit is an amount equal to the otherwise applicable
<PAGE>
annual Compensation limit multiplied by a fraction, the numerator of
which is the number of months in the short applicable period, and the
denominator of which is 12.
In determining Compensation for purposes of the annual Compensation
limit, the family member rules of Section 414(q)(6) of the Code shall
apply except that in applying such rules, the term "family" shall
include only the Employee's spouse and any lineal descendants who have
not attained age 19 before the close of the Plan Year. If, as a result
of the application of such family member rule the annual compensation
limit is exceeded, then (except for purposes of determining the portion
of Compensation up to the Integration Level if this Plan is integrated
with Social Security), the annual compensation limit shall be prorated
among the affected individuals in proportion to each such individual's
Compensation as determined under this Section prior to the application
of such limitation.
If Compensation for any prior applicable period is taken into account
in determining a Participant's allocations for the current Plan Year,
the Compensation for such prior applicable period is subject to the
applicable annual Compensation limit in effect for that prior period.
For this purpose, in determining allocations in Plan Years beginning on
or after January 1, 1989, the annual Compensation limit in effect for
applicable periods beginning before that date is $200,000. In
addition, in determining allocations in Plan Years beginning on or
after January 1, 1994, the annual Compensation limit in effect for
applicable periods beginning before that date is $150,000.
1.16 "Contribution Percentage" shall mean the ratio (expressed as a
percentage) of an Eligible Participant's Contribution Percentage
Amounts to the Eligible Participant's Compensation for the Plan Year.
1.17 "Contribution Percentage Amounts" shall mean the sum of the Thrift
Contributions, Voluntary Contributions and Matching Contributions under
the Plan on behalf of an Eligible Participant for the Plan Year. Such
Contribution Percentage Amounts shall not include Matching
Contributions that are forfeited either to correct Excess Aggregate
Contributions or because the contributions to which they relate are
Excess Elective Deferrals, Excess Contributions, or Excess Aggregate
Contributions. Such Contribution Percentage Amounts shall include
forfeitures of Excess Aggregate Contributions or Matching Contributions
allocated to the Eligible Participant's Employer Matching Contribution
Account, which shall be taken into account in the year in which such
forfeiture is allocated.
1.18 "Early Retirement Age" shall mean the date a Participant satisfies the
age and service requirements for early retirement, if any, specified in
the Adoption Agreement. Upon reaching his Early Retirement Age, a
Participant's right to his account balance shall be nonforfeitable,
notwithstanding the Plan's vesting schedule. If a Participant
separates from service before satisfying the age requirement for early
retirement, but has satisfied the service requirement, the Participant
will be entitled to elect to receive an early retirement benefit upon
satisfaction of such age requirement.
1.19 "Earned Income" shall mean the annual net earnings from self-employment
in the trade or business with respect to which the Plan is established,
<PAGE>
provided that personal services of the individual are a material
income-producing factor. Net earnings will be determined without
regard to items not included in gross income and the deductions
allocable to such items. Net earnings are reduced by contributions by
the Employer to a qualified plan to the extent deductible under section
404 of the Code. Net earnings shall be determined with regard to the
deduction allowed to the Employer by section 164(f) of the Code for
taxable years beginning after December 31, 1989.
1.20 "Effective Date" shall mean the date specified in the Adoption
Agreement.
1.21 "Elective Deferrals" shall mean any Employer contributions made to the
Plan at the election of the Participant, in lieu of cash compensation,
and shall include contributions made pursuant to a salary reduction
agreement or other deferral mechanism. With respect to any taxable
year, a Participant's Elective Deferrals are the sum of all Employer
contributions made on behalf of such Participant pursuant to an
election to defer under any CODA, any simplified employee pension cash
or deferred arrangement as described in section 402(h)(1)(B), any
eligible deferred compensation plan under section 457, any plan as
described under section 501(c)(18), and any Employer contributions made
on behalf of a Participant for the purchase of an annuity contract
under section 403(b) pursuant to a salary reduction agreement.
Elective Deferrals shall not include any deferrals properly distributed
as an Excess Amount pursuant to Section 4.4(d).
1.22 "Eligible Employee" shall mean each Employee who is not excluded from
eligibility to participate in the Plan under the Adoption Agreement.
1.23 "Eligibility Year(s) of Service" shall mean the twelve (12) consecutive
month period commencing on an Employee's Employment Commencement Date
and anniversaries thereof, during which the Employee worked at least
one thousand (1,000) Hours of Service (or such lesser number of Hours
of Service specified in the Adoption Agreement).
In the case of an Employee in the maritime industry whose compensation
is determined based on days of service, 125 days of service shall be
treated as 1,000 Hours of Service (or such lesser number of Hours of
Service as specified in the Adoption Agreement). For purposes of the
preceding sentence "maritime industry" shall mean that industry in
which Employees perform duties on board commercial, exploratory,
service or other vessels moving on the high seas, inland waterways,
Great Lakes, coastal zones, harbors and noncontiguous areas, or on
offshore ports, platforms or other similar sites.
In the case of a Participant, who does not have any nonforfeitable
right to the account balance derived from Employer contributions,
Eligibility Year(s) of Service before a period of consecutive one (1)
year Service Breaks will not be taken into account in computing
Eligibility Years of Service, if the number of consecutive one (1) year
Service Breaks in such period equals or exceeds the greater of five (5)
or the aggregate number of Eligibility Years of Service before such
break. Such aggregate number of Eligibility Years of Service will not
include any Eligibility Year of Service disregarded under the preceding
sentence by reason of prior Service Breaks.
<PAGE>
Notwithstanding the above, if the Adoption Agreement provides for full
and immediate vesting upon completion of the eligibility requirements
and an Employee has incurred a one (1) year Service Break before
satisfying the Plan's eligibility requirements, all Eligibility Year(s)
of Service before such Service Break will not be taken into account.
If the elapsed time method of crediting service is specified in the
Adoption Agreement, an Employee shall receive credit for Service,
except for credit which may be disregarded under this Section or
Section 2.3, for the aggregate of all time periods commencing on his
Employment Commencement Date or Re-Employment Commencement Date and
ending on his Severance from Service Date. An Employee shall also
receive credit for any Period of Severance of less than twelve (12)
months. Fractional periods of a year shall be expressed in terms of
days.
1.24 "Employee" shall mean an Owner-Employee, a Self-Employed Individual, a
Shareholder-Employee and any other person employed by the Employer or
any Affiliated Employer.
A "leased employee" shall also be treated as an Employee. The term
"leased employee" means any person (other than an employee of the
recipient employer) who pursuant to an agreement between the recipient
employer and any other person ("leasing organization") has performed
services for the recipient employer (or for the recipient employer and
related persons determined in accordance with section 414(n)(6) of the
Code) on a substantially full-time basis for a period of at least one
year, and such services are of a type historically performed by
employees in the business field of the recipient employer.
Contributions or benefits provided a leased employee by the leasing
organization which are attributable to services performed for the
recipient employer shall be treated as provided by the recipient
employer.
Notwithstanding the preceding paragraph, a leased employee shall not be
considered an employee of the recipient employer if: (i) such employee
is covered by a money purchase pension plan providing (1) a
nonintegrated employer contribution rate of at least ten percent (10%)
of compensation, as defined in section 415(c)(3) of the Code, but
including amounts contributed pursuant to a salary reduction agreement
which are excludable from the employee's gross income under section
125, section 402(a)(8), section 402(h) or section 403(b) of the Code,
(2) immediate participation, and (3) full and immediate vesting; and
(ii) leased employees do not constitute more than twenty percent (20%)
of the recipient employer's non-highly compensated workforce.
1.25 "Employer" shall mean the corporation, partnership, proprietorship or
other business entity which shall adopt the Plan or any successor
thereof.
1.26 "Employment Commencement Date" shall mean the first date with respect
to which an Employee performs an Hour of Service.
1.27 "Entry Date", unless otherwise specified in the Adoption Agreement,
shall mean the first day of the Plan Year and the first day of the
seventh month of the Plan Year. The initial Entry Date shall not
precede the original effective date of the Plan.
<PAGE>
1.28 "Excess Aggregate Contributions" shall mean, with respect to any Plan
Year, the excess of the aggregate Contribution Percentage Amounts taken
into account in computing the numerator of the Contribution Percentage,
actually made on behalf of Highly Compensated Employees for such Plan
Year, over the maximum Contribution Percentage Amounts permitted by the
Average Contribution Percentage tests of Section 3.7 (determined by
reducing contributions made on behalf of Highly Compensated Employees
in order of their Contribution Percentages, beginning with the highest
of such percentages).
1.29 "Excess Contributions" shall mean, with respect to any Plan Year, the
excess of the aggregate amount of Elective Deferrals, Qualified
Nonelective Contributions, and Qualified Matching Contributions
actually taken into account in computing the Actual Deferral Percentage
of Highly Compensated Employees for such Plan Year, over the maximum
amount of such contributions permitted under the Average Actual
Deferral Percentage tests of Section 3.6 (determined by reducing
contributions made on behalf of Highly Compensated Employees in order
of their Actual Deferral Percentages, beginning with the highest of
such percentages).
1.30 "Excess Elective Deferrals" shall mean a Participant's Elective
Deferrals for a taxable year in excess of the adjusted dollar
limitation of section 402(g) of the Code.
1.31 "Family Member" shall, with respect to a five percent (5%) owner or top
ten Highly Compensated Employee described in section 414(q)(6)(A) of
the Code, include the spouse and lineal ascendants and descendants of
an Employee or former Employee and the spouses of such lineal
ascendants and descendants. The determination of who is a Family
Member will be made in accordance with section 414(q) of the Code.
1.32 "Fund" shall mean all property received by the Trustee or Custodian for
purposes of the Plan, investments thereof and earnings thereon, less
payments made by the Trustee to carry out the Plan.
1.33 "Highly Compensated Employee" shall include highly compensated active
employees and highly compensated former employees.
A highly compensated active employee includes any Employee who performs
services for the Employer or any Affiliated Employer during the
determination year and who, during the look-back year: (i) received
Compensation from the Employer or any Affiliated Employer in excess of
$75,000 (as adjusted pursuant to section 415(d) of the Code); (ii)
received Compensation from the Employer or any Affiliated Employer in
excess of $50,000 (as adjusted pursuant to section 415(d) of the Code)
and was a member of the top-paid group for such year; or (iii) was an
officer of the Employer or any Affiliated Employer and received
Compensation during such year that is greater than fifty percent (50%)
of the dollar limitation in effect under section 415(b)(1)(A) of the
Code. The term Highly Compensated Employee also includes: (i) an
Employee who is described in the preceding sentence if the term
"determination year" is substituted for the term "look-back year" and
the Employee is one of the 100 most highly compensated Employees of the
Employer or any Affiliated Employer during the Plan Year; and (ii) an
Employee who is a five percent (5%) owner of the Employer or any
<PAGE>
Affiliated Employer at any time during the look-back year or
determination year.
If no officer has satisfied the compensation requirement of (iii) above
during either a determination year or look-back year, the highest paid
officer for such year shall be treated as a Highly Compensated
Employee.
For this purpose, the determination year shall be the Plan Year, and
the look-back year shall be the twelve (12) month period immediately
preceding the determination year unless the Employer has elected to use
the calendar year ending with or within the determination year as the
look-back year for purposes of its employee benefit plans. If the
Employer has so elected to use such calendar year as the look-back year
for its employee benefit plans, the determination year shall be the
"lag period," if any, by which the applicable determination year
extends beyond such calendar year.
A highly compensated former employee includes any Employee who
terminated employment (or was deemed to have terminated) prior to the
determination year, performs no service for the Employer or any
Affiliated Employer during the determination year, and was a highly
compensated active employee for either the separation year or any
determination year ending on or after the Employee's 55th birthday.
If an Employee is, during a determination year or look-back year, a
Family Member of either a five percent (5%) owner who is an active or
former Employee or a Highly Compensated Employee who is one of the 10
most Highly Compensated Employees of the Employer or any Affiliated
Employer during such year, then the Family Member and the five percent
(5%) owner or top-10 Highly Compensated Employee shall be aggregated.
The Family Member and five percent (5%) owner or top-10 Highly
Compensated Employee shall be treated as a single Employee receiving
Compensation and Plan contributions equal to the sum of Compensation
and contributions of the Family Member and five percent (5%) owner or
top-10 Highly Compensated Employee.
The determination of who is a Highly Compensated Employee, including
the determinations of the number and identify of employees in top-paid
group, the top 100 employees, the number of employees treated as
officers and the compensation that is considered, will be made in
accordance with section 414(q) of the Code and the regulations
thereunder.
1.34 "Hour of Service" shall mean:
(a) Each hour for which an Employee is compensated by the Employer,
or is entitled to be so compensated, for services rendered by
him to the Employer. These hours will be credited to the
Employee for the computation period in which the duties are
performed; and
(b) Each hour for which an Employee is compensated by the Employer,
or is entitled to be so compensated, on account of a period of
time during which no services are rendered by him to the
Employer (regardless of whether the Employee shall have ceased
to be an Employee) due to vacation, holiday, illness,
<PAGE>
incapacity (including disability), layoff, jury duty, military
duty or leave of absence. No more than five hundred and one
(501) Hours of Service shall be credited pursuant to this
subparagraph (b) on account of any single continuous period
during which an Employee renders no services to the Employer
(whether or not such period occurs in a single computation
period). Hours under this paragraph will be calculated and
credited pursuant to section 2530.200b-2 of the Department of
Labor Regulations which are incorporated herein by this
reference; and
(c) Each hour for which back pay, without regard to mitigation of
damages, has been awarded or agreed to by the Employer. The
same Hours of Service shall not be credited both under
subparagraph (a) or subparagraph (b), whichever shall be
applicable, and also under this subparagraph (c). The hours
will be credited to the Employee for the computation period or
periods to which the award or agreement pertains rather than
the computation period in which the award, agreement or payment
is made.
Hours of Service will be credited for employment with an
Affiliated Employer. Hours of Service will also be credited
for employment with a predecessor employer if the Employer
maintains the plan of such predecessor or the Employer so
elects in the Adoption Agreement.
Hours of Service will also be credited for any individual
considered an Employee under sections 414(n) or 414(o) of the
Code or the regulations thereunder.
Solely for purposes of determining whether a Service Break, as
defined in Section 1.54, for participation and vesting purposes
has occurred in a computation period, an individual who is
absent from work for maternity or paternity reasons shall
receive credit for the Hours of Service which would otherwise
have been credited to such individual but for such absence, or
in any case in which such hours cannot be determined, eight (8)
Hours of Service per day of such absence. For purposes of this
paragraph, an absence from work for maternity or paternity
reasons means an absence (1) by reason of the pregnancy of the
individual, (2) by reason of a birth of a child of the
individual, (3) by reason of the placement of the child with
the individual in connection with the adoption of such child by
such individual, or (4) for purposes of caring for such child
for a period beginning immediately following such birth or
placement. The Hours of Service credited under this paragraph
shall be credited (1) in the computation period in which the
absence begins if the crediting is necessary to prevent a
Service Break in that period, (2) in all other cases, in the
following computation period.
Hours of Service shall be credited on the basis of actual hours
worked unless another method has been specified in the Adoption
Agreement. Hours of Service shall not be counted if the
elapsed time method is specified in the Adoption Agreement,
<PAGE>
except to determine an Employee's Employment Commencement Date
or Re-Employment Commencement Date.
1.35 "Integration Level" shall mean the Taxable Wage Base or such lesser
amount elected by the Employer in the Adoption Agreement.
1.36 "Matching Contribution" shall mean Employer contributions made to this
Plan or any other defined contribution plan by reason of Thrift
Contributions or Elective Deferrals under this Plan.
1.37 "Net Profits" shall mean current and accumulated earnings of the
Employer before Federal and State taxes and contributions to this and
any other qualified plan.
1.38 "Non-Highly Compensated Employee" shall mean an Employee of the
Employer who is neither a Highly Compensated Employee nor a Family
Member.
1.39 "Normal Retirement Age" shall mean the age specified in the Adoption
Agreement. Upon reaching his Normal Retirement Age, the Participant's
right to his retirement benefit shall be nonforfeitable,
notwithstanding the Plan's vesting schedule. In the event the Employer
imposes a mandatory normal retirement age, the Normal Retirement Age
may not exceed such mandatory normal retirement age.
Notwithstanding any other provision of this Plan, the Employer, in
accordance with the provisions of the Age Discrimination in Employment
Act, shall have no right to compel a Participant to retire, except as
otherwise provided herein, if in the calendar year or the preceding
calendar year, the Employer has twenty (20) or more employees for each
work day in each of twenty (20) or more calendar weeks. The Employer
may retire a Participant who for the two (2) year period prior to
retirement is employed in a bona fide executive or high policy-making
position if (1) he has attained age sixty-five (65); (2) he has
attained his Normal Retirement Date; and (3) his annual retirement
benefit from the pension, profit sharing, savings or deferred
compensation plans maintained by the Employer equals, in the aggregate,
at least forty-four thousand dollars ($44,000). This Section shall be
deemed to be automatically amended to reflect any subsequent Federal
legislation or regulations.
1.40 "Owner-Employee" shall mean a sole proprietor or a partner who owns
more than ten percent (10%) of either the capital interest or profits
interest of a partnership.
1.41 "Participant" shall mean an Eligible Employee who enters the Plan
pursuant to Section 2.1 of the Plan.
(a) "Active Participant" shall mean a Participant who is credited
with one thousand (1,000) or more Hours of Service (or such
lesser number of Hours of Service specified in the Adoption
Agreement) in the Plan Year. Unless otherwise specified in the
Adoption Agreement, it is not necessary that the Participant be
employed on the last day of the Plan Year in order to be deemed
an Active Participant and share in the Employer contribution,
if any. If the elapsed time method of crediting service is
specified in the Adoption Agreement, Active Participant shall
<PAGE>
include all Participants, unless otherwise specified in the
Adoption Agreement.
Notwithstanding the foregoing paragraph, if the Plan is a
standardized plan, "Active Participant" shall mean, for each
Plan Year beginning on or after January 1, 1990, each
Participant other than a Participant who is not employed on the
last day of the Plan Year and is credited with more than 500
Hours of Service in the Plan Year. If the elapsed time method
of crediting service is specified in the Adoption Agreement,
"Active Participant" shall mean all Participants.
If the elapsed time method of crediting Hours of Service is
specified in the Adoption Agreement, Active Participant shall
mean a Participant who is credited with three (3) consecutive
calendar months of service.
(b) "Eligible Participant" shall mean an Employee who is eligible
under the terms of the Plan to make Thrift Contributions,
Elective Deferrals or Elective Deferrals and Thrift
Contributions, combined ("Combined Contributions") made on his
behalf.
1.42 "Participating Employer" shall mean any Affiliated Employer which has
adopted the Plan in accordance with Section 14.5.
1.43 "Period of Severance" shall mean a continuous period of time during
which the Employee is not employed by the Employer. Such period begins
on the Employee's Severance from Service Date and ends on the
Employee's Re-Employment Commencement Date.
1.44 "Plan" shall mean this Plan, the Trust Agreement and the Adoption
Agreement of the adopting Employer, as from time to time amended.
1.45 "Plan Year" shall mean the calendar year, unless another twelve (12)
consecutive month period is specified in the Adoption Agreement.
1.46 "Qualified Matching Contributions" shall mean Employer contributions to
the Plan which are allocated to Participants' accounts by reason of
Elective Deferrals, which are at all times subject to the distribution
and nonforfeitability requirements of section 401(k) of the Code.
1.47 "Qualified Nonelective Contributions" shall mean Employer contributions
(other than Matching Contributions or Qualified Matching Contributions)
which are allocated to Eligible Participants' accounts, which such
Participants may not elect to receive in cash until distributed from
the Plan and, which are at all times subject to the distribution and
nonforfeitability requirements of section 401(k) of the Code.
1.48 "Reemployment Commencement Date" shall mean the first day on which the
Employee is credited with an Hour of Service for the performance of
duties after the first eligibility computation period in which the
Employee incurs a one (1) year Service Break.
In the case of any Participant who has a one (1) year Service Break,
Eligibility Year(s) of Service before such break will not be taken into
account until the Employee has completed one (1) Eligibility Year of
<PAGE>
Service after returning to employment. Such Eligibility Year of
Service shall be measured by the twelve (12) consecutive month period
beginning on the Employee's Reemployment Commencement Date and, if
necessary, subsequent twelve (12) consecutive month periods beginning
on anniversaries of the Re-Employment Commencement Date.
If a former Participant completes an Eligibility Year of Service in
accordance with this provision, such Participant's participation will
be reinstated as of the Re-Employment Commencement Date.
1.49 "S-Corporation" shall mean an Employer who has made an election for its
taxable year of reference under section 1362(a) of the Code, or any
other applicable section pertaining thereto.
1.50 "Self-Employed Individual" shall mean an individual who has Earned
Income for the taxable year from the unincorporated trade, or business
or partnership with respect to which the Plan is established; also, an
individual who would have had Earned Income but for the fact such
trade, business or partnership had no net profits for the taxable year.
1.51 "Service" shall mean any twelve (12) consecutive month period identical
to the Plan Year during which the Employee completes at least one
thousand (1,000) or more Hours of Service (or such lesser number of
Hours of Service specified in the Adoption Agreement). Periods of time
to be excluded, if any, shall be stipulated in the Adoption Agreement.
In the case of Employees in the Maritime Industry, 125 days of service
shall be treated as 1,000 Hours of Service (or such lesser number of
hours of Service as specified in the Adoption Agreement).
Service will be credited in accordance with the rules set forth above
for any employment, for any period of time, for any Affiliated
Employer. Service will also be credited for any individual required to
be considered an Employee, for purposes of this Plan under section
414(n) or (o) of the Code, of the Employer or any Affiliated Employer.
If the elapsed time method of crediting service is specified in the
Adoption Agreement, an Employee shall receive credit for Service,
except for Service which may be disregarded under Sections 7.2(b), for
the aggregate of all time periods commencing on his Employment
Commencement Date or Re-Employment Commencement Date and ending on his
Severance from Service Date. An Employee shall also receive credit,
for vesting purposes, for any Period of Severance of less than twelve
(12) consecutive months. An Employee will receive a year of Service
for vesting purposes for each twelve (12) months of Service.
Fractional periods of a year shall be expressed in terms of days.
1.52 "Service Break" shall mean:
(a) For purposes of calculating Eligibility Years of Service, any
twelve (12) consecutive month period commencing on an
Employee's Employment Commencement Date or anniversaries
thereof during which the Employee is credited with five hundred
(500) Hours of Service or less. In the case of Employees in
the Maritime Industry, 62 days of service or less.
<PAGE>
(b) For purposes of calculating years of Service, any Plan Year
during which the Employee is credited with five hundred (500)
Hours of Service or less, where such Service Break shall be
measured from the first day of such Plan Year. In the case of
Employees in the Maritime Industry, 62 days of service or less.
(c) If the elapsed time method of crediting service is specified in
the Adoption Agreement, a Service Break shall mean a Period of
Severance of at least twelve (12) consecutive months; provided,
however, that in the case of an Employee absent for maternity
or paternity reasons (as defined in Section 1.35), the Period
of Severance shall not commence for this purpose until the
twenty-four (24) month anniversary of the first date of such
absence.
(d) A Service Break shall not be deemed to have occurred as a
result of absence due to service in the armed forces of the
United States, provided the Employee makes application for
resumption of work with the Employer following discharge,
within the time specified by then applicable laws.
1.53 "Severance from Service Date" shall mean the earlier of
(a) the date on which an Employee quits, retires, is discharged or
dies; or
(b) the twelve (12) month anniversary of the date an Employee is
first absent (with or without pay) for reason other than quit,
retirement, discharge or death (such as vacation, holiday,
sickness, disability, leave of absence or layoff).
1.54 Shareholder-Employee" shall mean a Participant who owns (or is
considered as owning) more than five percent (5%) of the outstanding
stock of an S-Corporation on any day during the taxable year of
reference of such S-Corporation. In determining the percent of a
Participant's ownership of the outstanding stock, the family
attribution rules of section 318(a)(1) of the Code, or any other
applicable section of the Code pertaining thereto shall apply.
1.55 "Sponsor" shall mean JOSEPH E. SEAGRAM & SONS, INC.
1.56 "Taxable Wage Base" shall mean, except for purposes of Article V, the
contribution and benefit base in effect under Section 230 of the Social
Security Act at the beginning of the Plan Year.
1.57 "Thrift Contributions" shall mean contributions made by a Participant
which are included in the Participant's gross income in the year in
which made.
1.58 "Total and Permanent Disability" shall mean the inability to engage in
any substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be expected to
result in death or which has lasted or can be expected to last for a
continuous period of not less than twelve (12) months. The permanence
and degree of such impairment shall be supported by medical evidence
satisfactory to the Committee.
<PAGE>
1.59 "Trustee" or "Custodian" shall mean the individual or individuals, or
institution appointed in the Adoption Agreement by the Employer to act
in accordance with the provisions of the Trust Agreement or Custodial
Agreement.
If the contributions will be made to a Custodian, references herein to
the "Trustee" shall be deemed to refer to the "Custodian" and the term
"Trust Fund" shall be deemed to refer to the "Custodial Account."
1.60 "Trust Agreement" shall mean the agreement between the Employer and the
Trustee.
1.61 "Valuation Date" shall mean the last day of the Plan Year and such
other dates as may be determined by the Committee.
1.62 "Voluntary Contributions" shall mean contributions previously made by a
Participant which were included in the Participant's gross income in
the year in which made.
ARTICLE II.
PARTICIPATION
2.1 Membership
Each Eligible Employee shall become a Participant on the Effective Date
or the Entry Date coincident with or next following the completion of
the age and service requirements set forth in the Adoption Agreement.
2.2 Excluded Employees
The Adoption Agreement may exclude Employees from participation in the
Plan based upon minimum age and service requirements or the inclusion
of such Employees in certain ineligible classifications.
In the event an Employee who is not a member of the eligible class of
Employees becomes a member of the eligible class, such Employee will
participate immediately if such Employee has satisfied the minimum age
and service requirements and would otherwise have previously become a
Participant.
In the event a Participant is no longer a member of an eligible class
of Employees and becomes ineligible to participate, but has not
incurred a Service Break, such Employee will participate immediately
upon returning to an eligible class of Employees. If such Participant
incurs a Service Break, eligibility to participate will be determined
under the rules of Section 1.23 of the Plan.
2.3 Reemployment
(a) A former Participant will become a Participant immediately upon
returning to the employ of the Employer if such former
Participant had a nonforfeitable right to all or a portion of
the account balance derived from Employer contributions at the
time of termination from service.
<PAGE>
(b) A former Participant who did not have a nonforfeitable right to
any portion of the account balance derived from Employer
contributions at the time of termination from service will be
considered a new Employee, for eligibility purposes, if the
number of consecutive one (1) year Service Breaks equal or
exceed the greater of five (5) or the aggregate number of years
of Service before such Service Breaks. If such former
Participant's years of Service before termination from service
may not be disregarded pursuant to the preceding sentence, such
former Participant shall participate immediately upon
reemployment.
(c) Any former Employee who was never a Participant and is
reemployed as an Employee will be eligible to participate
subject to the provisions of Section 2.1.
2.4 Change in Employment Status
In the event that a Participant who was credited with a year of Service
for the preceding Plan Year, at the request of the Employer, enters
directly into the employ of any other business entity, such Participant
shall be deemed to be an Active Participant. If such Participant
returns to the employ of the Employer or becomes eligible for benefits
pursuant to Articles VI or VII, without interruption of employment with
the Employer or other business entity, he shall be deemed not to have
had a Service Break for such period. However, if such Participant does
not immediately return to the employ of the Employer upon his
termination of employment with such other business entity or upon
recall by the Employer, he shall be deemed to have terminated his
employment for all purposes of the Plan as of the Anniversary Date
following the date of transfer.
2.5 Limitations on Participation of Owner-Employees
Notwithstanding the above, Plans which allow Owner-Employees to
participate must satisfy the following additional requirements:
(a) If this Plan provides contributions or benefits for one or more
Owner-Employees who control both the business for which this
Plan is established and one or more other trades or businesses,
this Plan and the plan established for other trades or
businesses must, when looked at as a single plan, satisfy
sections 401(a) and (d) of the Code for the Employees of this
and all other trades or businesses.
(b) If the Plan provides contributions or benefits for one or more
Owner-Employees who control one or more other trades or
businesses the employees of the other trades or businesses
must be included in a plan which satisfies sections 401(a) and
(d) of the Code and which provides contributions and benefits
not less favorable than provided for Owner-Employees under this
Plan.
(c) If an individual is covered as an Owner-Employee under the
plans of two or more trades or businesses which are not
controlled and the individual controls a trade or business,
then the contributions or benefits of the employees under the
<PAGE>
plan of the trades or businesses which are controlled must be
as favorable as those provided for him under the most favorable
plan of the trade or business which is not controlled.
For purposes of the preceding paragraphs, an Owner-Employee, or
two or more Owner-Employees, will be considered to control a
trade or business if the Owner-Employee, or two or more
Owner-Employees together:
(1) own the entire interest in an unincorporated trade or
business, or
(2) in the case of a partnership, own more than fifty
percent (50%) of either the capital interest or the
profits interest in the partnership.
For purposes of the preceding sentence, an Owner-Employee, or
two or more Owner-Employees shall be treated as owning any
interest in a partnership which is owned, directly or
indirectly, by a partnership which such Owner-Employee, or such
two or more Owner-Employees, are considered to control within
the meaning of the preceding sentence.
ARTICLE III.
CONTRIBUTIONS AND CREDITS TO PROFIT SHARING PLANS
(The provisions of this Article shall apply only
with respect to Profit Sharing Plans)
3.1 Limits on Employer Contributions
Employer contributions for each Plan Year (including, if applicable,
Elective Deferrals) shall be determined in accordance with the Adoption
Agreement, but shall not exceed the maximum amount which shall
constitute an allowable deduction under section 404(a) of the Code.
Unless otherwise specified in the Adoption Agreement, Employer
contributions may only be made out of Net Profits. If the Adoption
Agreement provides that one or more Employer contributions may be made
without regard to Net Profits, the Plan shall continue to be designed
to qualify as a profit sharing plan for purposes of the Code.
3.2 Forfeitures
Unless otherwise specified in the Adoption Agreement, forfeitures, if
any, will be allocated to Participants' Accounts in the following
manner: Forfeitures of Employer Discretionary Contributions will be
allocated in the same manner as are such contributions. Forfeitures of
Matching Contributions will be allocated to the Matching Contribution
Account in the same manner as are such contributions. Forfeitures of
Matching Contributions that are forfeited to the extent they relate to
Excess Elective Deferrals, Excess Contributions or Excess Aggregate
Contributions will be allocated to the Matching Contribution Account in
the same manner as are such Matching Contributions, except no such
forfeitures shall be allocated to any Highly Compensated Employee.
<PAGE>
3.3 Employer Discretionary Contributions
The following provisions shall apply if the Employer has elected in the
Adoption Agreement to make Employer Discretionary Contributions.
(a) If the Plan is not integrated with Social Security, the
Employer Discretionary Contribution for any Plan Year (and any
forfeitures, if forfeitures are reallocated to Active
Participants in accordance with Section 3.2) shall be allocated
to the Employer Discretionary Contribution Account established
for each Active Participant in the ratio in which each Active
Participant's Compensation for the Plan Year bears to that of
all Active Participants for such Plan Year.
(b) If the Plan is integrated with Social Security:
(i) Subject to the overall permitted disparity limits,if
under Article XIII, the Plan is Top-Heavy for the Plan
Year and the minimum Top-Heavy contribution is made
under the Plan, then Employer Discretionary
Contributions plus forfeitures shall be allocated to
the Account of each Participant who either completes
more than 500 Hours of Service during the Plan Year or
is employed on the last day of the Plan Year as
follows:
Step One: Contributions and forfeitures will be
allocated to each Participant's
Account in the ratio that each
Participant's total Compensation
bears to all Participants' total
Compensation, but not in excess of 3%
of each Participant's Compensation.
Step Two: Any contributions and forfeitures
remaining after the allocation in
Step One will be allocated to each
Participant's Account in the ratio
that each Participant's Compensation
for the Plan Year in excess of the
integration level bears to the excess
compensation of all Participants, but
not in excess of 3% of each
Participant's Compensation. For
purposes of this Step Two, in the
case of any Participant who has
exceeded the Cumulative Permitted
Disparity Limit described below, such
Participant's total Compensation for
the Plan Year will be taken into
account.
Step Three: Any contributions and forfeitures
remaining after the allocation in
Step Two will be allocated to each
Participant's Account in the ratio
that the sum of each Participant's
<PAGE>
total Compensation and Compensation
in excess of the Integration Level
bears to the sum of all Participants'
total Compensation and Compensation
in excess of the Integration Level;
however, the allocation cannot exceed
the product of (a) the Permitted
Disparity Percentage specified in the
Adoption Agreement multiplied by (b)
each Participant's total Compensation
and Compensation in excess of the
Integration Level. For purposes of
this Step Three, in the case of any
Participant who has exceeded the
Cumulative Permitted Disparity Limit
described below, two times such
Participant's total Compensation for
the Plan Year will be taken into
account.
Step Four: Any remaining Employer contributions
or forfeitures will be allocated to
each Participant's Account in the
ratio that each Participants's total
Compensation for the Plan Year bears
to all Participants' total
Compensation for that year.
The Integration Level shall be equal to the Taxable Wage Base
or such lesser amount elected by the Employer in the Adoption
Agreement.
(ii) Subject to the overall permitted disparity limits,if
the Plan is not Top- Heavy for the Plan Year, Employer
Discretionary Contributions plus forfeitures shall be
allocated to the Account of each Participant who
either completes more than 500 Hours of Service during
the Plan Year or is employed on the last day of the
Plan Year as follows:
Step One: Contributions and forfeitures will be
allocated to each Participant's
Account in the ratio that the sum of
each Participant's total Compensation
and Compensation in excess of the
Integration Level bears to the sum of
all Participants' total Compensation
and Compensation in excess of the
Integration Level; however, the
allocation cannot exceed the product
of (a) the Permitted Disparity
Percentage specified in the Adoption
Agreement multiplied by (b) each
Participant's total Compensation and
Compensation in excess of the
Integration Level. For purposes of
this Step One, in the case of any
<PAGE>
Participant who has exceeded the
Cumulative Permitted Disparity Limit
described below, two times such
Participant's total Compensation for
the Plan Year will be taken into
account.
Step Two: Any remaining Employer contributions
or forfeitures will be allocated to
each Participant's Account in the
ratio that each Participant's total
Compensation for the Plan Year bears
to all Participants' total
Compensation for that year.
The Integration Level shall be equal to the Taxable Wage Base
or such lesser amount elected by the Employer in the Adoption
Agreement.
Overall Permitted Disparity Limits
Annual Overall Permitted Disparity Limit: Notwithstanding
section 3.3(b)(i) and (ii) above, for any Plan Year this Plan
benefits any Participant who benefits under another qualified
plan or simplified employee pension, as defined in section
408(k) of the Code, maintained by the Employer that provides
for permitted disparity (or imputes disparity), Employer
contributions and forfeitures will be allocated to the Account
of each Participant who either completes more than 500 Hours of
Service during the Plan Year or who is employed on the last day
of the Plan Year in the ratio that such Participant's total
Compensation bears to the total Compensation of all
Participants.
Cumulative Permitted Disparity Limit: Effective for Plan Years
beginning on or after January 1, 1995, the Cumulative Permitted
Disparity Limit for a Participant is 35 total cumulative
permitted disparity years. Total cumulative permitted years
means the number of years credited to the Participant for
allocation or accrual purposes under this Plan, any other
qualified plan or simplified employer pension plan (whether or
not terminated) ever maintained by the Employer. For purposes
of determining the Participant's cumulative permitted disparity
limit, all years ending in the same calendar year are treated
as the same year. If the Participant has not benefited under a
defined benefit or target benefit plan for any year beginning
on or after January 1, 1994, the Participant has no cumulative
disparity limit.
3.4 401(k) Cash or Deferred Arrangements ("CODA")/Thrift Contributions
(1) Elective Deferrals
If elected in the Adoption Agreement, the Employer may make
contributions under a CODA.
<PAGE>
(a) Allocation of Deferrals. The Employer shall
contribute and allocate to each Participant's Elective
Deferral Account an amount equal to the amount of a
Participant's Elective Deferrals.
(1) Elective Deferrals Pursuant to a Salary
Reduction Agreement. To the extent provided
in the Adoption Agreement, a Participant may
elect to have Elective Deferrals made under
this Plan. Elective Deferrals shall include
both single-sum and continuing contributions
made pursuant to a salary reduction agreement.
(i) Commencement of Elective Deferrals.
A Participant shall be afforded a
reasonable period at least once each
calendar year, as specified in the
Adoption Agreement, to elect to
commence Elective Deferrals. Such
election shall become effective as
soon as administratively feasible,
but not before the time specified in
the Adoption Agreement.
(ii) Modification and Termination of
Elective Deferrals. A Participant's
election to commence Elective
Deferrals shall remain in effect
until modified or terminated. A
Participant shall be afforded a
reasonable period at least once each
calendar year, as specified in the
Adoption Agreement, to modify the
amount or frequency of his or her
Elective Deferrals. A Participant
may terminate his or her election to
make Elective Deferrals at any time.
(2) Cash bonuses. If permitted in the Adoption
Agreement, a Participant may also base
Elective Deferrals on cash bonuses that, at
the Participant's election, may be contributed
to the CODA or received by the Participant in
cash. A Participant shall be afforded a
reasonable period at least once a year to
elect to defer such amounts to the CODA. Such
election shall become effective as soon as
administratively feasible, but not before the
time specified in the Adoption Agreement.
(3) Elective Deferrals shall be contributed and
allocated to the Fund as soon as practicable
(but in no event later than 90 days) following
the close of the applicable pay period.
<PAGE>
(2) Thrift Contributions
Starting for Plan Year(s) beginning January 1, 1987,
if permitted under the Adoption Agreement,
Participants may make Thrift Contributions which shall
be allocated to a Thrift Account for each such
Participant.
(a) A Participant shall always be one hundred
percent (100%) vested in his Thrift Account.
(b) Unless specified otherwise in the Adoption
Agreement, Thrift Contributions shall take
effect on the Anniversary Date coincident with
or next following the Participant's election
to make Thrift Contributions. Elections to
change the amount of the Thrift Contribution
shall take effect on the Change Date specified
in the Adoption Agreement which is coincident
with or next following the date the
Participant's election is received by the
Committee. Notwithstanding this provision, a
Participant's revocation of an election to
make Thrift Contributions shall take effect as
soon as administratively feasible.
(c) Thrift Contributions shall be made to the Fund
as soon as practicable (but in no event later
than 90 days) following the close of the
applicable pay period.
(d) Notwithstanding any other provisions of this
Section 3.4(2), distributions or withdrawals
from a Participant's Thrift Account shall be
made in accordance with the rules applicable
to Voluntary Contributions under Section 8.1.
However, if the Employer has elected to make
Matching Contributions with respect to Thrift
Contributions, any Participant who withdraws
any amount from his Thrift Account, shall be
precluded from making Thrift Contributions
until the next permitted Change Date specified
in the Adoption Agreement which is at least
six (6) months after the date of withdrawal.
(e) Thrift Contributions shall be subject to the
Contribution Percentage tests and the rules
applicable to Excess Aggregate Contributions
set forth in Section 3.7.
(3) Matching Contributions
(a) If elected by the Employer in the Adoption
Agreement, the Employer will make Matching
Contributions to the Plan. The amount of such
Matching Contributions shall be calculated by
reference to each eligible Participant's
<PAGE>
Elective Deferrals or Thrift Contributions or
Combined Contributions as specified by the
Employer in the Adoption Agreement.
(b) Separate Account. Matching Contributions
shall be allocated to each eligible
Participant's Employer Matching Contribution
Account.
(c) Vesting. Matching Contributions will be
vested in accordance with the Employer's
election in the Adoption Agreement and the
terms of this plan. Notwithstanding anything
in the Plan to the contrary, Matching
Contributions shall be forfeited to the extent
they relate to Excess Elective Deferrals,
Excess Contributions or Excess Aggregate
Contributions, and shall not be taken into
account for purposes of Section 3.7(a).
(d) Forfeitures. Forfeitures of Matching
Contributions other than Excess Aggregate
Contributions shall be made in accordance with
the forfeiture provisions pursuant to Section
3.2 of the Plan.
(e) Matching Contributions shall be subject to the
Contribution Percentage tests and the rules
applicable to Excess Aggregate Contributions
set forth in Section 3.7.
(4) Qualified Matching Contributions
(a) If elected by the Employer in the Adoption
Agreement, the Employer will make Qualified
Matching Contributions to the CODA. The
amount of such Qualified Matching
Contributions shall be calculated by reference
to each eligible Participant's Elective
Deferrals or the Elective Deferral portion of
Combined Contributions, as specified in the
Adoption Agreement.
(b) Separate Account. Qualified Matching
Contributions shall be allocated to each
Participant's Qualified Nonelective
Contribution Account.
(c) Vesting. Qualified Matching Contributions
shall be fully vested and nonforfeitable at
all times.
(d) Distributions. Qualified Matching
Contributions and income allocable thereto
shall be distributable only in accordance with
Section 3.10.
<PAGE>
(5) Qualified Nonelective Contributions
(a) The Employer may elect to make Qualified
Nonelective Contributions under the Plan on
behalf of Employees as provided in the
Adoption Agreement.
The Qualified Nonelective Contributions will
be allocated to each eligible Participant's
Qualified Nonelective Contribution Account in
the ratio in which each eligible Participant's
Compensation for the Plan Year bears to the
total Compensation of all eligible
Participants for such Plan Year.
(b) Separate Account. Qualified Nonelective
Contributions shall be allocated to each
Eligible Participant's Qualified Nonelective
Contribution Account.
(c) Vesting. Qualified Nonelective Contributions
shall be fully vested and nonforfeitable at
all times.
(d) Distributions. Qualified Nonelective
Contributions and income allocable thereto
shall be distributable only in accordance with
Section 3.10.
3.5 Maximum Amount of Elective Deferrals
(a) General Rule. A Participant's Elective Deferrals are subject
to any limitations imposed in the Adoption Agreement and any
further limitations under the Plan. No Participant shall be
permitted to have Elective Deferrals made under this Plan or
any other CODA maintained by the Employer or an Affiliated
Employer, during any calendar year beginning after 1986, in
excess of the adjusted dollar limitation of section 402(g) of
the Code. Other dollar limitations may apply under section
402(g) of the Code to the extent that a Participant makes
Elective Deferrals to arrangements other than CODAs (see also
sections 402(h)(1)(B), 403(b), 457, and 501(c)(18) of the
Code).
(b) Distribution of Excess Elective Deferrals. A Participant may
allocate to the Plan any Excess Deferrals made during a
calendar year by notifying the Committee on or before the date
specified in the Adoption Agreement of the amount of the Excess
Elective Deferrals to be assigned to the Plan. A Participant
shall be deemed to notify the Committee of any Excess Elective
Deferrals that arise by taking into account only those Elective
Deferrals made to this Plan and any other plans of the
Employer. Notwithstanding any other provision of the Plan,
Excess Elective Deferrals, plus any income and minus any loss
allocable thereto, shall be distributed no later than April 15
to Participants to whose accounts Excess Elective Deferrals
were allocated for the preceding year and who claim Excess
<PAGE>
Elective Deferrals for such taxable year no later than the date
specified in the Adoption Agreement.
(c) Determination of Income or Loss. Excess Elective Deferrals
shall be adjusted for income or loss for the taxable year.
Unless indicated otherwise by the Committee, the income or loss
allocable to Excess Elective Deferrals is the income or loss
allocable to the Participant's Elective Deferral Account for
the taxable year multiplied by a fraction, the numerator of
which is such Participant's Excess Elective Deferrals for the
year and the denominator is the Participant's account balance
attributable to Elective Deferrals without regard to any income
or loss occurring during such taxable year. If the Committee
selects another method in order to compute the income or loss,
the method selected must not violate the requirements of Code
section 401(a)(4) and must be used consistently for all Plan
participants and for all corrective distributions under the
Plan for the taxable year.
3.6 Average Actual Deferral Percentage Tests
(a) General Rule. The Average Actual Deferral Percentage for
Eligible Participants who are Highly Compensated Employees for
each Plan Year beginning on or after January 1, 1987 and the
Average Actual Deferral Percentage for Eligible Participants
who are Non-Highly Compensated Employees for the same Plan Year
must satisfy one of the following tests:
(1) The Average Actual Deferral Percentage for Eligible
Participants who are Highly Compensated Employees for
the Plan Year shall not exceed the Average Actual
Deferral Percentage for Eligible Participants who are
Non-Highly Compensated Employees for the Plan Year
multiplied by 1.25;
or
(2) The Average Actual Deferral Percentage for Eligible
Participants who are Highly Compensated Employees for
the Plan Year shall not exceed the Average Actual
Deferral Percentage for Eligible Participants who are
Non-Highly Compensated Employees for the Plan Year
multiplied by 2.0, provided that the Average Actual
Deferral Percentage for Eligible Participants who are
Highly Compensated Employees does not exceed the
Average Actual Deferral Percentage for Eligible
Participants who are Non-Highly Compensated Employees
by more than two (2) percentage points.
(b) Special Rules.
(1) The Actual Deferral Percentage for
any Participant who is a Highly
Compensated Employee for the Plan
Year and who is eligible to have
Elective Deferrals (and, if
applicable, Qualified Nonelective
<PAGE>
Contributions or Qualified Matching
Contributions, or both) allocated for
his account under two or more CODAs,
that are maintained by the Employer,
shall be determined as if such
Elective Deferrals (and, if
applicable, such Qualified
Nonelective Contributions and
Qualified Matching Contributions, or
both) were made under a single
arrangement. If a Highly Compensated
Employee participates in two or more
CODAs that have different Plan Years,
all CODAs ending with or within the
same calendar year shall be treated
as a single arrangement.
(2) In the event that this Plan satisfies
the requirements of sections
401(a)(4), 401(k) or 410(b) of the
Code only if aggregated with one or
more other plans, or if one or more
other plans satisfy the requirements
of such sections of the Code only if
aggregated with this Plan, then this
Section shall be applied by
determining the Actual Deferral
Percentage of Eligible Participants
as if all such plans were a single
plan. For Plan Years beginning after
December 31, 1989, plans may be
aggregated in order to satisfy
section 401(k) of the Code only if
they have the same Plan Year.
(3) For purposes of the Average Actual
Deferral Percentage of an Eligible
Participant who is a 5 percent owner
or one of the 10 most highly-paid
Highly Compensated Employees, the
Elective Deferrals (and, if
applicable, Qualified Nonelective
Contributions or Qualified Matching
Contributions, or both) and
Compensation of such Participant
shall include the Elective Deferrals
(and, if applicable, Qualified
Nonelective Contributions and
Qualified Matching Contributions or
both), and Compensation for the Plan
Year of Family Members. Family
Members, with respect to Highly
Compensated Employees, shall be
disregarded as separate employees in
determining the Actual Deferral
Percentage both for Eligible
Participants who are Non-Highly
<PAGE>
Compensated Employees and for
Eligible Participants who are Highly
Compensated Employees.
(4) Notwithstanding anything in this Plan
to the contrary, Qualified
Nonelective Contributions and
Qualified Matching Contributions used
to meet the Average Actual Deferral
Percentage tests may be made at any
time before the last day of the
twelve (12) month period immediately
following the Plan Year to which the
contributions relate.
(5) The determination and treatment of
the Elective Deferrals, Qualified
Nonelective Contributions, Qualified
Matching Contributions and the Actual
Deferral Percentage of any Eligible
Participant shall satisfy such other
requirements as may be prescribed by
the Secretary of the Treasury.
(6) The Employer shall maintain adequate
records to demonstrate compliance
with the Average Actual Deferral
Percentage tests, including the
extent to which Qualified Nonelective
and Qualified Matching Contributions
are taken into account.
(c) Distribution of Excess Contributions.
Notwithstanding any other provision of the
Plan except Section 3.6(d) below, Excess
Contributions, plus any income and minus any
loss allocable thereto, shall be distributed
no later than the last day of each Plan Year
to Participants to whose accounts Excess
Contributions were allocated for the preceding
Plan Year. The amount of Excess Contributions
to be distributed shall be reduced by the
amount of any Excess Contributions
recharacterized in accordance with Section
3.6(d) below. Distributions of Excess
Contributions shall be made to Highly
Compensated Employees on the basis of the
respective portions of the Excess
Contributions attributable to each Highly
Compensated Employee. Excess Contributions
shall be allocated to Participants who are
subject to the family member aggregation rules
of section 414(q)(6) of the Code in the manner
prescribed by the regulations. [If such excess
amounts are not distributed or recharacterized
(in accordance with Section 3.6(d) below)
within 2 1/2 months after the last day of the
<PAGE>
Plan Year in which such excess amounts arose,
then section 4979 of the Code imposes a ten
percent (10%) excise tax on the Employer
maintaining the Plan with respect to such
amounts.] Excess Contributions of
Participants who are subject to the Family
Member aggregation rules described in Section
3.6(b)(3) shall be allocated among the Family
Members in proportion to the Elective
Deferrals (and amounts treated as Elective
Deferrals) of each Family Member that is
combined to determine the combined Actual
Deferral Percentage.
(1) Determination of Income or Loss.
Excess Contributions shall be
adjusted for income or loss for the
Plan Year. Unless indicated
otherwise by the Committee, the
income or loss allocable to Excess
Contributions is the income or loss
allocable to the Participant's
Elective Deferrals (and, if
applicable, Qualified Nonelective
Contributions or Qualified Matching
Contributions or both) for the Plan
Year multiplied by a fraction, the
numerator of which is such
Participant's Excess Contributions
for the year and the denominator is
the Participant's account balance
attributable to Elective Deferrals
(and, if applicable, Qualified
Nonelective Contributions or
Qualified Matching Contributions or
both) without regard to any income or
loss occurring during such Plan Year.
If the Committee selects another
method in order to compute the income
or loss, the method selected must not
violate the requirements of Code
section 401(a)(4) and must be used
consistently for all Plan
participants and for all corrective
distributions under the Plan for the
Plan Year.
(2) Accounting for Excess Contributions.
Excess Contributions shall be
distributed first from the
Participant's account balance
attributable to Elective Deferrals
and (to the extent used in the
Average Actual Deferral Percentage
tests) Qualified Matching
Contributions in proportion to the
Participant's Elective Deferrals and
<PAGE>
Qualified Matching Contributions for
the Plan Year. Excess Contributions
shall be distributed from the
Participant's Qualified Nonelective
Contribution Account only to the
extent that such Excess Contributions
exceed the Participant's account
balance attributable to Elective
Deferrals and Qualified Matching
Contributions.
(d) Recharacterization of Excess Contributions.
If the Plan provides for Thrift Contributions
by Participants and if permitted in the
Adoption Agreement, each Participant to whom
Excess Contributions are allocable may elect,
in lieu of distribution under Section 4.6(c)
above, that all or a portion of such Excess
Contributions be recharacterized as Thrift
Contributions no later than the later of (i)
2 1/2 months after the last day of the Plan
Year in which such excess amounts arose or
(ii) October 24, 1988. Recharacterization is
deemed to occur no earlier than the date the
last Highly Compensated Employee is informed
in writing of the amount recharacterized and
the consequences thereof.
In no event may the amount of Excess
Contributions recharacterized for any Plan
Year exceed the amount of Elective Deferrals
for such Plan Year. Excess Contributions may
not be recharacterized as Thrift Contributions
to the extent that, in combination with the
Thrift Contributions actually made for the
Plan Year, they exceed the maximum amount of
Thrift Contributions permitted under the Plan
(prior to the application of the Contribution
Percentage tests of Section 3.7).
Recharacterized Excess Contributions shall be
treated as Thrift Contributions for purposes
of the Contribution Percentage tests of
Section 3.7.
However, no matching Employer contribution
shall be made with respect to Recharacterized
Contributions. In addition, recharacterized
Excess Contributions shall be reported to the
Internal Revenue Service and the Participant
as employee contributions in accordance with
such rules as the Internal Revenue Service may
prescribe and shall be accounted for as
Voluntary Contributions for purposes of
sections 72 and 6047 of the Code.
Recharacterized Excess Contributions will be
taxable to the Participant for the
<PAGE>
Participant's taxable year in which the
Participant would have received them in cash.
Recharacterized Excess Contributions will be
taxable to the Participant for the
Participant's taxable year in which the
Participant would have received them in cash.
Recharacterized Excess Contributions shall
remain non-forfeitable and shall continue to
be treated for all other purposes, including
the limitations on distributions of section
401(k), the deduction limitations of section
404 of the Code, the contribution limitations
of section 415 of the Code and the top heavy
rules of section 416 of the Code, as Elective
Deferrals, except that Recharacterized Excess
Contributions which relate to Plan Years
beginning before January 1, 1989 shall be
treated as employee contributions for purposes
of section 401(k)(2) of the Code.
Recharacterized Excess Contributions shall be
allocated to the Participant's Elective
Deferral Account.
3.7 Average Contribution Percentage Tests
(a) General Rule. The Average Contribution Percentage for Eligible
Participants who are Highly Compensated Employees for each Plan
Year beginning on or after January 1, 1987 and the Average
Contribution Percentage for Eligible Participants who are
Non-Highly Compensated Employees for the same Plan Year must
satisfy one of the following tests:
(1) The Average Contribution Percentage for Eligible
Participants who are Highly Compensated Employees for
the Plan Year shall not exceed the Average
Contribution Percentage for Eligible Participants who
are Non-highly Compensated Employees for the Plan Year
multiplied by 1.25; or
(2) The Average Contribution Percentage for Eligible
Participants who are Highly Compensated Employees for
the Plan Year shall not exceed the Average
Contribution Percentage for Eligible Participants who
are Non-highly Compensated Employees for the Plan Year
multiplied by two (2), provided that the Average
Contribution Percentage for Eligible Participants who
are Highly Compensated Employees does not exceed the
Average Contribution Percentage for Eligible
Participants who are Non-highly Compensated Employees
by more than two (2) percentage points.
(b) Multiple Use Test.
(1) Effective for Plan Years beginning on or after January
1, 1989, if one or more Highly Compensated Employees
participate in both a CODA and a plan subject to the
Average Contribution Percentage tests maintained by
<PAGE>
the Employer and the sum of the Average Actual
Deferral Percentage and Average Contribution
Percentage of those Highly Compensated Employees
subject to either or both tests exceeds the "Aggregate
Limit" (as defined in (2) below), then the Average
Contribution Percentage of those Highly Compensated
Employees who also participate in a CODA will be
reduced (beginning with such Highly Compensated
Employee whose Contribution Percentage is the highest)
so that the limit is not exceeded. The amount by
which each Highly Compensated Employee's Contribution
Percentage Amounts is reduced shall be treated as an
Excess Aggregate Contribution. The Average Actual
Deferral Percentage and Average Contribution
Percentage of the Highly Compensated Employees are
determined after any corrections required to meet the
Average Actual Deferral Percentage and Average
Contribution Percentage tests. Notwithstanding the
foregoing, the Multiple Use limitations of Section
3.7(b) do not apply if the Average Actual Deferral
Percentage of Eligible Participants who are Highly
Compensated Employees does not exceed 1.25 multiplied
by the Average Actual Deferral Percentage of all other
Eligible Participants and the Average Contribution
Percentage of Eligible Participants who are Highly
Compensated Employees does not exceed 1.25 multiplied
by the Average Contribution Percentage of all other
Eligible Participants.
(2) For this purpose, "Aggregate Limit" shall mean the
greater of the limit produced by (A) or (B) below:
(A) the sum of (i) one hundred twenty-five percent
(125%) of the greater of the Average Actual
Deferral Percentage of the Non-Highly
Compensated Employees eligible to participate
in the CODA for the Plan Year or the Average
Contribution Percentage of the Non-Highly
Compensated Employees eligible to participate
under the Plan subject to section 401(m) of
the Code for the Plan Year beginning with or
within the Plan Year of the CODA, and (ii) two
(2) plus the lesser of such Average Actual
Deferral Percentage or Average Contribution
Percentage (however, this amount shall not
exceed two hundred percent (200%) of the
lesser such Average Actual Deferral Percentage
or Average Contribution Percentage).
(B) the sum of (i) one hundred twenty-five percent
(125%) of the lesser of the Average Actual
Deferral Percentage of the Non-Highly
Compensated Employees eligible to participate
in the CODA for the Plan Year or the Average
Contribution Percentage of the Non-Highly
Compensated Employees eligible to participate
under the Plan subject section 401(m) of the
<PAGE>
Code for the Plan Year beginning with or
within the Plan Year of the CODA, and (ii) two
(2) plus the greater of such Average Actual
Deferral Percentage or Average Contribution
Percentage (however, this amount shall not
exceed two hundred percent (200%) of the
greater of such Average Actual Deferral
Percentage or Average Contribution
Percentage).
(c) Special Rules.
(1) For purposes of this Section 3.7, the Contribution
Percentage for any Participant who is a Highly
Compensated Employee and who is eligible to have
Contribution Percentage Amounts allocated to his
account under two or more Plans described in section
401(a) of the Code, or CODAs, that are maintained by
the Employer or an Affiliated Employer, shall be
determined as if the total of such Contribution
Percentage Amounts was made under each Plan. If a
Highly Compensated Employee participates in two or
more CODAs that have different Plan Years, all CODAs
ending with or within the same calendar year shall be
treated as a single arrangement.
(2) In the event that this Plan satisfies the requirements
of sections 401(a)(4), 401(m) or 410(b) of the Code
only if aggregated with one or more other plans, or if
one or more other plans satisfy the requirements of
such sections of the Code only if aggregated with this
Plan, then this Section shall be applied by
determining the Contribution Percentages of
Participants as if all such plans were a single plan.
For Plan Years beginning after December 31, 1989,
plans may be aggregated in order to satisfy section
401(m) of the Code only if they have the same Plan
Year.
(3) For purposes of determining the Contribution
Percentage of an Eligible Participant who is a
5-percent owner or one of the 10 most highly-paid
Highly Compensated Employees, the Contribution
Percentage Amounts and Compensation of such
Participant shall include the Contribution Percentage
Amounts and Compensation for the Plan Year of Family
Members. Family Members, with respect to Highly
Compensated Employees, shall be disregarded as
separate employees in determining the Average
Contribution Percentage both for Eligible Participants
who are Non-Highly Compensated Employees and for
Eligible Participants who are Highly Compensated
Employees.
(4) For purposes of the Contribution Percentage tests,
Voluntary Contributions and Thrift Contributions are
considered to have been made in the Plan Year in which
<PAGE>
contributed to the Fund. Notwithstanding anything in
this Plan to the contrary, Matching Contributions will
be considered made for a Plan Year if allocated to
such year and made no later than the end of the twelve
(12) month period beginning on the day after the close
of the Plan Year.
(5) The determination and treatment of the Contribution
Percentage of any Participant shall satisfy such other
requirements as may be prescribed by the Secretary of
the Treasury.
(6) The Employer shall maintain adequate records to
demonstrate compliance with the Average Contribution
Percentage tests.
(d) Distribution of Excess Aggregate Contributions.
Notwithstanding any other provision of this Plan, Excess
Aggregate Contributions, plus any income and minus any loss
allocable thereto, shall be forfeited, if forfeitable, or if
not forfeitable, distributed no later than the last day of each
Plan Year to Participants to whose accounts such Excess
Aggregate Contributions were allocated for the preceding Plan
Year. [If such excess amounts are distributed more than 2 1/2
months after the last day of the Plan Year in which such excess
amounts arose, then section 4979 of the Code imposes a ten
percent (10%) excise tax on the Employer maintaining the Plan
with respect to such amounts]. Excess Aggregate Contributions
of Participants who are subject to the Family Member
aggregation rules described in Section 3.7(c)(3) shall be
allocated among the Family Members in proportion to the Thrift
Contributions, Voluntary Contributions, and Matching
Contributions (or amounts treated as Matching Contributions) of
each Family Member that is combined to determine the combined
Actual Contribution Percentage.
(1) Determination of Income or Loss. The Excess Aggregate
Contributions shall be adjusted for income or loss for
the Plan Year. Unless indicated otherwise by the
Committee, the income or loss allocable to Excess
Aggregate Contributions is the income or loss
allocable to the Participant's Voluntary Contribution
Account, Thrift Account and Employer Matching
Contribution Account for the Plan Year multiplied by a
fraction, the numerator of which is such Participant's
Excess Aggregate Contributions for the year and the
denominator is the Participant's account balance(s)
attributable to Contribution Percentage Amounts
without regard to any income or loss occurring during
such Plan Year. If the Committee selects another
method in order to compute the income or loss, the
method selected must not violate the requirements of
Code section 401(a)(4) and must be used consistently
for all Plan participants and for all corrective
distributions under the Plan for the Plan Year.
<PAGE>
(2) Treatment of Forfeitures. Forfeitures of Excess
Aggregate Contributions shall be allocated to
Participants' Accounts or applied to reduce Employer
contributions, as elected by the Employer in the
Adoption Agreement, under Section 3.2. If forfeitures
are reallocated to the accounts of Participants under
Section 3.2, forfeitures of Excess Aggregate
Contributions shall be allocated in the same manner as
Matching Contributions, except that no such
forfeitures shall be allocated to any Highly
Compensated Employee.
(3) The determination of the Excess Aggregate
Contributions shall be made after first determining
the Excess Elective Deferrals pursuant to Section 3.5,
and then determining the Excess Contributions pursuant
to Section 3.6.
4.8 Non-Hardship Withdrawals
(a) If Employer Discretionary Contributions are not integrated with
Social Security and a Participant's Employer Discretionary
Contributions and Matching Contribution Accounts are 100%
vested at the time of distribution, and if permitted by the
Adoption Agreement, a Participant may make withdrawals from his
Employer Discretionary Contributions and Matching Contribution
Accounts, for any reason, after attainment of age fifty-nine
and one-half (59 1/2).
(b) If permitted by the Adoption Agreement, a Participant may make
withdrawals from his Elective Deferral Account or Qualified
Nonelective Contribution Account, for any reason, after
attainment of age fifty-nine and one-half (59 1/2).
(c) A withdrawal under (a) or (b) above may be made at such time as
the Committee shall designate, but not more than quarterly
during a Plan Year provided that no single withdrawal shall be
less than five hundred dollars ($500) and a withdrawal by a
Participant prior to his separation from service may never
exceed the smaller of the actual amount contributed to the
account or the adjusted value of the account.
(d) If the Plan is subject to the Automatic Annuity Rules of
Section 6.2, the written consent of the Participant's spouse
(consistent with the requirements for a Qualified Election
under Section 6.2) must be obtained with respect to any
withdrawal.
3.9 Distribution on Account of Financial Hardship
(a) If elected by the Employer in the Adoption Agreement,
distributions may be made from a Participant's Elective
Deferral, Qualified Nonelective Contribution Account, vested
portion of the Participant's Employer Discretionary
Contribution Account, or the vested portion of the Employer
Matching Contribution Account on account of financial hardship
<PAGE>
if the distribution is necessary in light of the immediate and
heavy financial needs of the Participant.
Effective for Plan Years beginning on or after January 1, 1989,
distributions on account of financial hardship with respect to
Elective Deferrals shall be limited to the amount of the
Participant's Elective Deferrals and income allocable to such
contributions credited to the Participant's Elective Deferral
Account as of the end of the last Plan Year ending before July
1, 1989; neither the income allocable to Elective Deferrals
credited to a Participant's Elective Deferral Account after the
end of the last Plan Year ending before July 1, 1989 nor a
Participant's Qualified Non-elective Contribution Account shall
be available for such distributions.
(b) A distribution on account of financial hardship shall not
exceed the amount required to meet the immediate financial need
created by the hardship. With respect to the Elective Deferral
Account, and the Qualified Nonelective Contribution Account,
the determination of the existence of financial hardship, and
the amount required to meet the immediate financial need
created by the hardship shall be made by the Committee, in
accordance with the criteria specified in (c) below.
With respect to the Employer Discretionary Contribution Account
and the Employer Matching Contribution Account, the
determination of the existence of financial hardship, and the
amount required to meet the immediate financial need created by
the hardship shall be made by the Committee, in accordance with
the criteria specified in (d) below.
If the Plan is subject to the Automatic Annuity Rules of
Section 6.2, the written consent of the Participant's spouse
(consistent with the requirements for a Qualified Election
under Section 6.2) must be obtained with respect to any
withdrawal on account of financial hardship.
The Committee shall establish written procedures specifying the
requirements for distributions on account of hardship,
including the forms to be submitted. Distributions of amounts
under this Section shall be made as soon as administratively
feasible.
(c) (1) Immediate and Heavy Financial Need. Hardship
distributions will be allowed only on account of:
(i) Expenses for medical care (described in
section 213(d) of the Code) incurred by the
Employee, the Employee's spouse, or any
dependents of the Employee (as defined in
section 152 of the Code) or necessary for
these persons to obtain such care;
(ii) Purchase (excluding mortgage payments) of a
principal residence for the Employee;
<PAGE>
(iii) Payment of tuition and related educational
fees for the next 12 months of post-secondary
education for the Employee, the Employee's
spouse, children or dependents;
(iv) The need to prevent the eviction of the
Employee from his principal residence or
foreclosure on the mortgage of the Employee's
principal residence; or
(v) Such other financial need which the
Commissioner of Internal Revenue, through the
publication of revenue rulings, notices and
other documents of general applicability,
deems to be immediate and heavy.
(2) Distribution Necessary to Satisfy Financial Need. A
distribution shall not be made on account of a
financial need unless all of the following
requirements are satisfied:
(i) The distribution is not in excess of the
amount of the immediate and heavy financial
need (including amounts necessary to pay any
federal, state or local income taxes or
penalties reasonably anticipated to result
from the distribution) of the Employee;
(ii) The Employee has obtained all distributions,
other than hardship distributions, and all
nontaxable loans currently available under all
plans maintained by the Employer;
(iii) Elective contributions and employee
contributions under this Plan and all other
qualified and nonqualified deferred
compensation plans maintained by the Employer
(other than mandatory contributions to a
defined benefit plan) shall be suspended for
at least twelve (12) months after receipt of
the hardship distribution. For this purpose,
the phrase "qualified and nonqualified
deferred compensation plans" includes stock
option, stock purchase and similar plans, and
cash or deferred arrangements under a
cafeteria plan, within the meaning of Section
125 of the Code. It does not include health
or welfare benefit plans; and
(iv) The Plan, and all other plans maintained by
the Employer, provide that the Employee may
not make elective contributions for the
Employee's taxable year immediately following
the taxable year of the hardship distribution
in excess of the applicable limit under
section 402(g) of the Code for such next
taxable year less the amount of such
<PAGE>
Employee's elective contributions for the
taxable year of the hardship distribution.
An Employee shall not fail to be treated as an
Eligible Participant for purposes of the
Actual Deferral Percentage tests of Section
4.6 merely because his Elective Deferrals are
suspended in accordance with this provision.
(d) Immediate and Heavy Financial Need. The determination of
whether an immediate and heavy financial need exists shall be
made by the Committee in a uniform and nondiscriminatory
manner. The criteria may include the events described in
Section 3.9(c) of this plan.
(e) If a distribution is made pursuant to this Section when the
Participant has a nonforfeitable right to less than 100 percent
of his Account balance derived from contributions made by the
Employer and the Participant may increase the nonforfeitable
percentage in the account:
(1) A separate account will be established for the
Participant's interest in the Plan as of the time of
the distribution, and
(2) At any relevant time the Participant's nonforfeitable
portion of the separate account will be equal to an
amount ("X") determined by the formula:
X = P(AB + (R x D)) - (R x D)
For purposes of applying the formula: P is the nonforfeitable
percentage at the relevant time, D is the amount of the distribution
and R is the ratio of the Account balance AB at the relevant time to
the Account balance after distribution.
3.10 Special Distribution Rules
Except as provided in the Adoption Agreement, Elective
Deferrals, Qualified Nonelective Contributions, Qualified
Matching Contributions and income allocable thereto are not
distributable to the Participant, or the Participant's
Beneficiary, in accordance with the Participant's or
Beneficiary's election, earlier than upon separation from
service, death, or Total and Permanent Disability.
Distribution (if elected in the Adoption Agreement) upon
termination of the Plan without the establishment or
maintenance of a successor plan, the Employer's sale of
substantially all of the assets of a trade or business or the
sale of the Employer's interest in a subsidiary may only be
made, after March 31, 1988, in a lump sum distribution within
the meaning of section 401(k)(10)(B) of the Code.
Unless the Plan is a Profit Sharing Plan exempt from the
Automatic Annuity rules of Section 6.2 pursuant to Section 6.3,
all distributions that may be made pursuant to one or more of
the foregoing distributable events are subject to the spousal
<PAGE>
and Participant consent requirements contained in sections
401(a)(11) and 417 of the Code.
ARTICLE IV.
CONTRIBUTION AND ALLOCATION LIMITS
4.1 Timing of Contributions
Contributions under Sections 3.1, 3.4(3), 3.4(4), 3.4(5) shall be made
no later than the time prescribed by law (including any extensions
thereof) for filing the Employer's federal income tax return for the
Plan Year for which they are made.
4.2 Deductibility of Contributions
All contributions made by an Employer shall be conditioned upon their
deductibility by the Employer for income tax purposes; provided,
however, that no contributions shall be returned to an Employer except
as provided in Section 4.3.
4.3 Return of Employer Contributions
Notwithstanding any other provision of this Plan, contributions made by
an Employer may be returned to such Employer if:
(a) the contribution was made by reason of a mistake of fact and is
returned to the Employer within one year of the mistaken
contribution, or
(b) the contribution was conditioned upon its deductibility by the
Employer for income tax purposes, the deduction was disallowed
and the contribution is returned to the Employer within one
year after the disallowance of the deduction, or
(c) the contribution was conditioned upon initial qualification of
the Plan, the Plan was submitted to the Internal Revenue
Service for a determination as to its initial qualification
within the time prescribed by law for filing the Employer's
return for the taxable year in which the Plan was adopted or
such later date as the Secretary of the Treasury may prescribe,
the Plan received an adverse determination, and the
contribution is returned to the Employer within one year after
the date of the adverse determination.
Employer contributions may be returned even if such contributions have
been allocated to a Participant's Account which is fully or partially
nonforfeitable and it is necessary to adjust said Account to reflect
the return of the Employer contributions. The amount which may be
returned to the Employer is the excess of the amount contributed over
the amount that would have been contributed had there not occurred the
circumstances causing the excess. Earnings attributable to the excess
contribution may not be returned to the Employer, but losses thereto
shall reduce the amount to be so returned. Furthermore, if the
withdrawal of the amount attributable to the excess contribution would
cause the balance of the individual Account of any Participant to be
reduced to less than the balance which would have been in the Account
<PAGE>
had the excess amount not been contributed, then the amount to be
returned to the Employer shall be limited to avoid such reduction.
4.4 Limitation on Allocations:
(a) If the Participant does not participate in, and has never
participated in another qualified plan or a welfare benefit
fund, as defined in section 419(e) of the Code, maintained by
the Employer, or an individual medical benefit account, as
defined in section 415(l)(2) of the Code, maintained by the
Employer, or a simplified employee pension, as defined in
section 408(k) of the Code, maintained by the Employer which
provides an Annual Addition, the amount of Annual Additions
which may be credited to the Participant's Accounts for any
Limitation Year will not exceed the lesser of the Maximum
Permissible Amount or any other limitation contained in this
Plan. If the Employer contribution that would otherwise be
contributed or allocated to the Participant's Accounts would
cause the Annual Additions for the Limitation Year to exceed
the Maximum Permissible Amount, the amount contributed or
allocated will be reduced so that the Annual Additions for the
Limitation Year will equal the Maximum Permissible Amount.
(b) Prior to the determination of the Participant's actual
Compensation for a Limitation Year, the Maximum Permissible
Amount may be determined on the basis of the Participant's
estimated annual compensation for such Limitation Year. Such
estimated annual compensation shall be determined on a
reasonable basis and shall be uniformly determined for all
Participants similarly situated.
(c) As soon as administratively feasible after the end of the
Limitation Year, the Maximum Permissible Amount for such
Limitation Year shall be determined on the basis of the
Participant's actual Compensation for such Limitation Year.
(d) If, pursuant to Subsection (c) above or as a result of the
allocation of forfeitures, there is an Excess Amount with
respect to a Participant for a Limitation Year, such Excess
Amount shall be disposed of as follows:
(1) First, any deferrals made pursuant to a salary
reduction agreement or other deferral mechanism and
Thrift/Voluntary Employee contributions, to the extent
that the return would reduce the Excess Amount, shall
be returned to the Participant.
(2) Unless otherwise specified in the Adoption Agreement,
if after the application of paragraph (1) an Excess
Amount still exists, and the Participant is covered by
the Plan at the end of the Limitation Year, the Excess
Amount in the Participant's Accounts will be used to
reduce Employer contributions (including any
allocation of forfeitures) for such Participant in the
next Limitation Year, and each succeeding Limitation
Year if necessary.
<PAGE>
(3) If after the application of paragraph (1) an Excess
Amount still exists, and the Participant is not
covered by the Plan at the end of the Limitation Year,
the Excess Amount will be held unallocated in a
suspense account. The suspense account will be
applied to reduce future Employer contributions
(including allocation of any forfeitures) for all
remaining Participants in the next Limitation Year,
and each succeeding Limitation Year if necessary;
(4) If a suspense account is in existence at any time
during the Limitation Year pursuant to this Section,
it will not participate in the allocation of the
Trust's investment gains and losses. If a suspense
account is in existence at any time during a
particular Limitation Year, all amounts in the
suspense account must be allocated and reallocated to
Participants' Accounts before any Employer or any
employee contributions may be made to the Plan for
that Limitation Year. Excess Amounts may not be
distributed to Participants or former Participants.
(e) Subsections (e), (f), (g), (h), (i) and (j) apply if, in
addition to this Plan, the Participant is covered under another
qualified master or prototype defined contribution plan
maintained by the Employer or a welfare benefit fund, as
defined in section 419(e) of the Code, maintained by the
Employer or an individual medical benefit account, as defined
in section 415(l)(2) of the Code, maintained by the Employer,
or a simplified employee pension maintained by the Employer
which provides an Annual Addition, during any Limitation Year.
The Annual Additions which may be credited to a Participant's
Accounts under this Plan for any such Limitation Year will not
exceed the Maximum Permissible Amount reduced by the Annual
Additions credited to a Participant's account under the other
qualified master or prototype defined contribution plans,
welfare benefit funds, individual medical accounts, and
simplified employee pensions for the same Limitation Year. If
the Annual Additions with respect to the Participant under
other qualified master or prototype defined contribution plans,
welfare benefit funds, individual medical accounts, and
simplified employee pensions maintained by the Employer are
less than the Maximum Permissible Amount and the Employer
contribution that would otherwise be contributed or allocated
to the Participant's Accounts under this Plan would cause the
Annual Additions for the Limitation Year to exceed this
limitation, the amount contributed or allocated will be reduced
so that the Annual Additions under such plans and welfare
benefit funds for the Limitation Year will equal the Maximum
Permissible Amount. If the Annual Additions with respect to the
Participant under such other qualified master or prototype
defined contribution plans, and welfare benefit funds,
individual medical accounts, and simplified employee pensions
in the aggregate are equal to or greater than the Maximum
Permissible Amount, no amount will be contributed or allocated
to the Participant's Accounts under this Plan for the
Limitation Year.
<PAGE>
(f) Prior to determining the Participant's actual Compensation for
the Limitation Year, the Employer may determine the Maximum
Permissible Amount based on the Participant's estimated annual
compensation in the manner described in Subsection (b).
(g) As soon as administratively feasible after the end of the
Limitation Year, the Maximum Permissible Amount for such
Limitation Year shall be determined on the basis of the
Participant's actual Compensation for such Limitation Year.
(h) If pursuant to Subsection (g) above or as a result of the
allocation of forfeitures, a Participant's Annual Additions
under this Plan and all such other plans result in an Excess
Amount for a Limitation Year, the Excess Amount will be deemed
to consist of the Annual Additions last allocated, except that
Annual Additions attributable to a simplified employee pension
will be deemed to have been allocated first, followed by Annual
Additions to a welfare benefit fund or individual medical
account, regardless of the actual allocation date.
(i) If an Excess Amount was allocated to a Participant on an
allocation date of this Plan which coincides with an allocation
date of another plan, the Excess Amount attributed to this Plan
will be the product of:
(1) the total Excess Amount allocated as of such date,
times,
(2) the ratio of (A) the Annual Additions allocated to the
Participant for the Limitation Year as of such date
under this Plan, to (B) the total Annual Additions
allocated to the Participant for the Limitation Year
as of such date under this Plan and all other
qualified Master and Prototype defined contribution
plans.
(j) Any Excess Amounts attributed to this Plan shall be disposed of
as provided in Subsection (d).
(k) If the Participant is covered under another qualified defined
contribution plan maintained by the Employer which is not a
Master or Prototype plan, Annual Additions which may be
credited to the Participant's Accounts under this Plan for any
Limitation Year will be limited in accordance with Subsections
(e), (f), (g), (h), (i) and (j) as though the other plan were a
Master or Prototype plan unless the Employer provides other
limitations in the Adoption Agreement.
(l) If the Employer maintains, or at any time maintained, a
qualified defined benefit plan (other than the Sponsor's paired
plan number 02001, covering any Participant in this Plan, the
sum of the Participant's Defined Benefit Fraction and Defined
Contribution Fraction will not exceed one (1.0) in any
Limitation Year. Unless the Employer elects otherwise in the
Adoption Agreement, this limitation will be met by freezing or
reducing the rate of benefit accrual under the qualified
defined benefit plan.
<PAGE>
(m) For purposes of this Section 4.4, the following definitions
shall apply:
(1) "Annual Additions" shall mean the sum of the following
credited to a Participant's account for the Limitation
Year:
(A) All Employer contributions,
(B) All forfeitures, and
(C) All Employee contributions.
All excess deferrals as described in section 402(g) of
the Code, all excess contributions as defined in
section 401(k)(8)(B) of the Code, (including amounts
recharacterized), and all excess aggregate
contributions as defined in section 401(m)(6)(B) of
the Code, regardless of whether such amounts are
distributed or forfeited, shall continue to be treated
as Annual Additions.
For purposes of the above, amounts reapplied to reduce
Employer contributions under Subsections (d) and (j)
shall also be included as Annual Additions.
Amounts allocated, after March 31, 1984, to an
individual medical benefit account, as defined in
section 415(l)(2) of the Code, which is part of a
pension or annuity plan maintained by the Employer,
are treated as Annual Additions to a defined
contribution plan. Also, amounts derived from
contributions paid or accrued after December 31, 1985,
in taxable years ending after such date, which are
attributable to post-retirement medical benefits
allocated to the separate account of a Key Employee,
as defined in section 419A(d)(3) of the Code, under a
welfare benefit fund, as defined in section 419(e) of
the Code, maintained by the Employer, are treated as
Annual Additions to a defined contribution plan, and
allocations under a simplified employee pension.
(2) Unless specified otherwise in the Adoption Agreement, for
purposes of this Section, Compensation shall have the same
meaning as described in Section 1.15 of the Plan. One of the
following definitions of Compensation may be elected by the
employer in the Adoption Agreement.
(1) Information required to be reported under
section 6041, 6051, and 6052, (Wages, Tips and
Other Compensation Box on Form W-2).
Compensation defined as wages as defined in
section 3401(a) and all other payments of
compensation to an employee by the employer
(in the course of the employer's trade or
business) for which the employer is required
to furnish the employee a written statement
<PAGE>
under section 6041(d) and 6051(a)(3) of the
Code. Compensation must be determined without
regard to any rules under section 3401(a) that
limit the remuneration included in wages based
on the nature or location of the employment or
the services performed (such as the exception
for agricultural labor in section 3401(a)(2)).
(2) Section 3401(a) wages. Compensation is
defined as wages within the meaning of section
3401(a) for the purposes of income tax
withholding at the source but determined
without regard to any rules that limit the
remuneration included in wages based on the
nature or location of the employment or the
services performed (such as the exception for
agricultural labor in section 3401(a)(2).
(3) 415 safe-harbor compensation. Compensation is
defined as wages, salaries, and fees for
professional services and other amounts
received (without regard to whether or not an
amount is paid in cash) for personal services
actually rendered int he course of employment
with the employer maintaining the plan to the
extent that the amounts are includable in
gross income (including, but not limited to,
commissions paid salesmen, compensation for
services on the basis of percentage of
profits, commissions on insurance premiums,
tips, bonuses, fringe benefits, and
reimbursements or other expense allowances
under a nonaccountable plan (as described in
1.62-2(c)), and excluding the following:
(a) Employer contributions to a plan of
deferred compensation which are not
includable in the employee's gross
income for the taxable year in which
contributed, or employer
contributions under a simplified
employee pension plan to the extent
such contributions are deductible by
the employee, or any distributions
from a plan of deferred compensation;
(b) Amounts realized from the exercise of
a non-qualified stock option, or when
restricted stock (or property) held
by the employee either becomes freely
transferable or is no longer subject
to a substantial risk of forfeiture;
(c) Amounts realized from the sale,
exchange or other disposition of
stock acquired under a qualified
stock option; and
<PAGE>
(d) Other amounts which received special
tax benefits, or contributions made
by the employer (whether or not under
a salary reduction agreement) towards
the purchase of an annuity contract
described in section 403(b) of the
Code (whether or not the
contributions are actually excludable
from the gross income of the
employee).
For any self-employed individual compensation
will mean earned income.
For limitation years beginning after December 31,
1991, for purposes of applying the limitations of this
article, compensation for a limitation year is the
compensation actually paid or made available during
such limitation year.
Notwithstanding the preceding sentence, compensation
for a participant in a defined contribution plan who
is permanently and totally disabled (as defined in
section 22(e)(3) of the Internal Revenue Code) is the
compensation such participant would have received for
the limitation year if the participant had been paid
at the rate of compensation paid immediately before
becoming permanently and totally disabled; such
imputed compensation for the disabled participant may
be taken into account only if the participant is not a
highly compensated employee (as defined in section
414(q) of the Code) and contributions made on behalf
of such participant are nonforfeitable when made.
(3) "Defined Benefit Fraction" shall mean a
fraction, the numerator of which is the sum of
the Participant's Projected Annual Benefits
under all the defined benefit plans (whether
or not terminated) maintained by the Employer,
and the denominator of which is the lesser of
one hundred twenty-five percent (125%) of the
dollar limitation determined for the
Limitation Year under sections 415(b) and (d)
of the Code or one hundred forty percent
(140%) of the Highest Average Compensation
(which shall mean the average compensation for
the three consecutive years of Service with
the Employer that produces the highest
average), including any adjustments under
section 415(b) of the Code. A year of Service
with the Employer is the twelve (12)
consecutive month period defined in Section
1.54 of the Plan.
Notwithstanding the above, if the Participant was a
Participant as of the first day of the first
Limitation Year beginning after December 31, 1986, in
<PAGE>
one or more defined benefit plans maintained by the
Employer which were in existence on May 6, 1986, the
denominator of this fraction will not be less than one
hundred twenty five percent (125%) of the sum of the
annual benefits under such plans which the Participant
had accrued as of the close of the last Limitation
Year beginning before January 1, 1987, disregarding
any changes in the terms and conditions of the Plan
after May 5, 1986. The preceding sentence applies
only if the defined benefit plans individually and in
the aggregate satisfied the requirements of section
415 of the Code for all Limitation Years beginning
before January 1, 1987.
(4) "Defined Contribution Fraction" shall mean a fraction,
the numerator of which is the sum of the Annual
Additions to the Participant's Account under all the
defined contribution plans (whether or not terminated)
maintained by the Employer for the current and all
prior Limitation Years (including the Annual Additions
attributable to the Participant's nondeductible
Voluntary Contributions to all defined benefit plans,
whether or not terminated, maintained by the Employer
and the Annual Additions attributable to all welfare
benefit funds, as defined in section 419(e) of the
Code, and individual medical benefit accounts as
defined in section 415(l)(2) of the Code, and
simplified employee pensions, maintained by the
Employer) and the denominator of which is the sum of
the Maximum Aggregate Amounts for the current and all
prior Limitation Years of Service with the Employer
(regardless of whether a defined contribution plan was
maintained by the Employer). The Maximum Aggregate
Amount in any Limitation Year is the lesser of one
hundred twenty-five percent (125%) of the dollar
limitation in effect under section 415(c)(1)(A) of the
Code or thirty-five percent (35%) of the Participant's
Compensation for such year.
If the Employee was a Participant as of the end of the
first day of the first Limitation Year beginning after
December 31, 1986, in one or more defined contribution
plans maintained by the Employer which were in
existence on May 6, 1986, the numerator of this
fraction will be adjusted if the sum of this fraction
and the Defined Benefit Fraction would otherwise
exceed one (1.0) under the terms of this Plan. Under
the adjustment, an amount equal to the product of (A)
the excess of the sum of the fractions over one (1.0)
times (B) the denominator of this fraction, will be
permanently subtracted from the numerator of this
fraction. The adjustment is calculated as of the end
of the last Limitation Year beginning before January
1, 1987, and disregarding any changes in the terms and
conditions of the Plan made after May 5, 1986, but
using the section 415 limitation applicable to the
<PAGE>
first Limitation Year beginning on or after January 1,
1987.
The Annual Additions for any Limitation Year beginning
before January 1, 1987 shall not be recomputed to
treat all Employee contributions as Annual Additions.
(5) "Employer" shall mean the Employer that adopts this
Plan and all members of a controlled group of
corporations (as defined in section 414(b) of the Code
and as modified by section 415(h) of the Code) which
includes the Employer; any trade or business (whether
or not incorporated) which is under common control (as
defined in section 414(c) and as modified by section
415(h) of the Code) with the Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
section 414(m)); and any other entity required to be
aggregated with the Employer under Section 414(o) of
the Code.
(6) "Excess Amount" shall mean the excess of the
Participant's Annual Additions for the Limitation Year
over the Maximum Permissible Amount.
(7) "Limitation Year" shall mean the calendar year, unless
another twelve (12) consecutive month period is
elected in the Adoption Agreement. All qualified
plans maintained by the Employer must use the same
Limitation Year. If the Limitation Year is changed by
amendment, the new Limitation Year must begin on a
date within the Limitation Year in which the amendment
is made.
(8) "Master or Prototype Plan" shall mean a plan the form
of which is the subject of a favorable opinion letter
from the Internal Revenue Service.
(9) "Maximum Permissible Amount" shall mean the lesser of:
(A) thirty-thousand dollars ($30,000) (or, if
greater, one-fourth (1/4th) of the defined
benefit dollar limitation set forth in section
415(b)(1) of the Code as in effect for the
Limitation Year), or
(B) twenty-five percent (25%) of the Participant's
Compensation for the Limitation Year.
The compensation limitation referred to in paragraph
(B) above shall not apply to any contribution for
medical benefits (within the meaning of section 401(h)
or section 419A(f)(2) of the Code) which is otherwise
treated as an Annual Addition under section 415(l)(1)
or 419A(d)(2) of the Code.
<PAGE>
If a short Limitation Year is created because of an
amendment changing the Limitation Year to a different
twelve (12) consecutive month period, the Maximum
Permissible Amount will not exceed the defined
contribution dollar limitation set forth in paragraph
(A) above multiplied by the following fraction:
Number of Months in the Short Limitation Year
12
(10) "Projected Annual Benefit" shall mean the annual
retirement benefit (adjusted to an actuarial
equivalent straight life annuity if such benefit is
expressed in a form other than a straight life annuity
or Qualified Joint and Survivor Annuity) to which the
Participant would be entitled under the terms of the
Plan assuming:
(A) The Participant will continue employment until
the Normal Retirement Date under the Plan (or
current date, if later) and
(B) the Participant's Compensation for the current
Limitation Year and all other relevant factors
used to determine benefits under the Plan will
remain constant for all future Limitation
Years.
4.5 Separate Accounts
The Committee shall maintain the following separate Accounts, as are
applicable, with respect to each Participant:
(a) an Elective Deferral Account (as described in Article III),
(b) a Qualified Nonelective Contribution Account (as described in
Article III),
(c) a Thrift Account (as described in Article III),
(d) a Matching Contribution Account (as described in Article III),
(e) a Voluntary Account (as described in Article VIII),
(f) a Voluntary Tax-Deductible Account (as described in Article
VIII),
(g) a Rollover Account (as described in Article VIII),
(h) an Employer Discretionary Contribution Account (as described in
Article III), and
(i) a Transfer Account (as described in Article VIII).
Each such Account shall be credited with the applicable contributions,
forfeitures, earnings losses, expenses, and distributions. The
<PAGE>
maintenance of separate Accounts is only for accounting purposes and a
segregation of the Trust Fund to each Account shall not be required.
4.6 Valuation
(a) Except as otherwise provided in subsection (b) below, or as
directed by the Committee subject to approval by the Trustee,
the assets of the Trust Fund shall be valued at their current
fair market value as of each Valuation Date, and the earnings
and losses of the Trust Fund since the immediately preceding
Valuation Date shall be allocated to the separate Accounts of
all Participants and former Participants under the Plan in the
ratio that the fair market value of each such Account as of the
immediately preceding Valuation Date, reduced by any
distributions or withdrawals therefrom since such preceding
Valuation Date, bears to the total fair market value of all
separate Accounts as of the immediately preceding Valuation
Date, reduced by any distributions or withdrawals therefrom
since such preceding Valuation Date; provided, however, that if
Participant-directed investments have been elected in the
Adoption Agreement, the earnings and losses of each separate
Account shall be allocated solely to such Account.
Notwithstanding any other provision of the Plan, the Committee
may, in its sole discretion, on any date other than the last
day of the Plan Year, determine the value of an Account. If
such a determination is made, the date of such determination
shall be considered to be a Valuation Date.
(b) If the plan is an Easy Retirement Plan, the dividends, capital
gain distributions, and other earnings or losses received on
any share or unit of a regulated investment company or
collective investment fund, or on any other investment, that is
specifically credited to a Participant's separate Accounts
under the Plan and/or held under the Custodial Agreement shall
be allocated to such separate Accounts and, in the absence of
investment directions to the contrary, immediately reinvested,
to the extent practicable, in additional shares or units of
such regulated investment company or collective investment
fund, or in such other investments.
4.7 Segregation of Former Participant's Account
The Committee may segregate any portion of a former Participant's
account balance which is retained in the Fund after his death or
separation from service in an interest-bearing account and debited or
credited only with income and charges attributable directly.
ARTICLE V.
VESTING
5.1 Vested Interest
Each Participant shall at all times have a fully vested interest in his
Elective Deferral Account, Qualified Nonelective Account, Voluntary
<PAGE>
Account, Voluntary Tax-Deductible Account and Thrift Account. Each
Participant's Regular Account, Employer Discretionary Contribution
Account, and Employer Matching Contribution Account shall vest in
accordance with the vesting schedule elected in the Adoption Agreement.
If a Participant is not already fully vested in his Regular Account,
Employer Discretionary Contribution Account, and Employer Matching
Contributions Account, he shall become so upon reaching Normal
Retirement Age or Early Retirement Age, or upon his death or Total and
Permanent Disability.
5.2 Vesting of a Participant
Except in the case of Plans subject to full and immediate vesting, a
Participant's vested amount shall be calculated by multiplying his
Regular Account balance, Employer Discretionary Contribution Account
balance, and Employer Matching Contribution Account balance, if any, as
determined on the Valuation Date following his termination of
employment by his vested interest as determined under Section 5.1.
In order to determine the vested interest of a Participant after a
Service Break, the following rules shall apply:
(a) Subject to (b) below, a former Participant who had a
nonforfeitable right to all or a portion of the account balance
derived from Employer contributions at the time of the
Participant's termination will receive credit for all years of
Service prior to a Service Break if the Participant completes a
year of Service after returning to the employ of the Employer.
(b) In the case of a Participant who have five (5) or more
consecutive one (1) year Service Breaks, all Service after such
Service Breaks will be disregarded for the purpose of vesting
the Employer-derived account balance that accrued before such
Service Breaks. Such Participants' pre-Service Break Service
will count in vesting the post-Service Break Employer-derived
account balance only if (1) such Participant has any
nonforfeitable interest in the account balance attributable to
Employer contributions at the time of separation from service,
or (2) upon returning to service the number of consecutive one
(1) year Service Breaks is less than the number of years of
Service. Separate accounts will be maintained for the
Participant's pre-Service Break and post-Service Break
Employer-derived account balance. Both accounts will share in
the earnings and losses of the Fund.
5.3 Amendment of Vesting Provisions
No amendment to the vesting provisions pursuant to Section 5.1 shall
deprive a Participant of his nonforfeitable rights to benefits accrued
to the date of the amendment. Further, if the vesting provisions of
the Plan are amended, or the Plan is amended in any way that directly
or indirectly affects computation of a Participant's nonforfeitable
percentage or if the Plan is deemed amended by an automatic change to
or from a top-heavy vesting schedule, each Participant with at least
three (3) years of Service may elect, within a reasonable period after
the adoption of the amendment, to have his nonforfeitable percentage
<PAGE>
computed under the Plan without regard to such amendment. For
Participants who do not have at least one Hour of Service in any Plan
Year beginning on or after January 1, 1989, the preceding sentence
shall be applied by substituting "five (5) years of Service" for "three
(3) years of Service." The period during which the election may be
made shall commence with the date the amendment is adopted and shall
end on the later of (1) sixty (60) days after the amendment is adopted;
(2) sixty (60) days after the amendment becomes effective; or (3) sixty
(60) days after the Participant is issued written notice of the
amendment by the Employer or Committee.
5.4 Forfeitures
(a) If a Participant terminates employment with the Employer and
the value of the Participant's vested account balance derived
from Employer and Employee contributions (other than
accumulated deductible employee contributions) is not greater
than $3,500, the Employee shall receive a distribution of the
value of the entire vested portion of such account balance, and
the nonvested portion will be treated as a forfeiture. For
purposes of this Section 5.4, if the value of a Participant's
vested account balance is zero, the Participant shall be deemed
to have received a distribution of such vested account balance.
A Participant's vested account balance shall not include
Voluntary Tax-Deductible Contributions for Plan Years beginning
before January 1, 1989.
(b) If a Participant terminates employment with the Employer, and
elects (with his or her spouse's consent) in accordance with
Article VIII to receive the value of his or her vested account
balance, the nonvested portion will be treated as a forfeiture.
If the Participant elects to have distributed less than the
entire vested portion of the account balance derived from
Employer contributions, the part of the nonvested portion that
will be treated as a forfeiture is the total nonvested portion
multiplied by a fraction, the numerator of which is the amount
of the distribution attributable to Employer contributions and
the denominator of which is the total value of the vested
Employer derived account balance.
(c) If a Participant terminates employment with the Employer but
does not receive a distribution described in (a) or (b) above,
the non-vested portion of his account balance will be treated
as a forfeiture upon the occurrence of a Service Break of five
(5) consecutive years.
(d) If a Participant who receives a distribution pursuant to this
Section 5.4 resumes employment, the Participant's
Employer-derived account balance will be restored to the amount
on the date of distribution if the Participant repays to the
Plan the full amount of the distribution attributable to
Employer contributions before the earlier of (i) five (5) years
after the Participant's Re-Employment Commencement Date or (ii)
the date the Participant incurs five (5) consecutive one (1)
year Service Breaks following the date of distribution. If a
Participant is deemed to receive a distribution pursuant to
this Section, and the Participant resumes employment covered
<PAGE>
under this Plan before the date the Participant incurs five (5)
consecutive one year Service Breaks, upon the reemployment of
such Participant, the Employer-derived account balance of the
Participant will be restored to the amount on the date of such
deemed distribution.
ARTICLE VI.
BENEFITS ON RETIREMENT AND SEPARATION FROM SERVICE
6.1 Commencement of Benefits
(a) Any Participant who terminates employment with the Employer for
any reason (including Total and Permanent Disability as defined
in Section 1.58 of the Plan) shall be entitled to receive the
value of the vested portion of his Accounts (determined as of
the Valuation Date coincident with or immediately subsequent to
his termination with employment) as soon as administratively
feasible after the date of his termination of employment. If
the value of the Employee's vested account balance derived from
Employer and Employee contributions (excluding, for Plan Years
beginning before January 1, 1989, accumulated Voluntary
Tax-Deductible Contributions) is greater than (or at the time
of any prior distribution was greater than) $3,500, then no
such amount shall be distributed prior to Normal Retirement Age
(or age sixty-two (62), if later) unless the Participant
consents to the distribution. If the Plan is subject to the
Automatic Annuity rules of Section 6.2, then the consent of the
Participant's spouse shall also be required to a distribution
in any form other than a Qualified Joint and Survivor Annuity
(as defined in Section 6.2).
In the case of the Dreyfus Easy Retirement Plans (Plan Numbers
01005, and 01006), Participants who attain the Plan's Normal
Retirement Age shall be entitled to receive the value of the
vested portion of their Accounts. With respect to the Dreyfus
standardized and non-standardized prototype profit-sharing
plans (Plan Numbers 01002 and 01003) if permitted under the
Adoption Agreement, Participants who attain the Plan's Normal
Retirement Age shall be entitled to receive the value of the
vested portion of their Accounts.
The Committee shall provide the Participant with a written
explanation of the material features and relative values of the
optional forms of benefit available under the Plan. Such
notice shall also notify the Participant of the right to defer
distribution until a future date specified by the Participant
(not permitted in the case of the Dreyfus Easy Retirement Plans
-- Plan Numbers 01005 and 01006) or until Normal Retirement
Age (or age sixty-two (62), if later), and if the Plan is
subject to the Automatic Annuity Rules of Section 6.2, shall be
provided during the period beginning ninety (90) days before
and ending thirty (30) days before the Annuity Starting Date.
(b) If the value of the Participant's vested account balance
derived from Employer and Employee contributions (excluding,
<PAGE>
for Plan Years beginning before January 1, 1989, accumulated
Voluntary Tax-Deductible Contributions) is not greater than
$3,500, the Employee shall receive a distribution of the value
of the entire vested portion of such account balance. However,
no such distribution shall be made after the Annuity Starting
Date unless the Participant and his or her spouse (or the
Participant's surviving spouse) consent in writing to such
distribution.
(c) Unless the Participant elects otherwise, distribution of
benefits shall commence no later than the sixtieth (60th) day
after the close of the Plan Year in which the latest of the
following events occurs:
(i) the Participant reaches his Normal Retirement Age (or
age sixty-five (65), if earlier),
(ii) the tenth (10th) anniversary of the year in which the
Participant commenced participation in the Plan, or
(iii) the Participant terminates employment with the
Employer.
The failure of a Participant or surviving spouse to consent to
a distribution shall be deemed to be an election to defer
commencement of benefit distributions sufficient to satisfy
this Section.
(d) Neither the consent of the Participant nor the Participant's
spouse shall be required to the extent a distribution is
necessary to satisfy section 401(a)(9) or section 415 of the
Code.
(e) This Article applies to distribution made on or after January
1, 1993. Notwithstanding any provision of the plan to the
contrary that would otherwise limit a distributee's election
under this Article, a distributee may elect, at the time and in
the manner prescribed by the Committee, to have any portion of
an eligible rollover distribution paid directly to an eligible
retirement plan specified by the distributee in a direct
rollover.
Definitions:
(i) Eligible rollover distribution: An eligible
rollover distribution is any distribution of
all or any portion of the balance to the
credit of the distributee, except that an
eligible rollover distribution does not
include: any distribution that is one of a
series of substantially equal periodic
payments (not less frequently than annually)
made for the life (or life expectancy) of the
distributee or the joint lives (or joint life
expectancies) of the distributee and the
distributee's designated beneficiary, or for a
specified period of ten years or more; any
<PAGE>
distribution to the extent such distribution
is required under section 401(a)(9) of the
Code; and the portion of any distribution that
is not includible in gross income (determined
without regard to the exclusion for net
unrealized appreciation with respect to
employer securities).
(ii) Eligible retirement plan: An eligible
retirement plan is an individual retirement
account described in section 408(a) of the
Code, an individual retirement annuity
described in section 408(b) of the Code, an
annuity plan described in section 402(a) of
the Code, or a qualified trust described in
section 401(a) of the Code, that accepts the
distributee's eligible rollover distribution.
However, in the case of an eligible rollover
distribution to the surviving spouse, an
eligible retirement plan is an individual
retirement account or individual retirement
annuity.
(iii) Distributee: A distributee includes an
Employee or former Employee. In addition, the
Employee's or former Employee's surviving
spouse and the Employee's or former Employee's
spouse or former spouse who is the alternate
payee under a qualified domestic relations
order as defined in section 414(p) of the
Code, are distributees with regard to the
interest of the spouse or former spouse.
(iv) Direct rollover: A direct rollover is a
payment by the Plan to the eligible retirement
plan specified by the distributee.
6.2 Automatic Annuity Requirements
The provisions of Section 6.2 through 6.4 shall take precedence over
any conflicting provisions in this Plan.
(a) Applicability of Automatic Annuity Requirements.
Except as provided in Section 6.3 with respect to certain
Profit Sharing Plans, the provisions of this Section shall
apply to any Participant who is credited with at least one (1)
Hour of Service with the Employer on or after August 23, 1984,
and such other Participants as provided in Section 6.4.
Qualified Joint and Survivor Annuity. Unless an optional form
of benefit is selected pursuant to a Qualified Election within
the ninety (90) day period ending on the Annuity Starting Date,
a married Participant's Vested Account Balance shall be paid in
the form of a Qualified Joint and Survivor Annuity and an
unmarried Participant's Vested Account Balance will be paid in
the form of a life annuity. The Participant may elect to have
<PAGE>
such annuity distributed upon attainment of the Earliest
Retirement Age.
Qualified Pre-Retirement Survivor Annuity. Unless an optional
form of benefit has been selected within the Election Period
pursuant to a Qualified Election, if a Participant dies before
the Annuity Starting Date then the Participant's Vested Account
Balance shall be paid in the form of a Qualified Pre-Retirement
Survivor Annuity. The Surviving Spouse may elect to elect to
have such annuity distributed within a reasonable period after
the Participant's death.
Definitions. For purposes of this Section 8.2, the following
words shall have the following meanings:
(i) "Earliest Retirement Age" shall mean the earliest date
on which, under the Plan, the Participant could elect
to receive retirement benefits.
(ii) "Election Period" shall mean the period which begins
on the first day of the Plan Year in which the
Participant attains age thirty-five (35) and ends on
the date of the Participant's death. If a Participant
separates from service prior to the first day of the
Plan Year in which age thirty-five (35) is attained,
with respect to benefits accrued prior to separation,
the Election Period shall begin on the date of
separation.
A Participant who will not yet attain age thirty-five
(35) as of the end of any current Plan Year may make a
special Qualified Election to waive the Qualified
Pre-Retirement Survivor Annuity for the period
beginning on the date of such election and ending on
the first day of the plan year in which the
Participant will attain age thirty-five (35). Such
election shall not be valid unless the Participant
receives a written explanation of the Qualified
Pre-Retirement Survivor Annuity in such terms as are
comparable to the explanation required under Section
6.2(b). Qualified Pre-Retirement Survivor Annuity
coverage will be automatically reinstated as of the
first day of the Plan Year in which the Participant
attains age thirty-five (35). Any new waiver on or
after such date shall be subject to the full
requirements of this Section 6.2.
(iii) "Qualified Election" shall mean a Participant's waiver
of a Qualified Joint and Survivor Annuity or a
Qualified Pre-Retirement Survivor Annuity. Any such
waiver must be consented to in writing by the
Participant's Spouse. The Spouse's consent must:
designate a specific Beneficiary (including any class
of Beneficiaries or any contingent Beneficiaries,
which may not be changed without spousal consent) or
expressly permits designations by the Participant
without any further spousal consent; acknowledge the
<PAGE>
effect of the election; and be witnessed by a member
of the Committee or a Notary Public. Additionally, a
Participant's waiver of the Qualified Joint and
Survivor Annuity shall not be effective unless the
election designates a form of benefit payment which
may not be changed without spousal consent (or the
Spouse expressly permits designations by the
Participant without any further spousal consent).
Notwithstanding this consent requirement, if the
Participant establishes to the satisfaction of a
member of the Committee that there is no Spouse or the
Spouse cannot be located, a waiver will be deemed a
Qualified Election. Any spousal consent (or deemed
spousal consent) obtained under this provision will be
valid only with respect to such Spouse. A consent
that permits designations by the Participant without
further consent by such Spouse must acknowledge that
the Spouse has the right to limit consent to a
specific Beneficiary and, where applicable, a specific
form of benefit, and that the Spouse voluntarily
elects to relinquish either or both of such rights. A
revocation of a prior waiver may be made by a
Participant without the consent of the Spouse at any
time before the commencement of benefits. The number
of revocations shall not be limited. No consent
obtained under this provision shall be valid unless
the Participant has received notice as provided in
paragraph (b) below.
(iv) "Qualified Joint and Survivor Annuity" shall mean an
immediate annuity for the life of the Participant with
a survivor annuity for the life of the Spouse which is
fifty percent (50%) of the amount of the annuity which
is payable during the joint lives of the Participant
and the Spouse and which is the amount of benefit
which can be purchased with the Participant's Vested
Account Balance.
(v) "Qualified Pre-Retirement Survivor Annuity" shall mean
an annuity for the life of the Participant's surviving
spouse purchased with the Participant's Vested Account
Balance.
(vi) "Spouse (Surviving Spouse)" shall mean the Spouse or
Surviving Spouse of the Participant, provided that
former spouse will be treated as the Spouse or
Surviving Spouse to the extent provided under a
qualified domestic relations order as described in
section 414(p) of the Code.
(vii) "Vested Account Balance" shall mean the aggregate
value of the Participant's vested account balance
derived from employer and employee contributions
(including rollovers), whether vested before or upon
death, including the proceeds of insurance contracts,
if any, on the Participant's life. The provisions of
this Section 6.2 shall apply to a Participant who is
<PAGE>
vested in amounts attributable to employer
contributions, employee contributions (or both) at the
time of death or distribution.
(b) Notice Requirements
Qualified Joint and Survivor Annuity. In the case of a
Qualified Joint and Survivor Annuity as described above, the
Committee shall provide each Participant within the period
beginning ninety (90) days before and ending thirty (30) days
before the Annuity Starting Date a written explanation of: (i)
the terms and conditions of a Qualified Joint and Survivor
Annuity; (ii) the Participant's right to make and the effect of
an election to waive the Qualified Joint and Survivor Annuity
form of benefit; (iii) the rights of a Participant's Spouse;
(iv) the right to make, and the effect of, a revocation of a
previous election to waive the Qualified Joint and Survivor
Annuity; and (v) the right, if any, to defer the commencement
of benefits.
Qualified Pre-Retirement Survivor Annuity. In the case of a
Qualified Pre-Retirement Survivor Annuity as described above,
the Committee shall provide each Participant with a written
explanation of the Qualified Pre-Retirement Survivor Annuity in
such terms and in such manner as would be comparable to the
explanation provided for meeting the requirements applicable to
explaining a Qualified Joint and Survivor Annuity within
whichever of the following periods ends last:
(i) The period beginning on the first day of the Plan Year
in which the Participant attains age thirty-two (32)
and ending with the close of the Plan Year preceding
the Plan Year in which the Participant attains age
thirty-five (35).
(ii) A reasonable period ending after a Participant enters
the Plan.
(iii) A reasonable period ending after Section 6.3 ceases to
apply to a Profit Sharing Plan.
(iv) A reasonable period after Section 6.2 first applies to
a Participant.
Notwithstanding the foregoing, notice must be provided within a
reasonable period ending after termination of employment in the
case of a Participant who terminates employment before
attaining age 35.
For purposes of applying the preceding paragraph, a reasonable
period ending after the enumerated events described in (ii),
(iii), and (iv) is the end of the two-year period beginning one
year prior to the date the applicable event occurs, and ending
one year after that date. In the case of a Participant who
terminates employment before the Plan Year in which age
thirty-five (35) is attained, notice shall be provided within
the two-year period beginning one year prior to termination and
<PAGE>
ending one year after termination. If such a Participant
thereafter returns to employment with the Employer, the
applicable period for such Participant shall be redetermined.
If a distribution is one to which sections 401(a)(11) and 417
of the Code do not apply, such distribution may commence less
than 30 days after the notice required under section 1.411(a)-
11(c) of the Income Tax Regulations in given, provided that:
(1) the Plan Administrator clearly informs the
Participant that the Participant has a right
to a period of at least 30 days after
receiving the notice to consider the decision
of whether or not to elect a distribution
(and, if applicable, a particular distribution
option), and
(2) the participant, after receiving the
notice,affirmatively elects a distribution.
6.3 Profit Sharing Plans: Exception from Automatic Annuity Requirements
Unless otherwise specified in the Adoption Agreement, the provisions of
Sections 6.2 and 6.4 shall be inoperative in the case of a Profit
Sharing Plan if the following two (2) conditions are met: (1) the
Participant cannot or does not elect payments in the form of a life
annuity, and (2) on the death of the Participant, the Participant's
Vested Account Balance (as defined in Section 6.2) will be paid to the
Participant's Surviving Spouse (as defined in Section 6.2), but if
there is no Surviving Spouse, or, if the Surviving Spouse has already
consented in a manner conforming to a Qualified Election to a waiver of
a Qualified Pre-Retirement Survivor Annuity (under Section 6.2), then
to the Participant's Beneficiary.
However, the foregoing shall not be operative with respect to a
Participant if it is determined that this Profit Sharing Plan is a
direct or indirect transferee of a defined benefit plan, money purchase
pension plan (including a target benefit plan), stock bonus, or
profit-sharing plan which is subject to the survivor annuity
requirements of sections 401(a)(11) and 417 of the Code.
6.4 Transitional Rules Applicable to Joint and Survivor Annuities
(a) Any living Participant not receiving benefits on August 23,
1984, who would otherwise not receive the benefits prescribed
by Section 6.2 must be give the opportunity to elect to have
Section 6.2 apply if such Participant is credited with at least
one (1) Hour of Service under this Plan or a predecessor plan
in a Plan Year beginning on or after January 1, 1976, and such
Participant had at least ten (10) years of Service when he or
she terminated employment.
(b) Any living Participant not receiving benefits on August 23,
1984, who was credited with at least one (1) Hour of Service
under this Plan or a predecessor Plan on or after September 2,
1974, and who is not otherwise credited with any Service in a
Plan Year beginning on or after January 1, 1976, must be given
<PAGE>
the opportunity to have his or her benefits paid in the manner
set forth in paragraph (d) below.
(c) The respective opportunities to elect (as described in
paragraphs (a) and (b) above) must be afforded to the
appropriate Participants during the period commencing on
August 23, 1984, and ending on the date benefits would
otherwise commence to said Participants.
(d) Any Participant who has elected pursuant to paragraph (b) above
and any Participant who does not elect under paragraph (a)
above or who meets the requirements of paragraph (a) except
that such Participant does not have at least ten (10) Years of
Service when he or she terminates employment, shall have his or
her benefits distributed in accordance with all of the
following requirements if benefits would have been payable in
the form of a life annuity:
(1) Qualified Joint and Survivor Annuity. If benefits in
the form of a life annuity become payable to a married
Participant who:
(i) Begins to receive payments under the Plan on
or after his Normal Retirement Age; or
(ii) Dies on or after his Normal Retirement Age
while still working for the Employer; or
(iii) Begins to receive payments on or after the
Qualified Early Retirement Age; or
(iv) Separates from service on or after attaining
his Normal Retirement Age (or the Qualified
Early Retirement Age) and after satisfying the
eligibility requirements for the payment of
benefits under the Plan and thereafter dies
before beginning to receive such benefits;
then such benefits shall be received under this Plan
in the form of a Qualified Joint and Survivor Annuity,
unless the Participant, with the consent of his or her
Spouse, has elected otherwise during the election
period which shall begin at least six (6) months
before the Participant attains the Qualified Early
Retirement Age (or the date the Participant begins
participation in the Plan, if later) and end not more
than ninety (90) days before the commencement of
benefits. Any election hereunder shall be in writing
and may be changed by the Participant, with the
consent of his or her Spouse, at any time during the
election period.
(2) Election of Early Survivor Annuity. A Participant who
is employed after attaining the Qualified Early
Retirement Age will be given the opportunity to elect,
during the election period, to have a survivor annuity
payable on death. If the Participant elects the
<PAGE>
survivor annuity, payments under such annuity must not
be less than the payments which would have been made
to the Spouse under the Qualified Joint and Survivor
Annuity if the Participant had retired on the day
before his or her death. Any election under this
provision will be in writing and may be changed by the
Participant with the consent of his or her Spouse at
any time. The election period begins on the later of
(1) the ninetieth (90) day before the Participant
attains the Qualified Early Retirement Age, or (2) the
date on which participation begins, and ends on the
date the Participant terminates employment.
Notwithstanding the availability of the elections set
forth above, in the event a Participant dies after
attaining the Qualified Early Retirement Age while
still employed by the Employer, but before reaching
the Normal Retirement Date, the Participant's account
balance as of the date of death shall be paid to the
Participant's Spouse. If the Participant is not
married, such benefit shall be paid to the
Participant's designated Beneficiary or, if none, to
the Participant's estate.
(3) Definitions. For purpose of this Section 6.4, the
following words shall have the following meanings:
(i) "Qualified Joint and Survivor Annuity" shall
mean an annuity for the life of the
Participant with a survivor annuity for the
life of his Spouse as described in Section
6.2.
(ii) "Qualified Early Retirement Age" shall mean
the latest of:
(A) the earliest date, under the Plan, on
which the Participant may elect to
receive retirement benefits;
(B) the first day of the one hundred
twentieth (120th) month beginning
before the Participant reaches his
Normal Retirement Age; or
(C) the date on which the Participant
begins participation.
8.5 Required Payment of Benefits
(a) General Rule. Except as otherwise provided in Section 6.2, the
requirements of this Section shall apply to any distribution of
a Participant's account balance and will take precedence over
any inconsistent provisions of the Plan. Unless otherwise
specified, the provisions of this Section shall apply to
calendar years beginning after December 31, 1984.
<PAGE>
All distributions required under this Section 6.5 shall be
determined and made in accordance with the Income Tax
Regulations under section 401(a)(9) of the Code, including the
minimum distribution incidental benefit requirement of section
1.401(a)(9)-2 of the regulations.
(b) Limits on Distribution Periods. Distributions, if not made in
a single-sum, may only be made over one of the following
periods (or a combination thereof): (1) the life of the
Participant; (2) the life of the Participant and a Designated
Beneficiary; (3) a period certain not extending beyond the life
expectancy of the Participant; or (4) a period certain not
extending beyond the joint and last survivor expectancy of the
Participant and a Designated Beneficiary.
Any annuity contract purchased and distributed to a Participant
or his Beneficiary shall comply with the requirements of this
Plan, and shall be made and endorsed as nontransferable.
(c) Minimum Amounts to be Distributed. If the Participant's entire
interest is to be distributed in other than a single sum, the
following minimum distribution rules shall apply on or after
the Required Beginning Date:
(i) If a Participant's benefit is to be distributed over
(1) a period not extending beyond the life expectancy
of the Participant or the joint life and last survivor
expectancy of the Participant and the Participant's
Designated Beneficiary or (2) a period not extending
beyond the life expectancy of the Designated
Beneficiary, the amount required to be distributed for
each calendar year, beginning with distributions for
the first distribution calendar year, must at least
equal the quotient obtained by dividing the
Participant's benefit by the applicable life
expectancy.
(ii) For calendar years beginning before January 1, 1989,
if the Participant's spouse is not the designated
Beneficiary, the method of distribution selected must
assure that at least fifty percent (50%) of the
present value of the amount available for distribution
is paid within the life expectancy of the Participant.
(iii) For calendar years beginning after December 31, 1988,
the amount to be distributed each year, beginning with
distributions for the first distribution calendar year
shall not be less than the quotient obtained by
dividing the Participant's benefit by the lesser of
(1) the applicable life expectancy or (2) if the
Participant's spouse is not the Designated
Beneficiary, the applicable divisor determined from
the table set forth in Q&A-4 of section 1.401 (a)(9)-2
of the Income Tax Regulations. Distributions after
the death of the Participant shall be distributed
using the applicable life expectancy in paragraph
<PAGE>
(c)(i) above as the relevant divisor without regard to
section 1.401 (a)(9)-2 of the regulations.
(iv) The minimum distribution required for the
Participant's first distribution calendar year must be
made on or before the Participant's Required Beginning
Date. The minimum distribution for other calendar
years, including the minimum distribution for the
distribution calendar year in which the Employee's
Required Beginning Date occurs, must be made on or
before December 31 of that distribution calendar year.
(d) Commencement of Death Benefits. Upon the death of the
Participant, the following distribution provisions shall take
effect:
(i) If the Participant dies after distribution of his or
her interest has commenced, the remaining portion of
such interest will continue to be distributed at least
as rapidly as under the method of distribution being
used prior to the Participant's death. Upon the death
of the Participant's Beneficiary, any undistributed
interest shall be paid to the legal representatives of
such Beneficiary's estate.
(ii) If the Participant dies before distribution of his or
her interest commences, the Participant's entire
interest will be distributed by December 31 of the
calendar year in which falls the fifth anniversary of
the Participant's death except to the extent that an
election is made to receive distributions in
accordance with (1) or (2) below:
(1) If any portion of the Participant's interest
is payable to a Designated Beneficiary,
distributions may be made in substantially
equal installments over the life or over a
period certain not greater than the life
expectancy of the Designated Beneficiary
commencing on or before December 31 of the
calendar year immediately following the
calendar year in which the Participant died.
(2) If the Designated Beneficiary is the
Participant's surviving spouse, the date
distributions are required to begin in
accordance with (1) above shall not be earlier
than the later of (A) December 31 of the
calendar year immediately following the
calendar year in which the Participant died
and (B) December 31 of the calendar year in
which the Participant would have attained age
seventy and one-half (70 1/2).
If the Participant has not made an election pursuant to this
Section 6.5(d)(ii) by the time of his or her death, the
Participant's Designated Beneficiary must elect the method of
<PAGE>
distribution no later than the earlier of (1) December 31 of
the calendar year in which distributions would be required to
begin under this Section, or (2) December 31 of the calendar
year which contains the fifth anniversary of the date of death
of the Participant. If the Participant has no Designated
Beneficiary, or if the Designated Beneficiary does not elect a
method of distribution, distribution of the Participant's
entire interest must be completed by December 31 of the
calendar year containing the fifth anniversary of the
Participant's death.
(iii) For purposes of Section 6.5(d)(ii) above, if the
surviving spouse dies after the Participant, but
before payments to such spouse begin, the provisions
of Section 6.5(d)(ii), with the exception of
subparagraph (2) thereof, shall be applied as if the
surviving spouse were the Participant.
(iv) For purposes of this Section 6.5(d), any amount paid
to a child of the Participant will be treated as if it
had been paid to the Surviving Spouse if the amount
becomes payable to the Surviving Spouse when the child
reaches the age of majority.
(v) For purposes of this Section 6.5(d), distribution of a
Participant's interest is considered to begin on the
Participant's Required Beginning Date (or, if Section
6.5(d)(iii) above is applicable, the date distribution
is required to begin to the surviving spouse pursuant
to Section 6.5(d)(ii) above). If distribution in the
form of an annuity irrevocably commences to the
Participant before the Required Beginning Date, the
date distribution is considered to begin is the date
distribution actually commences.
(e) Definitions. For purposes of this Section 6.5, the following
terms shall have the following meanings:
(i) Designated Beneficiary. The individual who is
designated as the Beneficiary under the Plan in
accordance with section 401(a)(9) of the Code and the
regulations thereunder.
(ii) Distribution calendar year. A calendar year for which
a minimum distribution is required. For distributions
beginning before the Participant's death, the first
distribution calendar year is the calendar year
immediately preceding the calendar year which contains
the Participant's Required Beginning Date. For
distributions beginning after the Participant's death,
the first distribution calendar year is the calendar
year in which distributions are required to begin
pursuant to Section 6.5(d) above.
(iii) Life expectancy. The life expectancy (or joint and
last survivor expectancy) calculated using the
attained age of the Participant (or Designated
<PAGE>
Beneficiary) as of the Participant's (or Designated
Beneficiary's) birthday in the applicable calendar
year. The applicable calendar year shall be the first
distribution calendar year. If annuity payments
commerce before the required beginning date, the
applicable calendar year is the year such payments
commence. Life expectancy and joint and last survivor
expectancy are computed by use of the expected return
multiples in Tables V and VI of section 1.72-9 of the
Income Tax Regulations.
Unless otherwise elected by the Participant (or
spouse, in the case of distributions described in
Section 6.5(d)(ii)(2) above) by the time distributions
are required to begin, life expectancies shall be
recalculated annually. Such election shall be
irrevocable as to the Participant (or spouse) and
shall apply to all subsequent years. The life
expectancy of a nonspouse Beneficiary may not be
recalculated.
(iv) Participant's benefit.
(A) The account balance as of the last valuation
date in the calendar year immediately
preceding the distribution calendar year
(valuation calendar year) increased by the
amount of any contributions or forfeitures
allocated to the account balance as of dates
in the valuation calendar year after the
valuation date and decreased by distributions
made in the valuation calendar year after the
valuation date.
(B) Exception for second distribution calendar
year. For purposes of paragraph (A) above, if
any portion of the minimum distribution for
the first distribution calendar year is made
in the second distribution calendar year on or
before the Required Beginning Date, the amount
of the minimum distribution made in the second
distribution calendar year shall be treated as
if it had been made in the immediately
preceding distribution calendar year.
(v) Required Beginning Date.
(A) General rule. The Required Beginning Date of
a Participant is the first day of April of the
calendar year following the calendar year in
which the Participant attains age seventy and
one-half (70 1/2).
(B) Transitional rules. The Required Beginning
Date of a Participant who attains age seventy
and one-half (70 1/2) before January 1, 1988,
<PAGE>
shall be determined in accordance with (1) or
(2) below:
(1) Non-Five percent owners. The
Required Beginning Date of a
Participant who is not a five percent
(5%) owner is the first day of April
of the calendar year following the
calendar year in which the later of
retirement or attainment of age of
seventy and one-half (70 1/2) occurs.
(2) Five percent owners. The required
beginning date of a Participant who
is a five percent (5%) owner during
any year beginning after December 31,
1979, is the first day of April
following the later of:
(i) the calendar year in which
the Participant attains age
seventy and one-half
(70 1/2), or
(ii) the earlier of the calendar
year with or within which
ends the plan year in which
the Participant becomes a
five percent (5%) owner, or
the calendar year in which
the Participant retires.
The Required Beginning Date of a
Participant who is not a five percent
(5%) owner who attains age seventy
and one-half (70 1/2) during 1988 and
who has not retired as of January 1,
1989, is April 1, 1990.
(C) Five percent owner. A Participant is treated
as a five percent (5%) owner for purposes of
this Section if such Participant is a five
percent (5%) owner as defined in section
416(i) of the Code but without regard to
whether the Plan is top-heavy) at any time
during the Plan Year ending with or within the
calendar year in which such owner attains age
sixty-six and one-half (66 1/2) or any
subsequent Plan Year.
(D) Once distributions have begun to a five
percent (5%) owner under this Section, they
must continue to be distributed, even if the
Participant ceases to be a five percent (5%)
owner in a subsequent year.
<PAGE>
(f) Transitional Rule. Notwithstanding the other requirements of
this Section and subject to the requirements of Section 6.2,
distribution on behalf of any Employee, including a five
percent (5%) owner, may be made in accordance with all of the
following requirements (regardless of when such distribution
commences):
(i) The distribution by the trust is one which would not
have disqualified such trust under section 401(a)(9)
of the Code as in effect prior to amendment by the
Deficit Reduction Act of 1984.
(ii) The distribution is in accordance with a method of
distribution designated by the Employee whose interest
in the trust is being distributed or, if the Employee
is deceased, by a Beneficiary of such Employee.
(iii) Such designation was in writing, was signed by the
Employee or the Beneficiary, and was made before
January 1, 1984.
(iv) The Employee had accrued a benefit under the Plan as
of December 31, 1983.
(v) The method of distribution designated by the Employee
or the Beneficiary specifies the time at which
distribution will commence, the period over which
distributions will be made, and in the case of any
distribution upon the Employee's death, the
Beneficiaries of the Employee listed in order of
priority.
A distribution upon death will not be covered by this transitional rule
unless the information in the designation contains the required
information described above with respect to the distributions to be
made upon the death of the Employee.
For any distribution which commences before January 1, 1984, but
continues after December 31, 1983, the Employee, or the Beneficiary, to
who such distribution is being made, will be presumed to have
designated the method of distribution under which the distribution is
being made if the method of distribution was specified in writing and
the distribution satisfies the requirements in Subsections (i) through
(v) above.
If a designation is revoked, any subsequent distribution must satisfy
the requirements of section 401(a)(9) of the Code and the regulations
thereunder. If a designation is revoked subsequent to the date
distributions are required to begin, the trust must distribute by the
end of the calendar year following the calendar year in which the
revocation occurs the total amount not yet distributed which would have
been required to have been distributed to satisfy section 401(a)(9) of
the Code and the regulations thereunder, but for the election under
section 242(b)(2) of Pub. L. No. 97-248. For calendar years beginning
after December 31, 1988, such distributions must meet the minimum
distribution incidental benefit requirements in section 1.401(a)(9)-2
of the Income Tax Regulations. Any changes in the designation will be
<PAGE>
considered to be a revocation of the designation. However, the mere
substitution or addition of another Beneficiary (one not named in the
designation) under the designation will not be considered to be a
revocation of the designation, so long as such substitution or addition
does not alter the period over which distributions are to be made under
the designation, directly or indirectly (for example, by altering the
relevant measuring life). The rules of Q&A J-2 and J-3 of Income Tax
Regulations section 1.401(a)(9)-1 shall apply to rollovers and
transfers from one plan to another.
6.6 Available Forms of Distribution
(a) If pursuant to Section 6.3, the Plan is a Profit Sharing Plan
exempt from the Automatic Annuity Rules of Section 6.2, the
normal form of distribution shall be a lump sum distribution.
Unless specified otherwise in the Adoption Agreement, in lieu
of the lump sum distribution, a Participant or Beneficiary may
elect to receive installment payments payable monthly,
quarterly, semi-annually or annually.
(b) If the Plan is subject to the Automatic Annuity Rules of
Section 6.2, the normal form of distribution shall be the
applicable form of Automatic Annuity under Section 6.2. In
lieu of the Automatic Annuity, a Participant or Beneficiary may
elect a lump sum distribution or such other available forms of
distribution as are set forth below or as are specified in the
Adoption Agreement. Any such election by a Participant must be
accompanied by the written consent of his spouse (consistent
with the requirements for a Qualified Election under Section
6.2).
The available forms of distribution shall be:
(i) a joint and 100% survivor annuity contract purchased
from an insurance company selected by the Committee.
(ii) a single life annuity contract purchased from an
insurance company selected by the Committee.
(iii) a single life annuity contract, with 10 years
guaranteed, purchased from an insurance company
selected by the Committee.
(iv) installments payable monthly, quarterly, semi-annually
or annually.
6.7 Certain Distributions
In the event a distribution of an account balance made to or on behalf
of a Participant prior to the attainment of age fifty-nine and one-half
(59 1/2) would be subject to the ten percent (10%) penalty tax set
forth in section 72(t) or 72(m)(5) of the Code, the Participant may,
within sixty (60) days of the distribution date, request that the
distribution be transferred to another qualified retirement plan or an
Individual Retirement Account as a rollover contribution if the
distribution satisfies the requirements of section 402(a)(5) of the
Code.
<PAGE>
6.8 Forfeitures
Any balance in the Regular Account, Employer Discretionary Contribution
Account or in the Employer Matching Contribution Account, if any, of a
Participant who is separated from service, to which he is not entitled
under the foregoing provisions, shall be forfeited and applied as
provided in Section 3.2 of this Plan, and Section X(E) of the Dreyfus
Standardized/Paired Prototype Target Benefit Plan and Trust Adoption
Agreement.
ARTICLE VII.
DEATH BENEFITS
7.1 Payment to Beneficiary
(a) Subject to the provisions of Article VIII, upon the death of a
Participant, such Participant's account balance shall be paid
to his designated Beneficiary or if no such Beneficiary is
designated or survives the Participant, to the legal
representative of such Participant's estate. Such payment
shall commence as soon as practicable after the Participant's
death and after the Trustee is given such documentation as may
be required under the provisions of the Trust Agreement or
Custodial Agreement.
(b) Subject to the provisions of the Custodial Agreement if the
Plan is an Easy Retirement Plan, the Committee may prescribe
the manner in which a Beneficiary is to be designated in
writing and the Custodial Agreement, may prescribe the manner
in which such designations shall be filed. Notwithstanding the
foregoing, any designation (or change of designation) of a
Beneficiary must be consented to by the Participant's Spouse
pursuant to a Qualified Election under Section 6.2, if such
Beneficiary is not the Participant's Spouse.
7.2 Method of Payment
Subject to the provisions of Article VIII, death benefits may be paid
in any mode of benefit payment provided for in this Plan as elected by
the Participant or Beneficiary, except in the event of the death of the
Participant after payments have commenced under an annuity contract, by
the Beneficiary.
ARTICLE VIII.
PARTICIPANT CONTRIBUTIONS; ROLLOVERS
8.1 Voluntary Contributions
(a) Effective for Plan Years beginning January 1, 1987,
non-deductible Voluntary Contributions shall not be permitted
under this Plan. A separate Account shall be maintained for
Voluntary Contributions made prior to such time. Such Account
shall be nonforfeitable at all times.
<PAGE>
(b) A Participant may make withdrawals from the Voluntary Account
at such time as the Committee shall designate, but not more
than quarterly during a Plan Year provided that no single
withdrawal shall be less than the total amount available for
withdrawal under the other limitations of this Section 8.1 or
five hundred dollars ($500), whichever is less.
Notwithstanding the preceding sentence, if the Plan is an Easy
Retirement Plan, a Participant may make such a withdrawal at
any time.
(c) If the Plan is subject to the Automatic Annuity rules of
Section 6.2, the written consent of the Participant's spouse
(consistent with the requirements for a Qualified Election
under Section 6.2) must be obtained with respect to any
withdrawal.
(d) No forfeitures of amounts allocated to Participants from
Employer contributions and earnings thereon, shall occur solely
as a result of a Participant's withdrawal of voluntary
contributions.
(e) Voluntary Contributions for Plan years beginning after December
31, 1986 shall be subject to the Contribution Percentage tests
and the rules applicable to Excess Aggregate Contributions set
forth in Section 3.7.
8.2 Voluntary Tax-Deductible Contributions
(a) Voluntary Tax-Deductible Contributions (within the meaning of
section 72(o)(5)(A) of the Code) shall not be permitted under
this Plan for taxable years beginning after December 31, 1986.
A separate Voluntary Tax-Deductible Account shall be
established for such contributions made for taxable years
beginning on or before December 31, 1986. Such Account shall
be nonforfeitable at all times. However, no part of the
Voluntary Tax-Deductible Account will be used to purchase life
insurance or available for loans under Article XII.
(b) The Participant may withdraw any part of the Voluntary
Tax-Deductible Account by making written application to the
Committee. If the Plan is subject to the Automatic Annuity
Rules of Section 6.2, the written consent of the Participant's
Spouse (consistent with the requirements of a Qualified
Election under Section 6.2) must be obtained to any withdrawal
made after the first day of the first Plan Year beginning on or
after January 1, 1989.
8.3 Transfers From Other Trusts
Unless specified otherwise in the Adoption Agreement, the Committee
may, in its discretion, direct the Trustee to accept a rollover
contribution described in sections 401(a)(31), 402(a)(5), 403(a)(4) or
408(d)(3)(A)(ii) of the Code or a direct transfer of funds from a
qualified retirement plan, provided that, in the opinion of counsel for
the Employer, the transfer will not jeopardize the tax exempt status of
the Plan or create adverse tax consequences to the Employer. The
Committee shall exercise such discretion in a uniform and
<PAGE>
nondiscriminatory manner. A transfer or rollover contribution may be
made on behalf of an Employee eligible to participate in the Plan who
has not met the age and service requirements, if any, for
participation. Such an Employee shall become a Participant on the date
the Trustee accepts the rollover contribution or transfer for all
purposes, except that no employer or employee contributions shall be
made by or on behalf of such Employee and such Employee shall not share
in Plan forfeitures until he has completed the age and service
requirements for participation and become a Participant. A rollover
contribution or transfer shall be maintained in a Participant's
Rollover Account and Transfer Account, respectively. Notwithstanding
the preceding sentence, amounts attributable to voluntary deductible
employee contributions shall be maintained in a Participant's Voluntary
Tax-Deductible Account.
A Participant may take withdrawals from the Rollover Account at such
time as the Committee shall designate, but not more than quarterly
during a Plan Year, provided that no single withdrawal shall be less
than the total amount available for withdrawal or five hundred dollars
($500) whichever is less. If the Plan is subject to the Automatic
Annuity Rules of Section 6.2 and the Participant is married, the
request for withdrawal must be consented to in writing by the
Participant's spouse. Notwithstanding the preceding sentence, if the
Plan is an Easy Retirement Plan, a Participant may make such a
withdrawal at any time.
Unless indicated otherwise in the Adoption Agreement, distributions
shall be made from the Transfer Account upon meeting the requirements
set forth under Articles VIII and IX of the Plan. If the Plan is
subject to the Automatic Annuity Rules of Section 6.2 and the
Participant is married, the request for distribution must be consented
to in writing by the Participant's spouse.
The written consent of the Participant's spouse (consistent with the
requirements for a Qualified Election under Section 6.2) must be
obtained with respect to any withdrawal.
ARTICLE IX.
INSURANCE POLICIES
9.1 Policy Procurement
The Employer may elect in the Adoption Agreement to have the provisions
of this Article XI apply. If so authorized, the Committee may elect to
provide all Active Participants with the option of having life
insurance or annuity contracts (hereinafter referred to as "policy")
purchased on their behalf from a legal reserve life insurance company.
9.2 Rules and Regulations
The following rules shall be applicable to the acquisition, handling
and disposition of any policy:
(a) The basic options, cash surrender values and other material
features of all policies shall be as nearly uniform as
possible. No endowment policies shall be purchased.
<PAGE>
(b) The Trustee shall be designated as the sole owner of any policy
purchased hereunder. However, all benefits, rights, privileges
and options under such policy and any dividends or credits
earned in insurance contracts will be allocated to the
Participant's account balance derived from Employer
contributions for whose benefit the contract is held.
Notwithstanding any other provision of the Plan, in computing
the amount of the vested interest of any Participant, the cash
surrender value of any policy shall be included in the
Participant's account balance. The applicable vested interest
percentage shall be applied to this sum. The product of this
computation shall then constitute the Participant's vested
interest.
(c) Payments made to any insurance company with respect to any such
policy shall constitute an investment of the funds credited to
the account balance of the Participant on whose behalf it was
purchased and his account balance derived from Employer
contributions shall accordingly be reduced by any such
payments.
(d) If the policy or policies purchased are ordinary life
insurance, the aggregate premiums payable with respect to such
policy or policies may not equal or exceed fifty percent (50%)
of the aggregate Employer contributions and forfeitures
credited to such Participant's account balance, exclusive of
investment earnings. A Participant may upon consultation with
the Committee and with its consent modify or terminate this
election at any time. If the policy purchased is term or
universal life insurance, the phrase "twenty-five percent
(25%)" shall be substituted for the phrase "fifty percent
(50%)." If the policy or policies purchased are ordinary life
insurance and term insurance, the sum of one-half ( 1/2) the
ordinary life premiums and the term premiums may not exceed
twenty-five percent (25%) of the aggregate Employer
contributions and forfeitures credited to such Participant's
account balance, exclusive of investment earnings. For
purposes of these incidental insurance provisions, ordinary
life insurance contracts are contracts with both nondecreasing
death benefits and nonincreasing premiums.
(e) If a Participant is not insurable as a standard risk but may
nevertheless be eligible for insurance coverage at an extra
rating because of excess mortality hazards, the Committee, in
its discretion, may agree or not agree to obtain insurance.
The insurance to be purchased for a substandard life shall not
exceed the face amount that could have been purchased by the
premium that would have been available for the purchase of
insurance had the Participant not been rated a substandard
life. In determining whether or not to purchase insurance, the
Committee shall not discriminate and shall accord uniform
treatment to all of its Participants in a similar situation.
9.3 Transfer of Policies
(a) Upon the Participant's retirement, the Trustee shall, upon
instructions from the Committee, either transfer and deliver to
<PAGE>
the Participant any policy held on his behalf (with such
endorsements as the Committee may direct), convert such policy
to an annuity, or surrender such policy, in which case the cash
proceeds thereof shall be included as part of the account
balance of such Participant and distributed accordingly.
(b) The Committee shall offer to a vested Participant any policy
held in his behalf at a price equal to the total cash surrender
value of such policy. If the Participant elects to purchase
such policy, the Trustee shall, upon instructions from the
Committee, transfer ownership of the policy to such
Participant, endorsed so as to vest in the transferee all
right, title and interest thereto, free and clear of the Trust.
If the Participant declines to purchase such policy, the
Trustee shall, upon instructions from the Committee, liquidate
the policy for its cash surrender value; transfer the policy to
the Participant as a distribution of benefits; or if the
Participant has terminated employment with the Employer other
than by reason of retirement, death or disability, place the
policy on a paid-up basis. The Committee may direct the
Trustee to designate itself, if not so designated, as
Beneficiary under such policy for the period prior to the date
on which it is liquidated.
(c) Subject to the Qualified Joint and Survivor Annuity Rules of
Section 8.2, the contracts on a Participant's life will be
converted to cash or an annuity or distributed to the
Participant upon commencement of benefits.
9.4 Payment Upon Death
Subject to the Qualified Pre-Retirement Survivor Annuity Rules of
Section 8.2, all death benefits payable under any policy held on behalf
of a deceased Participant shall be paid to his Beneficiary. Such
benefits may, as the Committee shall determine, be paid either to the
Trust Fund, in which case the cash proceeds thereof shall be included
as part of vested account balance of such Participant and distributed
accordingly, or directly by the insurance company to the Beneficiary
pursuant to the settlement option in effect at the time of the
Participant's death. In the absence of such election, the benefits may
be paid in a lump sum or under any other settlement option contained in
such policy, as determined by the Committee.
9.5 Plan Provisions Control
In the event of any conflict between the terms of this Plan and the
terms of any policy issued hereunder, the Plan provisions shall
control.
ARTICLE X.
LOANS
10.1 Loans to Participants
If permitted under the Adoption Agreement, the Committee, in its
discretion, may authorize and direct the Trustee to grant loans to
<PAGE>
Participants and Beneficiaries in accordance with written rules
established by the Committee. Such loans:
(a) Shall not exceed the lesser of:
(1) fifty thousand dollars ($50,000) reduced by the
excess, if any, of (i) the highest outstanding balance
of loans from the Plan during the one (1) year period
ending on the day before the date on which such loan
was made, over (ii) the outstanding balance of loans
from the Plan on the date such loan was made, or
(2) one-half ( 1/2) of the Participant's or Beneficiary's
vested interest under the Plan.
For this purpose, all plans of the Employer and
Affiliated Employers shall be treated as a single
plan.
(b) Shall be evidenced by a promissory note, secured by an
assignment of a portion of the Participant's or Beneficiary's
vested interest in the Plan, other than a Voluntary
Tax-Deductible Account (effective for loans granted or renewed
after October 18, 1989, the portion of a Participant's or
Beneficiary's vested interest which may be used as security for
a loan hereunder shall not exceed fifty percent (50%));
(c) Shall bear a reasonable rate of interest as determined by the
Committee to be a rate of interest commensurate with the
interest rates charged by persons in the business of lending
money for loans which would be made under similar
circumstances; and
(d) Shall require substantially level repayments of principal and
interest (with repayments made not less frequently than
quarterly) over a period not to exceed five (5) years. Any
such loan shall be nonrenewable except that if the loan was
originally granted for a period of less than five (5) years,
then the same may be renewed, in the discretion of the
Committee, for a period of time equal to the difference between
five (5) years and the duration of the original loan. The five
(5) year repayment period shall not apply to any loan used to
acquire any dwelling unit which within a reasonable period of
time is to be used (to be determined at the time the loan is
made) as the principal residence of the Participant.
If the Plan is subject to the Automatic Annuity Rules of Section 6.2,
the written consent of the Participant's spouse (consistent with the
requirements for a Qualified Election under Section 6.2) must be
obtained within the ninety (90) day period ending on the date the
account balance is used as security for the loan. Such consent shall
thereafter be binding with respect to the consenting spouse or any
subsequent spouse. However, a new consent shall be required if the
account balance is used for renegotiation, extension, renewal or other
revision of the loan.
<PAGE>
If Participant-directed investments have been elected in the Adoption
Agreement, loans shall be treated as an investment of one or more of
the borrower's separate Accounts, in accordance with rules established
by the Committee. Repayments of principal and interest shall be
allocated solely to the Account(s) of the borrower from which such loan
was made, and any loss caused by non-payment or default shall be
charged solely to such Account(s). Otherwise, all loans hereunder
shall be treated as an investment of the Fund.
10.2 Provisions to be Applied in a Uniform and Nondiscriminatory Manner
In deciding whether or not to grant any request for a loan hereunder,
the Committee shall be guided by procedures and criteria designed to
assure that the loans shall be made available to all Participants and
Beneficiaries on a reasonably equivalent basis and shall not be
available to Highly Compensated Employees in an amount greater than the
amount made available to other Employees.
10.3 Satisfaction of Loan
In the event of default, foreclosure on the note and attachment of the
security will not occur until a distributable event occurs under the
terms of the Plan.
If spousal consent (consistent with the requirements for a Qualified
Election under Section 6.2) has been obtained, then, notwithstanding
any other provision of the Plan, the portion of the Participant's
vested account balance used as security for a loan shall be taken into
account for purposes of determining the amount of the account balance
payable at the time of death or distribution, but only if the reduction
is used as repayment of the loan. If less than one hundred percent
(100%) of the Participant's vested account balance (determined without
regard to the preceding sentence) is payable to the surviving spouse,
then the account balance shall be adjusted by first reducing the vested
account balance by the amount of the security used as repayment of the
loan, and then determining the benefit payable to the surviving spouse.
10.4 Loans to Owner-Employees or Shareholder-Employees
No loan shall be granted to an Owner-Employee or Shareholder-Employee
unless an exemption has been obtained for such loan from the Secretary
of Labor under Section 408 of the Act (and such loan is exempt from the
excise tax imposed under Section 4975 of the Code).
ARTICLE XI.
TOP-HEAVY PROVISIONS
As specified in the Adoption Agreement, the provisions of this Article XIII
will either (1) always supersede any conflicting provisions in the Plan or (2)
only supersede such conflicting provisions in any Plan Year beginning after
1983, during which the Plan is or becomes Top-Heavy.
11.1 Definitions
For purposes of this Article, the following words shall have the
following meanings:
<PAGE>
(a) "Compensation" shall mean Compensation as defined in Article I
as limited by section 401(a)(17) of the Code.
(b) "Determination Date" shall mean (1) the last day of the
preceding Plan Year, or (2) in the case of the first Plan Year
of any Plan, the last day of such Plan Year.
(c) "Employer" shall mean the Employer and all Affiliated
Employers.
(d) "Key Employee" shall mean any Employee or former Employee (and
the Beneficiaries of such Employee) who at any time during the
Plan Year containing the Determination Date and the four (4)
preceding Plan Years was:
(1) An officer of the Employer if such individual's annual
compensation exceeds fifty percent (50%) of the dollar
limitation under section 415(b)(1)(A) of the Code
(provided that the number of employees treated as
officers shall be no more than fifty (50) or, if
fewer, the greater of three (3) employees or ten
percent (10%) of all employees);
(2) An owner (or considered an owner under section 318 of
the Code) of at least a one-half of one percent (.5%)
interest and one of the ten (10) largest interests in
the Employer if such individual's annual compensation
exceeds one hundred percent (100%) of the dollar
limitation under section 415(c)(1)(A) of the Code;
(3) A five percent (5%) owner of the Employer; or
(4) A one percent (1%) owner of the Employer who has an
annual compensation of more than one hundred fifty
thousand dollars ($150,000).
For this purpose, annual compensation means compensation as
defined in section 415(c)(3) of the Code, but including amounts
excludible from the Employee's gross income by reason of
sections 125, 402(a)(8), 402(h) or 403(b) of the Code. The
determination of who is a Key Employee will be made in
accordance with section 416(i)(1) of the Code and the
regulations thereunder.
(d) "Non-Key Employee" shall mean any Employee who is not a Key
Employee.
(e) "Permissive Aggregation Group" shall mean the Required
Aggregation Group of plans plus any other plan or plans of the
Employer which, when considered as a group with the Required
Aggregation Group, would continue to satisfy the requirements
of sections 401(a)(4) and 410 of the Code.
(f) "Present Value" shall be based on the interest and mortality
table specified in the Employer's qualified defined benefit
plan for Top-Heavy purposes, or if such assumptions are not
specified in the Employer's qualified defined benefit plan,
<PAGE>
Present Value shall be based on the assumptions specified in
the Adoption Agreement.
(g) "Required Aggregation Group" shall mean (1) each qualified plan
of the Employer in which at least one Key Employee participates
or participated at any time during the determination period
(regardless of whether the Plan has terminated), and (2) any
other qualified plan of the Employer which enables a plan
described in (1) to meet the requirements of Sections 401(a)(4)
or 410 of the Code.
(h) "Super Top-Heavy Plan": For any Plan Year after 1983, this
Plan is Super Top-Heavy if the Top-Heavy Ratio for the Plan,
the Required Aggregation Group or the Permissive Aggregation
Group, as applicable, exceeds ninety percent (90%).
(i) "Top-Heavy": For any Plan Year beginning after 1983, this Plan
is Top-Heavy if any of the following conditions exist:
(1) If the Top-Heavy Ratio for this Plan exceeds sixty
percent (60%) and this Plan is not part of any
Required Aggregation Group or Permissive Aggregation
Group of plans.
(2) If this Plan is a part of a Required Aggregation Group
of plans, but not part of a Permissive Aggregation
Group and the Top-Heavy Ratio for the group of plans
exceeds sixty percent (60%).
(3) If this Plan is a part of a Required Aggregation Group
and part of a Permissive Aggregation Group of plans
and the Top-Heavy Ratio for the Permissive Aggregation
Group exceeds sixty percent (60%).
(j) "Top-Heavy Ratio":
(1) If the Employer maintains one or more defined
contribution plans (including any Simplified Employee
Pension Plan) and the Employer has not maintained any
defined benefit plan which during the five (5) year
period ending on the Determination Date has or has had
accrued benefits, the Top-Heavy Ratio for this Plan
alone or for the Required or Permissive Aggregation
Group as appropriate is a fraction, the numerator of
which is the sum of the account balances of all Key
Employees as of the Determination Date (including any
part of any account balance distributed in the five
(5) year period ending on the Determination Date, and
the denominator of which is the sum of all account
balances (including any part of any account balance
distributed in the five (5) year period ending on the
Determination Date, both computed in accordance with
section 416 of the Code and the regulations
thereunder. Both the numerator and denominator of the
Top-Heavy Ratio are increased to reflect any
contribution not actually made as of the Determination
Date, but which is required to be taken into account
<PAGE>
on that date under section 416 of the Code and the
regulations thereunder.
(2) If the Employer maintains one or more defined
contribution plans (including any Simplified Employee
Pension Plan) and the Employer maintains or has
maintained one or more defined benefit plans which
during the five (5) year period ending on the
Determination Date has or has had any accrued
benefits, the Top-Heavy Ratio for any Required or
Permissive Aggregation Group as appropriate is a
fraction, the numerator of which is the sum of account
balances under the aggregated defined contribution
plan or plans for all Key Employees determined in
accordance with (d) above, and the Present Value of
accrued benefits under the aggregated defined benefit
plan or plans for all employees as of the
Determination Date, and the denominator of which is
the sum of the account balances under the aggregated
defined contribution plan or plans for all
participants, determined in accordance with (j)(1)
above, and the Present Value of accrued benefits under
the defined benefit plan or plans for all Participants
as of the Determination Date, all determined in
accordance with section 416 of the Code and the
regulations thereunder. The accrued benefits under a
defined benefit plan in both the numerator and
denominator of the Top-Heavy Ratio are increased for
any distribution of an accrued benefit made in the
five (5) year period ending on the Determination Date.
(3) For purposes of (1) and (2) above, the value of
account balances and the Present Value of accrued
benefits will be determined as of the most recent
Valuation Date that falls within or ends with the
twelve (12) month period ending on the Determination
Date, except as provided in section 416 of the Code
and the regulations thereunder for the first and
second Plan years of a defined benefit plan. The
account balances and accrued benefits of a participant
who is not a Key Employee but who was a Key Employee
in a prior year, or has not been credited with at
least one Hour of Service for any Employer maintaining
the Plan at any time during the five (5) year period
ending on the Determination Date will be disregarded.
The calculation of the Top-Heavy Ratio, and the extent
to which distributions, rollovers, and transfers are
taken into account will be made in accordance with
section 416 of the Code and the regulations
thereunder. Deductible Employee contributions will
not be taken into account for purposes of computing
the Top-Heavy Ratio. When aggregating plans the value
of account balances and accrued benefits will be
calculated with references to the Determination Date
that falls within the same calendar year.
<PAGE>
(4) Solely for the purpose of determining if the Plan, or
any other plan included in a Required Aggregation
Group of which this Plan is a part, is Top-Heavy
(within the meaning of section 416(g) of the Code) the
accrued benefit of a Non-Key Employee shall be
determined under (a) the method, if any, that
uniformly applies for accrual purposes under all plans
maintained by the Employer, or (b) if there is no such
method, as if such benefit accrued not more rapidly
than the slowest accrual rate permitted under the
fractional accrual rate of section 411(b)(1)(C) of the
Code.
(k) "Valuation Date" shall mean the last day of the Plan Year and
is the day on which account balances and accrued benefits are
valued for purposes of calculating the Top-Heavy Ratio.
11.2 Vesting Schedules
For any Plan Year in which this Plan is Top-Heavy, one of the Top Heavy
minimum vesting schedules as elected by the Employer in the Adoption
Agreement will automatically apply to the Plan. The Top Heavy Minimum
vesting schedule applies to all benefits within the meaning of section
411(a)(7) of the Code except those attributable to Employee
contributions, including benefits accrued before the effective date of
section 416 of the Code and benefits accrued before the Plan became
Top-Heavy. Further, no reduction in a vested benefit may occur in the
event the Plan's status as Top-Heavy changes for any Plan Year.
However, this Section does not apply to the account balance of any
Employee who does not have an Hour of Service after the Plan has
initially become Top-Heavy and such Employee's account balance
attributable to Employer contributions and forfeitures will be
determined without regard to this Section.
11.3 Minimum Allocation
(a) Except as otherwise provided in (b), (c) and (d) below, when
the Plan is Top-Heavy the Employer contributions and
forfeitures allocated on behalf of any Participant who is a
Non-Key Employee shall not be less than the lesser of three
percent (3%) of such Participant's Compensation or, if neither
the Employer nor an Affiliated Employer maintains a defined
benefit plan which designates this Plan to satisfy sections
401(a)(4) or 410 of the Code, the largest percentage of
Employer contributions and forfeitures, as a percentage of the
Key Employee's Compensation, as limited by section 401(a)(17)
of the Code allocated on behalf of any Key Employee for that
year. For purposes of determining whether a Plan is Top-Heavy,
Elective Deferrals are considered Employer contributions.
However, neither Elective Deferrals nor Matching Contributions
may be taken into account for purposes of satisfying the three
percent (3%) minimum Top-Heavy contributions requirements for
Plan Years beginning on or after January 1, 1989.
The Minimum Allocation is determined without regard to a Social
Security contribution. This Minimum Allocation shall be made
even though, under other Plan provisions, the Participant would
<PAGE>
not otherwise be entitled to receive an allocation, or would
have received a lesser allocation for the year because of (1)
the Participant's failure to complete one thousand (1,000)
Hours of Service (or any equivalent provided in the Plan), (2)
the Participant's failure to make mandatory employee
contributions, or (3) the Participant's Compensation is less
than a stated amount.
(b) The provision in (a) above shall not apply to any Participant
who was not employed by the Employer on the last day of the
Plan Year.
(c) If the Employer maintains a qualified defined benefit plan and
this Plan is Top-Heavy, but is not Super Top-Heavy, each
Participant who is a Non-Key Employee and is not covered by the
defined benefit plan shall receive the Minimum Allocation under
(a) above, except that "four percent (4%) "shall be substituted
for "three percent (3%)".
(d) The provision in (a) above shall not apply with respect to any
Participant covered under any other qualified plan or plans of
the Employer other than a paired plan of the Sponsor and the
adopting Employer has elected in the Adoption Agreement that
the minimum Top Heavy allocation or benefit will be met in the
other plan or plans.
If the Employer maintains a qualified defined benefit plan,
other than Sponsor's paired defined benefit plan 02001, and the
adopting Employer has elected in the Adoption Agreement to
provide the Top Heavy minimum allocation or benefit under this
Plan, then with respect to participants covered under both
plans, "five percent (5%)" shall be substituted for "three
percent (3%)" in (a) above if the Plan is Super Top Heavy and
"seven and one-half percent (7 1/2%)" shall be substituted for
"three percent (3%)" in (a) above if the Plan is Top Heavy, but
not Super Top Heavy.
(e) The Minimum Allocation required (to the extent nonforfeitable
under section 416(b) of the Code) may not be forfeited under
section 411(a)(3)(B) or 411(a)(3)(D) of the Code.
11.4 Adjustment to Defined Benefit Fraction and Defined Contribution
Fraction under section 4.4.
If the Plan is Super Top-Heavy, then "one-hundred percent (100%)" shall
be substituted for "one hundred twenty-five percent (125%)" in the
denominator of the Defined Benefit Fraction and the Defined
Contribution Fraction under Section 6.4.
ARTICLE XII.
THE COMMITTEE
12.1 Creation of a Committee
The Employer may appoint a person or persons to act as the Committee
and serve at its pleasure. If no such Committee is appointed, the
<PAGE>
Employer shall act as the Committee. The Employer shall notify the
Trustee of the appointment of the original members of the Committee and
of each change in the membership of the Committee. Vacancies in the
Committee shall be filled by the Employer.
12.2 Committee Action
In the event that the Employer appoints such person or persons to act
as the Committee, such Committee shall act by a majority of its members
at a meeting (which can be by telephone) or in writing without a
meeting. A member of the Committee who is also a Participant of the
Plan shall not vote or act as a member of the Committee upon any matter
relating solely to his rights or benefits under the Plan.
12.3 Authorized Signatory
Except as otherwise provided in Section 12.10, the Committee may
designate a person or persons who shall be authorized to sign any
document in the name of the Committee. The Trustee shall be fully
protected in relying upon any notice, instruction or certification from
the Committee or executed pursuant to the provisions of this Section.
12.4 Powers and Duties
The Committee shall have such powers and duties as are necessary for
the proper administration of the Plan, including but not limited to the
power to make decisions with respect to the application and
interpretation of the Plan. The Committee shall be empowered to
establish rules and regulations for the transactions of its business
and for the administration of the Plan. The determinations of the
Committee with respect to the interpretation, application, or
administration of the Plan shall be final, binding, and conclusive upon
each person or party interested or concerned.
12.5 Nondiscrimination
Where provisions of this Plan are at the discretion of the Committee,
all Participants shall be treated in a uniform and nondiscriminatory
manner.
12.6 Records and Reports
The Committee shall maintain such records as may be necessary for
proper administration of the Plan and shall be responsible for
supplying all information and reports to the Internal Revenue Service,
Department of Labor, Participants, Beneficiaries and others as required
by law. Employees may examine records pertaining directing to them.
12.7 Reliance on Professional Advice
The Committee shall be entitled to rely conclusively on the advice or
opinion of any consultant, accountant, or attorney and such persons may
also act in their respective professional capacities as advisors to the
Employer.
<PAGE>
12.8 Payment of Expenses
All expenses of administration may be paid out of the Trust Fund unless
paid by the Employer. Such expenses shall include any expenses
incident to the duties of the Committee, including, but not limited to,
fees of consultants, accountants, and attorneys, and other costs of
administering the Plan. Until paid, the expenses shall constitute a
liability of the Trust Fund. However, the Employer may reimburse the
Trust Fund for any administration expense incurred. Any administration
expense paid to the Trust Fund as a reimbursement shall not be
considered an Employer contribution.
12.9 Limitation of Liability
The Committee must discharge its duties solely in the interest of the
Participants and their Beneficiaries. The Committee must carry out its
duties with the care, skill, prudence and diligence under circumstances
then prevailing that a prudent man acting in a like capacity and
familiar with such matters would use in the conduct of an enterprise of
like character and with like aims. The Committee, however, shall not
be liable for any acts or decisions based on the advice or opinion of
any consultant, accountant or attorney employed by the Committee in
their respective professional capacities as advisors to the Employer,
provided, however, that the Committee did not violate its general
fiduciary duty in selecting or retaining such advisor.
12.10 Payment Certification to Trustee
The Committee shall provide written instruction to the Trustee with
respect to all payments which become due under the terms of the Plan
and shall direct the Trustee to make such payments from the Trust Fund.
All orders, requests and instructions by the Committee to the Trustee
shall be in writing and signed by an authorized member of the
Committee.
The Trustee shall act and shall be fully protected in acting in
accordance with such orders, requests and instructions.
12.11 Claims Procedure
A Participant or Beneficiary ("Claimant") may file a written claim for
benefits with the Committee. If the Committee decides that a Claimant
is not entitled to all or any part of the benefits claimed, it shall
within ninety (90) days of receipt of such claim, inform the Claimant
in writing of its determination; the reasons for its determination,
including specific references to the pertinent Plan provisions; and the
Plan's review procedures. The Claimant or his authorized personal
representative shall be permitted to review pertinent documents and
within sixty (60) days after receipt of the notice of denial of claim
to request to appear personally before it or to submit such further
information or comments to the Committee as will, in the Claimant's
opinion establish his right to such benefits. The Committee will
render its final decision with the specific reason therefore in writing
and will transmit it to the claimant by certified mail within sixty
(60) days (or one hundred twenty (120) days, if special circumstances
require an extension of time and the claimant is given written notice
within the initial sixty (60) day period) of any such appearance. If
<PAGE>
the final decision is not made within such period, it will be
considered denied. If, upon review of a request for benefits
hereunder, the Committee finds the Participant ineligible for such
benefits, it shall inform the Participant in writing the reason or
reasons for such denial. In the event any Participant or Beneficiary
disagrees with the conclusions of the Committee, the Committee must
reconsider their decision based on the facts and evidence presented to
them by the Participant or Beneficiary. Further, the Committee must
substantiate in writing to any Participant or Beneficiary who disagrees
with the amount of his benefit the method under which the benefit
computations were made.
ARTICLE XIII.
GENERAL PROVISIONS
13.1 No Right of Continued Employment
No Employee or Participant shall have any right or claim to any benefit
under the Plan except in accordance with the provisions of the Plan.
The adoption of the Plan shall not be construed as creating any
contract of employment between the Employer and any Employee or
otherwise conferring upon any Employee or other person any legal right
to continuation of employment, nor as limiting or qualifying the right
of the Employer to discharge any Employee without regard to the effect
that such discharge might have upon his rights under the Plan.
13.2 Nonalienation of Interest
No benefit or interest available hereunder will be subject to
assignment or alienation, either voluntarily or involuntarily. The
preceding sentence shall not apply to loans made to the Participant
under the Plan, or domestic relations orders which are determined by
the Committee to be qualified domestic relations orders, as defined in
section 414(p) of the Code and section 206(d)(3) of the Act, or were
entered before January 1, 1985. Notwithstanding any provision in the
Plan to the contrary, payments pursuant to a qualified domestic
relations order may be made to an alternate payee prior to the time
that the Plan may make payments to the affected Participant.
13.3 Incompetence of Participants and Beneficiaries
If the Committee deems any person incapable of receiving benefits to
which he is entitled by reason of minority, illness, infirmity, or
other incapacity, it may direct the Trustee to make payment directly
for the benefit of such person to a legal representative of such
person. Such payment shall, to the extent thereof, discharge all
liability of the Employer, the Committee, the Trustee and the Fund.
13.4 Unclaimed Benefits
If any benefit hereunder has been payable and unclaimed for four (4)
years since the whereabouts or continued existence of the person
entitled thereto was last known to the Committee, such benefit shall be
placed in a segregated, interest-bearing suspense account with no
further attempts to uncover the whereabouts of the person entitled
thereto. The Committee shall rely upon notification from the
<PAGE>
Department of Health, Education and Welfare as to the whereabouts of
such person when he applies for benefits under the Social Security Act.
The four (4) year period may be extended by the Committee whenever, in
its discretion, special circumstances justify such action. The
Committee shall make a reasonable and diligent search for the
Participant before any benefit is segregated. If a benefit is
forfeited because the Participant or Beneficiary cannot be found, such
benefit will be reinstated if a claim is made by the Participant or
Beneficiary.
13.5 Separate Employer Trusts Maintained
Except as provided in Section 14.5, the Plan of each Employer which
adopts this Prototype Plan and corresponding Trust Agreement as part of
its Plan shall be administered separately from those of any other
Employer.
13.6 Governing Law
The Plan shall be administered, construed and enforced to the state
wherein the Trustee maintains its principal place of business, except
to the extent preempted by the Act.
13.7 Severability
Should any provision of the Plan or rules and regulations adopted
thereunder be deemed or held to be unlawful or invalid for any reason,
such fact shall not adversely affect the other provisions unless such
invalidity shall render impossible or impractical the functioning of
the Plan. In such case, the appropriate parties shall immediately
adopt a new provision to take the place of the illegal or invalid
provision.
13.8 Gender and Number
The masculine pronoun wherever used shall include the feminine pronoun
and the singular shall include the plural and the plural shall include
the singular, wherever appropriate to the context.
13.9 Titles and Headings
The titles or headings of the respective Articles and Sections are
inserted merely for convenience and shall be given no legal effect.
13.10 Failure of Employer's Plan to Qualify
The use of this Prototype Plan and corresponding Trust Agreement shall
be available only to the Plans of Employers which meet the requirements
of section 401(a) of the Code. If the Employer's Plan fails to attain
or retain qualification, such Plan will no longer participate in this
Prototype Plan and will be considered an individually designed plan.
13.11 Exclusive Benefit
Except as provided in Section 4.3, at no time shall any part of the
corpus or income of the Fund be used for or diverted to purposes other
<PAGE>
than for the exclusive benefit of the Participants and their
Beneficiaries and defraying reasonable expenses of the Plan.
13.12 Action by Employer
Any action, including the amendment or termination of the Plan as
provided in Sections 14.1 and 14.2 of the Plan, by an Employer which is
a corporation shall be taken by the board of directors of the
corporation or any person or persons duly empowered to exercise the
powers of the corporation with respect to the Plan. In the case of an
Employer which is a partnership, any action, including the amendment or
termination of the Plan as provided in Sections 14.1 and 14.2 of the
Plan, shall be taken by any general partner or the partnership. In the
case of an Employer which is a sole proprietorship, any action,
including the amendment or termination of the Plan as provided in
Sections 14.1 and 14.2 of the Plan, shall be taken by the sole
proprietor.
ARTICLE XIV
AMENDMENT AND TERMINATION
14.1 Amendment
(a) The Employer expressly recognizes the authority of the Sponsor
to amend the Plan and the Trust Agreement or Custodial
Agreement from time to time, and the Employer shall be deemed
to have consented to any such amendment. The Employer shall
receive a written instrument indicating the amendment of the
Plan and Trust Agreement and such amendment shall become
effective as of the effective date of such instrument.
(b) The Employer reserves the right to amend the Plan at any time.
Except for (1) changes to the choice of options in the Adoption
Agreement, (2) amendments stated in the Adoption Agreement
which allow the Plan to satisfy section 415 of the Code or to
avoid duplication of minimums under section 416 of the Code
because of the required aggregation of multiple plans, or (3)
amendments published by the Internal Revenue Service which
specifically provide that their adoption will not cause the
Plan to be treated as individually designed, an Employer will
no longer participate in the Prototype Plan and will be
considered to have an individually designed plan if it amends
the Plan or obtains a waiver of the minimum funding requirement
under Section 412(d) of the Code.
(c) Notwithstanding anything in this Plan to the contrary, no
amendment shall:
(1) Increase the responsibility of the Trustee without the
Trustee's written consent;
(2) Have the effect of decreasing a Participant's account
balance or eliminating an optional form of benefit
with respect to accrued benefits, except to the extent
permitted by section 412(c)(8) of the Code;
<PAGE>
(3) In the case of an Employee who is a Participant as of
the later of the date such amendment is adopted or the
date it becomes effective, decrease the nonforfeitable
percentage (determined as of such date) of such
Employee's right to his Employer-derived account
balance below his non-forfeitable percentage computed
under the Plan without regard to such amendment;
(4) Violate the exclusive benefit rule of Section 13.11.
14.2 Termination and Partial Termination
The adopting Employer may, at any time, by written notice to the
Trustee in such form as is acceptable to the Trustee, terminate the
Plan and discontinue all further contributions hereunder. Upon
termination or partial termination of the Plan or upon complete
discontinuance of contributions to a Profit Sharing Plan, each affected
Employee shall have a one hundred percent (100%) vested and
nonforfeitable interest in his account balance. Upon a termination or
partial termination of the Plan (and subject to the limitations of
section 3.10 in the case of a cash or deferred arrangement qualified
under section 401(k) of the Code), each affected Participant's account
balance may be distributed in accordance with the provisions of Article
VIII or, at the option of the Employer and with the Trustee's consent,
shall continue to be held by the Trustee for distribution as authorized
by Articles VIII and IX. Notwithstanding the preceding sentence, a
Profit Sharing Plan which does not offer an annuity form of benefit
(purchased from a commercial provider) may distribute each affected
Participant's account balance immediately in a single sum without
Participant consent, provided that neither the Employer nor any
Affiliated Employer maintains another defined contribution plan, other
than an employee stock ownership plan (as defined in section 4975(e)(7)
of the Code). If either the Employer or any Affiliated Employer
maintains another such defined contribution plan, then a Participant's
account balance may be transferred to such plan without his consent if
the Participant does not consent to the single sum distribution from
this Plan.
14.3 Plan Merger and Consolidation or Transfer of Plan Assets
In the event of any merger or consolidation with, or transfer of assets
or liabilities to, any other plan, each Participant of this Plan would
(if the Plan then terminated) receive an amount immediately after such
merger, consolidation or transfer which is equal to or greater than the
amount he would have been entitled to receive immediately before the
merger, consolidation, or transfer (if the Plan had then terminated).
14.4 Amended and Restated Plans
If this Plan is an amendment and restatement of an existing plan
("Existing Plan"), the following provisions shall apply:
(a) Each Employee who was a participant in the Existing Plan
immediately prior to the Effective Date shall become a
Participant in this Plan on the Effective Date.
<PAGE>
(b) The balance of such Employee's accounts under the Existing Plan
attributable to employer or employee contributions shall be
allocated to the corresponding Accounts under this Plan or
accounted for separately.
(c) All years of service credited for vesting service under the
Existing Plan shall be credited as years of Service under this
Plan. The amendment and restatement shall not reduce the
vested interest of a participant in the Existing Plan, and any
change in the vesting schedule shall be subject to the
provisions of Section 7.3.
(d) The amendment and restatement shall not reduce a Participant's
account balance and shall not eliminate any optional form of
benefit.
(e) Any beneficiary designation in effect under the Existing Plan
immediately before the amendment and restatement shall be
deemed to be a valid Beneficiary designation under this Plan,
to the extent consistent with Article VIII.
14.5 Participating Employers
(a) With the consent of the Employer and Trustee, and by duly
authorized action, any Affiliated Employer may adopt this Plan
and become a Participating Employer.
(b) Each such Participating Employer shall be bound by the same
Adoption Agreement provisions as those selected by the
Employer, and to use the same Trustee as the Employer. If the
Employer does not make a contribution to the Plan, the
Participating Employer shall be obligated to do so.
(c) The Trustee may, but shall not be required to commingle, hold
and invest as one Trust Fund all contributions made by
Participating Employers, as well as all increments thereof.
(d) With respect to its relations with the Trustee and Committee
for the purposes of this Plan, each Participating Employer
shall be deemed to have irrevocably designated the adopting
Employer as its agent. Amendment of this Plan by the adopting
Employer at any time when there shall be a Participating
Employer hereunder shall only be by the written action of the
adopting Employer, with the consent of the Trustee where such
consent is necessary in accordance with the terms of this Plan.
(e) A Participating Employer may, at any time, by written notice to
the Employer and Trustee in such form as is acceptable to the
Employer and Trustee, discontinue its participation in the plan
and discontinue all further contributions hereunder. The
Employer shall direct the Trustee to transfer, deliver and
assign Fund assets attributable to the Participants of such
Participating Employer to such successor trustee as shall have
been designated by such Participating Employer, in the event
that it has established a separate plan for its Employees. If
no successor trustee is designated, the Trustee shall retain
such assets for the
<PAGE>
Employees of said Participating Employer pursuant to the
provisions of Articles VI and VII hereof.
[Letterhead of Goodman Phillips & Vineberg]
December 30, 1996
THE SEAGRAM COMPANY LTD.
1430 Peel Street
Montreal, Quebec
H3A 1S9
Subject: THE SEAGRAM COMPANY LTD.
1996 Stock Incentive Plan
Stock Plan for Non-Employee Directors
Retirement Savings and Investment Plan
for Employees of Joseph E. Seagram & Sons, Inc.
and Affiliates - Universal Employees
Retirement Savings and Investment Plan
for Employees of Joseph E. Seagram & Sons, Inc.
and Affiliates - UNI Employees
Retirement Savings and Investment Plan
for Employees of Joseph E. Seagram & Sons, Inc.
and Affiliates - Spencer Employees
Retirement Savings and Investment Plan
for Union Employees of Joseph E. Seagram & Sons,
Inc. and Affiliates
Retirement Savings and Investment Plan
for Union Employees of Tropicana Products, Inc.
and Affiliates
Our File: 6399-567
____________________________________________________
Dear Sirs:
We are acting as Canadian counsel to The Seagram Company Ltd. (the "Company")
in connection with the Registration Statement on Form S-8 (the "Registration
Statement") of the Company which the Company intends to file with the
Securities and Exchange Commission under the Securities Act of 1933, as amended
(the "Act"), relating to the 1996 Stock Incentive Plan, Stock Plan for Non-
Employee Directors, Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates - Universal Employees, Retirement
Savings and Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates - UNI Employees, Retirement Savings and Investment Plan for
Employees of Joseph E. Seagram & Sons, Inc. and Affiliates - Spencer Employees,
Retirement Savings and Investment Plan for Union Employees of Joseph E. Seagram
& Sons, Inc. and Affiliates and Retirement Savings and Investment Plan for
Union Employees of Tropicana Products, Inc. and Affiliates (collectively the
"Plans").
We have examined such corporate records, documents and other instruments and
have made such other examinations and inquiries as we have deemed necessary to
enable us to express the opinions set forth herein.
Based on the foregoing, we are of the opinion, assuming the effectiveness of
the Registration Statement under the Act and that all authorizations, consents
<PAGE>
and approvals of and all filings, registrations, qualifications and recordings
with all governmental authorities of Canada and any applicable Province thereof
are obtained and made, that:
If the Company authorizes the original issuance of Shares under any
of the Plans, such originally issued Shares, when duly authorized,
issued and sold as contemplated by the Registration Statement and the
applicable Plan, will be legally issued and fully paid and non-
assessable Shares.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Yours very truly,
/s/ Goodman Phillips & Vineberg
CONSENT OF CHARTERED ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated September 5, 1996, which appears on
page 32 of the Transition Report to Shareholders of The Seagram Company Ltd.
for the transition period ended June 30, 1996, which is incorporated by
reference in The Seagram Company Ltd.'s Transition Report on Form 10-K for the
transition period ended June 30, 1996. We also consent to the incorporation by
reference of our report on the Financial Statement Schedules, which appears on
page 25 of such Transition Report on Form 10-K.
/s/ Price Waterhouse
PRICE WATERHOUSE
Montreal, Canada
December 30, 1996
CONSENT OF INDEPENDENT ACCOUNTANTS
E.I. DU PONT DE NEMOURS AND COMPANY
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 16, 1995, which appears on
page 38 of the 1994 Annual Report to Stockholders of E.I. du Pont de Nemours
and Company, which is incorporated by reference in E.I. du Pont de Nemours and
Company's Annual Report on Form 10-K for the year ended December 31, 1994. The
Consolidated Financial Statements of E.I. du Pont de Nemours and Company, as
listed under Item 14(a)1 of its Annual Report on Form 10-K for the year ended
December 31, 1994, are incorporated by reference in The Seagram Company Ltd.
Annual Report on Form 10-K for the transition period ended June 30, 1996.
/s/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
Philadelphia, Pennsylvania
December 30, 1996
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned, THE SEAGRAM
COMPANY LTD., a Canadian corporation (the "Corporation"), and each of the
undersigned directors and officers of the Corporation, hereby constitute and
appoint EDGAR M. BRONFMAN, CHARLES R. BRONFMAN, EDGAR BRONFMAN, JR., ROBERT W.
MATSCHULLAT, DANIEL R. PALADINO, and MICHAEL C.L. HALLOWS, and each of them
severally, his or her true and lawful attorneys and agents, with power to act
with or without the others and with full power of substitution and
resubstitution, to do any and all acts and things and to execute any and all
instruments which said attorneys and agents and each of them may deem necessary
or desirable to enable the Corporation to comply with the United States
Securities Act of 1933, as amended, and any rules, regulations and requirements
of the United States Securities and Exchange Commission (the "Commission")
thereunder in connection with the registration under such Act of common shares,
without nominal or par value, of the Corporation, to be offered or sold
pursuant to the employee benefit plans referenced in the Form S-8 of the
Corporation to which this Power of Attorney is attached, including
specifically, but without limiting the generality of the foregoing, power and
authority to sign the name of the Corporation and the name of the undersigned,
individually and in his or her capacity as a director or officer of the
Corporation, to a Registration Statement on Form S-8 (the "Registration
Statement") to be filed with the Securities and Exchange Commission with
respect to said common shares, to any and all amendments, including post-
effective amendments, to the Registration Statement, and to any and all
instruments or documents filed as a part of or in connection with the
Registration Statement and/or any such amendments; and to file with the
Commission the Registration Statement, any and all amendments thereto, and any
and all instruments or documents filed as a part of or in connection with the
Registration Statement and/or any such amendments; and each of the undersigned
hereby ratifies and confirms all that said attorneys and agents and each of
them shall do or cause to be done by virtue hereof.
<PAGE>
IN WITNESS WHEREOF each of the undersigned has subscribed these
presents as of this 31st day of December, 1996.
THE SEAGRAM COMPANY LTD.
By:/s/ Edgar M. Bronfman
______________________________
Edgar M. Bronfman
Chairman of the Board
/s/ Edgar M. Bronfman
______________________________
Edgar M. Bronfman
/s/ Charles R. Bronfman
______________________________
Charles R. Bronfman
/s/ Edgar Bronfman, Jr.
______________________________
Edgar Bronfman, Jr.
/s/ Samuel Bronfman II
______________________________
Samuel Bronfman II
/s/ Matthew W. Barrett
______________________________
Matthew W. Barrett
/s/ Frank J. Biondi, Jr.
______________________________
Frank J. Biondi, Jr.
/s/ William G. Davis
______________________________
William G. Davis
/s/ Paul Desmarais
______________________________
Paul Desmarais
/s/ Michele J. Hooper
______________________________
Michele J. Hooper
<PAGE>
/s/ David L. Johnston
______________________________
David L. Johnston
/s/ E. Leo Kolber
______________________________
E. Leo Kolber
/s/ Marie-Josee Kravis
______________________________
Marie-Josee Kravis
/s/ Robert W. Matschullat
______________________________
Robert W. Matschullat
/s/ C. Edward Medland
______________________________
C. Edward Medland
/s/ Lew R. Wasserman
______________________________
Lew R. Wasserman
/s/ John S. Weinberg
______________________________
John S. Weinberg
