<PAGE> 1
As filed with the Securities and Exchange Commission on October ___, 1996
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
------------------------
NCI BUILDING SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 76-0127701
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
7301 FAIRVIEW
HOUSTON, TEXAS 77041
(713) 466-7788
(Address of registrant's principal executive offices)
NCI 401(K) PROFIT SHARING PLAN
(Full Title of Plan)
------------------------
Johnie Schulte, Jr. Copy to: John K. Sterling, Esq.
President and Chief Executive Officer Gardere & Wynne, L.L.P.
NCI Building Systems, Inc. 1601 Elm Street
7301 Fairview Suite 3000
Houston, Texas 77041 Dallas, Texas 75201
(713) 466-7788 (214) 999-4925
(Name and address, including zip code, and telephone number,
including area code, of registrant's agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===================================================================================================================================
TITLE OF EACH CLASS PROPOSED MAXIMUM PROPOSED MAXIMUM
OF SECURITIES TO BE AMOUNT TO BE OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
REGISTERED REGISTERED (1)(2) PER SHARE (3) PRICE (1)(3) REGISTRATION FEE(3)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par value 300,000 shares $31.50 $9,450,000.00 $2,863.64
===================================================================================================================================
</TABLE>
(1) In addition, pursuant to Rule 416(c) under the Securities Act of
1933, this registration statement also covers an indeterminate
amount of interests to be offered or sold pursuant to the employee
benefit plan described herein.
(2) The shares of Common Stock, $.01 par value ("Common Stock"), of
NCI Building Systems, Inc., a Delaware corporation (the
"Registrant"), being registered hereby consist of shares to be
acquired by the Trustees pursuant to the NCI 401(k) Profit Sharing
Plan (the "Plan") for the accounts of participants.
(3) Calculated pursuant to Rule 457(h), based on the average of the
high and low prices for the Common Stock on October 22, 1996, as
quoted in the NASDAQ Stock Market.
================================================================================
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10 PROSPECTUS
ITEM 1. PLAN INFORMATION.*
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.*
*Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from the registration statement in accordance with
Rule 428 under the Securities Act of 1933, as amended, and the Note to
Part I of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.
The following documents filed by the Registrant with the Securities and
Exchange Commission are incorporated by reference in this registration
statement.
(1) The Registrant's Annual Report on Form 10-K for the fiscal
year ended October 31, 1995.
(2) The Registrant's Quarterly Report on Form 10-Q for the quarter
ended January 31, 1996.
(3) The Registrant's Quarterly Report on Form 10-Q for the quarter
ended April 30, 1996.
(4) The Registrant's Quarterly Report on Form 10-Q for the quarter
ended July 31, 1996.
(5) The Registrant's Current Report on Form 8-K dated November 13,
1995 and filed with the Commission on November 28, 1995 with respect to
the acquisition of the business of Doors & Building Components, Inc.
(6) The Registrant's Current Report on Form 8-K dated April 1,
1996 and filed with the Commission on April 9, 1996 with respect to the
acquisition of the business of Mesco Metal Buildings, a division of
Anderson Industries, Inc., amended by Form 8-K/A dated May 31, 1996 and
filed with the Commission on May 31, 1996.
(7) Annual Report of the Registrant's 401(K) Plan on Form 11-K
dated October 21, 1996 and filed with the Commission on October 22, 1996.
(8) The description of the Registrant's Common Stock contained in
the Registrant's Registration Statement on Form 8-A, as filed with the
Securities and Exchange Commission on February 22, 1992, which
incorporated by reference the section titled "Description of Capital
Stock" contained in the Prospectus filed with the Securities and Exchange
Commission on April 7, 1992 as part of the Registrant's registration
statement on Form S-1 (Registration No. 33-45612).
In addition, all documents subsequently filed by the Registrant or its
401(k) Profit Sharing Plan pursuant to Sections 13(a), 13(c), 14 and 15(d) of
the Securities Exchange Act of 1934, 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 of such documents. The consolidated financial
statements of the Registrant appearing
II-1
<PAGE> 3
in its latest Annual Report on Form 10-K filed with the Securities and Exchange
Commission on January 29, 1996, for the year ended October 31, 1995, have been
audited by Ernst & Young LLP, independent auditors, as set forth in their
report thereon included therein and incorporated herein by reference. Such
consolidated financial statements are, and audited consolidated financial
statements to be included in subsequently filed documents will be, incorporated
herein in reliance upon the reports of Ernst & Young LLP pertaining to such
financial statements (to the extent covered by consents filed with the
Securities and Exchange Commission) given upon the authority of such firm as
experts in accounting and auditing.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Gardere & Wynne, L.L.P., 1601 Elm Street, Suite 2600, Dallas, Texas
75201, counsel for the Registrant, has rendered an opinion as to the legality
of the securities being registered hereby. John K. Sterling, a partner in
Gardere & Wynne, L.L.P., owns 7,000 shares of Common Stock of the Registrant.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of the State of Delaware
provides that a Delaware corporation may, under certain circumstances,
indemnify its directors and officers against expenses, judgments, fines and
settlements actually and reasonably incurred by them in connection with certain
civil suits or actions. In addition, Section 145 permits a Delaware
corporation to grant its directors and officers additional rights of
indemnification through bylaw provisions and otherwise and to purchase
indemnity insurance on behalf of its directors and officers.
Article VI of the Registrant's By-laws require the Registrant to indemnify
its officers and directors and certain other employees and agents against
expenses incurred by them in defending or settling any actions or proceedings
in which they are made parties because they are or were the Registrant's
directors, officers, employees or agents. The Registrant's Restated
Certificate of Incorporation also provides that no director shall be personally
liable to the Registrant or its stockholders for any act or omission in such
director's capacity as a director.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
4.1 NCI 401(k) Profit Sharing Plan Adoption Agreement, effective
January 1, 1992, which includes therewith the 401(k) Profit
Sharing Plan and the Trust Agreement pursuant to the NCI
401(k) Profit Sharing Plan. (1)
* 4.2 NCI 401(k) Profit Sharing Adoption Agreement, effective
January 1, 1993, which includes therewith the NationsBank
Defined Contribution Master Plan and Trust Agreement, as
amended.
* 5.1 Opinion of Gardere & Wynne, L.L.P.
*24.1 Consent of Ernst & Young LLP.
*24.2 Consent of Gardere & Wynne, L.L.P. (included as part of
Exhibit 5.1).
*25 Power of Attorney (set forth on the signature pages of the
registration statement).
- --------------------------
(1) Previously filed as an exhibit to the Registrant's Registration Statement
on Form S-8 (Registration No. 33-52078) and incorporated herein by
reference.
* filed herewith
II-2
<PAGE> 4
In lieu of the opinion of counsel or determination letter contemplated by
Item 601(b)(5) of Regulation S-K, the Registrant hereby undertakes that it will
submit the Plan and all amendments thereto to the Internal Revenue Service
("IRS") in a timely manner, and that it will make all changes required by the
IRS in order to qualify the Plan under Section 401 of the Internal Revenue
Code.
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made of the securities registered hereby, a post-effective amendment
to this registration statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in 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 in this registration statement;
provided, however, that the undertakings set forth in paragraphs (1)(i)
and (1)(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 Securities Exchange Act of 1934 that are incorporated by reference in
this registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
The undersigned Registrant hereby further undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and each filing of the annual report of the
Plan pursuant to Section 15(d) of the Securities and Exchange Act of 1934) that
is incorporated by reference in the registration statement shall be deemed to
be a new registration statement relating to the securities offered by them, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
II-3
<PAGE> 5
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the Registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused
this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Houston, State of Texas, on the 14th
day of October, 1996.
NCI BUILDING SYSTEMS, INC.
(Registrant)
By: /s/ Johnie Schulte
----------------------------------------------
Johnie Schulte, President and Chief Executive
Officer
Each person whose signature appears below hereby constitutes and appoints
Johnie Schulte and Robert J. Medlock and each of them (with full power in each
of them to act alone), his true and lawful attorneys-in-fact and agents, with
full power of substitution and resubstitution, for him and in his name, place
and stead, in any and all capacities, to sign and to file with the Securities
and Exchange Commission and the securities regulatory authorities of the
several states registration statements, any amendment or post-effective
amendments or any and all other documents in connection therewith, in
connection with the registration under the Securities Act of 1933, as amended,
or the registration or qualification under any applicable state securities laws
or regulations, of interests in the Plan and shares of Common Stock issuable
pursuant to such Plan, granting unto said attorneys-in-fact and agents, and
each of them, full power and authority to do and perform each and every act and
thing requisite and necessary to be done, as fully to all intents and purposes
as he or she might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or either of them, or their or his
substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated below in the City of Houston, State of Texas on the 14th
day of October, 1996.
<TABLE>
<CAPTION>
Name Title
- ---- -----
<S> <C>
/s/ Johnie Schulte President, Chief Executive Officer and Director
- ----------------------- (a principal executive officer)
Johnie Schulte
/s/ Robert J. Medlock Vice President and Chief Financial Officer
- ----------------------- (principal financial officer)
Robert J. Medlock
/s/ T.C. Arnett Director
- -----------------------
T.C. Arnett
</TABLE>
II-4
<PAGE> 6
<TABLE>
<CAPTION>
Name Title
- ---- -----
<S> <C>
/s/ William D. Breedlove Director
- ------------------------------
William D. Breedlove
/s/ Gary L. Forbes Director
- ------------------------------
Gary L. Forbes
/s/ Robert N. McDonald Director
- ------------------------------
Robert N. McDonald
/s/ C.A. Rundell, Jr. Director
- ------------------------------
C.A. Rundell, Jr.
/s/ Daniel D. Zabcik Director
- ------------------------------
Daniel D. Zabcik
</TABLE>
The Plan. Pursuant to the requirements of the Securities Act of 1933, the
Trustee has duly caused this registration statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of Atlanta, State of
Georgia, on the 21st day of October, 1996.
NATIONSBANK OF GEORGIA, N.A., TRUSTEE FOR THE
NCI 401(k) PROFIT SHARING PLAN
By: /s/ William N. Denton
---------------------------
Print Name: William N. Denton
-------------------
Title: Vice President
------------------------
II-5
<PAGE> 7
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Exhibit
- ------ -------
<S> <C>
4.1 NCI 401(k) Profit Sharing Plan Adoption Agreement,
effective January 1, 1992, which includes therewith
the 401(k) Profit Sharing Plan and the Trust Agreement
pursuant to the NCI 401(k) Profit Sharing Plan. (1)
* 4.2 NCI 401(k) Profit Sharing Adoption Agreement, effective
January 1, 1993, which includes therewith the NationsBank
Defined Contribution Master Plan and Trust Agreement,
as amended.
* 5.1 Opinion of Gardere & Wynne, L.L.P.
*24.1 Consent of Ernst & Young LLP.
*24.2 Consent of Gardere & Wynne, L.L.P. (included as part of
Exhibit 5.1).
*25 Power of Attorney (set forth on the signature pages of the
registration statement).
</TABLE>
- ---------------------------
(1) Previously filed as an exhibit to the Registrant's Registration Statement
on Form S-8 (Registration No. 33-52078) and incorporated herein by
reference.
* filed herewith
II-6
<PAGE> 1
EXHIBIT 4.2
NATIONSBANK
DEFINED CONTRIBUTION MASTER PLAN
AND
TRUST AGREEMENT
<PAGE> 2
DEFINED CONTRIBUTION MASTER PLAN
TABLE OF CONTENTS
ALPHABETICAL LISTING OF DEFINITIONS. . . . . . . . . . . . . . . . . iii
ARTICLE I, DEFINITIONS
1.01 Employer . . . . . . . . . . . . . . . . . . . . . . . . . 1.01
1.02 Trustee . . . . . . . . . . . . . . . . . . . . . . . . . 1.01
1.03 Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.01
1.04 Adoption Agreement . . . . . . . . . . . . . . . . . . . . 1.01
1.05 Plan Administrator . . . . . . . . . . . . . . . . . . . . 1.01
1.06 Advisory Committee . . . . . . . . . . . . . . . . . . . . 1.02
1.07 Employee . . . . . . . . . . . . . . . . . . . . . . . . . 1.02
1.08 Self-Employed Individual/ Owner-Employee . . . . . . . . . 1.02
1.09 Highly Compensated Employee . . . . . . . . . . . . . . . 1.02
1.10 Participant . . . . . . . . . . . . . . . . . . . . . . . 1.03
1.11 Beneficiary . . . . . . . . . . . . . . . . . . . . . . . 1.03
1.12 Compensation . . . . . . . . . . . . . . . . . . . . . . . 1.03
1.13 Earned Income . . . . . . . . . . . . . . . . . . . . . . 1.05
1.14 Account . . . . . . . . . . . . . . . . . . . . . . . . . 1.05
1.15 Accrued Benefit . . . . . . . . . . . . . . . . . . . . . 1.05
1.16 Nonforfeitable . . . . . . . . . . . . . . . . . . . . . . 1.05
1.17 Plan Year/Limitation Year . . . . . . . . . . . . . . . . 1.05
1.18 Effective Date . . . . . . . . . . . . . . . . . . . . . . 1.05
1.19 Plan Entry Date . . . . . . . . . . . . . . . . . . . . . 1.05
1.20 Accounting Date . . . . . . . . . . . . . . . . . . . . . 1.05
1.21 Trust . . . . . . . . . . . . . . . . . . . . . . . . . . 1.05
1.22 Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . 1.05
1.23 Nontransferable Annuity . . . . . . . . . . . . . . . . . 1.05
1.24 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . 1.05
1.25 Code . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.05
1.26 Service . . . . . . . . . . . . . . . . . . . . . . . . . 1.05
1.27 Hour of Service . . . . . . . . . . . . . . . . . . . . . 1.05
1.28 Disability . . . . . . . . . . . . . . . . . . . . . . . . 1.07
1.29 Service for Predecessor Employer . . . . . . . . . . . . . 1.07
1.30 Related Employers . . . . . . . . . . . . . . . . . . . . 1.07
1.31 Leased Employees . . . . . . . . . . . . . . . . . . . . . 1.08
1.32 Special Rules for Owner-Employees . . . . . . . . . . . . 1.08
1.33 Determination of Top Heavy Status . . . . . . . . . . . . 1.09
1.34 Paired Plans . . . . . . . . . . . . . . . . . . . . . . . 1.10
ARTICLE II, EMPLOYEE PARTICIPANTS
2.01 Eligibility . . . . . . . . . . . . . . . . . . . . . . . 2.01
2.02 Year of Service - Participation . . . . . . . . . . . . . 2.01
2.03 Break in Service - Participation . . . . . . . . . . . . . 2.01
2.04 Participation upon Re-employment . . . . . . . . . . . . . 2.01
2.05 Change in Employee Status . . . . . . . . . . . . . . . . 2.02
2.06 Election Not to Participate . . . . . . . . . . . . . . . 2.02
ARTICLE III, EMPLOYER CONTRIBUTIONS AND FORFEITURES
3.01 Amount . . . . . . . . . . . . . . . . . . . . . . . . . . 3.01
3.02 Determination of Contribution . . . . . . . . . . . . . . 3.01
3.03 Time of Payment of Contribution . . . . . . . . . . . . . 3.01
3.04 Contribution Allocation . . . . . . . . . . . . . . . . . 3.01
3.05 Forfeiture Allocation . . . . . . . . . . . . . . . . . . 3.03
3.06 Accrual of Benefit . . . . . . . . . . . . . . . . . . . . 3.03
3.07 - 3.16 Limitations on Allocations . . . . . . . . . . . . 3.05
3.17 Special Allocation Limitation . . . . . . . . . . . . . . 3.07
3.18 Defined Benefit Plan Limitation . . . . . . . . . . . . . 3.07
3.19 Definitions - Article III . . . . . . . . . . . . . . . . 3.07
ARTICLE IV, PARTICIPANT CONTRIBUTIONS
4.01 Participant Nondeductible Contributions . . . . . . . . . 4.01
4.02 Participant Deductible Contributions . . . . . . . . . . . 4.01
4.03 Participant Rollover Contributions . . . . . . . . . . . . 4.01
4.04 Participant Contribution - Forfeitability . . . . . . . . 4.02
4.05 Participant Contribution -
Withdrawal/Distribution . . . . . . . . . . . . . . . . . 4.02
4.06 Participant Contribution -
Accrued Benefit . . . . . . . . . . . . . . . . . . . . . 4.02
ARTICLE V, TERMINATION OF SERVICE - PARTICIPANT VESTING
5.01 Normal Retirement Age . . . . . . . . . . . . . . . . . . 5.01
5.02 Participant Disability or Death . . . . . . . . . . . . . 5.01
5.03 Vesting Schedule . . . . . . . . . . . . . . . . . . . . . 5.01
5.04 Cash-out Distributions to Partially-
Vested Participants/Restoration of
Forfeited Accrued Benefit . . . . . . . . . . . . . . . . 5.01
5.05 Segregated Account for Repaid Amount . . . . . . . . . . . 5.02
5.06 Year of Service - Vesting . . . . . . . . . . . . . . . . 5.03
5.07 Break in Service - Vesting . . . . . . . . . . . . . . . . 5.03
5.08 Included Years of Service - Vesting . . . . . . . . . . . 5.03
5.09 Forfeiture Occurs . . . . . . . . . . . . . . . . . . . . 5.03
ARTICLE VI, TIME AND METHOD OF PAYMENT OF BENEFITS
6.01 Time of Payment of Accrued Benefit . . . . . . . . . . . . 6.01
6.02 Method of Payment of Accrued Benefit . . . . . . . . . . . 6.02
6.03 Benefit Payment Elections . . . . . . . . . . . . . . . . 6.04
6.04 Annuity Distributions to Participants
and Surviving Spouses . . . . . . . . . . . . . . . . . . 6.06
6.05 Waiver Election - Qualified Joint and
Survivor Annuity . . . . . . . . . . . . . . . . . . . . 6.07
6.06 Waiver Election - Preretirement Survivor
Annuity . . . . . . . . . . . . . . . . . . . . . . . . . 6.08
6.07 Distributions Under Domestic
Relations Orders . . . . . . . . . . . . . . . . . . . . 6.08
ARTICLE VII, EMPLOYER ADMINISTRATIVE PROVISIONS
7.01 Information to Committee . . . . . . . . . . . . . . . . . 7.01
7.02 No Liability . . . . . . . . . . . . . . . . . . . . . . . 7.01
7.03 Indemnity of Certain Fiduciaries . . . . . . . . . . . . . 7.01
7.04 Employer Direction of Investment . . . . . . . . . . . . . 7.01
7.05 Amendment to Vesting Schedule . . . . . . . . . . . . . . 7.01
ARTICLE VIII, PARTICIPANT ADMINISTRATIVE PROVISIONS
8.01 Beneficiary Designation . . . . . . . . . . . . . . . . . 8.01
8.02 No Beneficiary Designation/Death
of Beneficiary . . . . . . . . . . . . . . . . . . . . . 8.01
8.03 Personal Data to Committee . . . . . . . . . . . . . . . . 8.02
i
<PAGE> 3
DEFINED CONTRIBUTION MASTER PLAN
8.04 Address for Notification . . . . . . . . . . . . . . . . . 8.02
8.05 Assignment or Alienation . . . . . . . . . . . . . . . . . 8.02
8.06 Notice of Change in Terms . . . . . . . . . . . . . . . . 8.02
8.07 Litigation Against the Trust . . . . . . . . . . . . . . . 8.02
8.08 Information Available . . . . . . . . . . . . . . . . . . 8.02
8.09 Appeal Procedure for Denial of Benefits . . . . . . . . . 8.02
8.10 Participant Direction of Investment . . . . . . . . . . . 8.03
ARTICLE IX, ADVISORY COMMITTEE - DUTIES WITH RESPECT TO PARTICIPANTS'
ACCOUNTS
9.01 Members' Compensation, Expenses . . . . . . . . . . . . . 9.01
9.02 Term . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.01
9.03 Powers . . . . . . . . . . . . . . . . . . . . . . . . . . 9.01
9.04 General . . . . . . . . . . . . . . . . . . . . . . . . . 9.01
9.05 Funding Policy . . . . . . . . . . . . . . . . . . . . . . 9.02
9.06 Manner of Action . . . . . . . . . . . . . . . . . . . . . 9.02
9.07 Authorized Representative . . . . . . . . . . . . . . . . 9.02
9.08 Interested Member . . . . . . . . . . . . . . . . . . . . 9.02
9.09 Individual Accounts . . . . . . . . . . . . . . . . . . . 9.02
9.10 Value of Participant's Accrued Benefit . . . . . . . . . . 9.02
9.11 Allocation and Distribution of
Net Income Gain or Loss . . . . . . . . . . . . . . . . . 9.03
9.12 Individual Statement . . . . . . . . . . . . . . . . . . . 9.03
9.13 Account Charged . . . . . . . . . . . . . . . . . . . . . 9.04
9.14 Unclaimed Account Procedure . . . . . . . . . . . . . . . 9.04
ARTICLE X, TRUSTEE AND CUSTODIAN, POWERS
AND DUTIES
10.01 Acceptance . . . . . . . . . . . . . . . . . . . . . . 10.01
10.02 Receipt of Contributions . . . . . . . . . . . . . . . 10.01
10.03 Investment Powers . . . . . . . . . . . . . . . . . . . 10.01
10.04 Records and Statements . . . . . . . . . . . . . . . . 10.06
10.05 Fees and Expenses from Fund . . . . . . . . . . . . . . 10.06
10.06 Parties to Litigation . . . . . . . . . . . . . . . . . 10.06
10.07 Professional Agents . . . . . . . . . . . . . . . . . . 10.06
10.08 Distribution of Cash or Property . . . . . . . . . . . 10.06
10.09 Distribution Directions . . . . . . . . . . . . . . . . 10.06
10.10 Third Party/Multiple Trustees . . . . . . . . . . . . . 10.06
10.11 Resignation . . . . . . . . . . . . . . . . . . . . . . 10.07
10.12 Removal . . . . . . . . . . . . . . . . . . . . . . . . 10.07
10.13 Interim Duties and Successor Trustee . . . . . . . . . 10.07
10.14 Valuation of Trust . . . . . . . . . . . . . . . . . . 10.07
10.15 Limitation on Liability - If Investment Manager,
Ancillary Trustee or Independent Fiduciary Appointed. . 10.07
10.16 Investment in Group Trust Fund . . . . . . . . . . . . 10.07
10.17 Appointment of Ancillary Trustee or
Independent Fiduciary . . . . . . . . . . . . . . . . . 10.08
ARTICLE XI, PROVISIONS RELATING TO INSURANCE AND INSURANCE COMPANY
11.01 Insurance Benefit . . . . . . . . . . . . . . . . . . . 11.01
11.02 Limitation on Life Insurance Protection . . . . . . . . 11.01
11.03 Definitions . . . . . . . . . . . . . . . . . . . . . . 11.02
11.04 Dividend Plan . . . . . . . . . . . . . . . . . . . . . 11.02
11.05 Insurance Company Not a Party to Agreement. . . . . . . 11.03
11.06 Insurance Company Not Responsible for Trustee's
Actions . . . . . . . . . . . . . . . . . . . . . . . . 11.03
11.07 Insurance Company Reliance on Trustee's Signature . . . 11.03
11.08 Acquittance . . . . . . . . . . . . . . . . . . . . . . 11.03
11.09 Duties of Insurance Company . . . . . . . . . . . . . . 11.03
ARTICLE XII, MISCELLANEOUS
12.01 Evidence . . . . . . . . . . . . . . . . . . . . . . . 12.01
12.02 No Responsibility for Employer Action . . . . . . . . . 12.01
12.03 Fiduciaries Not Insurers . . . . . . . . . . . . . . . 12.01
12.04 Waiver of Notice . . . . . . . . . . . . . . . . . . . 12.01
12.05 Successors . . . . . . . . . . . . . . . . . . . . . . 12.01
12.06 Word Usage . . . . . . . . . . . . . . . . . . . . . . 12.01
12.07 State Law . . . . . . . . . . . . . . . . . . . . . . . 12.01
12.08 Employer's Right to Participate . . . . . . . . . . . . 12.01
12.09 Employment Not Guaranteed . . . . . . . . . . . . . . . 12.02
ARTICLE XIII, EXCLUSIVE BENEFIT, AMENDMENT, TERMINATION
13.01 Exclusive Benefit . . . . . . . . . . . . . . . . . . . 13.01
13.02 Amendment by Employer . . . . . . . . . . . . . . . . . 13.01
13.03 Amendment by Master Plan Sponsor . . . . . . . . . . . 13.02
13.04 Discontinuance . . . . . . . . . . . . . . . . . . . . 13.02
13.05 Full Vesting on Termination . . . . . . . . . . . . . . 13.02
13.06 Merger/Direct Transfer . . . . . . . . . . . . . . . . 13.02
13.07 Termination . . . . . . . . . . . . . . . . . . . . . . 13.03
ARTICLE XIV, CODE SECTION 401(k) AND CODE SECTION 401(m) ARRANGEMENTS
14.01 Application . . . . . . . . . . . . . . . . . . . . . . 14.01
14.02 Code Section 401(k) Arrangement . . . . . . . . . . . . 14.01
14.03 Definitions . . . . . . . . . . . . . . . . . . . . . . 14.01
14.04 Matching Contributions/Employee Contributions . . . . . 14.03
14.05 Time of Payment of Contributions . . . . . . . . . . . 14.03
14.06 Special Allocation Provisions - Deferral Contributions,
Matching Contributions and Qualified Nonelective
Contributions . . . . . . . . . . . . . . . . . . . . . 14.04
14.07 Annual Elective Deferral Limitation . . . . . . . . . . 14.05
14.08 Actual Deferral Percentage ("ADP") Test . . . . . . . . 14.06
14.09 Nondiscrimination Rules for Employer Matching
Contributions/Participant Nondeductible Contributions . 14.08
14.10 Multiple Use Limitation . . . . . . . . . . . . . . . . 14.10
14.11 Distribution Restrictions . . . . . . . . . . . . . . . 14.10
14.12 Special Allocation Rules . . . . . . . . . . . . . . . 14.11
ii
<PAGE> 4
DEFINED CONTRIBUTION MASTER PLAN
ALPHABETICAL LISTING OF DEFINITIONS
SECTION REFERENCE
PLAN DEFINITION (PAGE NUMBER)
- --------------- -------------------
100% Limitation . . . . . . . . . . . . . . . . . . . . . . . . 3.19(1) (3.10)
Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.14 (1.05)
Accounting Date . . . . . . . . . . . . . . . . . . . . . . . . . 1.20 (1.05)
Accrued Benefit . . . . . . . . . . . . . . . . . . . . . . . . . 1.15 (1.05)
Actual Deferral Percentage ("ADP") Test . . . . . . . . . . . . . 14.08 (14.06)
Adoption Agreement . . . . . . . . . . . . . . . . . . . . . . . 1.04 (1.01)
Advisory Committee . . . . . . . . . . . . . . . . . . . . . . . 1.06 (1.02)
Annual Addition . . . . . . . . . . . . . . . . . . . . . . . . 3.19(a) (3.07)
Average Contribution Percentage Test . . . . . . . . . . . . . 14.09 (14.08)
Beneficiary . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.11 (1.03)
Break in Service for Eligibility Purposes . . . . . . . . . . . . 2.03 (2.01)
Break in Service for Vesting Purposes . . . . . . . . . . . . . . 5.07 (5.03)
Cash-out Distribution . . . . . . . . . . . . . . . . . . . . . . 5.04 (5.01)
Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.25 (1.06)
Code Section 411(d)(6) Protected Benefits . . . . . . . . . . . 13.02 (13.01)
Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . 1.12 (1.03)
Compensation for Code Section 401(k) Purposes . . . . . . . . 14.03(f) (14.02)
Compensation for Code Section 415 Purposes . . . . . . . . . . 3.19(b) (3.08)
Compensation for Top Heavy Purposes . . . . . . . . . . . . 1.33(B)(3) (1.09)
Contract(s) . . . . . . . . . . . . . . . . . . . . . . . . . 11.03(c) (11.02)
Custodian Designation . . . . . . . . . . . . . . . . . . . . 10.03[B](10.03)
Deemed Cash-out Rule . . . . . . . . . . . . . . . . . . . . . 5.04(C) (5.02)
Deferral Contributions . . . . . . . . . . . . . . . . . . . 14.03(g) (14.02)
Deferral Contributions Account . . . . . . . . . . . . . . . 14.06(A) (14.04)
Defined Benefit Plan . . . . . . . . . . . . . . . . . . . . . 3.19(i) (3.09)
Defined Benefit Plan Fraction . . . . . . . . . . . . . . . . . 3.19(j) (3.09)
Defined Contribution Plan . . . . . . . . . . . . . . . . . . . 3.19(h) (3.08)
Defined Contribution Plan Fraction . . . . . . . . . . . . . . 3.19(k) (3.09)
Determination Date . . . . . . . . . . . . . . . . . . . . 1.33(B)(7) (1.10)
Disability . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.28 (1.07)
Distribution Date . . . . . . . . . . . . . . . . . . . . . . . . 6.01 (6.01)
Distribution Restrictions . . . . . . . . . . . . . . . . . . 14.03(m) (14.03)
Earned Income . . . . . . . . . . . . . . . . . . . . . . . . . . 1.13 (1.05)
Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . 1.18 (1.05)
Elective Deferrals . . . . . . . . . . . . . . . . . . . . . 14.03(h) (14.02)
Elective Transfer . . . . . . . . . . . . . . . . . . . . . . 13.06(A) (13.03)
Eligible Employee . . . . . . . . . . . . . . . . . . . . . . 14.03(c) (14.02)
Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.07 (1.02)
Employee Contributions . . . . . . . . . . . . . . . . . . . 14.03(n) (14.03)
Employer . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.01 (1.01)
Employer Contribution Account . . . . . . . . . . . . . . . . . 14.06 (14.04)
Employer for Code Section 415 Purposes . . . . . . . . . . . . 3.19(c) (3.08)
Employer for Top Heavy Purposes . . . . . . . . . . . . . . 1.33(B)(6) (1.10)
Employment Commencement Date . . . . . . . . . . . . . . . . . . 2.02 (2.01)
ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.24 (1.06)
Excess Aggregate Contributions . . . . . . . . . . . . . . . 14.09(D) (14.09)
Excess Amount . . . . . . . . . . . . . . . . . . . . . . . . . 3.19(d) (3.08)
Excess Contributions . . . . . . . . . . . . . . . . . . . . . 14.08 (14.07)
Exempt Participant . . . . . . . . . . . . . . . . . . . . . . . 8.01 (8.01)
Forfeiture Break in Service . . . . . . . . . . . . . . . . . . . 5.08 (5.03)
Group Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . 10.16 (10.07)
Hardship . . . . . . . . . . . . . . . . . . . . . . . . . . 6.01(A)(4) (6.01)
Hardship for Code Section 401(k) Purposes . . . . . . . . . . 14.11(A) (14.11)
Highly Compensated Employee . . . . . . . . . . . . . . . . . . . 1.09 (1.02)
Highly Compensated Group . . . . . . . . . . . . . . . . . . 14.03(d) (14.02)
Hour of Service . . . . . . . . . . . . . . . . . . . . . . . . . 1.27 (1.06)
Incidental Insurance Benefits . . . . . . . . . . . . . . . . 11.01(A) (11.01)
Insurable Participant . . . . . . . . . . . . . . . . . . . . 11.03(d) (11.02)
Investment Manager . . . . . . . . . . . . . . . . . . . . . . 9.04(i) (9.01)
Issuing Insurance Company . . . . . . . . . . . . . . . . . . 11.03(b)(11.02)
Joint and Survivor Annuity . . . . . . . . . . . . . . . . . . 6.04(A) (6.06)
Key Employee . . . . . . . . . . . . . . . . . . . . . . . 1.33(B)(1) (1.09)
Leased Employees . . . . . . . . . . . . . . . . . . . . . . . . 1.31 (1.08)
Limitation Year . . . . . . . . . . . . . . . 1.17 and 3.19(e) (1.05 and 3.08)
Loan Policy . . . . . . . . . . . . . . . . . . . . . . . . . . 9.04(A) (9.02)
Mandatory Contributions . . . . . . . . . . . . . . . . . . . 14.04(A) (14.03)
Mandatory Contributions Account . . . . . . . . . . . . . . . 14.04(A) (14.03)
Master or Prototype Plan . . . . . . . . . . . . . . . . . . . 3.19(f) (3.08)
Matching Contributions . . . . . . . . . . . . . . . . . . . 14.03(i) (14.02)
Maximum Permissible Amount . . . . . . . . . . . . . . . . . . 3.19(g) (3.08)
Minimum Distribution Incidental Benefit . . . . . . . . . . . . 6.02(A) (6.03)
Multiple Use Limitation . . . . . . . . . . . . . . . . . . . . 14.10 (14.10)
Named Fiduciary . . . . . . . . . . . . . . . . . . . . . . . 10.03[D] (10.05)
Nonelective Contributions . . . . . . . . . . . . . . . . . . 14.03(j) (14.02)
Nonforfeitable . . . . . . . . . . . . . . . . . . . . . . . . . 1.16 (1.05)
Nonhighly Compensated Employee . . . . . . . . . . . . . . . 14.03(b) (14.02)
Nonhighly Compensated Group . . . . . . . . . . . . . . . . . 14.03(e) (14.02)
Non-Key Employee . . . . . . . . . . . . . . . . . . . . . 1.33(B)(2) (1.09)
Nontransferable Annuity . . . . . . . . . . . . . . . . . . . . . 1.23 (1.05)
Normal Retirement Age . . . . . . . . . . . . . . . . . . . . . . 5.01 (5.01)
Owner-Employee . . . . . . . . . . . . . . . . . . . . . . . . . 1.08 (1.02)
Paired Plans . . . . . . . . . . . . . . . . . . . . . . . . . . 1.34 (1.10)
Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.10 (1.03)
Participant Deductible Contributions . . . . . . . . . . . . . . 4.02 (4.01)
Participant Forfeiture . . . . . . . . . . . . . . . . . . . . . 3.05 (3.03)
Participant Loans . . . . . . . . . . . . . . . . . . . . . . 10.03[E] (10.04)
Participant Nondeductible Contributions . . . . . . . . . . . . . 4.01 (4.01)
Permissive Aggregation Group . . . . . . . . . . . . . . . 1.33(B)(5) (1.10)
Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.03 (1.01)
Plan Administrator . . . . . . . . . . . . . . . . . . . . . . . 1.05 (1.01)
Plan Entry Date . . . . . . . . . . . . . . . . . . . . . . . . . 1.19 (1.05)
Plan Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.17 (1.05)
Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.03(a) (11.02)
Predecessor Employer . . . . . . . . . . . . . . . . . . . . . . 1.29 (1.07)
Preretirement Survivor Annuity . . . . . . . . . . . . . . . . 6.04(B) (6.06)
Qualified Domestic Relations Order . . . . . . . . . . . . . . . 6.07 (6.08)
Qualified Matching Contributions . . . . . . . . . . . . . . 14.03(k) (14.02)
Qualified Nonelective Contributions . . . . . . . . . . . . 14.03 (l) (14.03)
Qualifying Employer Real Property . . . . . . . . . . . . . . 10.03[F] (10.05)
Qualifying Employer Securities . . . . . . . . . . . . . . . 10.03[F] (10.05)
iii
<PAGE> 5
DEFINED CONTRIBUTION MASTER PLAN
SECTION REFERENCE
PLAN DEFINITION (PAGE NUMBER)
- --------------- -------------------
Related Employers . . . . . . . . . . . . . . . . . . . . . . . . 1.30 (1.07)
Required Aggregation Group . . . . . . . . . . . . . . . . 1.33(B)(4) (1.09)
Required Beginning Date . . . . . . . . . . . . . . . . . . . . 6.01(B) (6.02)
Rollover Contributions . . . . . . . . . . . . . . . . . . . . . 4.03 (4.01)
Self-Employed Individual . . . . . . . . . . . . . . . . . . . . 1.08 (1.02)
Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.26 (1.06)
Term Life Insurance Contract . . . . . . . . . . . . . . . . . 11.03 (11.02)
Top Heavy Minimum Allocation . . . . . . . . . . . . . . . . . 3.04(B) (3.01)
Top Heavy Ratio . . . . . . . . . . . . . . . . . . . . . . . . . 1.33 (1.09)
Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.21 (1.05)
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.02 (1.01)
Trustee Designation . . . . . . . . . . . . . . . . . . . . . 10.03[A] (10.01)
Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.22 (1.05)
Weighted Average Allocation Method . . . . . . . . . . . . . . 14.12 (14.11)
Year of Service for Eligibility Purposes . . . . . . . . . . . . 2.02 (2.01)
Year of Service for Vesting Purposes . . . . . . . . . . . . . . 5.06 (5.03)
* * *
iv
<PAGE> 6
NATIONSBANK
DEFINED CONTRIBUTION MASTER PLAN AND TRUST AGREEMENT
BASIC PLAN DOCUMENT #03
NationsBank, in its capacity as Master Plan Sponsor, establishes this
Master Plan intended to conform to and qualify under Section 401 and Section
501 of the Internal Revenue Code of 1986, as amended. An Employer establishes a
Plan and Trust under this Master Plan by executing an Adoption Agreement. If
the Employer adopts this Plan as a restated Plan in substitution for, and in
amendment of, an existing plan, the provisions of this Plan, as a restated
Plan, apply solely to an Employee whose employment with the Employer terminates
on or after the restated Effective Date of the Employer's Plan. If an
Employee's employment with the Employer terminates prior to the restated
Effective Date, that Employee is entitled to benefits under the Plan as the
Plan existed on the date of the Employee's termination of employment.
ARTICLE I
DEFINITIONS
1.01 "Employer" means each employer who adopts this Plan by executing
an Adoption Agreement.
1.02 "Trustee" means the person or persons who as Trustee execute the
Employer's Adoption Agreement, or any successor in office who in writing
accepts the position of Trustee. The Employer must designate in its Adoption
Agreement whether the Trustee will administer the Trust as a discretionary
Trustee or as a nondiscretionary Trustee. If a person acts as a discretionary
Trustee, the Employer also may appoint a Custodian. See Article X. If the
Master Plan Sponsor is a bank, savings and loan, credit union or similar
financial institution, a person other than the Master Plan Sponsor (or its
affiliate) may not serve as Trustee or as Custodian of the Employer's Plan
without the written consent of the Master Plan Sponsor.
1.03 "Plan" means the retirement plan established or continued by the
Employer in the form of this Agreement, including the Adoption Agreement under
which the Employer has elected to participate in this Master Plan. The Employer
must designate the name of the Plan in its Adoption Agreement. An Employer may
execute more than one Adoption Agreement offered under this Master Plan, each
of which will constitute a separate Plan and Trust established or continued by
that Employer. The Plan and the Trust created by each adopting Employer is a
separate Plan and a separate Trust, independent from the plan and the trust of
any other employer adopting this Master Plan. All section references within the
Plan are Plan section references unless the context clearly indicates
otherwise.
1.04 "Adoption Agreement" means the document executed by each Employer
adopting this Master Plan. The terms of this Master Plan as modified by the
terms of an adopting Employer's Adoption Agreement constitute a separate Plan
and Trust to be construed as a single Agreement. Each elective provision of the
Adoption Agreement corresponds by section reference to the section of the Plan
which grants the election. Each Adoption Agreement offered under this Master
Plan is either a Nonstandardized Plan or a Standardized Plan, as identified in
the preamble to that Adoption Agreement. The provisions of this Master Plan
apply equally to Nonstandardized Plans and to Standardized Plans unless
otherwise specified.
1.05 "Plan Administrator" is the Employer unless the Employer
designates another person to hold the position of Plan Administrator. In
addition to his other duties, the Plan Administrator has full responsibility
for compliance with the reporting and disclosure rules under ERISA as respects
this Agreement.
1.01
<PAGE> 7
DEFINED CONTRIBUTION MASTER PLAN
1.06 "Advisory Committee" means the Employer's Advisory Committee as
from time to time constituted.
1.07 "Employee" means any employee (including a Self-Employed
Individual) of the Employer. The Employer must specify in its Adoption
Agreement any Employee, or class of Employees, not eligible to participate in
the Plan. If the Employer elects to exclude collective bargaining employees,
the exclusion applies to any employee of the Employer included in a unit of
employees covered by an agreement which the Secretary of Labor finds to be a
collective bargaining agreement between employee representatives and one or
more employers unless the collective bargaining agreement requires the employee
to be included within the Plan. The term "employee representatives" does not
include any organization more than half the members of which are owners,
officers, or executives of the Employer.
1.08 "Self-Employed Individual/Owner-Employee." "Self-Employed
Individual" means an individual who has Earned Income (or who would have had
Earned Income but for the fact that the trade or business did not have net
earnings) for the taxable year from the trade or business for which the Plan is
established. "Owner-Employee" means a Self-Employed Individual who is the sole
proprietor in the case of a sole proprietorship. If the Employer is a
partnership, "Owner-Employee" means a Self-Employed Individual who is a partner
and owns more than 10% of either the capital or profits interest of the
partnership.
1.09 "Highly Compensated Employee" means an Employee who, during the
Plan Year or during the preceding 12-month period:
(a) is a more than 5% owner of the Employer (applying the
constructive ownership rules of Code Section 318, and applying the
principles of Code Section 318, for an unincorporated entity);
(b) has Compensation in excess of $75,000 (as adjusted by the
Commissioner of Internal Revenue for the relevant year);
(c) has Compensation in excess of $50,000 (as adjusted by the
Commissioner of Internal Revenue for the relevant year) and is part of
the top-paid 20% group of employees (based on Compensation for the
relevant year); or
(d) has Compensation in excess of 50% of the dollar amount prescribed
in Code Section 415(b)(1)(A) (relating to defined benefit plans) and is
an officer of the Employer.
If the Employee satisfies the definition in clause (b), (c) or (d) in
the Plan Year but does not satisfy clause (b), (c) or (d) during the preceding
12-month period and does not satisfy clause (a) in either period, the Employee
is a Highly Compensated Employee only if he is one of the 100 most highly
compensated Employees for the Plan Year. The number of officers taken into
account under clause (d) will not exceed the greater of 3 or 10% of the total
number (after application of the Code Section 414(q) exclusions) of Employees,
but no more than 50 officers. If no Employee satisfies the Compensation
requirement in clause (d) for the relevant year, the Advisory Committee will
treat the highest paid officer as satisfying clause (d) for that year.
For purposes of this Section 1.09, "Compensation" means Compensation as
defined in Section 1.12, except any exclusions from Compensation elected in the
Employer's Adoption Agreement Section 1.12 do not apply, and Compensation must
include "elective contributions" (as defined in Section 1.12). The Advisory
Committee must make the determination of who is a Highly Compensated Employee,
including the determinations of the number and identity of the top paid 20%
group, the top 100 paid Employees, the number of officers includible in clause
(d) and the relevant Compensation, consistent with Code Section 414(q) and
regulations issued under that Code section. The Employer may make a calendar
year election to determine the Highly Compensated Employees for the Plan Year,
as prescribed by Treasury regulations. A calendar year election must apply to
all
1.02
<PAGE> 8
DEFINED CONTRIBUTION MASTER PLAN
plans and arrangements of the Employer. For purposes of applying any
nondiscrimination test required under the Plan or under the Code, in a manner
consistent with applicable Treasury regulations, the Advisory Committee will
treat a Highly Compensated Employee and all family members (a spouse, a lineal
ascendant or descendant, or a spouse of a lineal ascendant or descendant) as a
single Highly Compensated Employee, but only if the Highly Compensated Employee
is a more than 5% owner or is one of the 10 Highly Compensated Employees with
the greatest Compensation for the Plan Year. This aggregation rule applies to a
family member even if that family member is a Highly Compensated Employee
without family aggregation.
The term "Highly Compensated Employee" also includes any former Employee
who separated from Service (or has a deemed Separation from Service, as
determined under Treasury regulations) prior to the Plan Year, performs no
Service for the Employer during the Plan Year, and was a Highly Compensated
Employee either for the separation year or any Plan Year ending on or after his
55th birthday. If the former Employee's Separation from Service occurred prior
to January 1, 1987, he is a Highly Compensated Employee only if he satisfied
clause (a) of this Section 1.09 or received Compensation in excess of $50,000
during: (1) the year of his Separation from Service (or the prior year); or (2)
any year ending after his 54th birthday.
1.10 "Participant" is an Employee who is eligible to be and becomes a
Participant in accordance with the provisions of Section 2.01.
1.11 "Beneficiary" is a person designated by a Participant who is or
may become entitled to a benefit under the Plan. A Beneficiary who becomes
entitled to a benefit under the Plan remains a Beneficiary under the Plan until
the Trustee has fully distributed his benefit to him. A Beneficiary's right to
(and the Plan Administrator's, the Advisory Committee's or a Trustee's duty to
provide to the Beneficiary) information or data concerning the Plan does not
arise until he first becomes entitled to receive a benefit under the Plan.
1.12 "Compensation" means, except as provided in the Employer's
Adoption Agreement, the Participant's Earned Income, wages, salaries, fees for
professional service and other amounts received for personal services actually
rendered in the course of employment with the Employer maintaining the plan
(including, but not limited to, commissions paid salesmen, compensation for
services on the basis of a percentage of profits, commissions on insurance
premiums, tips and bonuses). The Employer must elect in its Adoption Agreement
whether to include elective contributions in the definition of Compensation.
"Elective contributions" are amounts excludible from the Employee's gross
income under Code Sections 125, 402(a)(8), 402(h) or 403(b), and contributed by
the Employer, at the Employee's election, to a Code Section 401(k) arrangement,
a Simplified Employee Pension, cafeteria plan or tax-sheltered annuity. The
term "Compensation" does not include:
(a) Employer contributions (other than "elective contributions," if
includible in the definition of Compensation under Section 1.12 of the
Employer's Adoption Agreement) to a plan of deferred compensation to the
extent the contributions are not included in the gross income of the
Employee for the taxable year in which contributed, on behalf of an
Employee to a Simplified Employee Pension Plan to the extent such
contributions are excludible from the Employee's gross income, and any
distributions from a plan of deferred compensation, regardless of
whether such amounts are includible in the gross income of the Employee
when distributed.
(b) Amounts realized from the exercise of a non-qualified stock
option, or when restricted stock (or property) held by an 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 stock option described in Part II, Subchapter D,
Chapter 1 of the Code.
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DEFINED CONTRIBUTION MASTER PLAN
(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 an Employer (whether or not under a salary
reduction agreement) towards the purchase of an annuity contract
described in Code Section 403(b) (whether or not the contributions are
excludible from the gross income of the Employee), other than "elective
contributions," if elected in the Employer's Adoption Agreement.
Any reference in this Plan to Compensation is a reference to the
definition in this Section 1.12, unless the Plan reference specifies a
modification to this definition. The Advisory Committee will take into account
only Compensation actually paid for the relevant period. A Compensation payment
includes Compensation by the Employer through another person under the common
paymaster provisions in Code Sections 3121 and 3306.
(A) LIMITATIONS ON COMPENSATION.
(1) COMPENSATION DOLLAR LIMITATION. For any Plan Year beginning after
December 31, 1988, the Advisory Committee must take into account only the first
$200,000 (or beginning January 1, 1990, such larger amount as the Commissioner
of Internal Revenue may prescribe) of any Participant's Compensation. For any
Plan Year beginning prior to January 1, 1989, this $200,000 limitation (but not
the family aggregation requirement described in the next paragraph) applies
only if the Plan is top heavy for such Plan Year or operates as a deemed top
heavy plan for such Plan Year.
(2) APPLICATION OF COMPENSATION LIMITATION TO CERTAIN FAMILY MEMBERS.
The $200,000 Compensation limitation applies to the combined Compensation of
the Employee and of any family member aggregated with the Employee under
Section 1.09 who is either (i) the Employee's spouse; or (ii) the Employee's
Lineal descendant under the age of 19. If, for a Plan Year, the combined
Compensation of the Employee and such family members who are Participants
entitled to an allocation for that Plan Year exceeds the $200,000 (or adjusted)
limitation, "Compensation" for each such Participant, for purposes of the
contribution and allocation provisions of Article III, means his Adjusted
Compensation. Adjusted Compensation is the amount which bears the same ratio to
the $200,000 (or adjusted) limitation as the affected Participant's
Compensation (without regard to the $200,000 Compensation limitation) bears to
the combined Compensation of all the affected Participants in the family unit.
If the Plan uses permitted disparity, the Advisory Committee must determine the
integration level of each affected family member Participant prior to the
proration of the $200,000 Compensation limitation, but the combined integration
level of the affected Participants may not exceed $200,000 (or the adjusted
limitation). The combined Excess Compensation of the affected Participants in
the family unit may not exceed $200,000 (or the adjusted limitation) minus the
affected Participants' combined integration level (as determined under the
preceding sentence). If the combined Excess Compensation exceeds this
limitation, the Advisory Committee will prorate the Excess Compensation
limitation among the affected Participants in the family unit in proportion to
each such individual's Adjusted Compensation minus his integration level. If
the Employer's Plan is a Nonstandardized Plan, the Employer may elect to use a
different method in determining the Adjusted Compensation of the affected
Participants by specifying that method in an addendum to the Adoption
Agreement, numbered Section 1.12.
(B) NONDISCRIMINATION. For purposes of determining whether the Plan
discriminates in favor of Highly Compensated Employees, Compensation means
Compensation as defined in this Section 1.12, except: (1) the Employer may
elect to include or to exclude elective contributions, irrespective of the
Employer's election in its Adoption Agreement regarding elective contributions;
and (2) the
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DEFINED CONTRIBUTION MASTER PLAN
Employer will not give effect to any elections made in the "modifications to
Compensation definition" section of Adoption Agreement Section 1.12. The
Employer's election described in clause (1) must be consistent and uniform with
respect to all Employees and all plans of the Employer for any particular Plan
Year. If the Employer's Plan is a Nonstandardized Plan, the Employer,
irrespective of clause (2), may elect to exclude from this nondiscrimination
definition of Compensation any items of Compensation excludible under Code
Section 414(s) and the applicable Treasury regulations, provided such adjusted
definition conforms to the nondiscrimination requirements of those regulations.
1.13 "Earned Income" means net earnings from self-employment in the
trade or business with respect to which the Employer has established the Plan,
provided personal services of the individual are a material income producing
factor. The Advisory Committee will determine net earnings without regard to
items excluded from gross income and the deductions allocable to those items.
The Advisory Committee will determine net earnings after the deduction allowed
to the Self-Employed Individual for all contributions made by the Employer to a
qualified plan and, for Plan Years beginning after December 31, 1989, the
deduction allowed to the Self-Employed under Code Section 164(f) for self-
employment taxes.
1.14 "Account" means the separate account(s) which the Advisory
Committee or the Trustee maintains for a Participant under the Employer's Plan.
1.15 "Accrued Benefit" means the amount standing in a Participant's
Account(s) as of any date derived from both Employer contributions and Employee
contributions, if any.
1.16 "Nonforfeitable" means a Participant's or Beneficiary's
unconditional claim, legally enforceable against the Plan, to the Participant's
Accrued Benefit.
1.17 "Plan Year" means the fiscal year of the Plan, the consecutive
month period specified in the Employer's Adoption Agreement. The Employer's
Adoption Agreement also must specify the "Limitation Year" applicable to the
limitations on allocations described in Article III. If the Employer maintains
Paired Plans, each Plan must have the same Plan Year.
1.18 "Effective Date" of this Plan is the date specified in the
Employer's Adoption Agreement.
1.19 "Plan Entry Date" means the date(s) specified in Section 2.01 of
the Employer's Adoption Agreement.
1.20 "Accounting Date" is the last day of an Employer's Plan Year.
Unless otherwise specified in the Plan, the Advisory Committee will make all
Plan allocations for a particular Plan Year as of the Accounting Date of that
Plan Year.
1.21 "Trust" means the separate Trust created under the Employer's
Plan.
1.22 "Trust Fund" means all property of every kind held or acquired by
the Employer's Plan, other than incidental benefit insurance contracts.
1.23 "Nontransferable Annuity" means an annuity which by its terms
provides that it may not be sold, assigned, discounted, pledged as collateral
for a loan or security for the performance of an obligation or for any purpose
to any person other than the insurance company. If the Plan distributes an
annuity contract, the contract must be a Nontransferable Annuity.
1.24 "ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
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DEFINED CONTRIBUTION MASTER PLAN
1.25 "Code" means the Internal Revenue Code of 1986, as amended.
1.26 "Service" means any period of time the Employee is in the employ
of the Employer, including any period the Employee is on an unpaid leave of
absence authorized by the Employer under a uniform, nondiscriminatory policy
applicable to all Employees. "Separation from Service" means the Employee no
longer has an employment relationship with the Employer maintaining this Plan.
1.27 "Hour of Service" means:
(a) Each Hour of Service for which the Employer, either directly or
indirectly, pays an Employee, or for which the Employee is entitled to
payment, for the performance of duties. The Advisory Committee credits
Hours of Service under this paragraph (a) to the Employee for the
computation period in which the Employee performs the duties,
irrespective of when paid;
(b) Each Hour of Service for back pay, irrespective of mitigation of
damages, to which the Employer has agreed or for which the Employee has
received an award. The Advisory Committee credits Hours of Service under
this paragraph (b) to the Employee for the computation period(s) to
which the award or the agreement pertains rather than for the
computation period in which the award, agreement or payment is made; and
(c) Each Hour of Service for which the Employer, either directly or
indirectly, pays an Employee, or for which the Employee is entitled to
payment (irrespective of whether the employment relationship is
terminated), for reasons other than for the performance of duties during
a computation period, such as leave of absence, vacation, holiday, sick
leave, illness, incapacity (including disability), layoff, jury duty or
military duty. The Advisory Committee will credit no more than 501 Hours
of Service under this paragraph (c) to an Employee on account of any
single continuous period during which the Employee does not perform any
duties (whether or not such period occurs during a single computation
period). The Advisory Committee credits Hours of Service under this
paragraph (c) in accordance with the rules of paragraphs (b) and (c) of
Labor Reg. Section 2530.200b-2, which the Plan, by this reference,
specifically incorporates in full within this paragraph (c).
The Advisory Committee will not credit an Hour of Service under more
than one of the above paragraphs. A computation period for purposes of this
Section 1.27 is the Plan Year, Year of Service period, Break in Service period
or other period, as determined under the Plan provision for which the Advisory
Committee is measuring an Employee's Hours of Service. The Advisory Committee
will resolve any ambiguity with respect to the crediting of an Hour of Service
in favor of the Employee.
(A) METHOD OF CREDITING HOURS OF SERVICE. The Employer must elect in its
Adoption Agreement the method the Advisory Committee will use in crediting an
Employee with Hours of Service. For purposes of the Plan, "actual" method means
the determination of Hours of Service from records of hours worked and hours
for which the Employer makes payment or for which payment is due from the
Employer. If the Employer elects to apply an "equivalency" method, for each
equivalency period for which the Advisory Committee would credit the Employee
with at least one Hour of Service, the Advisory Committee will credit the
Employee with: (i) 10 Hours of Service for a daily equivalency; (ii) 45 Hours
of Service for a weekly equivalency; (iii) 95 Hours of Service for a
semimonthly payroll period equivalency; and (iv) 190 Hours of Service for a
monthly equivalency.
(B) MATERNITY/PATERNITY LEAVE. Solely for purposes of determining whether
the Employee incurs a Break in Service under any provision of this Plan, the
Advisory Committee must credit Hours of Service during an Employee's unpaid
absence period due to maternity or paternity leave. The Advisory Committee
considers an Employee on maternity or paternity leave if the Employee's absence
is due to the Employee's pregnancy, the birth of the Employee's child, the
placement with
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DEFINED CONTRIBUTION MASTER PLAN
the Employee of an adopted child, or the care of the Employee's child
immediately following the child's birth or placement. The Advisory Committee
credits Hours of Service under this paragraph on the basis of the number of
Hours of Service the Employee would receive if he were paid during the absence
period or, if the Advisory Committee cannot determine the number of Hours of
Service the Employee would receive, on the basis of 8 hours per day during the
absence period. The Advisory Committee will credit only the number (not
exceeding 501) of Hours of Service necessary to prevent an Employee's Break in
Service. The Advisory Committee credits all Hours of Service described in this
paragraph to the computation period in which the absence period begins or, if
the Employee does not need these Hours of Service to prevent a Break in Service
in the computation period in which his absence period begins, the Advisory
Committee credits these Hours of Service to the immediately following
computation period.
1.28 "Disability" means the Participant, because of a physical or
mental disability, will be unable to perform the duties of his customary
position of employment (or is unable to engage in any substantial gainful
activity) for an indefinite period which the Advisory Committee considers will
be of long continued duration. A Participant also is disabled if he incurs the
permanent loss or loss of use of a member or function of the body, or is
permanently disfigured, and incurs a Separation from Service. The Plan
considers a Participant disabled on the date the Advisory Committee determines
the Participant satisfies the definition of disability. The Advisory Committee
may require a Participant to submit to a physical examination in order to
confirm disability. The Advisory Committee will apply the provisions of this
Section 1.28 in a nondiscriminatory, consistent and uniform manner. If the
Employer's Plan is a Nonstandardized Plan, the Employer may provide an
alternate definition of disability in an addendum to its Adoption Agreement,
numbered Section 1.28.
1.29 SERVICE FOR PREDECESSOR EMPLOYER. If the Employer maintains the
plan of a predecessor employer, the Plan treats service of the Employee with
the predecessor employer as service with the Employer. If the Employer does not
maintain the plan of a predecessor employer, the Plan does not credit service
with the predecessor employer, unless the Employer identifies the predecessor
in its Adoption Agreement and specifies the purposes for which the Plan will
credit service with that predecessor employer.
1.30 RELATED EMPLOYERS. A related group is a controlled group of
corporations (as defined in Code Section 414(b)), trades or businesses
(whether or not incorporated) which are under common control (as defined in
Code Section 414(c)) or an affiliated service group (as defined in Code Section
414(m) or in Code Section 414(o)). If the Employer is a member of a related
group, the term "Employer" includes the related group members for purposes of
crediting Hours of Service, determining Years of Service and Breaks in Service
under Articles II and V, applying the Participation Test and the Coverage Test
under Section 3.06(E), applying the limitations on allocations in Part 2 of
Article III, applying the top heavy rules and the minimum allocation
requirements of Article III, the definitions of Employee, Highly Compensated
Employee, Compensation and Leased Employee, and for any other purpose required
by the applicable Code section or by a Plan provision. However, an Employer may
contribute to the Plan only by being a signatory to the Execution Page of the
Adoption Agreement or to a Participation Agreement to the Employer's Adoption
Agreement. If one or more of the Employer's related group members become
Participating Employers by executing a Participation Agreement to the
Employer's Adoption Agreement, the term "Employer" includes the participating
related group members for all purposes of the Plan, and "Plan Administrator"
means the Employer that is the signatory to the Execution Page of the Adoption
Agreement.
If the Employer's Plan is a Standardized Plan, all Employees of the
Employer or of any member of the Employer's related group, are eligible to
participate in the Plan, irrespective of whether the related group member
directly employing the Employee is a Participating Employer. If the Employer's
Plan is a Nonstandardized Plan, the Employer must specify in Section 1.07 of
its Adoption Agreement, whether the Employees of related group members that are
not Participating
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<PAGE> 13
DEFINED CONTRIBUTION MASTER PLAN
Employers are eligible to participate in the Plan. Under a Nonstandardized
Plan, the Employer may elect to exclude from the definition of "Compensation"
for allocation purposes any Compensation received from a related employer that
has not executed a Participation Agreement and whose Employees are not eligible
to participate in the Plan.
1.31 LEASED EMPLOYEES. The Plan treats a Leased Employee as an
Employee of the Employer. A Leased Employee is an individual (who otherwise is
not an Employee of the Employer) who, pursuant to a leasing agreement between
the Employer and any other person, has performed services for the Employer (or
for the Employer and any persons related to the Employer within the meaning of
Code Section 144(a)(3)) on a substantially full time basis for at least one
year and who performs services historically performed by employees in the
Employer's business field. If a Leased Employee is treated as an Employee by
reason of this Section 1.31 of the Plan, "Compensation" includes Compensation
from the leasing organization which is attributable to services performed for
the Employer.
(A) SAFE HARBOR PLAN EXCEPTION. The Plan does not treat a Leased Employee as
an Employee if the leasing organization covers the employee in a safe harbor
plan and, prior to application of this safe harbor plan exception, 20% or less
of the Employer's Employees (other than Highly Compensated Employees) are
Leased Employees. A safe harbor plan is a money purchase pension plan providing
immediate participation, full and immediate vesting, and a nonintegrated
contribution formula equal to at least 10% of the employee's compensation
without regard to employment by the leasing organization on a specified date.
The safe harbor plan must determine the 10% contribution on the basis of
compensation as defined in Code Section 415(c)(3) plus elective contributions
(as defined in Section 1.12).
(B) OTHER REQUIREMENTS. The Advisory Committee must apply this Section 131
in a manner consistent with Code Sections 414(n) and 414(o) and the regulations
issued under those Code sections. The Employer must specify in the Adoption
Agreement the manner in which the Plan will determine the allocation of
Employer contributions and Participant forfeitures on behalf of a Participant
if the Participant is a Leased Employee covered by a plan maintained by the
leasing organization.
1.32 SPECIAL RULES FOR OWNER-EMPLOYEES. The following special
provisions and restrictions apply to Owner-Employees:
(a) If the Plan provides contributions or benefits for an Owner-
Employee or for a group of Owner-Employees who controls the trade or
business with respect to which this Plan is established and the Owner-
Employee or Owner-Employees also control as Owner-Employees one or more
other trades or businesses, plans must exist or be established with
respect to all the controlled trades or businesses so that when the
plans are combined they form a single plan which satisfies the
requirements of Code Section 401(a) and Code Section 401(d) with respect
to the employees of the controlled trades or businesses.
(b) The Plan excludes an Owner-Employee or group of Owner-Employees
if the Owner-Employee or group of Owner-Employees controls any other
trade or business, unless the employees of the other controlled trade or
business participate in a plan which satisfies the requirements of Code
Section 401(a) and Code Section 401(d). The other qualified plan must
provide contributions and benefits which are not less favorable than the
contributions and benefits provided for the Owner-Employee or group of
Owner-Employees under this Plan, or if an Owner-Employee is covered
under another qualified plan as an Owner-Employee, then the plan
established with respect to the trade or business he does control must
provide contributions or benefits as favorable as those provided under
the most favorable plan of the trade or business he does not control. If
the exclusion of this paragraph (b) applies and the Employer's Plan is a
Standardized Plan, the Employer may not participate or continue to
participate in this Master Plan and the Employer's Plan becomes an
individually-designed plan for purposes of qualification reliance.
1.08
<PAGE> 14
DEFINED CONTRIBUTION MASTER PLAN
(c) For purposes of paragraphs (a) and (b) of this Section 1.32, an
Owner-Employee or group of Owner-Employees controls a trade or business
if the Owner-Employee or 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 50% of either the capital interest or the
profits interest in the partnership.
1.33 DETERMINATION OF TOP HEAVY STATUS. If this Plan is the only
qualified plan maintained by the Employer, the Plan is top heavy for a Plan
Year if the top heavy ratio as of the Determination Date exceeds 60%. The top
heavy ratio is a fraction, the numerator of which is the sum of the present
value of Accrued Benefits of all Key Employees as of the Determination Date and
the denominator of which is a similar sum determined for all Employees. The
Advisory Committee must include in the top heavy ratio, as part of the present
value of Accrued Benefits, any contribution not made as of the Determination
Date but includible under Code Section 416 and the applicable Treasury
regulations, and distributions made within the Determination Period. The
Advisory Committee must calculate the top heavy ratio by disregarding the
Accrued Benefit (and distributions, if any, of the Accrued Benefit) of any Non-
Key Employee who was formerly a Key Employee, and by disregarding the Accrued
Benefit (including distributions, if any, of the Accrued Benefit) of an
individual who has not received credit for at least one Hour of Service with
the Employer during the Determination Period. The Advisory Committee must
calculate the top heavy ratio, including the extent to which it must take into
account distributions, rollovers and transfers, in accordance with Code Section
416 and the regulations under that Code section.
If the Employer maintains other qualified plans (including a simplified
employee pension plan), or maintained another such plan which now is
terminated, this Plan is top heavy only if it is part of the Required
Aggregation Group, and the top heavy ratio for the Required Aggregation Group
and for the Permissive Aggregation Group, if any, each exceeds 60%. The
Advisory Committee will calculate the top heavy ratio in the same manner as
required by the first paragraph of this Section 1.33, taking into account all
plans within the Aggregation Group. To the extent the Advisory Committee must
take into account distributions to a Participant, the Advisory Committee must
include distributions from a terminated plan which would have been part of the
Required Aggregation Group if it were in existence on the Determination Date.
The Advisory Committee will 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, Code Section 416
and the regulations under that Code section. If a Participant in a defined
benefit plan is a Non-Key Employee, the Advisory Committee will determine his
accrued benefit under the accrual method, if any, which is applicable uniformly
to all defined benefit plans maintained by the Employer or, if there is no
uniform method, in accordance with the slowest accrual rate permitted under the
fractional rule accrual method described in Code Section 411(b)(1)(C). If the
Employer maintains a defined benefit plan, the Employer must specify in
Adoption Agreement Section 3.18 the actuarial assumptions (interest and
mortality only) the Advisory Committee will use to calculate the present value
of benefits from a defined benefit plan. If an aggregated plan does not have a
valuation date coinciding with the Determination Date, the Advisory Committee
must value the Accrued Benefits in the aggregated plan as of the most recent
valuation date falling within the twelve-month period ending on the
Determination Date, except as Code Section 416 and applicable Treasury
regulations require for the first and second plan year of a defined benefit
plan. The Advisory Committee will calculate the top heavy ratio with reference
to the Determination Dates that fall within the same calendar year.
(A) STANDARDIZED PLAN. If the Employer's Plan is a Standardized Plan, the
Plan operates as a deemed top heavy plan in all Plan Years, except, if the
Standardized Plan includes a Code Section 401(k) arrangement, the Employer may
elect to apply the top heavy requirements only in Plan Years for which the Plan
actually is top heavy. Under a deemed top heavy plan, the Advisory Committee
need not determine whether the Plan actually is top heavy. However, if the
Employer, in Adoption
1.09
<PAGE> 15
DEFINED CONTRIBUTION MASTER PLAN
Agreement Section 3.18, elects to over-ride the 100% limitation, the Advisory
Committee will need to determine whether a deemed top heavy Plan's top heavy
ratio for a Plan Year exceeds 90%.
(B) DEFINITIONS. For purposes of applying the provisions of this Section
1.33:
(1) "Key Employee" means, as of any Determination Date, any Employee
or former Employee (or Beneficiary of such Employee) who, for any Plan
Year in the Determination Period: (i) has Compensation in excess of 50%
of the dollar amount prescribed in Code Section 415(b)(1)(A) (relating
to defined benefit plans) and is an officer of the Employer; (ii) has
Compensation in excess of the dollar amount prescribed in Code Section
415(c)(1)(A) (relating to defined contribution plans) and is one of the
Employees owning the ten largest interests in the Employer; (iii) is a
more than 5% owner of the Employer; or (iv) is a more than 1% owner of
the Employer and has Compensation of more than $150,000. The
constructive ownership rules of Code Section 318 (or the principles of
that section, in the case of an unincorporated Employer,) will apply to
determine ownership in the Employer. The number of officers taken into
account under clause (i) will not exceed the greater of 3 or 10% of the
total number (after application of the Code Section 414(q) exclusions)
of Employees, but no more than 50 officers. The Advisory Committee will
make the determination of who is a Key Employee in accordance with Code
Section 416(i)(1) and the regulations under that Code section.
(2) "Non-Key Employee" is an employee who does not meet the
definition of Key Employee.
(3) "Compensation" means Compensation as determined under Section
1.09 for purposes of identifying Highly Compensated Employees.
(4) "Required Aggregation Group" means: (i) each qualified plan of
the Employer in which at least one Key Employee participates at any time
during the Determination Period; and (ii) any other qualified plan of
the Employer which enables a plan described in clause (i) to meet the
requirements of Code Section 401(a)(4) or of Code Section 410.
(5) "Permissive Aggregation Group" is the Required Aggregation Group
plus any other qualified plans maintained by the Employer, but only if
such group would satisfy in the aggregate the requirements of Code
Section 401(a)(4) and of Code Section 410. The Advisory Committee will
determine the Permissive Aggregation Group.
(6) "Employer" means the Employer that adopts this Plan and any
related employers described in Section 1.30.
(7) "Determination Date" for any Plan Year is the Accounting Date of
the preceding Plan Year or, in the case of the first Plan Year of the
Plan, the Accounting Date of that Plan Year. The "Determination Period"
is the 5 year period ending on the Determination Date.
1.34 "Paired Plans" means the Employer has adopted two Standardized
Plan Adoption Agreements offered with this Master Plan, one Adoption Agreement
being a Paired Profit Sharing Plan and one Adoption Agreement being a Paired
Pension Plan. A Paired Profit Sharing Plan may include a Code Section 401(k)
arrangement. A Paired Pension Plan must be a money purchase pension plan or a
target benefit pension plan. Paired Plans must be the subject of a favorable
opinion letter issued by the National Office of the Internal Revenue Service.
This Master Plan does not pair any of its Standardized Plan Adoption Agreements
with Standardized Plan Adoption Agreements under a defined benefit master plan.
* * * * * * * * * *
1.10
<PAGE> 16
DEFINED CONTRIBUTION MASTER PLAN
ARTICLE II
EMPLOYEE PARTICIPANTS
2.01 ELIGIBILITY. Each Employee becomes a Participant in the Plan in
accordance with the participation option selected by the Employer in its
Adoption Agreement. If this Plan is a restated Plan, each Employee who was a
Participant in the Plan on the day before the Effective Date continues as a
Participant in the Plan, irrespective of whether he satisfies the participation
conditions in the restated Plan, unless otherwise provided in the Employer's
Adoption Agreement.
2.02 YEAR OF SERVICE - PARTICIPATION. For purposes of an Employee's
participation in the Plan under Adoption Agreement Section 2.01, the Plan takes
into account all of his Years of Service with the Employer, except as provided
in Section 2.03. "Year of Service" means an eligibility computation period
during which the Employee completes not less than the number of Hours of
Service specified in the Employer's Adoption Agreement. The initial eligibility
computation period is the first 12 consecutive month period measured from the
Employment Commencement Date. The Plan measures succeeding eligibility
computation periods in accordance with the option selected by the Employer in
its Adoption Agreement. If the Employer elects to measure subsequent periods on
a Plan Year basis, an Employee who receives credit for the required number of
Hours of Service during the initial eligibility computation period and during
the first applicable Plan Year will receive credit for two Years of Service
under Article II. "Employment Commencement Date" means the date on which the
Employee first performs an Hour of Service for the Employer. If the Employer
elects a service condition under Adoption Agreement Section 2.01 based on
months, the Plan does not apply any Hour of Service requirement after the
completion of the first Hour of Service.
2.03 BREAK IN SERVICE - PARTICIPATION. An Employee incurs a "Break in
Service" if during any 12 consecutive month period he does not complete more
than 500 Hours of Service with the Employer. The "12 consecutive month period"
under this Section 2.03 is the same 12 consecutive month period for which the
Plan measures "Years of Service" under Section 2.02.
(A) 2-YEAR ELIGIBILITY. If the Employer elects a 2 years of service
condition for eligibility purposes under Adoption Agreement Section 2.01, the
Plan treats an Employee who incurs a one year Break in Service and who has
never become a Participant as a new Employee on the date he first performs an
Hour of Service for the Employer after the Break in Service.
(B) SUSPENSION OF YEARS OF SERVICE. The Employer must elect in its Adoption
Agreement whether a Participant will incur a suspension of Years of Service
after incurring a one year Break in Service. If this rule applies under the
Employer's Plan, the Plan disregards a Participant's Years of Service (as
defined in Section 2.02) earned prior to a Break in Service until the
Participant completes another Year of Service and the Plan suspends the
Participant's participation in the Plan. If the Participant completes a Year of
Service following his Break in Service, the Plan restores that Participant's
pre-Break Years of Service (and the Participant resumes active participation in
the Plan) retroactively to the first day of the computation period in which the
Participant earns the first post-Break Year of Service. The initial computation
period under this Section 2.03(B) is the 12 consecutive month period measured
from the date the Participant first receives credit for an Hour of Service
following the one year Break in Service period. The Plan measures any
subsequent periods, if necessary, in a manner consistent with the computation
period selection in Adoption Agreement Section 2.02. This Section 2.03(B) does
not affect a Participant's vesting credit under Article V and, during a
suspension period, the Participant's Account continues to share fully in Trust
Fund allocations under Section 9.11. Furthermore, this Section 2.03(B) will not
result in the restoration of any Year of Service disregarded under the Break in
Service rule of Section 2.03(A).
2.04 PARTICIPATION UPON RE-EMPLOYMENT. A Participant whose employment
with the Employer terminates will re-enter the Plan as a Participant on the
date of his re-employment, subject to the Break in Service rule, if applicable,
under Section 2.03(B). An Employee who satisfies the Plan's eligibility
conditions but who terminates employment with the
2.01
<PAGE> 17
DEFINED CONTRIBUTION MASTER PLAN
Employer prior to becoming a Participant will become a Participant on the later
of the Plan Entry Date on which he would have entered the Plan had he not
terminated employment or the date of his reemployment, subject to the Break in
Service rule, if applicable, under Section 2.03(B). Any Employee who terminates
employment prior to satisfying the Plan's eligibility conditions becomes a
Participant in accordance with Adoption Agreement Section 2.01.
2.05 CHANGE IN EMPLOYEE STATUS. If a Participant has not incurred a
Separation from Service but ceases to be eligible to participate in the Plan,
by reason of employment within an employment classification excluded by the
Employer under Adoption Agreement Section 1.07, the Advisory Committee must
treat the Participant as an Excluded Employee during the period such a
Participant is subject to the Adoption Agreement exclusion. The Advisory
Committee determines a Participant's sharing in the allocation of Employer
contributions and Participant forfeitures, if applicable, by disregarding his
Compensation paid by the Employer for services rendered in his capacity as an
Excluded Employee. However, during such period of exclusion, the Participant,
without regard to employment classification, continues to receive credit for
vesting under Article V for each included Year of Service and the Participant's
Account continues to share fully in Trust Fund allocations under Section 9.11.
If an Excluded Employee who is not a Participant becomes eligible to
participate in the Plan by reason of a change in employment classification, he
will participate in the Plan immediately if he has satisfied the eligibility
conditions of Section 2.01 and would have been a Participant had he not been an
Excluded Employee during his period of Service. Furthermore, the Plan takes
into account all of the Participant's included Years of Service with the
Employer as an Excluded Employee for purposes of vesting credit under Article V.
2.06 ELECTION NOT TO PARTICIPATE. If the Employer's Plan is a
Standardized Plan, the Plan does not permit an otherwise eligible Employee nor
any Participant to elect not to participate in the Plan. If the Employer's Plan
is a Nonstandardized Plan, the Employer must specify in its Adoption Agreement
whether an Employee eligible to participate, or any present Participant, may
elect not to participate in the Plan. For an election to be effective for a
particular Plan Year, the Employee or Participant must file the election in
writing with the Plan Administrator not later than the time specified in the
Employer's Adoption Agreement. The Employer may not make a contribution under
the Plan for the Employee or for the Participant for the Plan Year for which
the election is effective, nor for any succeeding Plan Year, unless the
Employee or Participant re-elects to participate in the Plan. After an
Employee's or Participant's election not to participate has been effective for
at least the minimum period prescribed by the Employer's Adoption Agreement,
the Employee or Participant may re-elect to participate in the Plan for any
Plan Year and subsequent Plan Years. An Employee or Participant may re-elect to
participate in the Plan by filing his election in writing with the Plan
Administrator not later than the time specified in the Employer's Adoption
Agreement. An Employee or Participant who re-elects to participate may again
elect not to participate only as permitted in the Employer's Adoption
Agreement. If an Employee is a Self-Employed Individual, the Employee's
election (except as permitted by Treasury regulations without creating a Code
401(k) arrangement with respect to that Self-Employed Individual) must be
effective no later than the date the Employee first would become a Participant
in the Plan and the election is irrevocable. The Plan Administrator must
furnish an Employee or a Participant any form required for purposes of an
election under this Section 2.06. An election timely filed is effective for the
entire Plan Year.
A Participant who elects not to participate may not receive a
distribution of his Accrued Benefit attributable either to Employer or to
Participant contributions except as provided under Article IV or under Article
VI. However, for each Plan Year for which a Participant's election not to
participate is effective, the Participant's Account, if any, continues to share
in Trust Fund allocations under Article IX. Furthermore, the Employee or the
Participant receives vesting credit under Article V for each included Year of
Service during the period the election not to participate is effective.
* * * * *
2.02
<PAGE> 18
DEFINED CONTRIBUTION MASTER PLAN
ARTICLE III
EMPLOYER CONTRIBUTIONS AND FORFEITURES
PART 1. AMOUNT OF EMPLOYER CONTRIBUTIONS AND PLAN ALLOCATIONS: SECTIONS 3.01
THROUGH 3.06
3.01 AMOUNT. For each Plan Year, the Employer contributes to the Trust
the amount determined by application of the contribution option selected by the
Employer in its Adoption Agreement. The Employer may not make a contribution to
the Trust for any Plan Year to the extent the contribution would exceed the
Participants' Maximum Permissible Amounts.
The Employer contributes to this Plan on the condition its contribution
is not due to a mistake of fact and the Revenue Service will not disallow the
deduction for its contribution. The Trustee, upon written request from the
Employer, must return to the Employer the amount of the Employer's contribution
made by the Employer by mistake of fact or the amount of the Employer's
contribution disallowed as a deduction under Code Section 404. The Trustee will
not return any portion of the Employer's contribution under the provisions of
this paragraph more than one year after:
(a) The Employer made the contribution by mistake of fact; or
(b) The disallowance of the contribution as a deduction, and then,
only to the extent of the disallowance.
The Trustee will not increase the amount of the Employer contribution
returnable under this Section 3.01 for any earnings attributable to the
contribution, but the Trustee will decrease the Employer contribution
returnable for any losses attributable to it. The Trustee may require the
Employer to furnish it whatever evidence the Trustee deems necessary to enable
the Trustee to confirm the amount the Employer has requested be returned is
properly returnable under ERISA.
3.02 DETERMINATION OF CONTRIBUTION. The Employer, from its records,
determines the amount of any contributions to be made by it to the Trust under
the terms of the Plan.
3.03 TIME OF PAYMENT OF CONTRIBUTION. The Employer may pay its
contribution for each Plan Year in one or more installments without interest.
The Employer must make its contribution to the Plan within the time prescribed
by the Code or applicable Treasury regulations. Subject to the consent of the
Trustee, the Employer may make its contribution in property rather than in
cash, provided the contribution of property is not a prohibited transaction
under the Code or under ERISA.
3.04 CONTRIBUTION ALLOCATION.
(A) METHOD OF ALLOCATION. The Employer must specify in its Adoption
Agreement the manner of allocating each annual Employer contribution to this
Trust.
(B) TOP HEAVY MINIMUM ALLOCATION. The Plan must comply with the provisions
of this Section 3.04(B), subject to the elections in the Employer's Adoption
Agreement.
(1) TOP HEAVY MINIMUM ALLOCATION UNDER STANDARDIZED PLAN. Subject
to the Employer's election under Section 3.04(B)(3), the top heavy minimum
allocation requirement applies to a Standardized Plan for each Plan Year,
irrespective of whether the Plan is top heavy.
(a) Each Participant employed by the Employer on the last day
of the Plan Year will receive a top heavy minimum allocation for
that Plan Year. The Employer may elect in Section 3.04 of its
Adoption Agreement to apply this paragraph (a) only to a
Participant who is a Non-Key Employee.
3.01
<PAGE> 19
DEFINED CONTRIBUTION MASTER PLAN
(b) Subject to any overriding elections in Section 3.18 of the
Employer's Adoption Agreement, the top heavy minimum allocation
is the lesser of 3% of the Participant's Compensation for the
Plan Year or the highest contribution rate for the Plan Year made
on behalf of any Participant for the Plan Year. However, if the
Employee participates in Paired Plans, the top heavy minimum
allocation is 3% of his Compensation. If, under Adoption
Agreement Section 3.04, the Employer elects to apply paragraph
(a) only to a Participant who is a Non-Key Employee, the Advisory
Committee will determine the "highest contribution rate"
described in the first sentence of this paragraph (b) by
reference only to the contribution rates of Participants who are
Key Employees for the Plan Year.
(2) TOP HEAVY MINIMUM ALLOCATION UNDER NONSTANDARDIZED PLAN. The top
heavy minimum allocation requirement applies to a Nonstandardized Plan only in
Plan Years for which the Plan is top heavy. Except as provided in the
Employer's Adoption Agreement, if the Plan is top heavy in any Plan Year:
(a) Each Non-Key Employee who is a Participant and is employed
by the Employer on the last day of the Plan Year will receive a
top heavy minimum allocation for that Plan Year, irrespective of
whether he satisfies the Hours of Service condition under Section
3.06 of the Employer's Adoption Agreement; and
(b) The top heavy minimum allocation is the lesser of 3% of
the Non-Key Employee's Compensation for the Plan Year or the
highest contribution rate for the Plan Year made on behalf of any
Key Employee. However, if a defined benefit plan maintained by
the Employer which benefits a Key Employee depends on this Plan
to satisfy the antidiscrimination rules of Code Section 401(a)(4)
or the coverage rules of Code Section 410 (or another plan
benefiting the Key Employee so depends on such defined benefit
plan), the top heavy minimum allocation is 3% of the Non-Key
Employee's Compensation regardless of the contribution rate for
the Key Employees.
(3) SPECIAL ELECTION FOR STANDARDIZED CODE SECTION 401(k) PLAN. If
the Employer's Plan is a Standardized Code Section 401(k) Plan, the Employer
may elect in Adoption Agreement Section 3.04 to apply the top heavy minimum
allocation requirements of Section 3.04(B)(1) only for Plan Years in which the
Plan actually is a top heavy plan.
(4) SPECIAL DEFINITIONS. For purposes of this Section 3.04(B), the
term "Participant" includes any Employee otherwise eligible to participate in
the Plan but who is not a Participant because of his Compensation level or
because of his failure to make elective deferrals under a Code Section 401(k)
arrangement or because of his failure to make mandatory contributions. For
purposes of subparagraph (1)(b) or (2)(b), "Compensation" means Compensation as
defined in Section 1.12, except Compensation does not include elective
contributions, irrespective of whether the Employer has elected to include
these amounts in Section 1.12 of its Adoption Agreement, any exclusion selected
in Section 1.12 of the Adoption Agreement (other than the exclusion of elective
contributions) does not apply, and any modification to the definition of
Compensation in Section 3.06 does not apply.
(5) DETERMINING CONTRIBUTION RATES. For purposes of this Section
3.04(B), a Participant's contribution rate is the sum of all Employer
contributions (not including Employer contributions to Social Security) and
forfeitures allocated to the Participant's Account for the Plan Year divided by
his Compensation for the entire Plan Year. However, for purposes of satisfying
a Participant's top heavy minimum allocation in Plan Years beginning after
December 31, 1988, the Participant's contribution rate does not include any
elective contributions under a Code Section 401(k) arrangement nor any Employer
matching contributions allocated on the basis of those elective contributions
or on
3.02
<PAGE> 20
DEFINED CONTRIBUTION MASTER PLAN
the basis of employee contributions, except a Nonstandardized Plan may include
in the contribution rate any matching contributions not necessary to satisfy
the nondiscrimination requirements of Code Section 401(k) or of Code Section
401(m).
If the Employee is a Participant in Paired Plans, the Advisory Committee
will consider the Paired Plans as a single Plan to determine a Participant's
contribution rate and to determine whether the Plans satisfy this top heavy
minimum allocation requirement. To determine a Participant's contribution rate
under a Nonstandardized Plan, the Advisory Committee must treat all qualified
top heavy defined contribution plans maintained by the Employer (or by any
related Employers described in Section 1.30) as a single plan.
(6) NO ALLOCATIONS. If, for a Plan Year, there are no allocations of
Employer contributions or forfeitures for any Participant (for purposes of
Section 3.04 (B)(1)(b)) or for any Key Employee (for purposes of Section
3.04(B)(2)(b)), the Plan does not require any top heavy minimum allocation for
the Plan Year, unless a top heavy minimum allocation applies because of the
maintenance by the Employer of more than one plan.
(7) ELECTION OF METHOD. The Employer must specify in its Adoption
Agreement the manner in which the Plan will satisfy the top heavy minimum
allocation requirement.
(a) If the Employer elects to make any necessary additional
contribution to this Plan, the Advisory Committee first will allocate
the Employer contributions (and Participant forfeitures, if any) for the
Plan Year in accordance with the provisions of Adoption Agreement
Section 3.04. The Employer then will contribute an additional amount for
the Account of any Participant entitled under this Section 3.04(B) to a
top heavy minimum allocation and whose contribution rate for the Plan
Year, under this Plan and any other plan aggregated under paragraph (5),
is less than the top heavy minimum allocation. The additional amount is
the amount necessary to increase the Participant's contribution rate to
the top heavy minimum allocation. The Advisory Committee will allocate
the additional contribution to the Account of the Participant on whose
behalf the Employer makes the contribution.
(b) If the Employer elects to guarantee the top heavy minimum
allocation under another plan, this Plan does not provide the top heavy
minimum allocation and the Advisory Committee will allocate the annual
Employer contributions (and Participant forfeitures) under the Plan
solely in accordance with the allocation method selected under Adoption
Agreement Section 3.04.
3.05 FORFEITURE ALLOCATION. The amount of a Participant's Accrued
Benefit forfeited under the Plan is a Participant forfeiture. The Advisory
Committee will allocate Participant forfeitures in the manner specified by the
Employer in its Adoption Agreement. The Advisory Committee will continue to
hold the undistributed, non-vested portion of a terminated Participant's
Accrued Benefit in his Account solely for his benefit until a forfeiture occurs
at the time specified in Section 5.09 or if applicable, until the time
specified in Section 9.14. Except as provided under Section 5.04, a Participant
will not share in the allocation of a forfeiture of any portion of his Accrued
Benefit.
3.06 ACCRUAL OF BENEFIT. The Advisory Committee will determine the
accrual of benefit (Employer contributions and Participant forfeitures) on the
basis of the Plan Year in accordance with the Employer's elections in its
Adoption Agreement.
(A) COMPENSATION TAKEN INTO ACCOUNT. The Employer must specify in its
Adoption Agreement the Compensation the Advisory Committee is to take into
account in allocating an Employer contribution to a Participant's Account for
the Plan Year in which the Employee first becomes a Participant. For all other
Plan Years, the Advisory Committee will take into account only the
3.03
<PAGE> 21
DEFINED CONTRIBUTION MASTER PLAN
Compensation determined for the portion of the Plan Year in which the Employee
actually is a Participant. The Advisory Committee must take into account the
Employee's entire Compensation for the Plan Year to determine whether the Plan
satisfies the top heavy minimum allocation requirement of Section 3.04(B). The
Employer, in an addendum to its Adoption Agreement numbered 3.06(A), may elect
to measure Compensation for the Plan Year for allocation purposes on the basis
of a specified period other than the Plan Year.
(B) HOURS OF SERVICE REQUIREMENT. Subject to the applicable minimum
allocation requirement of Section 3.04, the Advisory Committee will not
allocate any portion of an Employer contribution for a Plan Year to any
Participant's Account if the Participant does not complete the applicable
minimum Hours of Service requirement specified in the Employer's Adoption
Agreement.
(C) EMPLOYMENT REQUIREMENT. If the Employer's Plan is a Standardized Plan, a
Participant who, during a particular Plan Year, completes the accrual
requirements of Adoption Agreement Section 3.06 will share in the allocation of
Employer contributions for that Plan Year without regard to whether he is
employed by the Employer on the Accounting Date of that Plan Year. If the
Employer's Plan is a Nonstandardized Plan, the Employer must specify in its
Adoption Agreement whether the Participant will accrue a benefit if he is not
employed by the Employer on the Accounting Date of the Plan Year. If the
Employer's Plan is a money purchase plan or a target benefit plan, whether
Nonstandardized or Standardized, the Plan conditions benefit accrual on
employment with the Employer on the last day of the Plan Year for the Plan Year
in which the Employer terminates the Plan.
(D) OTHER REQUIREMENTS. If the Employer's Adoption Agreement includes
options for other requirements affecting the Participant's accrual of benefits
under the Plan, the Advisory Committee will apply this Section 3.06 in
accordance with the Employer's Adoption Agreement selections.
(E) SUSPENSION OF ACCRUAL REQUIREMENTS UNDER NONSTANDARDIZED PLAN. If the
Employer's Plan is a Nonstandardized Plan, the Employer may elect in its
Adoption Agreement to suspend the accrual requirements elected under Adoption
Agreement Section 3.06 if, for any Plan Year beginning after December 31, 1989,
the Plan fails to satisfy the Participation Test or the Coverage Test. A Plan
satisfies the Participation Test if, on each day of the Plan Year, the number
of Employees who benefit under the Plan is at least equal to the lesser of 50
or 40% of the total number of Includible Employees as of such day. A Plan
satisfies the Coverage Test if, on the last day of each quarter of the Plan
Year, the number of Nonhighly Compensated Employees who benefit under the Plan
is at least equal to 70% of the total number of Includible Nonhighly
Compensated Employees as of such day. "Includible" Employees are all Employees
other than: (1) those Employees excluded from participating in the Plan for the
entire Plan Year by reason of the collective bargaining unit exclusion or the
nonresident alien exclusion under Adoption Agreement Section 1.07 or by reason
of the participation requirements of Sections 2.01 and 2.03; and (2) any
Employee who incurs a Separation from Service during the Plan Year and fails to
complete at least 501 Hours of Service for the Plan Year. A "Nonhighly
Compensated Employee" is an Employee who is not a Highly Compensated Employee
and who is not a family member aggregated with a Highly Compensated Employee
pursuant to Section 1.09 of the Plan.
For purposes of the Participation Test and the Coverage Test, an
Employee is benefiting under the Plan on a particular date if, under Adoption
Agreement Section 3.04, he is entitled to an allocation for the Plan Year.
Under the Participation Test, when determining whether an Employee is entitled
to an allocation under Adoption Agreement Section 3.04, the Advisory Committee
will disregard any allocation required solely by reason of the top heavy
minimum allocation, unless the top heavy minimum allocation is the only
allocation made under the Plan for the Plan Year.
3.04
<PAGE> 22
DEFINED CONTRIBUTION MASTER PLAN
If this Section 3.06(E) applies for a Plan Year, the Advisory Committee
will suspend the accrual requirements for the Includible Employees who are
Participants, beginning first with the Includible Employee(s) employed with the
Employer on the last day of the Plan Year, then the Includible Employee(s) who
have the latest Separation from Service during the Plan Year, and continuing to
suspend in descending order the accrual requirements for each Includible
Employee who incurred an earlier Separation from Service, from the latest to
the earliest Separation from Service date, until the Plan satisfies both the
Participation Test and the Coverage Test for the Plan Year. If two or more
Includible Employees have a Separation from Service on the same day, the
Advisory Committee will suspend the accrual requirements for all such
Includible Employees, irrespective of whether the Plan can satisfy the
Participation Test and the Coverage Test by accruing benefits for fewer than
all such Includible Employees. If the Plan suspends the accrual requirements
for an Includible Employee, that Employee will share in the allocation of
Employer contributions and Participant forfeitures, if any, without regard to
the number of Hours of Service he has earned for the Plan Year and without
regard to whether he is employed by the Employer on the last day of the Plan
Year. If the Employer's Plan includes Employer matching contributions subject
to Code Section 401(m), this suspension of accrual requirements applies
separately to the Code Section 401 (m) portion of the Plan, and the Advisory
Committee will treat an Employee as benefiting under that portion of the Plan
if he is an Eligible Employee for purposes of the Code Section 401(m)
nondiscrimination test. The Employer may modify the operation of this Section
3.06(E) by electing appropriate modifications in Section 3.06 of its Adoption
Agreement.
PART 2. LIMITATIONS ON ALLOCATIONS: SECTIONS 3.07 THROUGH 3.19
[Note: Sections 3.07 through 3.10 apply only to Participants in this
Plan who do not participate, and who have never participated, in another
qualified plan or in a welfare benefit fund (as defined in Code Section 419(e))
maintained by the Employer.]
3.07 The amount of Annual Additions which the Advisory Committee may
allocate under this Plan on a Participant's behalf for a Limitation Year may
not exceed the Maximum Permissible Amount. If the amount the Employer otherwise
would contribute to the Participant's Account would cause the Annual Additions
for the Limitation Year to exceed the Maximum Permissible Amount, the Employer
will reduce the amount of its contribution so the Annual Additions for the
Limitation Year will equal the Maximum Permissible Amount. If an allocation of
Employer contributions, pursuant to Section 3.04, would result in an Excess
Amount (other than an Excess Amount resulting from the circumstances described
in Section 3.10) to the Participant's Account, the Advisory Committee will
reallocate the Excess Amount to the remaining Participants who are eligible for
an allocation of Employer contributions for the Plan Year in which the
Limitation Year ends. The Advisory Committee will make this reallocation on the
basis of the allocation method under the Plan as if the Participant whose
Account otherwise would receive the Excess Amount is not eligible for an
allocation of Employer contributions.
3.08 Prior to the determination of the Participant's actual
Compensation for a Limitation Year, the Advisory Committee may determine the
Maximum Permissible Amount on the basis of the Participant's estimated annual
Compensation for such Limitation Year, The Advisory Committee must make this
determination on a reasonable and uniform basis for all Participants similarly
situated. The Advisory Committee must reduce any Employer contributions
(including any allocation of forfeitures) based on estimated annual
Compensation by any Excess Amounts carried over from prior years.
3.09 As soon as is administratively feasible after the end of the
Limitation Year, the Advisory Committee will determine the Maximum Permissible
Amount for such Limitation Year on the basis of the Participant's actual
Compensation for such Limitation Year.
3.05
<PAGE> 23
DEFINED CONTRIBUTION MASTER PLAN
3.10 If, pursuant to Section 3.09, or because of the allocation of
forfeitures, there is an Excess Amount with respect to a Participant for a
Limitation Year, the Advisory Committee will dispose of such Excess Amount as
follows:
(a) The Advisory Committee will return any nondeductible voluntary
Employee contributions to the Participant to the extent the return would
reduce the Excess Amount.
(b) If, after the application of paragraph (a), an Excess Amount
still exists, and the Plan covers the Participant at the end of the
Limitation Year, then the Advisory Committee will use the Excess
Amount(s) to reduce future Employer contributions (including any
allocation of forfeitures) under the Plan for the next Limitation Year
and for each succeeding Limitation Year, as is necessary, for the
Participant. If the Employer's Plan is a profit sharing plan, the
Participant may elect to limit his Compensation for allocation purposes
to the extent necessary to reduce his allocation for the Limitation Year
to the Maximum Permissible Amount and eliminate the Excess Amount.
(c) If, after the application of paragraph (a), an Excess Amount
still exists, and the Plan does not cover the Participant at the end of
the Limitation Year, then the Advisory Committee will hold the Excess
Amount unallocated in a suspense account. The Advisory Committee will
apply the suspense account to reduce Employer Contributions (including
allocation of forfeitures) for all remaining Participants in the next
Limitation Year, and in each succeeding Limitation Year if necessary.
Neither the Employer nor any Employee may contribute to the Plan for any
Limitation Year in which the Plan is unable to allocate fully a suspense
account maintained pursuant to this paragraph (c).
(d) The Advisory Committee will not distribute any Excess Amount(s)
to Participants or to former Participants.
[Note: Sections 3.11 through 3.16 apply only to Participants who, in
addition to this Plan, participate in one or more plans (including Paired
Plans), all of which are qualified Master or Prototype defined contribution
plans or welfare benefit funds (as defined in Code Section 419(e)) maintained
by the Employer during the Limitation Year.]
3.11 The amount of Annual Additions which the Advisory Committee may
allocate under this Plan on a Participant's behalf for a Limitation Year may
not exceed the Maximum Permissible Amount, reduced by the sum of any Annual
Additions allocated to the Participant's Accounts for the same Limitation Year
under this Plan and such other defined contribution plan. If the amount the
Employer otherwise would contribute to the Participant's Account under this
Plan would cause the Annual Additions for the Limitation Year to exceed this
limitation, the Employer will reduce the amount of its contribution so the
Annual Additions under all such plans for the Limitation Year will equal the
Maximum Permissible Amount. If an allocation of Employer contributions,
pursuant to Section 3.04, would result in an Excess Amount (other than an
Excess Amount resulting from the circumstances described in Section 3.10) to
the Participant's Account, the Advisory Committee will reallocate the Excess
Amount to the remaining Participants who are eligible for an allocation of
Employer contributions for the Plan Year in which the Limitation Year ends. The
Advisory Committee will make this reallocation on the basis of the allocation
method under the Plan as if the Participant whose Account otherwise would
receive the Excess Amount is not eligible for an allocation of Employer
contributions.
3.12 Prior to the determination of the Participant's actual
Compensation for the Limitation Year, the Advisory Committee may determine the
amounts referred to in 3.11 above on the basis of the Participant's estimated
annual Compensation for such Limitation Year. The Advisory Committee will make
this determination on a reasonable and uniform basis for all Participants
similarly
3.06
<PAGE> 24
DEFINED CONTRIBUTION MASTER PLAN
situated. The Advisory Committee must reduce any Employer contribution
(including allocation of forfeitures) based on estimated annual Compensation by
any Excess Amounts carried over from prior years.
3.13 As soon as is administratively feasible after the end of the
Limitation Year, the Advisory Committee will determine the amounts referred to
in 3.11 on the basis of the Participant's actual Compensation for such
Limitation Year.
3.14 If pursuant to Section 3.13, or because of the allocation of
forfeitures, a Participant's Annual Additions under this Plan and all such
other plans result in an Excess Amount, such Excess Amount will consist of the
Amounts last allocated. The Advisory Committee will determine the Amounts last
allocated by treating the Annual Additions attributable to a welfare benefit
fund as allocated first, irrespective of the actual allocation date under the
welfare benefit fund.
3.15 The Employer must specify in its Adoption Agreement the Excess
Amount attributed to this Plan, if the Advisory Committee allocates an Excess
Amount to a Participant on an allocation date of this Plan which coincides with
an allocation date of another plan.
3.16 The Advisory Committee will dispose of any Excess Amounts
attributed to this Plan as provided in Section 3.10.
[Note: Section 3.17 applies only to Participants who, in addition to
this Plan, participate in one or more qualified plans which are qualified
defined contribution plans other than a Master or Prototype plan maintained by
the Employer during the Limitation Year.]
3.17 SPECIAL ALLOCATION LIMITATION. The amount of Annual Additions
which the Advisory Committee may allocate under this Plan on behalf of any
Participant are limited in accordance with the provisions of Section 3.11
through 3.16, as though the other plan were a Master or Prototype plan, unless
the Employer provides other limitations in an addendum to the Adoption
Agreement, numbered Section 3.17.
3.18 DEFINED BENEFIT PLAN LIMITATION. If the Employer maintains a
defined benefit plan, or has ever maintained a defined benefit plan which the
Employer has terminated, then the sum of the defined benefit plan fraction and
the defined contribution plan fraction for any Participant for any Limitation
Year must not exceed 1.0. The Employer must provide in Adoption Agreement
Section 3.18 the manner in which the Plan will satisfy this limitation. The
Employer also must provide in its Adoption Agreement Section 3.18 the manner in
which the Plan will satisfy the top heavy requirements of Code Section 416
after taking into account the existence (or prior maintenance) of the defined
benefit plan.
3.19 DEFINITIONS - ARTICLE III. For purposes of Article III, the
following terms mean:
(a) "Annual Addition" - The sum of the following amounts allocated on
behalf of a Participant for a Limitation Year, of (i) all Employer
contributions; (ii) all forfeitures; and (iii) all Employee
contributions. Except to the extent provided in Treasury regulations,
Annual Additions include excess contributions described in Code Section
401(k), excess aggregate contributions described in Code Section 401(m)
and excess deferrals described in Code Section 402(g), irrespective of
whether the plan distributes or forfeits such excess amounts. Annual
Additions also include Excess Amounts reapplied to reduce Employer
contributions under Section 3.10. Amounts allocated after March 31,
1984, to an individual medical account (as defined in Code Section
415(1)(2)) included as part of a defined benefit plan maintained by the
Employer are Annual
3.07
<PAGE> 25
DEFINED CONTRIBUTION MASTER PLAN
Additions. Furthermore, Annual Additions include contributions paid or
accrued after December 31, 1985, for taxable years ending after December
31, 1985, attributable to post-retirement medical benefits allocated to
the separate account of a key employee (as defined in Code Section
419A(d)(3)) under a welfare benefit fund (as defined in Code Section
419(e)) maintained by the Employer.
(b) "Compensation" - For purposes of applying the limitations of Part
2 of this Article III, "Compensation" means Compensation as defined in
Section 1.12, except Compensation does not include elective
contributions, irrespective of whether the Employer has elected to
include these amounts as Compensation under Section 1.12 of its Adoption
Agreement, and any exclusion selected in Section 1.12 of the Adoption
Agreement (other than the exclusion of elective contributions) does not
apply.
(c) "Employer" - The Employer that adopts this Plan and any related
employers described in Section 1.30. Solely for purposes of applying the
limitations of Part 2 of this Article III, the Advisory Committee will
determine related employers described in Section 1.30 by modifying Code
Sections 414(b) and (c) in accordance with Code Section 415(h).
(d) "Excess Amount" - The excess of the Participant's Annual
Additions for the Limitation Year over the Maximum Permissible Amount.
(e) "Limitation Year" - The period selected by the Employer under
Adoption Agreement Section 1.17. All qualified plans of the Employer must
use the same Limitation Year. If the Employer amends the Limitation Year
to a different 12 consecutive month period, the new Limitation Year must
begin on a date within the Limitation Year for which the Employer makes
the amendment, creating a short Limitation Year.
(f) "Master or Prototype Plan" - A plan the form of which is the
subject of a favorable notification letter or a favorable opinion letter
from the Internal Revenue Service.
(g) "Maximum Permissible Amount" - The lesser of (i) $30,000 (or, if
greater, one-fourth of the defined benefit dollar limitation under Code
Section 415(b)(1)(A)), or (ii) 25% of the Participant's Compensation for
the Limitation Year. If there is a short Limitation Year because of a
change in Limitation Year, the Advisory Committee will multiply the
$30,000 (or adjusted) limitation by the following fraction:
Number of months in the short Limitation Year
12
(h) "Defined contribution plan" - A retirement plan which provides
for an individual account for each participant and for benefits based
solely on the amount contributed to the participant's account, and any
income, expenses, gains and losses, and any forfeitures of accounts of
other participants which the plan may allocate to such participant's
account. The Advisory Committee must treat all defined contribution
plans (whether or not terminated) maintained by the Employer as a single
plan. Solely for purposes of the limitations of Part 2 of this Article
III, the Advisory Committee will treat employee contributions made to a
defined benefit plan maintained by the Employer as a separate defined
contribution plan. The Advisory Committee also will treat as a defined
contribution plan an individual medical account (as defined in Code
Section 415(1)(2)) included as part of a defined benefit plan maintained
by the Employer and, for taxable years ending after December 31, 1985, a
welfare benefit fund under Code Section 419(e) maintained by the
Employer to the extent there are post-retirement medical benefits
allocated to the separate account of a key employee (as defined in Code
Section 419A(d)(3)).
3.08
<PAGE> 26
DEFINED CONTRIBUTION MASTER PLAN
(i) "Defined benefit plan" - A retirement plan which does not provide
for individual accounts for Employer contributions. The Advisory
Committee must treat all defined benefit plans (whether or not
terminated) maintained by the Employer as a single plan.
[Note: The definitions in paragraphs (j), (k) and (1) apply only if the
limitation described in Section 3.18 applies to the Employer's Plan.]
(j) "Defined benefit plan fraction" -
Projected annual benefit of the Participant under the defined benefit plan(s)
-----------------------------------------------------------------------------
The lesser of (i) 125% (subject to the "100% limitation" in paragraph (l))
of the dollar limitation in effect under Code Section 415(b)(1)(A)
for the Limitation Year, or (ii) 140% of the Participant's
average Compensation for his high three (3) consecutive
Years of Service
To determine the denominator of this fraction, the Advisory
Committee will make any adjustment required under Code Section 415(b)
and will determine a Year of Service, unless otherwise provided in an
addendum to Adoption Agreement Section 3.18, as a Plan Year in which the
Employee completed at least 1,000 Hours of Service. The "projected
annual benefit" is the annual retirement benefit (adjusted to an
actuarially equivalent straight life annuity if the plan expresses such
benefit in a form other than a straight life annuity or qualified joint
and survivor annuity) of the Participant under the terms of the defined
benefit plan on the assumptions he continues employment until his normal
retirement age (or current age, if later) as stated in the defined
benefit plan, his compensation continues at the same rate as in effect
in the Limitation Year under consideration until the date of his normal
retirement age and all other relevant factors used to determine benefits
under the defined benefit plan remain constant as of the current
Limitation Year for all future Limitation Years.
CURRENT ACCRUED BENEFIT. If the Participant accrued benefits in
one or more defined benefit plans maintained by the Employer which were
in existence on May 6, 1986, the dollar limitation used in the
denominator of this fraction will not be less than the Participant's
Current Accrued Benefit. A Participant's Current Accrued Benefit is 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 (the
last Limitation Year beginning before January 1, 1987), 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 Current Accrued Benefit rule applies
only if the defined benefit plans individually and in the aggregate
satisfied the requirements of Code Section 415 as in effect at the end
of the 1986 Limitation Year.
(k) "Defined contribution plan fraction" -
The sum, as of the close of the Limitation Year, of the Annual Additions
to the Participant's Account under the defined contribution plan(s)
-------------------------------------------------------------------
The sum of the lesser of the following amounts determined
for the Limitation Year and for each prior Year of Service with the Employer:
(i) 125% (subject to the "100% limitation" in paragraph (l)) of the dollar
limitation in effect under Code Section 415(c)(1)(A) for the Limitation Year
(determined without regard to the special dollar limitations for employee stock
ownership plans), or (ii) 35% of the Participant's Compensation for the
Limitation Year
For purposes of determining the defined contribution plan
fraction, the Advisory Committee will not recompute Annual Additions in
Limitation Years beginning prior to
3.09
<PAGE> 27
DEFINED CONTRIBUTION MASTER PLAN
January 1, 1987, to treat all Employee contributions as Annual
Additions. If the Plan satisfied Code Section 415 for Limitation Years
beginning prior to January 1, 1987, the Advisory Committee will
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 3.19. If the sum of the redetermined
fractions exceeds 1.0, the Advisory Committee will subtract permanently
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 Advisory Committee must
disregard any accrued benefit under the defined benefit plan which is in
excess of the Current Accrued Benefit. This 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.
(l) "100% limitation." If the 100% limitation applies, the Advisory
Committee must determine the denominator of the defined benefit plan
fraction and the denominator of the defined contribution plan fraction
by substituting 100% for 125%. If the Employer's Plan is a Standardized
Plan, the 100% limitation applies in all Limitation Years, subject to
any override provisions under Section 3.18 of the Employer's Adoption
Agreement. If the Employer overrides the 100% limitation under a
Standardized Plan, the Employer must specify in its Adoption Agreement
the manner in which the Plan satisfies the extra minimum benefit
requirement of Code Section 416(h) and the 100% limitation must continue
to apply if the Plan's top heavy ratio exceeds 90%. If the Employer's
Plan is a Nonstandardized Plan, the 100% limitation applies only if: (i)
the Plan's top heavy ratio exceeds 90%; or (ii) the Plan's top heavy
ratio is greater than 60%, and the Employer does not elect in its
Adoption Agreement Section 3.18 to provide extra minimum benefits which
satisfy Code Section 416(h)(2).
* * * * * * * * * *
3.10
<PAGE> 28
DEFINED CONTRIBUTION MASTER PLAN
ARTICLE IV
PARTICIPANT CONTRIBUTIONS
4.01 PARTICIPANT NONDEDUCTIBLE CONTRIBUTIONS. This Plan does not
permit Participant nondeductible contributions unless the Employer maintains
its Plan under a Code Section 401(k) Adoption Agreement. If the Employer does
not maintain its Plan under a Code Section 401(k) Adoption Agreement and, prior
to the adoption of this Master Plan, the Plan accepted Participant
nondeductible contributions for a Plan Year beginning after December 31, 1986,
those contributions must satisfy the requirements of Code Section 401(m). This
Section 4.01 does not prohibit the Plan's acceptance of Participant
nondeductible contributions prior to the first Plan Year commencing after the
Plan Year in which the Employer adopts this Master Plan.
4.02 PARTICIPANT DEDUCTIBLE CONTRIBUTIONS. A qualified Plan may not
accept Participant deductible contributions after April 15, 1987. If the
Employer's Plan includes Participant deductible contributions ("DECs") made
prior to April 16, 1987, the Advisory Committee must maintain a separate
accounting for the Participant's Accrued Benefit attributable to DECs,
including DECs which are part of a rollover contribution described in Section
4.03. The Advisory Committee will treat the accumulated DECs as part of the
Participant's Accrued Benefit for all purposes of the Plan, except for purposes
of determining the top heavy ratio under Section 1.33. The Advisory Committee
may not use DECs to purchase life insurance on the Participant's behalf.
4.03 PARTICIPANT ROLLOVER CONTRIBUTIONS. Any Participant, with the
Employer's written consent and after filing with the Trustee the form
prescribed by the Advisory Committee, may contribute cash or other property to
the Trust other than as a voluntary contribution if the contribution is a
"rollover contribution" which the Code permits an employee to transfer either
directly or indirectly from one qualified plan to another qualified plan.
Before accepting a rollover contribution, the Trustee may require an Employee
to furnish satisfactory evidence that the proposed transfer is in fact a
"rollover contribution" which the Code permits an employee to make to a
qualified plan. A rollover contribution is not an Annual Addition under Part 2
of Article III.
The Trustee will invest the rollover contribution in a segregated
investment Account for the Participant's sole benefit unless the Trustee (or
the Named Fiduciary, in the case of a nondiscretionary Trustee designation), in
its sole discretion, agrees to invest the rollover contribution as part of the
Trust Fund. The Trustee will not have any investment responsibility with
respect to a Participant's segregated rollover Account. The Participant,
however, from time to time, may direct the Trustee in writing as to the
investment of his segregated rollover Account in property, or property
interests, of any kind, real, personal or mixed; provided however, the
Participant may not direct the Trustee to make loans to his Employer. A
Participant's segregated rollover Account alone will bear any extraordinary
expenses resulting from investments made at the direction of the Participant.
As of the Accounting Date (or other valuation date) for each Plan Year, the
Advisory Committee will allocate and credit the net income (or net loss) from a
Participant's segregated rollover Account and the increase or decrease in the
fair market value of the assets of a segregated rollover Account solely to that
Account. The Trustee is not liable nor responsible for any loss resulting to
any Beneficiary, nor to any Participant, by reason of any sale or investment
made or other action taken pursuant to and in accordance with the direction of
the Participant. In all other respects, the Trustee will hold, administer and
distribute a rollover contribution in the same manner as any Employer
contribution made to the Trust.
An eligible Employee, prior to satisfying the Plan's eligibility
conditions, may make a rollover contribution to the Trust to the same extent
and in the same manner as a Participant. If an Employee makes a rollover
contribution to the Trust prior to satisfying the Plan's eligibility
conditions, the Advisory Committee and Trustee must treat the Employee as a
Participant for all
4.01
<PAGE> 29
DEFINED CONTRIBUTION MASTER PLAN
purposes of the Plan except the Employee is not a Participant for purposes of
sharing in Employer contributions or Participant forfeiture under the Plan
until he actually becomes a Participant in the Plan. If the Employee has a
Separation from Service prior to becoming a Participant, the Trustee will
distribute his rollover contribution Account to him as if it were an Employer
contribution Account.
4.04 PARTICIPANT CONTRIBUTION - FORFEITABILITY. A Participant's
Accrued Benefit is, at all times, 100% Nonforfeitable to the extent the value
of his Accrued Benefit is derived from his Participant contributions described
in this Article IV.
4.05 PARTICIPANT CONTRIBUTION - WITHDRAWAL/DISTRIBUTION. A
Participant, by giving prior written notice to the Trustee, may withdraw all or
any part of the value of his Accrued Benefit derived from his Participant
contributions described in this Article IV. A distribution of Participant
contributions must comply with the joint and survivor requirements described in
Article VI, if those requirements apply to the Participant. A Participant may
not exercise his right to withdraw the value of his Accrued Benefit derived
from his Participant contributions more than once during any Plan Year. The
Trustee, in accordance with the direction of the Advisory Committee, will
distribute a Participant's unwithdrawn Accrued Benefit attributable to his
Participant contributions in accordance with the provisions of Article VI
applicable to the distribution of the Participant's Nonforfeitable Accrued
Benefit.
4.06 PARTICIPANT CONTRIBUTION - ACCRUED BENEFIT. The Advisory
Committee must maintain a separate Account(s) in the name of each Participant
to reflect the Participant's Accrued Benefit under the Plan derived from his
Participant contributions. A Participant's Accrued Benefit derived from his
Participant contributions as of any applicable date is the balance of his
separate Participant contribution Account(s).
* * * * * * * * * *
4.02
<PAGE> 30
DEFINED CONTRIBUTION MASTER PLAN
ARTICLE V
TERMINATION OF SERVICE - PARTICIPANT VESTING
5.01 NORMAL RETIREMENT AGE. The Employer must define Normal Retirement
Age in its Adoption Agreement. A Participant's Accrued Benefit derived from
Employer contributions is 100% Nonforfeitable upon and after his attaining
Normal Retirement Age (if employed by the Employer on or after that date).
5.02 PARTICIPANT DISABILITY OR DEATH. The Employer may elect in its
Adoption Agreement to provide a Participant's Accrued Benefit derived from
Employer contributions will be 100% Nonforfeitable if the Participant's
Separation from Service is a result of his death or his disability.
5.03 VESTING SCHEDULE. Except as provided in Sections 5.01 and 5.02,
for each Year of Service, a Participant's Nonforfeitable percentage of his
Accrued Benefit derived from Employer contributions equals the percentage in
the vesting schedule completed by the Employer in its Adoption Agreement.
(A) ELECTION OF SPECIAL VESTING FORMULA. If the Trustee makes a distribution
(other than a cash-out distribution described in Section 5.04) to a partially-
vested Participant, and the Participant has not incurred a Forfeiture Break in
Service at the relevant time, the Advisory Committee will establish a separate
Account for the Participant's Accrued Benefit. At any relevant time following
the distribution, the Advisory Committee will determine the Participant's
Nonforfeitable Accrued Benefit derived from Employer contributions in
accordance with the following formula: P(AB + (R x D)) - (R x D).
To apply this formula, "P" is the Participant's current vesting
percentage at the relevant time, "AB" is the Participant's Employer-derived
Accrued Benefit at the relevant time, "R" is the ratio of "AB" to the
Participant's Employer-derived Accrued Benefit immediately following the
earlier distribution and "D" is the amount of the earlier distribution. If,
under a restated Plan, the Plan has made distribution to a partially-vested
Participant prior to its restated Effective Date and is unable to apply the
cash-out provisions of Section 5.04 to that prior distribution, this special
vesting formula also applies to that Participant's remaining Account. The
Employer, in an addendum to its Adoption Agreement, numbered Section 5.03, may
elect to modify this formula to read as follows: P(AB + D) - D.
5.04 CASH-OUT DISTRIBUTIONS TO PARTIALLY-VESTED PARTICIPANTS/
RESTORATION OF FORFEITED ACCRUED BENEFIT. If, pursuant to Article VI, a
partially-vested Participant receives a cash-out distribution before he incurs
a Forfeiture Break in Service (as defined in Section 5.08), the cash-out
distribution will result in an immediate forfeiture of the nonvested portion of
the Participant's Accrued Benefit derived from Employer contributions. See
Section 5.09. A partially-vested Participant is a Participant whose
Nonforfeitable Percentage determined under Section 5.03 is less than 100%. A
cash-out distribution is a distribution of the entire present value of the
Participant's Nonforfeitable Accrued Benefit.
(A) RESTORATION AND CONDITIONS UPON RESTORATION. A partially-vested
Participant who is re-employed by the Employer after receiving a cash-out
distribution of the Nonforfeitable percentage of his Accrued Benefit may repay
the Trustee the amount of the cash-out distribution attributable to Employer
contributions, unless the Participant no longer has a right to restoration by
reason of the conditions of this Section 5.04(A). If a partially-vested
Participant makes the cash-out distribution repayment, the Advisory Committee,
subject to the conditions of this Section 5.04(A), must restore his Accrued
Benefit attributable to Employer contributions to the same dollar amount as the
dollar amount of his Accrued Benefit on the Accounting Date, or other valuation
date, immediately preceding the date of the cash-out distribution, unadjusted
for any gains or losses occurring subsequent to that Accounting Date, or other
valuation date. Restoration of the Participant's
5.01
<PAGE> 31
DEFINED CONTRIBUTION MASTER PLAN
Accrued Benefit includes restoration of all Code Section 411(d)(6) protected
benefits with respect to that restored Accrued Benefit, in accordance with
applicable Treasury regulations. The Advisory Committee will not restore a re-
employed Participant's Accrued Benefit under this paragraph if:
(1) 5 years have elapsed since the Participant's first re-employment
date with the Employer following the cash-out distribution; or
(2) The Participant incurred a Forfeiture Break in Service (as
defined in Section 5.08). This condition also applies if the Participant
makes repayment within the Plan Year in which he incurs the Forfeiture
Break in Service and that Forfeiture Break in Service would result in a
complete forfeiture of the amount the Advisory Committee otherwise would
restore.
(B) TIME AND METHOD OF RESTORATION. If neither of the two conditions
preventing restoration of the Participant's Accrued Benefit applies, the
Advisory Committee will restore the Participant's Accrued Benefit as of the
Plan Year Accounting Date coincident with or immediately following the
repayment. To restore the Participant's Accrued Benefit, the Advisory
Committee, to the extent necessary, will allocate to the Participant's Account:
(1) First, the amount, if any, of Participant forfeitures the
Advisory Committee would otherwise allocate under Section 3.05;
(2) Second, the amount, if any, of the Trust Fund net income or gain
for the Plan Year; and
(3) Third, the Employer contribution for the Plan Year to the extent
made under a discretionary formula.
In an addendum to its Adoption Agreement numbered 5.04(B), the Employer
may eliminate as a means of restoration any of the amounts described in clauses
(1), (2) and (3) or may change the order of priority of these amounts. To the
extent the amounts described in clauses (1), (2) and (3) are insufficient to
enable the Advisory Committee to make the required restoration, the Employer
must contribute, without regard to any requirement or condition of Section
3.01, the additional amount necessary to enable the Advisory Committee to make
the required restoration. If, for a particular Plan Year, the Advisory
Committee must restore the Accrued Benefit of more than one re-employed
Participant, then the Advisory Committee will make the restoration allocations
to each such Participant's Account in the same proportion that a Participant's
restored amount for the Plan Year bears to the restored amount for the Plan
Year of all re-employed Participants. The Advisory Committee will not take into
account any allocation under this Section 5.04 in applying the limitation on
allocations under Part 2 of Article III.
(C) 0% VESTED PARTICIPANT. The Employer must specify in its Adoption
Agreement whether the deemed cash-out rule applies to a 0% vested Participant.
A 0% vested Participant is a Participant whose Accrued Benefit derived from
Employer contributions is entirely forfeitable at the time of his Separation
from Service. If the Participant's Account is not entitled to an allocation of
Employer contributions for the Plan Year in which he has a Separation from
Service, the Advisory Committee will apply the deemed cash-out rule as if the
0% vested Participant received a cash-out distribution on the date of the
Participant's Separation from Service. If the Participant's Account is entitled
to an allocation of Employer contributions or Participant forfeitures for the
Plan Year in which he has a Separation from Service, the Advisory Committee
will apply the deemed cash-out rule as if the 0% vested Participant received a
cash-out distribution on the first day of the first Plan Year beginning after
his Separation from Service. For purposes of applying the restoration
provisions of this Section 5.04, the Advisory Committee will treat the 0%
vested Participant as repaying his cash-out "distribution" on the first date of
his re-employment with the Employer. If the deemed cash-out rule does not apply
to the Employer's Plan, a 0% vested Participant will not incur a forfeiture
until he incurs a Forfeiture Break in Service.
5.05 SEGREGATED ACCOUNT FOR REPAID AMOUNT. Until the Advisory
Committee restores the Participant's Accrued Benefit, as described in Section
5.04, the Trustee will invest the cash-out amount the Participant has repaid in
a segregated Account maintained solely for that
5.02
<PAGE> 32
DEFINED CONTRIBUTION MASTER PLAN
Participant. The Trustee must invest the amount in the Participant's segregated
Account in Federally insured interest bearing savings account(s) or time
deposit(s) (or a combination of both), or in other fixed income investments.
Until commingled with the balance of the Trust Fund on the date the Advisory
Committee restores the Participant's Accrued Benefit, the Participant's
segregated Account remains a part of the Trust, but it alone shares in any
income it earns and it alone bears any expense or loss it incurs. Unless the
repayment qualifies as a rollover contribution, the Advisory Committee will
direct the Trustee to repay to the Participant as soon as is administratively
practicable the full amount of the Participant's segregated Account if the
Advisory Committee determines either of the conditions of Section 5.04(A)
prevents restoration as of the applicable Accounting Date, notwithstanding the
Participant's repayment.
5.06 YEAR OF SERVICE - VESTING. For purposes of vesting under Section
5.03, Year of Service means any 12-consecutive month period designated in the
Employer's Adoption Agreement during which an Employee completes not less than
the number of Hours of Service (not exceeding 1,000) specified in the
Employer's Adoption Agreement. A Year of Service includes any Year of Service
earned prior to the Effective Date of the Plan, except as provided in Section
5.08.
5.07 BREAK IN SERVICE - VESTING. For purposes of this Article V, a
Participant incurs a "Break in Service" if during any vesting computation
period he does not complete more than 500 Hours of Service. If, pursuant to
Section 5.06, the Plan does not require more than 500 Hours of Service to
receive credit for a Year of Service, a Participant incurs a Break in Service
in a vesting computation period in which he fails to complete a Year of
Service.
5.08 INCLUDED YEARS OF SERVICE - VESTING. For purposes of determining
"Years of Service" under Section 5.06, the Plan takes into account all Years of
Service an Employee completes with the Employer except:
(a) For the sole purpose of determining a Participant's
Nonforfeitable percentage of his Accrued Benefit derived from Employer
contributions which accrued for his benefit prior to a Forfeiture Break
in Service, the Plan disregards any Year of Service after the
Participant first incurs a Forfeiture Break in Service. The Participant
incurs a Forfeiture Break in Service when he incurs 5 consecutive Breaks
in Service.
(b) The Plan disregards any Year of Service excluded under the
Employer's Adoption Agreement.
The Plan does not apply the Break in Service rule under Code Section
411(a)(6)(B). Therefore, an Employee need not complete a Year of Service after
a Break in Service before the Plan takes into account the Employee's otherwise
includible Years of Service under this Article V.
5.09 FORFEITURE OCCURS. A Participant's forfeiture, if any, of his
Accrued Benefit derived from Employer contributions occurs under the Plan on
the earlier of:
(a) The last day of the vesting computation period in which the
Participant first incurs a Forfeiture Break in Service; or
(b) The date the Participant receives a cash-out distribution.
The Advisory Committee determines the percentage of a Participant's
Accrued Benefit forfeiture, if any, under this Section 5.09 solely by reference
to the vesting schedule of Section 5.03. A Participant does not forfeit any
portion of his Accrued Benefit for any other reason or cause except as
expressly provided by this Section 5.09 or as provided under Section 9.14.
* * * * * * * * * *
5.03
<PAGE> 33
DEFINED CONTRIBUTION MASTER PLAN
ARTICLE VI
TIME AND METHOD OF PAYMENT OF BENEFITS
6.01 TIME OF PAYMENT OF ACCRUED BENEFIT. Unless, pursuant to Section
6.03, the Participant or the Beneficiary elects in writing to a different time
or method of payment, the Advisory Committee will direct the Trustee to
commence distribution of a Participant's Nonforfeitable Accrued Benefit in
accordance with this Section 6.01. A Participant must consent, in writing, to
any distribution required under this Section 6.01 if the present value of the
Participant's Nonforfeitable Accrued Benefit, at the time of the distribution
to the Participant, exceeds $3,500 and the Participant has not attained the
later of Normal Retirement Age or age 62. Furthermore, the Participant's
spouse also must consent, in writing, to any distribution, for which Section
6.04 requires the spouse's consent. For all purposes of this Article VI, the
term "annuity starting date" means the first day of the first period for which
the Plan pays an amount as an annuity or in any other form. A distribution date
under this Article VI, unless otherwise specified within the Plan, is the date
or dates the Employer specifies in the Adoption Agreement, or as soon as
administratively practicable following that distribution date. For purposes of
the consent requirements under this Article VI, if the present value of the
Participant's Nonforfeitable Accrued Benefit, at the time of any distribution,
exceeds $3,500, the Advisory Committee must treat that present value as
exceeding $3,500 for purposes of all subsequent Plan distributions to the
Participant.
(A) SEPARATION FROM SERVICE FOR A REASON OTHER THAN DEATH.
(1) PARTICIPANT'S NONFORFEITABLE ACCRUED BENEFIT NOT EXCEEDING
$3,500. If the Participant's Separation from Service is for any reason other
than death, the Advisory Committee will direct the Trustee to distribute the
Participant's Nonforfeitable Accrued Benefit in a lump sum, on the distribution
date the Employer specifies in the Adoption Agreement, but in no event later
than the 60th day following the close of the Plan Year in which the Participant
attains Normal Retirement Age. If the Participant has attained Normal
Retirement Age at the time of his Separation from Service, the distribution
under this paragraph will occur no later than the 60th day following the close
of the Plan Year in which the Participant's Separation from Service occurs.
(2) PARTICIPANT'S NONFORFEITABLE ACCRUED BENEFIT EXCEEDS $3,500. If
the Participant's Separation from Service is for any reason other than death,
the Advisory Committee will direct the Trustee to commence distribution of the
Participant's Nonforfeitable Accrued Benefit in a form and at the time elected
by the Participant, pursuant to Section 6.03. In the absence of an election by
the Participant, the Advisory Committee will direct the Trustee to distribute
the Participant's Nonforfeitable Accrued Benefit in a lump sum (or, if
applicable, the normal annuity form of distribution required under Section
6.04), on the 60th day following the close of the Plan Year in which the latest
of the following events occurs: (a) the Participant attains Normal Retirement
Age; (b) the Participant attains age 62; or (c) the Participant's Separation
from Service.
(3) DISABILITY. If the Participant's Separation from Service is
because of his disability, the Advisory Committee will direct the Trustee to
pay the Participant's Nonforfeitable Accrued Benefit in lump sum, on the
distribution date the Employer specifies in the Adoption Agreement, subject to
the notice and consent requirements of this Article VI and subject to the
applicable mandatory commencement dates described in Paragraphs (1) and (2).
(4) HARDSHIP. Prior to the time at which the Participant may receive
distribution under Paragraphs (1), (2) or (3), the Participant may request a
distribution from his Nonforfeitable Accrued Benefit in an amount necessary to
satisfy a hardship, if the Employer elects in the Adoption Agreement to permit
hardship distributions. Unless the Employer elects otherwise in the Adoption
Agreement, a hardship distribution must be on account of any of the following:
(a) medical expenses; (b) the purchase (excluding mortgage payments) of the
Participant's principal residence; (c) post-secondary education tuition, for
the next semester or quarter, for the Participant or for the Participant's
spouse, children or dependents; (d) to prevent the eviction of the Participant
from his principal residence or the foreclosure on the mortgage of the
Participant's
6.01
<PAGE> 34
DEFINED CONTRIBUTION MASTER PLAN
principal residence; (e) funeral expenses of the Participant's family member;
or (f) the Participant's disability. A partially-vested Participant may not
receive a hardship distribution described in this Paragraph (A)(4) prior to
incurring a Forfeiture Break in Service, unless the hardship distribution is a
cash-out distribution (as defined in Article V). The Advisory Committee will
direct the Trustee to make the hardship distribution as soon as
administratively practicable after the Participant makes a valid request for
the hardship distribution.
(B) REQUIRED BEGINNING DATE. If any distribution commencement date described
under Paragraph (A) of this Section 6.01, either by Plan provision or by
Participant election (or nonelection), is later than the Participant's Required
Beginning Date, the Advisory Committee instead must direct the Trustee to make
distribution on the Participant's Required Beginning Date, subject to the
transitional election, if applicable, under Section 6.03(D). A Participant's
Required Beginning Date is the April 1 following the close of the calendar year
in which the Participant attains age 70 1/2. However, if the Participant, prior
to incurring a Separation from Service, attained age 70 1/2 by January 1, 1988,
and, for the five Plan Year period ending in the calendar year in which he
attained age 70 1/2 and for all subsequent years, the Participant was not a
more than 5% owner, the Required Beginning Date is the April 1 following the
close of the calendar year in which the Participant separates from Service or,
if earlier, the April 1 following the close of the calendar year in which the
Participant becomes a more than 5% owner. Furthermore, if a Participant who was
not a more than 5% owner attained age 70 1/2 during 1988 and did not incur a
Separation from Service prior to January 1, 1989, his Required Beginning Date
is April 1, 1990. A mandatory distribution at the Participant's Required
Beginning Date will be in lump sum (or, if applicable, the normal annuity form
of distribution required under Section 6.04) unless the Participant, pursuant
to the provisions of this Article VI, makes a valid election to receive an
alternative form of payment.
(C) DEATH OF THE PARTICIPANT. The Advisory Committee will direct the
Trustee, in accordance with this Section 6.01(C), to distribute to the
Participant's Beneficiary the Participant's Nonforfeitable Accrued Benefit
remaining in the Trust at the time of the Participant's death. Subject to the
requirements of Section 6.04, the Advisory Committee will determine the death
benefit by reducing the Participant's Nonforfeitable Accrued Benefit by any
security interest the Plan has against that Nonforfeitable Accrued Benefit by
reason of an outstanding Participant loan.
(1) DECEASED PARTICIPANT'S NONFORFEITABLE ACCRUED BENEFIT DOES NOT
EXCEED $3,500. The Advisory Committee, subject to the requirements of Section
6.04, must direct the Trustee to distribute the deceased Participant's
Nonforfeitable Accrued Benefit in a single sum, as soon as administratively
practicable following the Participant's death or, if later, the date on which
the Advisory Committee receives notification of or otherwise confirms the
Participant's death.
(2) DECEASED PARTICIPANT'S NONFORFEITABLE ACCRUED BENEFIT EXCEEDS
$3,500. The Advisory Committee will direct the Trustee to distribute the
deceased Participant's Nonforfeitable Accrued Benefit at the time and in the
form elected by the Participant or, if applicable by the Beneficiary, as
permitted under this Article VI. In the absence of an election, subject to the
requirements of Section 6.04, the Advisory Committee will direct the Trustee to
distribute the Participant's undistributed Nonforfeitable Accrued Benefit in a
lump sum on the first distribution date following the close of the Plan Year in
which the Participant's death occurs or, if later, the first distribution date
following the date the Advisory Committee receives notification of or otherwise
confirms the Participant's death.
If the death benefit is payable in full to the Participant's surviving
spouse, the surviving spouse, in addition to the distribution options provided
in this Section 6.01(C), may elect distribution at any time or in any form
(other than a joint and survivor annuity) this Article VI would permit for a
Participant.
6.02 METHOD OF PAYMENT OF ACCRUED BENEFIT. Subject to the annuity
distribution requirements, if any, prescribed by Section 6.04, and any
restrictions prescribed by Section 6.03, a
6.02
<PAGE> 35
DEFINED CONTRIBUTION MASTER PLAN
Participant or Beneficiary may elect distribution under one, or any
combination, of the following methods: (a) by payment in a lump sum; or (b) by
payment in monthly, quarterly or annual installments over a fixed reasonable
period of time, not exceeding the life expectancy of the Participant, or the
joint life and last survivor expectancy of the Participant and his Beneficiary.
The Employer may elect in its Adoption Agreement to modify the methods of
payment available under this Section 6.02.
The distribution options permitted under this Section 6.02 are available
only if the present value of the Participant Nonforfeitable Accrued Benefit, at
the time of the distribution to the Participant, exceeds $3,500. To facilitate
installment payments under this Article VI, the Advisory Committee may direct
the Trustee to segregate all or any part of the Participant's Accrued Benefit
in a separate Account. The Trustee will invest the Participant's segregated
Account in Federally insured interest bearing savings account(s) or time
deposit(s) (or a combination of both), or in other fixed income investments. A
segregated Account remains a part of the Trust, but it alone shares in any
income it earns, and it alone bears any expense or loss it incurs. A
Participant or Beneficiary may elect to receive an installment distribution in
the form of a Nontransferable Annuity Contract. Under an installment
distribution, the Participant or Beneficiary, at any time, may elect to
accelerate the payment of all, or any portion, of the Participant's unpaid
Nonforfeitable Accrued Benefit, subject to the requirements of Section 6.04.
(A) MINIMUM DISTRIBUTION REQUIREMENTS FOR PARTICIPANTS. The Advisory
Committee may not direct the Trustee to distribute the Participant's
Nonforfeitable Accrued Benefit, nor may the Participant elect to have the
Trustee distribute his Nonforfeitable Accrued Benefit, under a method of
payment which, as of the Required Beginning Date, does not satisfy the minimum
distribution requirements under Code Section 401(a)(9) and the applicable
Treasury regulations. The minimum distribution for a calendar year equals the
Participant's Nonforfeitable Accrued Benefit as of the latest valuation date
preceding the beginning of the calendar year divided by the Participant's life
expectancy or, if applicable, the joint and last survivor expectancy of the
Participant and his designated Beneficiary (as determined under Article VIII,
subject to the requirements of the Code Section 401(a)(9) regulations). The
Advisory Committee will increase the Participant's Nonforfeitable Accrued
Benefit, as determined on the relevant valuation date, for contributions or
forfeitures allocated after the valuation date and by December 31 of the
valuation calendar year, and will decrease the valuation by distributions made
after the valuation date and by December 31 of the valuation calendar year. For
purposes of this valuation, the Advisory Committee will treat any portion of
the minimum distribution for the first distribution calendar year made after
the close of that year as a distribution occurring in that first distribution
calendar year. In computing a minimum distribution, the Advisory Committee must
use the unisex life expectancy multiples under Treas. Reg. Section 1.72-9. The
Advisory Committee, only upon the Participant's written request, will compute
the minimum distribution for a calendar year subsequent to the first calendar
year for which the Plan requires a minimum distribution by redetermining the
applicable life expectancy. However, the Advisory Committee may not redetermine
the joint life and last survivor expectancy of the Participant and a nonspouse
designated Beneficiary in a manner which takes into account any adjustment to a
life expectancy other than the Participant's life expectancy.
If the Participant's spouse is not his designated Beneficiary, a method
of payment to the Participant (whether by Participant election or by Advisory
Committee direction) may not provide more than incidental benefits to the
Beneficiary. For Plan Years beginning after December 31, 1988, the Plan must
satisfy the minimum distribution incidental benefit ("MDIB") requirement in the
Treasury regulations issued under Code Section 401(a)(9) for distributions made
on or after the Participant's Required Beginning Date and before the
Participant's death. To satisfy the MDIB requirement, the Advisory Committee
will compute the minimum distribution required by this Section 6.02(A) by
substituting the applicable MDIB divisor for the applicable life expectancy
factor, if the MDIB divisor is a lesser number. Following the Participant's
death, the Advisory Committee will compute the minimum distribution required by
this Section 6.02(A) solely on the basis of the applicable life expectancy
factor and will disregard the MDIB factor. For Plan Years beginning prior to
January 1, 1989, the Plan satisfies the incidental benefits requirement if the
distributions to the Participant satisfied the MDIB requirement or if the
present value of the retirement benefits
6.03
<PAGE> 36
DEFINED CONTRIBUTION MASTER PLAN
payable solely to the Participant is greater than 50% of the present value of
the total benefits payable to the Participant and his Beneficiaries. The
Advisory Committee must determine whether benefits to the Beneficiary are
incidental as of the date the Trustee is to commence payment of the retirement
benefits to the Participant, or as of any date the Trustee redetermines the
payment period to the Participant.
The minimum distribution for the first distribution calendar year is due
by the Participant's Required Beginning Date. The minimum distribution for each
subsequent distribution calendar year, including the calendar year in which the
Participant's Required Beginning Date occurs, is due by December 31 of that
year. If the Participant receives distribution in the form of a Nontransferable
Annuity Contract, the distribution satisfies this Section 6.02(A) if the
contract complies with the requirements of Code Section 401(a)(9) and the
applicable Treasury regulations.
(B) MINIMUM DISTRIBUTION REQUIREMENTS FOR BENEFICIARIES. The method of
distribution to the Participant's Beneficiary must satisfy Code Section
401(a)(9) and the applicable Treasury regulations. If the Participant's death
occurs after his Required Beginning Date or, if earlier, the date the
Participant commences an irrevocable annuity pursuant to Section 6.04, the
method of payment to the Beneficiary must provide for completion of payment
over a period which does not exceed the payment period which had commenced for
the Participant. If the Participant's death occurs prior to his Required
Beginning Date, and the Participant had not commenced an irrevocable annuity
pursuant to Section 6.04, the method of payment to the Beneficiary, subject to
Section 6.04, must provide for completion of payment to the Beneficiary over a
period not exceeding: (i) 5 years after the date of the Participant's death; or
(ii) if the Beneficiary is a designated Beneficiary, the designated
Beneficiary's life expectancy. The Advisory Committee may not direct payment of
the Participant's Nonforfeitable Accrued Benefit over a period described in
clause (ii) unless the Trustee will commence payment to the designated
Beneficiary no later than the December 31 following the close of the calendar
year in which the Participant's death occurred or, if later, and the designated
Beneficiary is the Participant's surviving spouse, December 31 of the calendar
year in which the Participant would have attained age 70 1/2. If the Trustee
will make distribution in accordance with clause (ii), the minimum distribution
for a calendar year equals the Participant's Nonforfeitable Accrued Benefit as
of the latest valuation date preceding the beginning of the calendar year
divided by the designated Beneficiary's life expectancy. The Advisory Committee
must use the unisex life expectancy multiples under Treas. Reg. Section 1.72-9
for purposes of applying this paragraph. The Advisory Committee, only upon the
written request of the Participant or of the Participant's surviving spouse,
will recalculate the life expectancy of the Participant's surviving spouse not
more frequently than annually, but may not recalculate the life expectancy of a
nonspouse designated Beneficiary after the Trustee commences payment to the
designated Beneficiary. The Advisory Committee will apply this paragraph by
treating any amount paid to the Participant's child, which becomes payable to
the Participant's surviving spouse upon the child's attaining the age of
majority, as paid to the Participant's surviving spouse. Upon the Beneficiary's
written request, the Advisory Committee must direct the Trustee to accelerate
payment of all or any portion, of the Participant's unpaid Accrued Benefit, as
soon as administratively practicable following the effective date of that
request.
6.03 BENEFIT PAYMENT ELECTIONS. Not earlier than 90 days, but not
later than 30 days, before the Participant's annuity starting date, the
Advisory Committee must provide a benefit notice to a Participant who is
eligible to make an election under this Section 6.03. The benefit notice must
explain the optional forms of benefit in the Plan, including the material
features and relative values of those options, and the Participant's right to
defer distribution until he attains the later of Normal Retirement Age or age
62.
If a Participant or Beneficiary makes an election prescribed by this
Section 6.03, the Advisory Committee will direct the Trustee to distribute the
Participant's Nonforfeitable Accrued Benefit in accordance with that election.
Any election under this Section 6.03 is subject to the requirements of Section
6.02 and of Section 6.04. The Participant or Beneficiary must make an election
under this Section 6.03 by filing his election with the Advisory Committee at
any time before the
6.04
<PAGE> 37
DEFINED CONTRIBUTION MASTER PLAN
Trustee otherwise would commence to pay a Participant's Accrued Benefit in
accordance with the requirements of Article VI.
(A) PARTICIPANT ELECTIONS AFTER SEPARATION FROM SERVICE. If the present
value of a Participant's Nonforfeitable Accrued Benefit exceeds $3,500, he may
elect to have the Trustee commence distribution as of any distribution date
permitted under the Employer's Adoption Agreement Section 6.03. The Participant
may reconsider an election at any time prior to the annuity starting date and
elect to commence distribution as of any other distribution date permitted
under the Employer's Adoption Agreement Section 6.03. If the Participant is
partially-vested in his Accrued Benefit, an election under this Paragraph (A)
to distribute prior to the Participant's incurring a Forfeiture Break in
Service (as defined in Section 5.08), must be in the form of a cash-out
distribution (as defined in Article V). A Participant may not receive a cash-
out distribution if, prior to the time the Trustee actually makes the cash-out
distribution, the Participant returns to employment with the Employer.
Following his attainment of Normal Retirement Age, a Participant who has
separated from Service may elect distribution as of any distribution date,
irrespective of the elections under Adoption Agreement Section 6.03.
(B) PARTICIPANT ELECTIONS PRIOR TO SEPARATION FROM SERVICE. The Employer
must specify in its Adoption Agreement the distribution election rights, if
any, a Participant has prior to his Separation from Service. A Participant must
make an election under this Section 6.03(B) on a form prescribed by the
Advisory Committee at any time during the Plan Year for which his election is
to be effective. In his written election, the Participant must specify the
percentage or dollar amount he wishes the Trustee to distribute to him. The
Participant's election relates solely to the percentage or dollar amount
specified in his election form and his right to elect to receive an amount, if
any, for a particular Plan Year greater than the dollar amount or percentage
specified in his election form terminates on the Accounting Date. The Trustee
must make a distribution to a Participant in accordance with his election under
this Section 6.03(B) within the 90 day period (or as soon as administratively
practicable) after the Participant files his written election with the Trustee.
The Trustee will distribute the balance of the Participant's Accrued Benefit
not distributed pursuant to his election(s) in accordance with the other
distribution provisions of this Plan.
(C) DEATH BENEFIT ELECTIONS. If the present value of the deceased
Participant's Nonforfeitable Accrued Benefit exceeds $3,500, the Participant's
Beneficiary may elect to have the Trustee distribute the Participant's
Nonforfeitable Accrued Benefit in a form and within a period permitted under
Section 6.02. The Beneficiary's election is subject to any restrictions
designated in writing by the Participant and not revoked as of his date of
death.
(D) TRANSITIONAL ELECTIONS. Notwithstanding the provisions of Sections 6.01
and 6.02, if the Participant (or Beneficiary) signed a written distribution
designation prior to January 1, 1984, the Advisory Committee must distribute
the Participant's Nonforfeitable Accrued Benefit in accordance with that
designation, subject however, to the survivor requirements, if applicable, of
Sections 6.04, 6.05 and 6.06. This Section 6.03(D) does not apply to a pre-1984
distribution designation, and the Advisory Committee will not comply with that
designation, if any of the following applies: (1) the method of distribution
would have disqualified the Plan under Code Section 401(a)(9) as in effect on
December 31, 1983; (2) the Participant did not have an Accrued Benefit as of
December 31, 1983; (3) the distribution designation does not specify the timing
and form of the distribution and the death Beneficiaries (in order of
priority); (4) the substitution of a Beneficiary modifies the payment period of
the distribution; or, (5) the Participant (or Beneficiary) modifies or revokes
the distribution designation. In the event of a revocation, the Plan must
distribute, no later than December 31 of the calendar year following the year
of revocation, the amount which the Participant would have received under
Section 6.02(A) if the distribution designation had not been in effect or, if
the Beneficiary revokes the distribution designation, the amount which the
Beneficiary would have received under Section 6.02(B) if the distribution
designation had not been in effect. The Advisory Committee will apply this
Section 6.03(D) to rollovers and transfers in accordance with Part J of the
Code Section 401(a)(9) Treasury regulations.
6.05
<PAGE> 38
DEFINED CONTRIBUTION MASTER PLAN
6.04 ANNUITY DISTRIBUTIONS TO PARTICIPANTS AND SURVIVING SPOUSES.
(A) JOINT AND SURVIVOR ANNUITY. The Advisory Committee must direct the
Trustee to distribute a married or unmarried Participant's Nonforfeitable
Accrued Benefit in the form of a qualified joint and survivor annuity, unless
the Participant makes a valid waiver election (described in Section 6.05)
within the 90 day period ending on the annuity starting date. If, as of the
annuity starting date, the Participant is married, a qualified joint and
survivor annuity is an immediate annuity which is purchasable with the
Participant's Nonforfeitable Accrued Benefit and which provides a life annuity
for the Participant and a survivor annuity payable for the remaining life of
the Participant's surviving spouse equal to 50% of the amount of the annuity
payable during the life of the Participant. If, as of the annuity starting
date, the Participant is not married, a qualified joint and survivor annuity is
an immediate life annuity for the Participant which is purchasable with the
Participant's Nonforfeitable Accrued Benefit. On or before the annuity starting
date, the Advisory Committee, without Participant or spousal consent, must
direct the Trustee to pay the Participant's Nonforfeitable Accrued Benefit in a
lump sum, in lieu of a qualified joint and survivor annuity, in accordance with
Section 6.01, if the Participant's Nonforfeitable Accrued Benefit is not
greater than $3,500. This Section 6.04(A) applies only to a Participant who has
completed at least one Hour of Service with the Employer after August 22, 1984.
(B) PRERETIREMENT SURVIVOR ANNUITY. If a married Participant dies prior to
his annuity starting date, the Advisory Committee will direct the Trustee to
distribute a portion of the Participant's Nonforfeitable Accrued Benefit to the
Participant's surviving spouse in the form of a preretirement survivor annuity,
unless the Participant has a valid waiver election (as described in
Section 6.06) in effect, or unless the Participant and his spouse were not
married throughout the one year period ending on the date of his death. A
preretirement survivor annuity is an annuity which is purchasable with 50% of
the Participant's Nonforfeitable Accrued Benefit (determined as of the date of
the Participant's death) and which is payable for the life of the Participant's
surviving spouse. The value of the preretirement survivor annuity is
attributable to Employer contributions and to Employee contributions in the
same proportion as the Participant's Nonforfeitable Accrued Benefit is
attributable to those contributions. The portion of the Participant's
Nonforfeitable Accrued Benefit not payable under this paragraph is payable to
the Participant's Beneficiary, in accordance with the other provisions of this
Article VI. If the present value of the preretirement survivor annuity does not
exceed $3,500, the Advisory Committee, on or before the annuity starting date,
must direct the Trustee to make a lump sum distribution to the Participant's
surviving spouse, in lieu of a preretirement survivor annuity. This Section
6.04(B) applies only to a Participant who dies after August 22, 1984, and
either (i) completes at least one Hour of Service with the Employer after
August 22, 1984, or (ii) separated from Service with at least 10 Years of
Service (as defined in Section 5.06) and completed at least one Hour of Service
with the Employer in a Plan Year beginning after December 31, 1975.
(C) SURVIVING SPOUSE ELECTIONS. If the present value of the preretirement
survivor annuity exceeds $3,500, the Participant's surviving spouse may elect
to have the Trustee commence payment of the preretirement survivor annuity at
any time following the date of the Participant's death, but not later than the
mandatory distribution periods described in Section 6.02, and may elect any of
the forms of payment described in Section 6.02, in lieu of the preretirement
survivor annuity. In the absence of an election by the surviving spouse, the
Advisory Committee must direct the Trustee to distribute the preretirement
survivor annuity on the first distribution date following the close of the Plan
Year in which the latest of the following events occurs: (i) the Participant's
death; (ii) the date the Advisory Committee receives notification of or
otherwise confirms the Participant's death; (iii) the date the Participant
would have attained Normal Retirement Age; or (iv) the date the Participant
would have attained age 62.
(D) SPECIAL RULES. If the Participant has in effect a valid waiver election
regarding the qualified joint and survivor annuity or the preretirement
survivor annuity, the Advisory Committee must direct the Trustee to distribute
the Participant's Nonforfeitable Accrued Benefit in accordance with Sections
6.01, 6.02 and 6.03. The Advisory Committee will reduce the Participant's
Nonforfeitable Accrued Benefit by any security interest (pursuant to any offset
rights authorized by Section
6.06
<PAGE> 39
DEFINED CONTRIBUTION MASTER PLAN
10.03[E]) held by the Plan by reason of a Participant loan to determine the
value of the Participant's Nonforfeitable Accrued Benefit distributable in the
form of a qualified joint and survivor annuity or preretirement survivor
annuity, provided any post-August 18, 1985, loan satisfied the spousal consent
requirement described in Section 10.03[E] of the Plan. For purposes of applying
this Article VI, the Advisory Committee treats a former spouse as the
Participant's spouse or surviving spouse to the extent provided under a
qualified domestic relations order described in Section 6.07. The provisions of
this Section 6.04, and of Sections 6.05 and 6.06, apply separately to the
portion of the Participant's Nonforfeitable Accrued Benefit subject to the
qualified domestic relations order and to the portion of the Participant's
Nonforfeitable Accrued Benefit not subject to that order.
(E) PROFIT SHARING PLAN ELECTION. If this Plan is a profit sharing plan, the
Employer must elect the extent to which the preceding provisions of Section
6.04 apply. If the Employer elects to apply this Section 6.04 only to a
Participant described in this Section 6.04(E), the preceding provisions of this
Section 6.04 apply only to the following Participants: (1) a Participant as
respects whom the Plan is a direct or indirect transferee from a plan subject
to the Code Section 417 requirements and the Plan received the transfer after
December 31, 1984, unless the transfer is an elective transfer described in
Section 13.06; (2) a Participant who elects a life annuity distribution (if
Section 6.02 or Section 13.02 of the Plan requires the Plan to provide a life
annuity distribution option); and (3) a Participant whose benefits under a
defined benefit plan maintained by the Employer are offset by benefits provided
under this Plan. If the Employer elects to apply this Section 6.04 to all
Participants, the preceding provisions of this Section 6.04 apply to all
Participants described in the first two paragraphs of this Section 6.04,
without regard to the limitations of this Section 6.04(E). Sections 6.05 and
6.06 only apply to Participants to whom the preceding provisions of this
Section 6.04 apply.
6.05 WAIVER ELECTION - QUALIFIED JOINT AND SURVIVOR ANNUITY, Not
earlier than 90 days, but not later than 30 days, before the Participant's
annuity starting date, the Advisory Committee must provide the Participant a
written explanation of the terms and conditions of the qualified joint and
survivor annuity, the Participant's right to make, and the effect of, an
election to waive the joint and survivor form of benefit, the rights of the
Participant's spouse regarding the waiver election and the Participant's right
to make, and the effect of, a revocation of a waiver election. The Plan does
not limit the number of times the Participant may revoke a waiver of the
qualified joint and survivor annuity or make a new waiver during the election
period.
A married Participant's waiver election is not valid unless (a) the
Participant's spouse (to whom the survivor annuity is payable under the
qualified joint and survivor annuity), after the Participant has received the
written explanation described in this Section 6.05, has consented in writing to
the waiver election, the spouse's consent acknowledges the effect of the
election, and a notary public or the Plan Administrator (or his representative)
witnesses the spouse's consent, (b) the spouse consents to the alternate form
of payment designated by the Participant or to any change in that designated
form of payment, and (c) unless the spouse is the Participant's sole primary
Beneficiary, the spouse consents to the Participant's Beneficiary designation
or to any change in the Participant's Beneficiary designation. The spouse's
consent to a waiver of the qualified joint and survivor annuity is irrevocable,
unless the Participant revokes the waiver election. The spouse may execute a
blanket consent to any form of payment designation or to any Beneficiary
designation made by the Participant, if the spouse acknowledges the right to
limit that consent to a specific designation but, in writing, waives that
right. The consent requirements of this Section 6.05 apply to a former spouse
of the Participant, to the extent required under a qualified domestic relations
order described in Section 6.07.
The Advisory Committee will accept as valid a waiver election which does
not satisfy the spousal consent requirements if the Advisory Committee
establishes the Participant does not have a spouse, the Advisory Committee is
not able to locate the Participant's spouse, the Participant is legally
separated or has been abandoned (within the meaning of State law) and the
Participant has a court order to that effect, or other circumstances exist
under which the Secretary of the
6.07
<PAGE> 40
DEFINED CONTRIBUTION MASTER PLAN
Treasury will excuse the consent requirement. If the Participant's spouse is
legally incompetent to give consent, the spouse's legal guardian (even if the
guardian is the Participant) may give consent.
6.06 WAIVER ELECTION - PRERETIREMENT SURVIVOR ANNUITY. The Advisory
Committee must provide a written explanation of the preretirement survivor
annuity to each married Participant, within the following period which ends
last: (1) the period beginning on the first day of the Plan Year in which the
Participant attains age 32 and ending on the last day of the Plan Year in which
the Participant attains age 34; (2) a reasonable period after an Employee
becomes a Participant; (3) a reasonable period after the joint and survivor
rules become applicable to the Participant; or (4) a reasonable period after a
fully subsidized preretirement survivor annuity no longer satisfies the
requirements for a fully subsidized benefit. A reasonable period described in
clauses (2), (3) and (4) is the period beginning one year before and ending one
year after the applicable event. If the Participant separates from Service
before attaining age 35, clauses (1), (2), (3) and (4) do not apply and the
Advisory Committee must provide the written explanation within the period
beginning one year before and ending one year after the Separation from
Service. The written explanation must describe, in a manner consistent with
Treasury regulations, the terms and conditions of the preretirement survivor
annuity comparable to the explanation of the qualified joint and survivor
annuity required under Section 6.05. The Plan does not limit the number of
times the Participant may revoke a waiver of the preretirement survivor annuity
or make a new waiver during the election period.
A Participant's waiver election of the preretirement survivor annuity is
not valid unless (a) the Participant makes the waiver election no earlier than
the first day of the Plan Year in which he attains age 35 and (b) the
Participant's spouse (to whom the preretirement survivor annuity is payable)
satisfies the consent requirements described in Section 6.05, except the spouse
need not consent to the form of benefit payable to the designated Beneficiary.
The spouse's consent to the waiver of the preretirement survivor annuity is
irrevocable, unless the Participant revokes the waiver election. Irrespective
of the time of election requirement described in clause (a), if the Participant
separates from Service prior to the first day of the Plan Year in which he
attains age 35, the Advisory Committee will accept a waiver election as
respects the Participant's Accrued Benefit attributable to his Service prior to
his Separation from Service. Furthermore, if a Participant who has not
separated from Service makes a valid waiver election, except for the timing
requirement of clause (a), the Advisory Committee will accept that election as
valid, but only until the first day of the Plan Year in which the Participant
attains age 35. A waiver election described in this paragraph is not valid
unless made after the Participant has received the written explanation
described in this Section 6.06.
6.07 DISTRIBUTIONS UNDER DOMESTIC RELATIONS ORDERS. Nothing contained
in this Plan prevents the Trustee, in accordance with the direction of the
Advisory Committee, from complying with the provisions of a qualified domestic
relations order (as defined in Code Section 414(p)). This Plan specifically
permits distribution to an alternate payee under a qualified domestic relations
order at any time, irrespective of whether the Participant has attained his
earliest retirement age (as defined under Code Section 414(p)) under the Plan.
A distribution to an alternate payee prior to the Participant's attainment of
earliest retirement age is available only if: (1) the order specifies
distribution at that time or permits an agreement between the Plan and the
alternate payee to authorize an earlier distribution; and (2) if the present
value of the alternate payee's benefits under the Plan exceeds $3,500, and the
order requires, the alternate payee consents to any distribution occurring
prior to the Participant's attainment of earliest retirement age. The Employer,
in an addendum to its Adoption Agreement numbered 6.07, may elect to limit
distribution to an alternate payee only when the Participant has attained his
earliest retirement age under the Plan. Nothing in this Section 6.07 gives a
Participant a right to receive distribution at a time otherwise not permitted
under the Plan nor does it permit the alternate payee to receive a form of
payment not otherwise permitted under the Plan.
6.08
<PAGE> 41
DEFINED CONTRIBUTION MASTER PLAN
The Advisory Committee must establish reasonable procedures to determine
the qualified status of a domestic relations order. Upon receiving a domestic
relations order, the Advisory Committee promptly will notify the Participant
and any alternate payee named in the order, in writing, of the receipt of the
order and the Plan's procedures for determining the qualified status of the
order. Within a reasonable period of time after receiving the domestic
relations order, the Advisory Committee must determine the qualified status of
the order and must notify the Participant and each alternate payee, in writing,
of its determination. The Advisory Committee must provide notice under this
paragraph by mailing to the individual's address specified in the domestic
relations order, or in a manner consistent with Department of Labor
regulations.
If any portion of the Participant's Nonforfeitable Accrued Benefit is
payable during the period the Advisory Committee is making its determination of
the qualified status of the domestic relations order, the Advisory Committee
must make a separate accounting of the amounts payable. If the Advisory
Committee determines the order is a qualified domestic relations order within
18 months of the date amounts first are payable following receipt of the order,
the Advisory Committee will direct the Trustee to distribute the payable
amounts in accordance with the order. If the Advisory Committee does not make
its determination of the qualified status of the order within the 18-month
determination period, the Advisory Committee will direct the Trustee to
distribute the payable amounts in the manner the Plan would distribute if the
order did not exist and will apply the order prospectively if the Advisory
Committee later determines the order is a qualified domestic relations order.
To the extent it is not inconsistent with the provisions of the
qualified domestic relations order, the Advisory Committee may direct the
Trustee to invest any partitioned amount in a segregated subaccount or separate
account and to invest the account in Federally insured, interest-bearing
savings account(s) or time deposit(s) (or a combination of both), or in other
fixed income investments. A segregated subaccount remains a part of the Trust,
but it alone shares in any income it earns, and it alone bears any expense or
loss it incurs. The Trustee will make any payments or distributions required
under this Section 6.07 by separate benefit checks or other separate
distribution to the alternate payee(s).
* * * * * * * * * *
6.09
<PAGE> 42
DEFINED CONTRIBUTION MASTER PLAN
ARTICLE VII
EMPLOYER ADMINISTRATIVE PROVISIONS
7.01 INFORMATION TO COMMITTEE. The Employer must supply current
information to the Advisory Committee as to the name, date of birth, date of
employment, annual compensation, leaves of absence, Years of Service and date
of termination of employment of each Employee who is, or who will be eligible
to become, a Participant under the Plan, together with any other information
which the Advisory Committee considers necessary. The Employer's records as to
the current information the Employer furnishes to the Advisory Committee are
conclusive as to all persons.
7.02 NO LIABILITY. The Employer assumes no obligation or
responsibility to any of its Employees, Participants or Beneficiaries for any
act of, or failure to act, on the part of its Advisory Committee (unless the
Employer is the Advisory Committee), the Trustee, the Custodian, if any, or the
Plan Administrator (unless the Employer is the Plan Administrator).
7.03 INDEMNITY OF CERTAIN FIDUCIARIES. The Employer indemnifies and
saves harmless the Plan Administrator and the members of the Advisory
Committee, and each of them, from and against any and all loss resulting from
liability to which the Plan Administrator and the Advisory Committee, or the
members of the Advisory Committee, may be subjected by reason of any act or
conduct (except willful misconduct or gross negligence) in their official
capacities in the administration of this Trust or Plan or both, including all
expenses reasonably incurred in their defense, in case the Employer fails to
provide such defense. The indemnification provisions of this Section 7.03 do
not relieve the Plan Administrator or any Advisory Committee member from any
liability he may have under ERISA for breach of a fiduciary duty. Furthermore,
the Plan Administrator and the Advisory Committee members and the Employer may
execute a letter agreement further delineating the indemnification agreement of
this Section 7.03, provided the letter agreement must be consistent with and
does not violate ERISA. The indemnification provisions of this Section 7.03
extend to the Trustee (or to a Custodian, if any) solely to the extent provided
by a letter agreement executed by the Trustee (or Custodian) and the Employer.
7.04 EMPLOYER DIRECTION OF INVESTMENT. The Employer has the right to
direct the Trustee with respect to the investment and re-investment of assets
comprising the Trust Fund only if the Trustee consents in writing to permit
such direction. If the Trustee consents to Employer direction of investment,
the Trustee and the Employer must execute a letter agreement as a part of this
Plan containing such conditions, limitations and other provisions they deem
appropriate before the Trustee will follow any Employer direction as respects
the investment or re-investment of any part of the Trust Fund.
7.05 AMENDMENT TO VESTING SCHEDULE. Though the Employer reserves the
right to amend the vesting schedule at any time, the Advisory Committee will
not apply the amended vesting schedule to reduce the Nonforfeitable percentage
of any Participant's Accrued Benefit derived from Employer contributions
(determined as of the later of the date the Employer adopts the amendment, or
the date the amendment becomes effective) to a percentage less than the
Nonforfeitable percentage computed under the Plan without regard to the
amendment. An amended vesting schedule will apply to a Participant only if the
Participant receives credit for at least one Hour of Service after the new
schedule becomes effective.
If the Employer makes a permissible amendment to the vesting schedule,
each Participant having at least 3 Years of Service with the Employer may elect
to have the percentage of his Nonforfeitable Accrued Benefit computed under the
Plan without regard to the amendment. For Plan Years beginning prior to January
1, 1989, the election described in the preceding sentence
7.01
<PAGE> 43
DEFINED CONTRIBUTION MASTER PLAN
applies only to Participants having at least 5 Years of Service with the
Employer. The Participant must file his election with the Advisory Committee
within 60 days of the latest of (a) the Employer's adoption of the amendment;
(b) the effective date of the amendment; or (c) his receipt of a copy of the
amendment. The Advisory Committee, as soon as practicable, must forward a true
copy of any amendment to the vesting schedule to each affected Participant,
together with an explanation of the effect of the amendment, the appropriate
form upon which the Participant may make an election to remain under the
vesting schedule provided under the Plan prior to the amendment and notice of
the time within which the Participant must make an election to remain under the
prior vesting schedule. The election described in this Section 7.05 does not
apply to a Participant if the amended vesting schedule provides for vesting at
least as rapid at all times as the vesting schedule in effect prior to the
amendment. For purposes of this Section 7.05, an amendment to the vesting
schedule includes any Plan amendment which directly or indirectly affects the
computation of the Nonforfeitable percentage of an Employee's rights to his
Employer derived Accrued Benefit. Furthermore, the Advisory Committee must
treat any shift in the vesting schedule, due to a change in the Plan's top
heavy status, as an amendment to the vesting schedule for purposes of this
Section 7.05.
* * * * * * * * * *
7.02
<PAGE> 44
DEFINED CONTRIBUTION MASTER PLAN
ARTICLE VIII
PARTICIPANT ADMINISTRATIVE PROVISIONS
8.01 BENEFICIARY DESIGNATION. Any Participant may from time to time
designate, in writing, any person or persons, contingently or successively, to
whom the Trustee will pay his Nonforfeitable Accrued Benefit (including any
life insurance proceeds payable to the Participant's Account) in the event of
his death and the Participant may designate the form and method of payment. The
Advisory Committee will prescribe the form for the written designation of
Beneficiary and, upon the Participant's filing the form with the Advisory
Committee, the form effectively revokes all designations filed prior to that
date by the same Participant.
(A) COORDINATION WITH SURVIVOR REQUIREMENTS. If the joint and survivor
requirements of Article VI apply to the Participant, this Section 8.01 does not
impose any special spousal consent requirements on the Participant's
Beneficiary designation. However, in the absence of spousal consent (as
required by Article VI) to the Participant's Beneficiary designation: (1) any
waiver of the joint and survivor annuity or of the preretirement survivor
annuity is not valid; and (2) if the Participant dies prior to his annuity
starting date, the Participant's Beneficiary designation will apply only to the
portion of the death benefit which is not payable as a preretirement survivor
annuity. Regarding clause (2), if the Participant's surviving spouse is a
primary Beneficiary under the Participant's Beneficiary designation, the
Trustee will satisfy the spouse's interest in the Participant's death benefit
first from the portion which is payable as a preretirement survivor annuity.
(B) PROFIT SHARING PLAN EXCEPTION. If the Plan is a profit sharing plan,
the Beneficiary designation of a married Exempt Participant is not valid unless
the Participant's spouse consents (in a manner described in Section 6.05) to
the Beneficiary designation. An "Exempt Participant" is a Participant who is
not subject to the joint and survivor requirements of Article VI. The spousal
consent requirement in this paragraph does not apply if the Exempt Participant
and his spouse are not married throughout the one year period ending on the
date of the Participant's death, or if the Participant's spouse is the
Participant's sole primary Beneficiary.
8.02 NO BENEFICIARY DESIGNATION/DEATH OF BENEFICIARY. If a
Participant fails to name a Beneficiary in accordance with Section 8.01, or if
the Beneficiary named by a Participant predeceases him, then the Trustee will
pay the Participant's Nonforfeitable Accrued Benefit in accordance with Section
6.02 in the following order of priority, unless the Employer specifies a
different order of priority in an addendum to its Adoption Agreement, to:
(a) The Participant's surviving spouse;
(b) The Participant's surviving children, including adopted
children, in equal shares;
(c) The Participant's surviving parents, in equal shares; or
(d) The Participant's estate.
If the Beneficiary does not predecease the Participant, but dies prior
to distribution of the Participant's entire Nonforfeitable Accrued Benefit, the
Trustee will pay the remaining Nonforfeitable Accrued Benefit to the
Beneficiary's estate unless the Participant's Beneficiary designation provides
otherwise or unless the Employer provides otherwise in its Adoption Agreement.
If the Plan is a profit sharing plan, and the Plan includes Exempt
Participants, the Employer may not specify a different order of priority in the
Adoption Agreement unless the Participant's surviving spouse will be first in
the different order of priority. The Advisory Committee will direct the Trustee
as to the method and to whom the Trustee will make payment under this Section
8.02.
8.01
<PAGE> 45
DEFINED CONTRIBUTION MASTER PLAN
8.03 PERSONAL DATA TO COMMITTEE. Each Participant and each
Beneficiary of a deceased Participant must furnish to the Advisory Committee
such evidence, data or information as the Advisory Committee considers
necessary or desirable for the purpose of administering the Plan. The
provisions of this Plan are effective for the benefit of each Participant upon
the condition precedent that each Participant will furnish promptly full, true
and complete evidence, data and information when requested by the Advisory
Committee, provided the Advisory Committee advises each Participant of the
effect of his failure to comply with its request.
8.04 ADDRESS FOR NOTIFICATION. Each Participant and each
Beneficiary of a deceased Participant must file with the Advisory Committee
from time to time, in writing, his post office address and any change of post
office address. Any communication, statement or notice addressed to a
Participant, or Beneficiary, at his last post office address filed with the
Advisory Committee, or as shown on the records of the Employer, binds the
Participant, or Beneficiary, for all purposes of this Plan.
8.05 ASSIGNMENT OR ALIENATION. Subject to Code Section 414(p)
relating to qualified domestic relations orders, neither a Participant nor a
Beneficiary may anticipate, assign or alienate (either at law or in equity) any
benefit provided under the Plan, and the Trustee will not recognize any such
anticipation, assignment or alienation. Furthermore, a benefit under the Plan
is not subject to attachment, garnishment, levy, execution or other legal or
equitable process.
8.06 NOTICE OF CHANGE IN TERMS. The Plan Administrator, within the
time prescribed by ERISA and the applicable regulations, must furnish all
Participants and Beneficiaries a summary description of any material amendment
to the Plan or notice of discontinuance of the Plan and all other information
required by ERISA to be furnished without charge.
8.07 LITIGATION AGAINST THE TRUST. A court of competent
jurisdiction may authorize any appropriate equitable relief to redress
violations of ERISA or to enforce any provisions of ERISA or the terms of the
Plan. A fiduciary may receive reimbursement of expenses properly and actually
incurred in the performance of his duties with the Plan.
8.08 INFORMATION AVAILABLE. Any Participant in the Plan or any
Beneficiary may examine copies of the Plan description, latest annual report,
any bargaining agreement, this Plan and Trust, contract or any other instrument
under which the Plan was established or is operated. The Plan Administrator
will maintain all of the items listed in this Section 8.08 in his office, or in
such other place or places as he may designate from time to time in order to
comply with the regulations issued under ERISA, for examination during
reasonable business hours. Upon the written request of a Participant or
Beneficiary the Plan Administrator must furnish him with a copy of any item
listed in this Section 8.08. The Plan Administrator may make a reasonable
charge to the requesting person for the copy so furnished.
8.09 APPEAL PROCEDURE FOR DENIAL OF BENEFITS. A Participant or a
Beneficiary ("Claimant") may file with the Advisory Committee a written claim
for benefits, if the Participant or Beneficiary determines the distribution
procedures of the Plan have not provided him his proper Nonforfeitable Accrued
Benefit. The Advisory Committee must render a decision on the claim within 60
days of the Claimant's written claim for benefits. The Plan Administrator must
provide adequate notice in writing to the Claimant whose claim for benefits
under the Plan the Advisory Committee has denied. The Plan Administrator's
notice to the Claimant must set forth:
(a) The specific reason for the denial;
8.02
<PAGE> 46
DEFINED CONTRIBUTION MASTER PLAN
(b) Specific references to pertinent Plan provisions on which the
Advisory Committee based its denial;
(c) A description of any additional material and information
needed for the Claimant to perfect his claim and an explanation of why
the material or information is needed; and
(d) That any appeal the Claimant wishes to make of the adverse
determination must be in writing to the Advisory Committee within 75
days after receipt of the Plan Administrator's notice of denial of
benefits. The Plan Administrator's notice must further advise the
Claimant that his failure to appeal the action to the Advisory
Committee in writing within the 75-day period will render the Advisory
Committee's determination final, binding and conclusive.
If the Claimant should appeal to the Advisory Committee, he, or his
duly authorized representative, may submit, in writing, whatever issues and
comments he, or his duly authorized representative, feels are pertinent. The
Claimant, or his duly authorized representative, may review pertinent Plan
documents. The Advisory Committee will re-examine all facts related to the
appeal and make a final determination as to whether the denial of benefits is
justified under the circumstances. The Advisory Committee must advise the
Claimant of its decision within 60 days of the Claimant's written request for
review, unless special circumstances (such as a hearing) would make the
rendering of a decision within the 60-day limit unfeasible, but in no event may
the Advisory Committee render a decision respecting a denial for a claim for
benefits later than 120 days after its receipt of a request for review.
The Plan Administrator's notice of denial of benefits must identify
the name of each member of the Advisory Committee and the name and address of
the Advisory Committee member to whom the Claimant may forward his appeal.
8.10 PARTICIPANT DIRECTION OF INVESTMENT. A Participant has the
right to direct the Trustee with respect to the investment or re-investment of
the assets comprising the Participant's individual Account only if the Trustee
consents in writing to permit such direction. If the Trustee consents to
Participant direction of investment, the Trustee will accept direction from
each Participant on a written election form (or other written agreement), as a
part of this Plan, containing such conditions, limitations and other provisions
the parties deem appropriate. The Trustee or, with the Trustee's consent, the
Advisory Committee, may establish written procedures, incorporated specifically
as part of this Plan, relating to Participant direction of investment under
this Section 8.10. The Trustee will maintain a segregated investment Account to
the extent a Participant's Account is subject to Participant self-direction.
The Trustee is not liable for any loss, nor is the Trustee liable for any
breach, resulting from a Participant's direction of the investment of any part
of his directed Account.
The Advisory Committee, to the extent provided in a written loan
policy adopted under Section 9.04, will treat a loan made to a Participant as a
Participant direction of investment under this Section 8.10. To the extent of
the loan outstanding at any time, the borrowing Participant's Account alone
shares in any interest paid on the loan, and it alone bears any expense or loss
it incurs in connection with the loan. The Trustee may retain any principal or
interest paid on the borrowing Participant's loan in an interest bearing
segregated Account on behalf of the borrowing Participant until the Trustee (or
the Named Fiduciary, in the case of a nondiscretionary Trustee) deems it
appropriate to add the amount paid to the Participant's separate Account under
the Plan.
If the Trustee consents to Participant direction of investment of his
Account, the Plan treats any post-December 31, 1981, investment by a
Participant's directed Account in collectibles (as defined by Code Section
408(m)) as a deemed distribution to the Participant for Federal income tax
purposes.
* * * * * * * * * * * * * * *
8.03
<PAGE> 47
DEFINED CONTRIBUTION MASTER PLAN
ARTICLE IX
ADVISORY COMMITTEE - DUTIES WITH RESPECT TO PARTICIPANTS' ACCOUNTS
9.01 MEMBERS' COMPENSATION, EXPENSES. The Employer must appoint an
Advisory Committee to administer the Plan, the members of which may or may not
be Participants in the Plan, or which may be the Plan Administrator acting
alone. In the absence of an Advisory Committee appointment, the Plan
Administrator assumes the powers, duties and responsibilities of the Advisory
Committee. The members of the Advisory Committee will serve without
compensation for services as such, but the Employer will pay all expenses of
the Advisory Committee, except to the extent the Trust properly pays for such
expenses, pursuant to Article X.
9.02 TERM. Each member of the Advisory Committee serves until the
appointment of his successor.
9.03 POWERS. In case of a vacancy in the membership of the Advisory
Committee, the remaining members of the Advisory Committee may exercise any and
all of the powers, authority, duties and discretion conferred upon the Advisory
Committee pending the filling of the vacancy.
9.04 GENERAL. The Advisory Committee has the following powers and
duties:
(a) To select a Secretary, who need not be a member of the
Advisory Committee;
(b) To determine the rights of eligibility of an Employee to
participate in the Plan, the value of a Participant's Accrued Benefit
and the Nonforfeitable percentage of each Participant's Accrued
Benefit;
(c) To adopt rules of procedure and regulations necessary for the
proper and efficient administration of the Plan provided the rules are
not inconsistent with the terms of this Agreement;
(d) To construe and enforce the terms of the Plan and the rules
and regulations it adopts, including interpretation of the Plan
documents and documents related to the Plan's operation;
(e) To direct the Trustee as respects the crediting and
distribution of the Trust;
(f) To review and render decisions respecting a claim for (or
denial of a claim for) a benefit under the Plan;
(g) To furnish the Employer with information which the Employer
may require for tax or other purposes;
(h) To engage the service of agents whom it may deem advisable to
assist it with the performance of its duties;
(i) To engage the services of an Investment Manager or Managers
(as defined in ERISA Section 3(38)), each of whom will have full power
and authority to manage, acquire or dispose (or direct the Trustee
with respect to acquisition or disposition) of any Plan asset under
its control;
(j) To establish, in its sole discretion, a nondiscriminatory
policy (see Section 9.04(A)) which the Trustee must observe in making
loans, if any, to Participants and Beneficiaries; and
9.01
<PAGE> 48
DEFINED CONTRIBUTION MASTER PLAN
(k) To establish and maintain a funding standard account and to
make credits and charges to the account to the extent required by and
in accordance with the provisions of the Code.
The Advisory Committee must exercise all of its powers, duties and
discretion under the Plan in a uniform and nondiscriminatory manner.
(A) LOAN POLICY. If the Advisory Committee adopts a loan policy, pursuant
to paragraph (j), the loan policy must be a written document and must include:
(1) the identity of the person or positions authorized to administer the
participant loan program; (2) a procedure for applying for the loan; (3) the
criteria for approving or denying a loan; (4) the limitations, if any, on the
types and amounts of loans available; (5) the procedure for determining a
reasonable rate of interest; (6) the types of collateral which may secure the
loan; and (7) the events constituting default and the steps the Plan will take
to preserve plan assets in the event of default. This Section 9.04 specifically
incorporates a written loan policy as part of the Employer's Plan.
9.05 FUNDING POLICY. The Advisory Committee will review, not less
often than annually, all pertinent Employee information and Plan data in order
to establish the funding policy of the Plan and to determine the appropriate
methods of carrying out the Plan's objectives. The Advisory Committee must
communicate periodically, as it deems appropriate, to the Trustee and to any
Plan Investment Manager the Plan's short-term and long-term financial needs so
investment policy can be coordinated with Plan financial requirements.
9.06 MANNER OF ACTION. The decision of a majority of the members
appointed and qualified controls.
9.07 AUTHORIZED REPRESENTATIVE . The Advisory Committee may
authorize any one of its members, or its Secretary, to sign on its behalf any
notices, directions, applications, certificates, consents, approvals, waivers,
letters or other documents. The Advisory Committee must evidence this authority
by an instrument signed by all members and filed with the Trustee.
9.08 INTERESTED MEMBER. No member of the Advisory Committee may
decide or determine any matter concerning the distribution, nature or method of
settlement of his own benefits under the Plan, except in exercising an election
available to that member in his capacity as a Participant, unless the Plan
Administrator is acting alone in the capacity of the Advisory Committee.
9.09 INDIVIDUAL ACCOUNTS. The Advisory Committee will maintain, or
direct the Trustee to maintain, a separate Account, or multiple Accounts, in
the name of each Participant to reflect the Participant's Accrued Benefit under
the Plan. If a Participant re-enters the Plan subsequent to his having a
Forfeiture Break in Service, the Advisory Committee, or the Trustee, must
maintain a separate Account for the Participant's pre-Forfeiture Break in
Service Accrued Benefit and a separate Account for his post-Forfeiture Break in
Service Accrued Benefit, unless the Participant's entire Accrued Benefit under
the Plan is 100% Nonforfeitable.
The Advisory Committee will make its allocations, or request the
Trustee to make its allocations, to the Accounts of the Participants in
accordance with the provisions of Section 9.11. The Advisory Committee may
direct the Trustee to maintain a temporary segregated investment Account in the
name of a Participant to prevent a distortion of income, gain or loss
allocations under Section 9.11. The Advisory Committee must maintain records of
its activities.
9.10 VALUE OF PARTICIPANT'S ACCRUED BENEFIT. The value of each
Participant's Accrued Benefit consists of that proportion of the net worth (at
fair market value) of the Employer's Trust Fund which the net credit balance in
his Account (exclusive of the cash value of
9.02
<PAGE> 49
DEFINED CONTRIBUTION MASTER PLAN
incidental benefit insurance contracts) bears to the total net credit balance
in the Accounts (exclusive of the cash value of the incidental benefit
insurance contracts) of all Participants plus the cash surrender value of any
incidental benefit insurance contracts held by the Trustee on the Participant's
life.
For purposes of a distribution under the Plan, the value of a
Participant's Accrued Benefit is its value as of the valuation date immediately
preceding the date of the distribution. Any distribution (other than a
distribution from a segregated Account) made to a Participant (or to his
Beneficiary) more than 90 days after the most recent valuation date may include
interest on the amount of the distribution as an expense of the Trust Fund. The
interest, if any, accrues from such valuation date to the date of the
distribution at the rate established in the Employer's Adoption Agreement.
9.11 ALLOCATION AND DISTRIBUTION OF NET INCOME GAIN OR LOSS. A
"valuation date" under this Plan is each Accounting Date and each interim
valuation date determined under Section 10.14. As of each valuation date the
Advisory Committee must adjust Accounts to reflect net income, gain or loss
since the last valuation date. The valuation period is the period beginning the
day after the last valuation date and ending on the current valuation date.
(A) TRUST FUND ACCOUNTS. The allocation provisions of this paragraph apply
to all Participant Accounts other than segregated investment Accounts. The
Advisory Committee first will adjust the Participant Accounts, as those
Accounts stood at the beginning of the current valuation period, by reducing
the Accounts for any forfeitures arising under Section 5.09 or under Section
9.14, for amounts charged during the valuation period to the Accounts in
accordance with Section 9.13 (relating to distributions) and Section 11.01
(relating to insurance premiums), and for the cash value of incidental benefit
insurance contracts. The Advisory Committee then, subject to the restoration
allocation requirements of Section 5.04 or of Section 9.14, will allocate the
net income, gain or loss pro rata to the adjusted Participant Accounts. The
allocable net income, gain or loss is the net income (or net loss), including
the increase or decrease in the fair market value of assets, since the last
valuation date.
(B) SEGREGATED INVESTMENT ACCOUNTS. A segregated investment Account
receives all income it earns and bears all expense or loss it incurs. The
Advisory Committee will adopt uniform and nondiscriminatory procedures for
determining income or loss of a segregated investment Account in a manner which
reasonably reflects investment directions relating to pooled investments and
investment directions occurring during a valuation period. As of the valuation
date, the Advisory Committee must reduce a segregated Account for any
forfeiture arising under Section 5.09 after the Advisory Committee has made all
other allocations, changes or adjustments to the Account for the Plan Year.
(C) ADDITIONAL RULES. An Excess Amount or suspense account described in
Part 2 of Article III does not share in the allocation of net income, gain or
loss described in this Section 9.11. If the Employer maintains its Plan under a
Code Section 401(k) Adoption Agreement, the Employer may specify in its
Adoption Agreement alternate valuation provisions authorized by that Adoption
Agreement. This Section 9.11 applies solely to the allocation of net income,
gain or loss of the Trust. The Advisory Committee will allocate the Employer
contributions and Participant forfeitures, if any, in accordance with Article
III.
9.12 INDIVIDUAL STATEMENT. As soon as practicable after the
Accounting Date of each Plan Year, but within the time prescribed by ERISA and
the regulations under ERISA, the Plan Administrator will deliver to each
Participant (and to each Beneficiary) a statement reflecting the condition of
his Accrued Benefit in the Trust as of that date and such other information
ERISA requires be furnished the Participant or Beneficiary. No Participant,
except a member of the
9.03
<PAGE> 50
DEFINED CONTRIBUTION MASTER PLAN
Advisory Committee, has the right to inspect the records reflecting the Account
of any other Participant.
9.13 ACCOUNT CHARGED. The Advisory Committee will charge a
Participant's Account for all distributions made from that Account to the
Participant, to his Beneficiary or to an alternate payee. The Advisory
Committee also will charge a Participant's Account for any administrative
expenses incurred by the Plan directly related to that Account.
9.14 UNCLAIMED ACCOUNT PROCEDURE. The Plan does not require either
the Trustee or the Advisory Committee to search for, or to ascertain the
whereabouts of, any Participant or Beneficiary. At the time the Participant's
or Beneficiary's benefit becomes distributable under Article VI, the Advisory
Committee, by certified or registered mail addressed to his last known address
of record with the Advisory Committee or the Employer, must notify any
Participant, or Beneficiary, that he is entitled to a distribution under this
Plan. The notice must quote the provisions of this Section 9.14 and otherwise
must comply with the notice requirements of Article VI. If the Participant, or
Beneficiary, fails to claim his distributive share or make his whereabouts
known in writing to the Advisory Committee within 6 months from the date of
mailing of the notice, the Advisory Committee will treat the Participant's or
Beneficiary's unclaimed payable Accrued Benefit as forfeited and will
reallocate the unclaimed payable Accrued Benefit in accordance with Section
3.05. A forfeiture under this paragraph will occur at the end of the notice
period or, if later, the earliest date applicable Treasury regulations would
permit the forfeiture. Pending forfeiture, the Advisory Committee, following
the expiration of the notice period, may direct the Trustee to segregate the
Nonforfeitable Accrued Benefit in a segregated Account and to invest that
segregated Account in Federally insured interest bearing savings accounts or
time deposits (or in a combination of both), or in other fixed income
investments.
If a Participant or Beneficiary who has incurred a forfeiture of his
Accrued Benefit under the provisions of the first paragraph of this Section
9.14 makes a claim, at any time, for his forfeited Accrued Benefit, the
Advisory Committee must restore the Participant's or Beneficiary's forfeited
Accrued Benefit to the same dollar amount as the dollar amount of the Accrued
Benefit forfeited, unadjusted for any gains or losses occurring subsequent to
the date of the forfeiture. The Advisory Committee will make the restoration
during the Plan Year in which the Participant or Beneficiary makes the claim,
first from the amount, if any, of Participant forfeitures the Advisory
Committee otherwise would allocate for the Plan Year, then from the amount, if
any, of the Trust Fund net income or gain for the Plan Year and then from the
amount, or additional amount, the Employer contributes to enable the Advisory
Committee to make the required restoration. The Advisory Committee must direct
the Trustee to distribute the Participant's or Beneficiary's restored Accrued
Benefit to him not later than 60 days after the close of the Plan Year in which
the Advisory Committee restores the forfeited Accrued Benefit. The forfeiture
provisions of this Section 9.14 apply solely to the Participant's or to the
Beneficiary's Accrued Benefit derived from Employer contributions.
9.04
<PAGE> 51
DEFINED CONTRIBUTION MASTER PLAN
ARTICLE X
TRUSTEE AND CUSTODIAN, POWERS AND DUTIES
10.01 ACCEPTANCE. The Trustee accepts the Trust created under the
Plan and agrees to perform the obligations imposed. The Trustee must provide
bond for the faithful performance of its duties under the Trust to the extent
required by ERISA.
10.02 RECEIPT OF CONTRIBUTIONS. The Trustee is accountable to the
Employer for the funds contributed to it by the Employer, but does not have any
duty to see that the contributions received comply with the provisions of the
Plan. The Trustee is not obliged to collect any contributions from the
Employer, nor is obliged to see that funds deposited with it are deposited
according to the provisions of the Plan.
10.03 INVESTMENT POWERS.
[A] DISCRETIONARY TRUSTEE DESIGNATION. If the Employer, in Adoption Agreement
Section 1.02, designates the Trustee to administer the Trust as a discretionary
Trustee, then the Trustee has full discretion and authority with regard to the
investment of the Trust Fund, except with respect to a Plan asset under the
control or direction of a properly appointed Investment Manager or with respect
to a Plan asset properly subject to Employer, Participant or Advisory Committee
direction of investment. The Trustee must coordinate its investment policy with
Plan financial needs as communicated to it by the Advisory Committee. The
Trustee is authorized and empowered, but not by way of limitation, with the
following powers, rights and duties:
(a) To invest any part or all of the Trust Fund in any common or
preferred stocks, open-end or closed-end mutual funds, put and call
options traded on a national exchange, United States retirement plan
bonds, corporate bonds, debentures, convertible debentures, commercial
paper, U.S. Treasury bills, U.S. Treasury notes and other direct or
indirect obligations of the United States Government or its agencies,
improved or unimproved real estate situated in the United States,
limited partnerships, insurance contracts of any type, mortgages,
notes or other property of any kind, real or personal, to buy or sell
options on common stock on a nationally recognized exchange with or
without holding the underlying common stock, to buy and sell
commodities, commodity options and contracts for the future delivery
of commodities, and to make any other investments the Trustee deems
appropriate, as a prudent man would do under like circumstances with
due regard for the purposes of this Plan. Any investment made or
retained by the Trustee in good faith is proper but must be of a kind
constituting a diversification considered by law suitable for trust
investments.
(b) To retain in cash so much of the Trust Fund as it may deem
advisable to satisfy liquidity needs of the Plan and to deposit any
cash held in the Trust Fund in a bank account at reasonable interest.
(c) To invest, if the Trustee is a bank or similar financial
institution supervised by the United States or by a State, in any type
of deposit of the Trustee (or of a bank related to the Trustee within
the meaning of Code Section 414(b)) at a reasonable rate of interest
or in a common trust fund, as described in Code Section 584, or in a
collective investment fund, the provisions of which govern the
investment of such assets and which the Plan incorporates by this
reference, which the Trustee (or its affiliate, as defined in Code
Section 1504) maintains exclusively for the collective investment of
money contributed by the bank (or the affiliate) in its capacity as
trustee and which conforms to the rules of the Comptroller of the
Currency.
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DEFINED CONTRIBUTION MASTER PLAN
(d) To manage, sell, contract to sell, grant options to purchase,
convey, exchange, transfer, abandon, improve, repair, insure, lease
for any term even though commencing in the future or extending beyond
the term of the Trust, and otherwise deal with all property, real or
personal, in such manner, for such considerations and on such terms
and conditions as the Trustee decides.
(e) To credit and distribute the Trust as directed by the Advisory
Committee. The Trustee is not obliged to inquire as to whether any
payee or distributee is entitled to any payment or whether the
distribution is proper or within the terms of the Plan, or as to the
manner of making any payment or distribution. The Trustee is
accountable only to the Advisory Committee for any payment or
distribution made by it in good faith on the order or direction of the
Advisory Committee.
(f) To borrow money, to assume indebtedness, extend mortgages and
encumber by mortgage or pledge.
(g) To compromise, contest, arbitrate or abandon claims and
demands, in its discretion.
(h) To have with respect to the Trust all of the rights of an
individual owner, including the power to give proxies, to participate
in any voting trusts, mergers, consolidations or liquidations, and to
exercise or sell stock subscriptions or conversion rights.
(i) To lease for oil, gas and other mineral purposes and to create
mineral severances by grant or reservation; to pool or unitize
interests in oil, gas and other minerals; and to enter into operating
agreements and to execute division and transfer orders.
(j) To hold any securities or other property in the name of the
Trustee or its nominee, with depositories or agent depositories or in
another form as it may deem best, with or without disclosing the trust
relationship.
(k) To perform any and all other acts in its judgment necessary or
appropriate for the proper and advantageous management, investment and
distribution of the Trust.
(l) To retain any funds or property subject to any dispute without
liability for the payment of interest, and to decline to make payment
or delivery of the funds or property until final adjudication is made
by a court of competent jurisdiction.
(m) To file all tax returns required of the Trustee.
(n) To furnish to the Employer, the Plan Administrator and the
Advisory Committee an annual statement of account showing the
condition of the Trust Fund and all investments, receipts,
disbursements and other transactions effected by the Trustee during
the Plan Year covered by the statement and also stating the assets of
the Trust held at the end of the Plan Year, which accounts are
conclusive on all persons, including the Employer, the Plan
Administrator and the Advisory Committee, except as to any act or
transaction concerning which the Employer, the Plan Administrator or
the Advisory Committee files with the Trustee written exceptions or
objections within 90 days after the receipt of the accounts or for
which ERISA authorizes a longer period within which to object.
(o) To begin, maintain or defend any litigation necessary in
connection with the administration of the Plan, except that the
Trustee is not obliged or required to do so unless indemnified to its
satisfaction.
10.02
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DEFINED CONTRIBUTION MASTER PLAN
[B] NONDISCRETIONARY TRUSTEE DESIGNATION/APPOINTMENT OF CUSTODIAN. If the
Employer, in its Adoption Agreement Section 1.02, designates the Trustee to
administer the Trust as a nondiscretionary Trustee, then the Trustee will not
have any discretion or authority with regard to the investment of the Trust
Fund, but must act solely as a directed trustee of the funds contributed to it.
A nondiscretionary Trustee, as directed trustee of the funds held by it under
the Employer's Plan, is authorized and empowered, by way of limitation, with
the following powers, rights and duties, each of which the nondiscretionary
Trustee exercises solely as directed trustee in accordance with the written
direction of the Named Fiduciary (except to the extent a Plan asset is subject
to the control and management of a properly appointed Investment Manager or
subject to Advisory Committee or Participant direction of investment):
(a) To invest any part or all of the Trust Fund in any common or
preferred stocks, open-end or closed-end mutual funds, put and call
options traded on a national exchange, United States retirement plan
bonds, corporate bonds, debentures, convertible debentures, commercial
paper, U.S. Treasury bills, U.S. Treasury notes and other direct or
indirect obligations of the United States Government or its agencies,
improved or unimproved real estate situated in the United States,
limited partnerships, insurance contracts of any type, mortgages,
notes or other property of any kind, real or personal, to buy or sell
options on common stock on a nationally recognized options exchange
with or without holding the underlying common stock, to buy and sell
commodities, commodity options and contracts for the future delivery
of commodities, and to make any other investments the Named Fiduciary
deems appropriate.
(b) To retain in cash so much of the Trust Fund as the Named
Fiduciary may direct in writing to satisfy liquidity needs of the Plan
and to deposit any cash held in the Trust Fund in a bank account at
reasonable interest, including, specific authority to invest in any
type of deposit of the Trustee (or of a bank related to the Trustee
within the meaning of Code Section 414(b)) at a reasonable rate of
interest.
(c) To sell, contract to sell, grant options to purchase, convey,
exchange, transfer, abandon, improve, repair, insure, lease for any
term even though commencing in the future or extending beyond the term
of the Trust, and otherwise deal with all property, real or personal,
in such manner, for such considerations and on such terms and
conditions as the Named Fiduciary directs in writing.
(d) To credit and distribute the Trust as directed by the Advisory
Committee. The Trustee is not obliged to inquire as to whether any
payee or distributee is entitled to any payment or whether the
distribution is proper or within the terms of the Plan, or as to the
manner of making any payment or distribution. The Trustee is
accountable only to the Advisory Committee for any payment or
distribution made by it in good faith on the order or direction of the
Advisory Committee.
(e) To borrow money, to assume indebtedness, extend mortgages and
encumber by mortgage or pledge.
(f) To have with respect to the Trust all of the rights of an
individual owner, including the power to give proxies, to participate
in any voting trusts, mergers, consolidations or liquidations, and to
exercise or sell stock subscriptions or conversion rights, provided
the exercise of any such powers is in accordance with and at the
written direction of the Named Fiduciary.
(g) To lease for oil, gas and other mineral purposes and to create
mineral severances by grant or reservation; to pool or unitize
interests in oil, gas and other minerals; and to enter into operating
agreements and to execute division and transfer orders, provided the
exercise
10.03
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DEFINED CONTRIBUTION MASTER PLAN
of any such powers is in accordance with and at the written direction
of the Named Fiduciary.
(h) To hold any securities or other property in the name of the
nondiscretionary Trustee or its nominee, with depositories or agent
depositories or in another form as the Named Fiduciary may deem best,
with or without disclosing the custodial relationship.
(i) To retain any funds or property subject to any dispute without
liability for the payment of interest, and to decline to make payment
or delivery of the funds or property until a court of competent
jurisdiction makes final adjudication.
(j) To file all tax returns required of the Trustee.
(k) To furnish to the Named Fiduciary, the Employer, the Plan
Administrator and the Advisory Committee an annual statement of
account showing the condition of the Trust Fund and all investments,
receipts, disbursements and other transactions effected by the
nondiscretionary Trustee during the Plan Year covered by the statement
and also stating the assets of the Trust held at the end of the Plan
Year, which accounts are conclusive on all persons, including the
Named Fiduciary, the Employer, the Plan Administrator and the Advisory
Committee, except as to any act or transaction concerning which the
Named Fiduciary, the Employer, the Plan Administrator or the Advisory
Committee files with the nondiscretionary Trustee written exceptions
or objections within 90 days after the receipt of the accounts or for
which ERISA authorizes a longer period within which to object.
(l) To begin, maintain or defend any litigation necessary in
connection with the administration of the Plan, except that the
Trustee is not obliged or required to do so unless indemnified to its
satisfaction.
APPOINTMENT OF CUSTODIAN. The Employer may appoint a Custodian under
the Plan, the acceptance by the Custodian indicated on the execution page of
the Employer's Adoption Agreement. If the Employer appoints a Custodian, the
Employer's Plan must have a discretionary Trustee, as described in Section
10.03[A]. A Custodian has the same powers, rights and duties as a
nondiscretionary Trustee, as described in this Section 10.03[B]. The Custodian
accepts the terms of the Plan and Trust by executing the Employer's Adoption
Agreement. Any reference in the Plan to a Trustee also is a reference to a
Custodian where the context of the Plan dictates. A limitation of the Trustee's
liability by Plan provision also acts as a limitation of the Custodian's
liability. Any action taken by the Custodian at the discretionary Trustee's
direction satisfies any provision in the Plan referring to the Trustee's taking
that action.
MODIFICATION OF POWERS/LIMITED RESPONSIBILITY. The Employer and the
Custodian or nondiscretionary Trustee, by letter agreement, may limit the
powers of the Custodian or nondiscretionary Trustee to any combination of
powers listed within this Section 10.03[B]. If there is a Custodian or a
nondiscretionary Trustee under the Employer's Plan, then the Employer, in
adopting this Plan acknowledges the Custodian or nondiscretionary Trustee has
no discretion with respect to the investment or re-investment of the Trust Fund
and that the Custodian or nondiscretionary Trustee is acting solely as
custodian or as directed trustee with respect to the assets comprising the
Trust Fund.
[C] LIMITATION OF POWERS OF CERTAIN CUSTODIANS. If a Custodian is a bank which,
under its governing state law, does not possess trust powers, then paragraphs
(a), (c), (e), (f), (g) of Section 10.03[B], Section 10.16 and Article XI do
not apply to that bank and that bank only has the power and authority to
exercise the remaining powers, rights and duties under Section 10.03[B].
10.04
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DEFINED CONTRIBUTION MASTER PLAN
[D] NAMED FIDUCIARY/LIMITATION OF LIABILITY OF NONDISCRETIONARY TRUSTEE OR
CUSTODIAN. Under a nondiscretionary Trustee designation, the Named Fiduciary
under the Employer's Plan has the sole responsibility for the management and
control of the Employer's Trust Fund, except with respect to a Plan asset under
the control or direction of a properly appointed Investment Manager or with
respect to a Plan asset properly subject to Participant or Advisory Committee
direction of investment. If the Employer appoints a Custodian, the Named
Fiduciary is the discretionary Trustee. Under a nondiscretionary Trustee
designation, unless the Employer designates in writing another person or
persons to serve as Named Fiduciary, the Named Fiduciary under the Plan is the
president of a corporate Employer, the managing partner of a partnership
Employer or the sole proprietor, as appropriate. The Named Fiduciary will
exercise its management and control of the Trust Fund through its written
direction to the nondiscretionary Trustee or to the Custodian, whichever
applies to the Employer's Plan.
The nondiscretionary Trustee or Custodian has no duty to review or to
make recommendations regarding investments made at the written direction of the
Named Fiduciary. The nondiscretionary Trustee or Custodian must retain any
investment obtained at the written direction of the Named Fiduciary until
further directed in writing by the Named Fiduciary to dispose of such
investment. The nondiscretionary Trustee or Custodian is not liable in any
manner or for any reason for making, retaining or disposing of any investment
pursuant to any written direction described in this paragraph. Furthermore, the
Employer agrees to indemnify and to hold the nondiscretionary Trustee or
Custodian harmless from any damages, costs or expenses, including reasonable
counsel fees, which the nondiscretionary Trustee or Custodian may incur as a
result of any claim asserted against the nondiscretionary Trustee, the
Custodian or the Trust arising out of the nondiscretionary Trustee's or
Custodian's compliance with any written direction described in this paragraph.
[E] PARTICIPANT LOANS. This Section 10.03[E] specifically authorizes the
Trustee to make loans on a nondiscriminatory basis to a Participant or to a
Beneficiary in accordance with the loan policy established by the Advisory
Committee, provided: (1) the loan policy satisfies the requirements of Section
9.04; (2) loans are available to all Participants and Beneficiaries on a
reasonably equivalent basis and are not available in a greater amount for
Highly Compensated Employees than for other Employees; (3) any loan is
adequately secured and bears a reasonable rate of interest; (4) the loan
provides for repayment within a specified time; (5) the default provisions of
the note prohibit offset of the Participant's Nonforfeitable Accrued Benefit
prior to the time the Trustee otherwise would distribute the Participant's
Nonforfeitable Accrued Benefit; (6) the amount of the loan does not exceed (at
the time the Plan extends the loan) the present value of the Participant's
Nonforfeitable Accrued Benefit; and (7) the loan otherwise conforms to the
exemption provided by Code Section 4975(d)(1). If the joint and survivor
requirements of Article VI apply to the Participant, the Participant may not
pledge any portion of his Accrued Benefit as security for a loan made after
August 18, 1985, unless, within the 90 day period ending on the date the pledge
becomes effective, the Participant's spouse, if any, consents (in a manner
described in Section 6.05 other than the requirement relating to the consent of
a subsequent spouse) to the security or, by separate consent, to an increase in
the amount of security. If the Employer is an unincorporated trade or business,
a Participant who is an Owner-Employee may not receive a loan from the Plan,
unless he has obtained a prohibited transaction exemption from the Department
of Labor. If the Employer is an "S Corporation," a Participant who is a
shareholder-employee (an employee or an officer) who, at any time during the
Employer's taxable year, owns more than 5%, either directly or by attribution
under Code Section 318(a)(1), of the Employer's outstanding stock may not
receive a loan from the Plan, unless he has obtained a prohibited transaction
exemption from the Department of Labor. If the Employer is not an
unincorporated trade or business nor an "S Corporation," this Section 10.03[E]
does not impose any restrictions on the class of Participants eligible for a
loan from the Plan.
[F] INVESTMENT IN QUALIFYING EMPLOYER SECURITIES AND QUALIFYING EMPLOYER REAL
PROPERTY. The investment options in this Section 10.03[F] include the ability
to invest in qualifying Employer securities or qualifying Employer real
property, as defined in and as limited by ERISA. If the Employer's Plan is a
Nonstandardized profit sharing plan, it may elect in its Adoption Agreement to
10.05
<PAGE> 56
DEFINED CONTRIBUTION MASTER PLAN
permit the aggregate investments in qualifying Employer securities and in
qualifying Employer real property to exceed 10% of the value of Plan assets.
10.04 RECORDS AND STATEMENTS. The records of the Trustee pertaining
to the Plan must be open to the inspection of the Plan Administrator, the
Advisory Committee and the Employer at all reasonable times and may be audited
from time to time by any person or persons as the Employer, Plan Administrator
or Advisory Committee may specify in writing. The Trustee must furnish the Plan
Administrator or Advisory Committee with whatever information relating to the
Trust Fund the Plan Administrator or Advisory Committee considers necessary.
10.05 FEES AND EXPENSES FROM FUND. A Trustee or Custodian will
receive reasonable annual compensation as may be agreed upon from time to time
between the Employer and the Trustee or Custodian. No person who is receiving
full pay from the Employer may receive compensation for services as Trustee or
as Custodian. The Trustee will pay from the Trust Fund all fees and expenses
reasonably incurred by the Plan, to the extent such fees and expenses are for
the ordinary and necessary administration and operation of the Plan, unless the
Employer pays such fees and expenses. Any fee or expense paid, directly or
indirectly, by the Employer is not an Employer contribution to the Plan,
provided the fee or expense relates to the ordinary and necessary
administration of the Fund.
10.06 PARTIES TO LITIGATION. Except as otherwise provided by ERISA,
no Participant or Beneficiary is a necessary party or is required to receive
notice of process in any court proceeding involving the Plan, the Trust Fund or
any fiduciary of the Plan. Any final judgment entered in any proceeding will be
conclusive upon the Employer, the Plan Administrator, the Advisory Committee,
the Trustee, Custodian, Participants and Beneficiaries.
10.07 PROFESSIONAL AGENTS. The Trustee may employ and pay from the
Trust Fund reasonable compensation to agents, attorneys, accountants and other
persons to advise the Trustee as in its opinion may be necessary. The Trustee
may delegate to any agent, attorney, accountant or other person selected by it
any non-Trustee power or duty vested in it by the Plan, and the Trustee may act
or refrain from acting on the advice or opinion of any agent, attorney,
accountant or other person so selected.
10.08 DISTRIBUTION OF CASH OR PROPERTY. The Trustee may make
distribution under the Plan in cash or property, or partly in each, at its fair
market value as determined by the Trustee. For purposes of a distribution to a
Participant or to a Participant's designated Beneficiary or surviving spouse,
"property" includes a Nontransferable Annuity Contract, provided the contract
satisfies the requirements of this Plan.
10.09 DISTRIBUTION DIRECTIONS. If no one claims a payment or
distribution made from the Trust, the Trustee must promptly notify the Advisory
Committee and then dispose of the payment in accordance with the subsequent
direction of the Advisory Committee.
10.10 THIRD PARTY/MULTIPLE TRUSTEES. No person dealing with the
Trustee is obligated to see to the proper application of any money paid or
property delivered to the Trustee, or to inquire whether the Trustee has acted
pursuant to any of the terms of the Plan. Each person dealing with the Trustee
may act upon any notice, request or representation in writing by the Trustee,
or by the Trustee's duly authorized agent, and is not liable to any person in
so acting. The certificate of the Trustee that it is acting in accordance with
the Plan will be conclusive in favor of any person relying on the certificate.
If more than two persons act as Trustee, a decision of the majority of such
persons controls with respect to any decision regarding the administration or
investment of the Trust Fund or of any portion of the Trust Fund with respect
to which such persons act as Trustee. However, the signature of only one
Trustee is necessary to effect any transaction on behalf of the Trust.
10.06
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DEFINED CONTRIBUTION MASTER PLAN
10.11 RESIGNATION. The Trustee or Custodian may resign its position
at any time by giving 30 days' written notice in advance to the Employer and to
the Advisory Committee. If the Employer fails to appoint a successor Trustee
within 60 days of its receipt of the Trustee's written notice of resignation,
the Trustee will treat the Employer as having appointed itself as Trustee and
as having filed its acceptance of appointment with the former Trustee. The
Employer, in its sole discretion, may replace a Custodian. If the Employer does
not replace a Custodian, the discretionary Trustee will assume possession of
Plan assets held by the former Custodian.
10.12 REMOVAL. The Employer, by giving 30 days' written notice in
advance to the Trustee, may remove any Trustee or Custodian. In the event of
the resignation or removal of a Trustee, the Employer must appoint a successor
Trustee if it intends to continue the Plan. If two or more persons hold the
position of Trustee, in the event of the removal of one such person, during any
period the selection of a replacement is pending, or during any period such
person is unable to serve for any reason, the remaining person or persons will
act as the Trustee.
10.13 INTERIM DUTIES AND SUCCESSOR TRUSTEE. Each successor Trustee
succeeds to the title to the Trust vested in his predecessor by accepting in
writing his appointment as successor Trustee and by filing the acceptance with
the former Trustee and the Advisory Committee without the signing or filing of
any further statement. The resigning or removed Trustee, upon receipt of
acceptance in writing of the Trust by the successor Trustee, must execute all
documents and do all acts necessary to vest the title of record in any
successor Trustee. Each successor Trustee has and enjoys all of the powers,
both discretionary and ministerial, conferred under this Agreement upon his
predecessor. A successor Trustee is not personally liable for any act or
failure to act of any predecessor Trustee, except as required under ERISA. With
the approval of the Employer and the Advisory Committee, a successor Trustee,
with respect to the Plan, may accept the account rendered and the property
delivered to it by a predecessor Trustee without incurring any liability or
responsibility for so doing.
10.14 VALUATION OF TRUST. The Trustee must value the Trust Fund as
of each Accounting Date to determine the fair market value of each
Participant's Accrued Benefit in the Trust. The Trustee also must value the
Trust Fund on such other valuation dates as directed in writing by the Advisory
Committee or as required by the Employer's Adoption Agreement.
10.15 LIMITATION ON LIABILITY - IF INVESTMENT MANAGER, ANCILLARY
TRUSTEE OR INDEPENDENT FIDUCIARY APPOINTED. The Trustee is not liable for the
acts or omissions of any Investment Manager the Advisory Committee may appoint,
nor is the Trustee under any obligation to invest or otherwise manage any asset
of the Plan which is subject to the management of a properly appointed
Investment Manager. The Advisory Committee, the Trustee and any properly
appointed Investment Manager may execute a letter agreement as a part of this
Plan delineating the duties, responsibilities and liabilities of the Investment
Manager with respect to any part of the Trust Fund under the control of the
Investment Manager.
The limitation on liability described in this Section 10.15 also
applies to the acts or omissions of any ancillary trustee or independent
fiduciary properly appointed under Section 10.17 of the Plan. However, if a
discretionary Trustee, pursuant to the delegation described in Section 10.17 of
the Plan, appoints an ancillary trustee, the discretionary Trustee is
responsible for the periodic review of the ancillary trustee's actions and must
exercise its delegated authority in accordance with the terms of the Plan and
in a manner consistent with ERISA. The Employer, the discretionary Trustee and
an ancillary trustee may execute a letter agreement as a part of this Plan
delineating any indemnification agreement between the parties.
10.16 INVESTMENT IN GROUP TRUST FUND. The Employer, by adopting this
Plan, specifically authorizes the Trustee to invest all or any portion of the
assets comprising the Trust Fund in any group trust fund which at the time of
the investment provides for the pooling of the assets of plans qualified under
Code Section 401(a). This authorization applies solely to a group trust fund
10.07
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DEFINED CONTRIBUTION MASTER PLAN
exempt from taxation under Code Section 501(a) and the trust agreement of which
satisfies the requirements of Revenue Ruling 81-100. The provisions of the
group trust fund agreement, as amended from time to time, are by this reference
incorporated within this Plan and Trust. The provisions of the group trust fund
will govern any investment of Plan assets in that fund. The Employer must
specify in an attachment to its adoption agreement the group trust fund(s) to
which this authorization applies. If the Trustee is acting as a
nondiscretionary Trustee, the investment in the group trust fund is available
only in accordance with a proper direction, by the Named Fiduciary, in
accordance with Section 10.03[B]. Pursuant to paragraph (c) of Section 10.03[A]
of the Plan, a Trustee has the authority to invest in certain common trust
funds and collective investment funds without the need for the authorizing
addendum described in this Section 10.16.
Furthermore, at the Employer's direction, the Trustee, for collective
investment purposes, may combine into one trust fund the Trust created under
this Plan with the Trust created under any other qualified retirement plan the
Employer maintains. However, the Trustee must maintain separate records of
account for the assets of each Trust in order to reflect properly each
Participant's Accrued Benefit under the plan(s) in which he is a Participant.
10.17 APPOINTMENT OF ANCILLARY TRUSTEE OR INDEPENDENT FIDUCIARY.
The Employer, in writing, may appoint any person in any State to act as
ancillary trustee with respect to a designated portion of the Trust Fund,
subject to the consent required under Section 1.02 if the Master Plan Sponsor
is a financial institution. An ancillary trustee must acknowledge in writing
its acceptance of the terms and conditions of its appointment as ancillary
trustee and its fiduciary status under ERISA. The ancillary trustee has the
rights, powers, duties and discretion as the Employer may delegate, subject to
any Limitations or directions specified in the instrument evidencing
appointment of the ancillary trustee and to the terms of the Plan or of ERISA.
The investment powers delegated to the ancillary trustee may include any
investment powers available under Section 10.03 of the Plan including the right
to invest any portion of the assets of the Trust Fund in a common trust fund,
as described in Code Section 584, or in any collective investment fund, the
provisions of which govern the investment of such assets and which the Plan
incorporates by this reference, but only if the ancillary trustee is a bank or
similar financial institution supervised by the United States or by a State and
the ancillary trustee (or its affiliate, as defined in Code Section 1504)
maintains the common trust fund or collective investment fund exclusively for
the collective investment of money contributed by the ancillary trustee (or its
affiliate) in a trustee capacity and which conforms to the rules of the
Comptroller of the Currency. The Employer also may appoint as an ancillary
trustee, the trustee of any group trust fund designated for investment pursuant
to the provisions of Section 10.16 of the Plan.
The ancillary trustee may resign its position at any time by providing
at least 30 days' advance written notice to the Employer, unless the Employer
waives this notice requirement. The Employer, in writing, may remove an
ancillary trustee at any time. In the event of resignation or removal, the
Employer may appoint another ancillary trustee, return the assets to the
control and management of the Trustee or receive such assets in the capacity of
ancillary trustee. The Employer may delegate its responsibilities under this
Section 10.17 to a discretionary Trustee under the Plan, but not to a
nondiscretionary Trustee or to a Custodian, subject to the acceptance by the
discretionary Trustee of that delegation.
If the U.S. Department of Labor ("the Department") requires
engagement of an independent fiduciary to have control or management of all or
a portion of the Trust Fund, the Employer will appoint such independent
fiduciary, as directed by the Department. The independent fiduciary will have
the duties, responsibilities and powers prescribed by the Department and will
exercise those duties, responsibilities and powers in accordance with the
terms, restrictions and conditions established by the Department and, to the
extent not inconsistent with ERISA, the terms of the Plan. The independent
fiduciary must accept its appointment in writing and must acknowledge its
status as a fiduciary of the Plan.
* * *
10.08
<PAGE> 59
DEFINED CONTRIBUTION MASTER PLAN
ARTICLE XI
PROVISIONS RELATING TO INSURANCE AND INSURANCE COMPANY
11.01 INSURANCE BENEFIT. The Employer may elect to provide
incidental life insurance benefits for insurable Participants who consent to
life insurance benefits by signing the appropriate insurance company
application form. The Trustee will not purchase any incidental life insurance
benefit for any Participant prior to an allocation to the Participant's
Account. At an insured Participant's written direction, the Trustee will use
all or any portion of the Participant's nondeductible voluntary contributions,
if any, to pay insurance premiums covering the Participant's life. This
Section 11.01 also authorizes the purchase of life insurance, for the benefit
of the Participant, on the life of a family member of the Participant or on any
person in whom the Participant has an insurable interest. However, if the
policy is on the joint lives of the Participant and another person, the Trustee
may not maintain that policy if that other person predeceases the Participant.
The Employer will direct the Trustee as to the insurance company and
insurance agent through which the Trustee is to purchase the insurance
contracts, the amount of the coverage and the applicable dividend plan. Each
application for a policy, and the policies themselves, must designate the
Trustee as sole owner, with the right reserved to the Trustee to exercise any
right or option contained in the policies, subject to the terms and provisions
of this Agreement. The Trustee must be the named beneficiary for the Account of
the insured Participant. Proceeds of insurance contracts paid to the
Participant's Account under this Article XI are subject to the distribution
requirements of Article V and of Article VI. The Trustee will not retain any
such proceeds for the benefit of the Trust.
The Trustee will charge the premiums on any incidental benefit
insurance contract covering the life of a Participant against the Account of
that Participant. The Trustee will hold all incidental benefit insurance
contracts issued under the Plan as assets of the Trust created under the Plan.
(A) INCIDENTAL INSURANCE BENEFITS. The aggregate of life insurance
premiums paid for the benefit of a Participant, at all times, may not exceed
the following percentages of the aggregate of the Employer's contributions
allocated to any Participant's Account: (i) 49% in the case of the purchase of
ordinary life insurance contracts; or (ii) 25% in the case of the purchase of
term life insurance or universal life insurance contracts. If the Trustee
purchases a combination of ordinary life insurance contract(s) and term life
insurance or universal life insurance contract(s), then the sum of one-half of
the premiums paid for the ordinary life insurance contract(s) and the premiums
paid for the term life insurance or universal life insurance contract(s) may
not exceed 25% of the Employer contributions allocated to any Participant's
Account.
(B) EXCEPTION FOR CERTAIN PROFIT SHARING PLANS. If the Employer's Plan is
a profit sharing plan, the incidental insurance benefits requirement does not
apply to the Plan if the Plan purchases life insurance benefits only from
Employer contributions accumulated in the Participant's Account for at least
two years (measured from the allocation date).
11.02 LIMITATION ON LIFE INSURANCE PROTECTION. The Trustee will not
continue any life insurance protection for any Participant beyond his annuity
starting date (as defined in Article VI). If the Trustee holds any incidental
benefit insurance contract(s) for the benefit of a Participant when he
terminates his employment (other than by reason of death), the Trustee must
proceed as follows:
11.01
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DEFINED CONTRIBUTION MASTER PLAN
(a) If the entire cash value of the contract(s) is vested in the
terminating Participant, or if the contract(s) will have no cash value
at the end of the policy year in which termination of employment
occurs, the Trustee will transfer the contract(s) to the Participant
endorsed so as to vest in the transferee all right, title and interest
to the contract(s), free and clear of the Trust; subject however, to
restrictions as to surrender or payment of benefits as the issuing
insurance company may permit and as the Advisory Committee directs;
(b) If only part of the cash value of the contract(s) is vested in
the terminating Participant, the Trustee, to the extent the
Participant's interest in the cash value of the contract(s) is not
vested, may adjust the Participant's interest in the value of his
Account attributable to Trust assets other than incidental benefit
insurance contracts and proceed as in (a), or the Trustee must effect
a loan from the issuing insurance company on the sole security of the
contract(s) for an amount equal to the difference between the cash
value of the contract(s) at the end of the policy year in which
termination of employment occurs and the amount of the cash value that
is vested in the terminating Participant, and the Trustee must
transfer the contract(s) endorsed so as to vest in the transferee all
right, title and interest to the contract(s), free and clear of the
Trust; subject however, to the restrictions as to surrender or payment
of benefits as the issuing insurance company may permit and the
Advisory Committee directs;
(c) If no part of the cash value of the contract(s) is vested in
the terminating Participant, the Trustee must surrender the
contract(s) for cash proceeds as may be available.
In accordance with the written direction of the Advisory Committee,
the Trustee will make any transfer of contract(s) under this Section 11.02 on
the Participant's annuity starting date (or as soon as administratively
practicable after that date). The Trustee may not transfer any contract under
this Section 11.02 which contains a method of payment NOT specifically
authorized by Article VI or which fails to comply with the joint and survivor
annuity requirements, if applicable, of Article VI. In this regard, the Trustee
either must convert such a contract to cash and distribute the cash instead of
the contract, or before making the transfer, require the issuing company to
delete the unauthorized method of payment option from the contract.
11.03 DEFINITIONS. For purposes of this Article XI:
(a) "Policy" means an ordinary life insurance contract or a term
life insurance contract issued by an insurer on the life of a
Participant.
(b) "Issuing insurance company" is any life insurance company
which has issued a policy upon application by the Trustee under the
terms of this Agreement.
(c) "Contract" or "Contracts" means a policy of insurance. In the
event of any conflict between the provisions of this Plan and the
terms of any contract or policy of insurance issued in accordance with
this Article XI, the provisions of the Plan control.
(d) "Insurable Participant" means a Participant to whom an
insurance company, upon an application being submitted in accordance
with the Plan, will issue insurance coverage, either as a standard
risk or as a risk in an extra mortality classification.
11.04 DIVIDEND PLAN. The dividend plan is premium reduction unless
the Advisory Committee directs the Trustee to the contrary. The Trustee must
use all dividends for a contract to purchase insurance benefits or additional
insurance benefits for the Participant on whose life the insurance company has
issued the contract. Furthermore, the Trustee must arrange, where possible, for
all policies issued on the Lives of Participants under the Plan to have the
same premium due
11.02
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DEFINED CONTRIBUTION MASTER PLAN
date and all ordinary life insurance contracts to contain guaranteed cash
values with as uniform basic options as are possible to obtain. The term
"dividends" includes policy dividends, refunds of premiums and other credits.
11.05 INSURANCE COMPANY NOT A PARTY TO AGREEMENT. No insurance
company, solely in its capacity as an issuing insurance company, is a party to
this Agreement nor is the company responsible for its validity.
11.06 INSURANCE COMPANY NOT RESPONSIBLE FOR TRUSTEE'S ACTIONS. No
insurance company, solely in its capacity as an issuing insurance company, need
examine the terms of this Agreement nor is responsible for any action taken by
the Trustee.
11.07 INSURANCE COMPANY RELIANCE ON TRUSTEE'S SIGNATURE. For the
purpose of making application to an insurance company and in the exercise of
any right or option contained in any policy, the insurance company may rely
upon the signature of the Trustee and is saved harmless and completely
discharged in acting at the direction and authorization of the Trustee.
11.08 ACQUITTANCE. An insurance company is discharged from all
liability for any amount paid to the Trustee or paid in accordance with the
direction of the Trustee, and is not obliged to see to the distribution or
further application of any moneys it so pays.
11.09 DUTIES OF INSURANCE COMPANY. Each insurance company must keep
such records, make such identification of contracts, funds and accounts within
funds, and supply such information as may be necessary for the proper
administration of the Plan under which it is carrying insurance benefits.
Note: The provisions of this Article XI are not applicable, and the
Plan may not invest in insurance contracts, if a Custodian signatory to the
Adoption Agreement is a bank which has not acquired trust powers from its
governing state banking authority.
* * * * * * * * * * * * * * *
11.03
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DEFINED CONTRIBUTION MASTER PLAN
ARTICLE XII
MISCELLANEOUS
12.01 EVIDENCE. Anyone required to give evidence under the terms of
the Plan may do so by certificate, affidavit, document or other information
which the person to act in reliance may consider pertinent, reliable and
genuine, and to have been signed, made or presented by the proper party or
parties. The Advisory Committee and the Trustee are fully protected in acting
and relying upon any evidence described under the immediately preceding
sentence.
12.02 NO RESPONSIBILITY FOR EMPLOYER ACTION. Neither the Trustee nor
the Advisory Committee has any obligation or responsibility with respect to any
action required by the Plan to be taken by the Employer, any Participant or
eligible Employee, or for the failure of any of the above persons to act or
make any payment or contribution, or to otherwise provide any benefit
contemplated under this Plan. Furthermore, the Plan does not require the
Trustee or the Advisory Committee to collect any contribution required under
the Plan, or to determine the correctness of the amount of any Employer
contribution. Neither the Trustee nor the Advisory Committee need inquire into
or be responsible for any action or failure to act on the part of the others,
or on the part of any other person who has any responsibility regarding the
management, administration or operation of the Plan, whether by the express
terms of the Plan or by a separate agreement authorized by the Plan or by the
applicable provisions of ERISA. Any action required of a corporate Employer
must be by its Board of Directors or its designate.
12.03 FIDUCIARIES NOT INSURERS. The Trustee, the Advisory Committee,
the Plan Administrator and the Employer in no way guarantee the Trust Fund from
loss or depreciation. The Employer does not guarantee the payment of any money
which may be or becomes due to any person from the Trust Fund. The liability of
the Advisory Committee and the Trustee to make any payment from the Trust Fund
at any time and all times is limited to the then available assets of the Trust.
12.04 WAIVER OF NOTICE. Any person entitled to notice under the Plan
may waive the notice, unless the Code or Treasury regulations prescribe the
notice or ERISA specifically or impliedly prohibits such a waiver.
12.05 SUCCESSORS. The Plan is binding upon all persons entitled to
benefits under the Plan, their respective heirs and legal representatives, upon
the Employer, its successors and assigns, and upon the Trustee, the Advisory
Committee, the Plan Administrator and their successors.
12.06 WORD USAGE. Words used in the masculine also apply to the
feminine where applicable, and wherever the context of the Employer's Plan
dictates, the plural includes the singular and the singular includes the
plural.
12.07 STATE LAW. The law of the state of the Employer's principal
place of business (unless otherwise designated in an addendum to the Employer's
Adoption Agreement) will determine all questions arising with respect to the
provisions of this Agreement except to the extent superseded by Federal law.
12.08 EMPLOYER'S RIGHT TO PARTICIPATE. If the Employer's Plan fails
to qualify or to maintain qualification or if the Employer makes any amendment
or modification to a provision of this Plan (other than a proper completion of
an elective provision under the Adoption Agreement or the attachment of an
addendum authorized by the Plan or by the Adoption Agreement), the Employer may
no longer participate under this Master Plan. The Employer also may not
participate (or continue to participate) in this Master Plan if the Trustee or
Custodian (or a change in the Trustee or Custodian) does not satisfy the
requirements of Section 1.02 of the Plan. If the
12.01
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DEFINED CONTRIBUTION MASTER PLAN
Employer is not entitled to participate under this Master Plan, the Employer's
Plan is an individually-designed plan and the reliance procedures specified in
the applicable Adoption Agreement no longer will apply.
12.09 EMPLOYMENT NOT GUARANTEED. Nothing contained in this Plan, or
with respect to the establishment of the Trust, or any modification or
amendment to the Plan or Trust, or in the creation of any Account, or the
payment of any benefit, gives any Employee, Employee-Participant or any
Beneficiary any right to continue employment, any legal or equitable right
against the Employer, or Employee of the Employer, or against the Trustee, or
its agents or employees, or against the Plan Administrator, except as expressly
provided by the Plan, the Trust, ERISA or by a separate agreement.
12.02
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DEFINED CONTRIBUTION MASTER PLAN
ARTICLE XIII
EXCLUSIVE BENEFIT, AMENDMENT, TERMINATION
13.01 EXCLUSIVE BENEFIT. Except as provided under Article III, the
Employer has no beneficial interest in any asset of the Trust and no part of
any asset in the Trust may ever revert to or be repaid to an Employer, either
directly or indirectly; nor, prior to the satisfaction of all liabilities with
respect to the Participants and their Beneficiaries under the Plan, may any part
of the corpus or income of the Trust Fund, or any asset of the Trust, be (at
any time) used for, or diverted to, purposes other than the exclusive benefit
of the Participants or their Beneficiaries. However, if the Commissioner of
Internal Revenue, upon the Employer's request for initial approval of this
Plan, determines the Trust created under the Plan is not a qualified trust
exempt from Federal income tax, then (and only then) the Trustee, upon written
notice from the Employer, will return the Employer's contributions (and
increment attributable to the contributions) to the Employer. The Trustee must
make the return of the Employer contribution under this Section 13.01 within
one year of a final disposition of the Employer's request for initial approval
of the Plan. The Employer's Plan and Trust will terminate upon the Trustee's
return of the Employer's contributions.
13.02 AMENDMENT BY EMPLOYER. The Employer has the right at any time
and from time to time:
(a) To amend the elective provisions of the Adoption Agreement in
any manner it deems necessary or advisable in order to qualify (or
maintain qualification of) this Plan and the Trust created under it
under the provisions of Code Section 401(a);
(b) To amend the Plan to allow the Plan to operate under a waiver
of the minimum funding requirement; and
(c) To amend this Agreement in any other manner.
No amendment may authorize or permit any of the Trust Fund (other than
the part which is required to pay taxes and administration expenses) to be used
for or diverted to purposes other than for the exclusive benefit of the
Participants or their Beneficiaries or estates. No amendment may cause or
permit any portion of the Trust Fund to revert to or become a property of the
Employer. The Employer also may not make any amendment which affects the
rights, duties or responsibilities of the Trustee, the Plan Administrator or
the Advisory Committee without the written consent of the affected Trustee, the
Plan Administrator or the affected member of the Advisory Committee. The
Employer must make all amendments in writing. Each amendment must state the
date to which it is either retroactively or prospectively effective. See
Section 12.08 for the effect of certain amendments adopted by the Employer.
(A) CODE SECTION 411(d)(6) PROTECTED BENEFITS. An amendment (including the
adoption of this Plan as a restatement of an existing plan) may not decrease a
Participant's Accrued Benefit, except to the extent permitted under Code
Section 412(c)(8), and may not reduce or eliminate Code Section 411(d)(6)
protected benefits determined immediately prior to the adoption date (or, if
later, the effective date) of the amendment. An amendment reduces or eliminates
Code Section 411(d)(6) protected benefits if the amendment has the effect of
either (1) eliminating or reducing an early retirement benefit or a
retirement-type subsidy (as defined in Treasury regulations), or (2) except as
provided by Treasury regulations, eliminating an optional form of benefit. The
Advisory Committee must disregard an amendment to the extent application of the
amendment would fail to satisfy this paragraph. If the Advisory Committee must
disregard an amendment because the amendment would violate clause (1)
13.01
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DEFINED CONTRIBUTION MASTER PLAN
or clause (2), the Advisory Committee must maintain a schedule of the early
retirement option or other optional forms of benefit the Plan must continue for
the affected Participants.
13.03 AMENDMENT BY MASTER PLAN SPONSOR. The Master Plan Sponsor (or
PPD, as agent of the Master Plan Sponsor), without the Employer's consent, may
amend the Plan and Trust, from time to time, in order to conform the Plan and
Trust to any requirement for qualification of the Plan and Trust under the
Internal Revenue Code. The Master Plan Sponsor may not amend the Plan in any
manner which would modify any election made by the Employer under the Plan
without the Employer's written consent. Furthermore, the Master Plan Sponsor
may not amend the Plan in any manner which would violate the proscription of
Section 13.02. A Trustee does not have the power to amend the Plan or Trust.
13.04 DISCONTINUANCE.The Employer has the right, at any time, to
suspend or discontinue its contributions under the Plan, and to terminate, at
any time, this Plan and the Trust created under this Agreement. The Plan will
terminate upon the first to occur of the following:
(a) The date terminated by action of the Employer;
(b) The dissolution or merger of the Employer, unless the
successor makes provision to continue the Plan, in which event the
successor must substitute itself as the Employer under this Plan. Any
termination of the Plan resulting from this paragraph (b) is not
effective until compliance with any applicable notice requirements
under ERISA.
13.05 FULL VESTING ON TERMINATION. Upon either full or partial
termination of the Plan, or, if applicable, upon complete discontinuance of
profit sharing plan contributions to the Plan, an affected Participant's right
to his Accrued Benefit is 100% Nonforfeitable, irrespective of the
Nonforfeitable percentage which otherwise would apply under Article V.
13.06 MERGER/DIRECT TRANSFER. The Trustee may not consent to, or be
a party to, any merger or consolidation with another plan, or to a transfer of
assets or liabilities to another plan, unless immediately after the merger,
consolidation or transfer, the surviving Plan provides each Participant a
benefit equal to or greater than the benefit each Participant would have
received had the Plan terminated immediately before the merger or consolidation
or transfer. The Trustee possesses the specific authority to enter into merger
agreements or direct transfer of assets agreements with the trustees of other
retirement plans described in Code Section 401(a), including an elective
transfer, and to accept the direct transfer of plan assets, or to transfer plan
assets, as a party to any such agreement.
The Trustee may accept a direct transfer of plan assets on behalf of
an Employee prior to the date the Employee satisfies the Plan's eligibility
conditions. If the Trustee accepts such a direct transfer of plan assets, the
Advisory Committee and Trustee must treat the Employee as a Participant for all
purposes of the Plan except the Employee is not a Participant for purposes of
sharing in Employer contributions or Participant forfeitures under the Plan
until he actually becomes a Participant in the Plan.
(A) ELECTIVE TRANSFERS. The Trustee, after August 9, 1988, may not consent
to, or be a party to a merger, consolidation or transfer of assets with a
defined benefit plan, except with respect to an elective transfer, or unless
the transferred benefits are in the form of paid-up individual annuity
contracts guaranteeing the payment of the transferred benefits in accordance
with the terms of the transferor plan and in a manner consistent with the Code
and with ERISA. The Trustee will hold, administer and distribute the
transferred assets as a part of the Trust Fund and the Trustee must maintain a
separate Employer contribution Account for the benefit of the Employee on whose
behalf the Trustee accepted the transfer in order to reflect the value of the
transferred assets. Unless a transfer of assets to this Plan is an elective
transfer, the Plan will preserve all Code Section 411(d)(6)
13.02
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DEFINED CONTRIBUTION MASTER PLAN
protected benefits with respect to those transferred assets, in the manner
described in Section 13.02. A transfer is an elective transfer if: (1) the
transfer satisfies the first paragraph of this Section 13.06; (2) the transfer
is voluntary, under a fully informed election by the Participant; (3) the
Participant has an alternative that retains his Code Section 411(d)(6)
protected benefits (including an option to leave his benefit in the transferor
plan, if that plan is not terminating); (4) the transfer satisfies the
applicable spousal consent requirements of the Code; (5) the transferor plan
satisfies the joint and survivor notice requirements of the Code, if the
Participant's transferred benefit is subject to those requirements; (6) the
Participant has a right to immediate distribution from the transferor plan, in
lieu of the elective transfer; (7) the transferred benefit is at least the
greater of the single sum distribution provided by the transferor plan for
which the Participant is eligible or the present value of the Participant's
accrued benefit under the transferor plan payable at that plan's normal
retirement age; (8) the Participant has a 100% Nonforfeitable interest in the
transferred benefit; and (9) the transfer otherwise satisfies applicable
Treasury regulations. An elective transfer may occur between qualified plans of
any type. Any direct transfer of assets from a defined benefit plan after
August 9, 1988, which does not satisfy the requirements of this paragraph will
render the Employer's Plan individually-designed. See Section 12.08.
(B) DISTRIBUTION RESTRICTIONS UNDER CODE SECTION 401(k). If the Plan
receives a direct transfer (by merger or otherwise) of elective contributions
(or amounts treated as elective contributions) under a Plan with a Code Section
401(k) arrangement, the distribution restrictions of Code Sections 401(k)(2)
and (10) continue to apply to those transferred elective contributions.
13.07 TERMINATION.
(A) PROCEDURE. Upon termination of the Plan, the distribution provisions
of Article VI remain operative, with the following exceptions:
(1) if the present value of the Participant's Nonforfeitable
Accrued Benefit does not exceed $3,500, the Advisory Committee will
direct the Trustee to distribute the Participant's Nonforfeitable
Accrued Benefit to him in lump sum as soon as administratively
practicable after the Plan terminates; and
(2) if the present value of the Participant's Nonforfeitable
Accrued Benefit exceeds $3,500, the Participant or the Beneficiary, in
addition to the distribution events permitted under Article VI, may
elect to have the Trustee commence distribution of his Nonforfeitable
Accrued Benefit as soon as administratively practicable after the Plan
terminates.
To liquidate the Trust, the Advisory Committee will purchase a
deferred annuity contract for each Participant which protects the Participant's
distribution rights under the Plan, if the Participant's Nonforfeitable Accrued
Benefit exceeds $3,500 and the Participant does not elect an immediate
distribution pursuant to Paragraph (2).
If the Employer's Plan is a profit sharing plan, in lieu of the
preceding provisions of this Section 13.07 and the distribution provisions of
Article VI, the Advisory Committee will direct the Trustee to distribute each
Participant's Nonforfeitable Accrued Benefit, in lump sum, as soon as
administratively practicable after the termination of the Plan, irrespective of
the present value of the Participant's Nonforfeitable Accrued Benefit and
whether the Participant consents to that distribution. This paragraph does not
apply if: (1) the Plan provides an annuity option; or (2) as of the period
between the Plan termination date and the final distribution of assets, the
Employer maintains any other defined contribution plan (other than an ESOP).
The Employer, in an addendum to its Adoption Agreement numbered 13.07, may
elect not to have this paragraph apply.
13.03
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DEFINED CONTRIBUTION MASTER PLAN
The Trust will continue until the Trustee in accordance with the
direction of the Advisory Committee has distributed all of the benefits under
the Plan. On each valuation date, the Advisory Committee will credit any part
of a Participant's Accrued Benefit retained in the Trust with its proportionate
share of the Trust's income, expenses, gains and losses, both realized and
unrealized. Upon termination of the Plan, the amount, if any, in a suspense
account under Article III will revert to the Employer, subject to the
conditions of the Treasury regulations permitting such a reversion. A
resolution or amendment to freeze all future benefit accrual but otherwise to
continue maintenance of this Plan, is not a termination for purposes of this
Section 13.07.
(B) DISTRIBUTION RESTRICTIONS UNDER CODE SECTION 401(k). If the Employer's
Plan includes a Code Section 401(k) arrangement or if transferred assets
described in Section 13.06 are subject to the distribution restrictions of Code
Sections 401(k)(2) and (10), the special distribution provisions of this
Section 13.07 are subject to the restrictions of this paragraph. The portion of
the Participant's Nonforfeitable Accrued Benefit attributable to elective
contributions (or to amounts treated under the Code Section 401(k) arrangement
as elective contributions) is not distributable on account of Plan termination,
as described in this Section 13.07, unless: (a) the Participant otherwise is
entitled under the Plan to a distribution of that portion of his Nonforfeitable
Accrued Benefit; or (b) the Plan termination occurs without the establishment
of a successor plan. A successor plan under clause (b) is a defined
contribution plan (other than an ESOP) maintained by the Employer (or by a
related employer) at the time of the termination of the Plan or within the
period ending twelve months after the final distribution of assets. A
distribution made after March 31, 1988, pursuant to clause (b), must be part of
a lump sum distribution to the Participant of his Nonforfeitable Accrued
Benefit.
* * * * * * * *
13.04
<PAGE> 68
DEFINED CONTRIBUTION MASTER PLAN
ARTICLE XIV
CODE SECTION 401(k) AND CODE SECTION 401(m) ARRANGEMENTS
14.01 APPLICATION. This Article XIV applies to an Employer's Plan
only if the Employer is maintaining its Plan under a Code Section 401(k)
Adoption Agreement.
14.02 CODE SECTION 401(k) ARRANGEMENT. The Employer will elect in
Section 3.01 of its Adoption Agreement the terms of the Code Section 401(k)
arrangement, if any, under the Plan. If the Employer's Plan is a Standardized
Plan, the Code Section 401(k) arrangement must be a salary reduction
arrangement. If the Employer's Plan is a Nonstandardized Plan, the Code Section
401(k) arrangement may be a salary reduction arrangement or a cash or deferred
arrangement.
(A) SALARY REDUCTION ARRANGEMENT. If the Employer elects a salary
reduction arrangement, any Employee eligible to participate in the Plan may
file a salary reduction agreement with the Advisory Committee. The salary
reduction agreement may not be effective earlier than the following date which
occurs last: (i) the Employee's Plan Entry Date (or, in the case of a
reemployed Employee, his reparticipation date under Article II); (ii) the
execution date of the Employee's salary reduction agreement; (iii) the date the
Employer adopts the Code Section 401(k) arrangement by executing the Adoption
Agreement; or (iv) the effective date of the Code Section 401(k) arrangement,
as specified in the Employer's Adoption Agreement. Regarding clause (i), an
Employee subject to the Break in Service rule of Section 2.03(B) of the Plan
may not enter into a salary reduction agreement until the Employee has
completed a sufficient number of Hours of Service to receive credit for a Year
of Service (as defined in Section 2.02) following his reemployment commencement
date. A salary reduction agreement must specify the amount of Compensation (as
defined in Section 1.12) or percentage of Compensation the Employee wishes to
defer. The salary reduction agreement will apply only to Compensation which
becomes currently available to the Employee after the effective date of the
salary reduction agreement. The Employer will apply a reduction election to all
Compensation (and to increases in such Compensation) unless the Employee
specifies in his salary reduction agreement to limit the election to certain
Compensation. The Employer will specify in Adoption Agreement Section 3.01 the
rules and restrictions applicable to the Employees salary reduction agreements.
(B) CASH OR DEFERRED ARRANGEMENT. If the Employer elects a cash or
deferred arrangement, a Participant may elect to make a cash election against
his proportionate share of the Employer's Cash or Deferred Contribution, in
accordance with the Employer's elections in Adoption Agreement Section 3.01. A
Participant's proportionate share of the Employer's Cash or Deferred
Contribution is the percentage of the total Cash or Deferred Contribution which
bears the same ratio that the Participant's Compensation for the Plan Year
bears to the total Compensation of all Participants for the Plan Year. For
purposes of determining each Participant's proportionate share of the Cash or
Deferred Contribution, a Participant's Compensation is his Compensation as
determined under Section 1.12 of the Plan (as modified by Section 3.06 for
allocation purposes), excluding any effect the proportionate share may have on
the Participant's Compensation for the Plan Year. The Advisory Committee will
determine the proportionate share prior to the Employer's actual contribution
to the Trust, to provide the Participants the opportunity to file cash
elections. The Employer will pay directly to the Participant the portion of his
proportionate share the Participant has elected to receive in cash.
(C) ELECTION NOT TO PARTICIPATE. A Participant's or Employee's election
not to participate, pursuant to Section 2.06, includes his right to enter into
a salary reduction agreement or to share in the allocation of a Cash or
Deferred Contribution, unless the Participant or Employee limits the effect of
the election to the non-401(k) portions of the Plan.
14.03 DEFINITIONS. For purposes of this Article XIV:
(a) "Highly Compensated Employee" means an Eligible Employee who
satisfies the definition in Section 1.09 of the Plan. Family members
aggregated as a single Employee under Section 1.09 constitute a single
Highly Compensated Employee, whether a particular family member is a
14.01
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DEFINED CONTRIBUTION MASTER PLAN
Highly Compensated Employee or a Nonhighly Compensated Employee
without the application of family aggregation.
(b) "Nonhighly Compensated Employee" means an Eligible Employee
who is not a Highly Compensated Employee and who is not a family
member treated as a Highly Compensated Employee.
(c) "Eligible Employee" means, for purposes of the ADP test
described in Section 14.08, an Employee who is eligible to enter into
a salary reduction agreement for the Plan Year, irrespective of
whether he actually enters into such an agreement, and a Participant
who is eligible for an allocation of the Employer's Cash or Deferred
Contribution for the Plan Year. For purposes of the ACP test described
in Section 14.09, an "Eligible Employee" means a Participant who is
eligible to receive an allocation of matching contributions (or would
be eligible if he made the type of contributions necessary to receive
an allocation of matching contributions) and a Participant who is
eligible to make nondeductible contributions, irrespective of whether
he actually makes nondeductible contributions. An Employee continues
to be an Eligible Employee during a period the Plan suspends the
Employee's right to make elective deferrals or nondeductible
contributions following a hardship distribution.
(d) "Highly Compensated Group" means the group of Eligible
Employees who are Highly Compensated Employees for the Plan Year.
(e) "Nonhighly Compensated Group" means the group of Eligible
Employees who are Nonhighly Compensated Employees for the Plan Year.
(f) "Compensation" means, except as specifically provided in this
Article XIV, Compensation as defined for nondiscrimination purposes in
Section 1.12(B) of the Plan. To compute an Employee's ADP or ACP, the
Advisory Committee may limit Compensation taken into account to
Compensation received only for the portion of the Plan Year in which
the Employee was an Eligible Employee and only for the portion of the
Plan Year in which the Plan or the Code Section 401(k) arrangement was
in effect.
(g) "Deferral contributions" are Salary Reduction Contributions
and Cash or Deferred Contributions the Employer contributes to the
Trust on behalf of an Eligible Employee, irrespective of whether, in
the case of Cash or Deferred Contributions, the contribution is at the
election of the Employee. For Salary Reduction Contributions, the
terms "deferral contributions" and "elective deferrals" have the same
meaning.
(h) "Elective deferrals" are all Salary Reduction Contributions
and that portion of any Cash or Deferred Contribution which the
Employer contributes to the Trust at the election of an Eligible
Employee. Any portion of a Cash or Deferred Contribution contributed
to the Trust because of the Employee's failure to make a cash election
is an elective deferral. However, any portion of a Cash or Deferred
Contribution over which the Employee does not have a cash election is
not an elective deferral. Elective deferrals do not include amounts
which have become currently available to the Employee prior to the
election nor amounts designated as nondeductible contributions at the
time of deferral or contribution.
(i) "Matching contributions" are contributions made by the
Employer on account of elective deferrals under a Code Section 401(k)
arrangement or on account of employee contributions. Matching
contributions also include Participant forfeitures allocated on
account of such elective deferrals or employee contributions.
(j) "Nonelective contributions" are contributions made by the
Employer which are not subject to a deferral election by an Employee
and which are not matching contributions.
(k) "Qualified matching contributions" are matching contributions
which are l00% Nonforfeitable at all times and which are subject to
the distribution restrictions described in paragraph (m). Matching
contributions are not 100% Nonforfeitable at all times if the Employee
has a 100% Nonforfeitable interest because of his Years of Service
taken into account under a vesting schedule. Any matching
contributions allocated to a Participant's
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DEFINED CONTRIBUTION MASTER PLAN
Qualified Matching Contributions Account under the Plan automatically
satisfy the definition of qualified matching contributions.
(l) "Qualified nonelective contributions" are nonelective
contributions which are 100% Nonforfeitable at all times and which are
subject to the distribution restrictions described in paragraph (m).
Nonelective contributions are not 100% Nonforfeitable at all times if
the Employee has a 100% Nonforfeitable interest because of his Years
of Service taken into account under a vesting schedule. Any
nonelective contributions allocated to a Participant's Qualified
Nonelective Contributions Account under the Plan automatically satisfy
the definition of qualified nonelective contributions.
(m) "Distribution restrictions" means the Employee may not receive
a distribution of the specified contributions (nor earnings on those
contributions) except in the event of (1) the Participant's death,
disability, termination of employment or attainment of age 59 1/2, (2)
financial hardship satisfying the requirements of Code Section 401(k)
and the applicable Treasury regulations, (3) a plan termination,
without establishment of a successor defined contribution plan (other
than an ESOP), (4) a sale of substantially all of the assets (within
the meaning of Code Section 409(d)(2)) used in a trade or business,
but only to an employee who continues employment with the corporation
acquiring those assets, or (5) a sale by a corporation of its
interest in a subsidiary (within the meaning of Code Section
409(d)(3)), but only to an employee who continues employment with the
subsidiary. For Plan Years beginning after December 31, 1988, a
distribution on account of financial hardship, as described in clause
(2), may not include earnings on elective deferrals credited as of a
date later than December 31, 1988, and may not include qualified
matching contributions and qualified nonelective contributions, nor
any earnings on such contributions, credited after December 31, 1988.
A plan does not violate the distribution restrictions if, instead of
the December 31, 1988, date in the preceding sentence the plan
specifies a date not later than the end of the last Plan Year ending
before July 1, 1989. A distribution described in clauses (3), (4) or
(5), if made after March 31, 1988, must be a lump sum distribution, as
required under Code Section 401(k)(10).
(n) "Employee contributions" are contributions made by a
Participant on an after-tax basis, whether voluntary or mandatory, and
designated, at the time of contribution, as an employee (or
nondeductible) contribution. Elective deferrals and deferral
contributions are not employee contributions. Participant
nondeductible contributions, made pursuant to Section 4.01 of the
Plan, are employee contributions.
14.04 MATCHING CONTRIBUTIONS/EMPLOYEE CONTRIBUTIONS. The Employer
may elect in Adoption Agreement Section 3.01 to provide matching contributions.
The Employer also may elect in Adoption Agreement Section 4.01 to permit or to
require a Participant to make nondeductible contributions.
(A) MANDATORY CONTRIBUTIONS. Any Participant nondeductible contributions
eligible for matching contributions are mandatory contributions. The Advisory
Committee will maintain a separate accounting, pursuant to Section 4.06 of the
Plan, to reflect the Participant's Accrued Benefit derived from his mandatory
contributions. The Employer, under Adoption Agreement Section 4.05, may
prescribe special distribution restrictions which will apply to the Mandatory
Contributions Account prior to the Participant's Separation from Service.
Following his Separation from Service, the general distribution provisions of
Article VI apply to the distribution of the Participant's Mandatory
Contributions Account.
14.05 TIME OF PAYMENT OF CONTRIBUTIONS. The Employer must make
Salary Reduction Contributions to the Trust within an administratively
reasonable period of time after withholding the corresponding Compensation from
the Participant. Furthermore, the Employer must make Salary Reduction
Contributions, Cash or Deferred Contributions, Employer matching contributions
(including qualified Employer matching contributions) and qualified Employer
nonelective contributions no later than the time prescribed by the Code or by
applicable Treasury regulations. Salary Reduction Contributions and Cash or
Deferred Contributions are Employer contributions for all purposes under this
Plan, except to the extent the Code or Treasury
14.03
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DEFINED CONTRIBUTION MASTER PLAN
regulations prohibit the use of these contributions to satisfy the
qualification requirements of the Code.
14.06 SPECIAL ALLOCATION PROVISIONS - DEFERRAL CONTRIBUTIONS,
MATCHING CONTRIBUTIONS AND QUALIFIED NONELECTIVE CONTRIBUTIONS. To make
allocations under the Plan, the Advisory Committee must establish a Deferral
Contributions Account, a Qualified Matching Contributions Account, a Regular
Matching Contributions Account, a Qualified Nonelective Contributions Account
and an Employer Contributions Account for each Participant.
(A) DEFERRAL CONTRIBUTIONS. The Advisory Committee will allocate to each
Participant's Deferral Contributions Account the amount of Deferral
Contributions the Employer makes to the Trust on behalf of the Participant. The
Advisory Committee will make this allocation as of the last day of each Plan
Year unless, in Adoption Agreement Section 3.04, the Employer elects more
frequent allocation dates for salary reduction contributions.
(B) MATCHING CONTRIBUTIONS. The Employer must specify in its Adoption
Agreement whether the Advisory Committee will allocate matching contributions
to the Qualified Matching Contributions Account or to the Regular Matching
Contributions Account of each Participant. The Advisory Committee will make
this allocation as of the last day of each Plan Year unless, in Adoption
Agreement Section 3.04, the Employer elects more frequent allocation dates for
matching contributions.
(1) To the extent the Employer makes matching contributions under
a fixed matching contribution formula, the Advisory Committee will
allocate the matching contribution to the Account of the Participant
on whose behalf the Employer makes that contribution. A fixed matching
contribution formula is a formula under which the Employer contributes
a certain percentage or dollar amount on behalf of a Participant based
on that Participant's deferral contributions or nondeductible
contributions eligible for a match, as specified in Section 3.01 of
the Employer's Adoption Agreement. The Employer may contribute on a
Participant's behalf under a specific matching contribution formula
only if the Participant satisfies the accrual requirements for
matching contributions specified in Section 3.06 of the Employer's
Adoption Agreement and only to the extent the matching contribution
does not exceed the Participant's annual additions limitation in Part
2 of Article III.
(2) To the extent the Employer makes matching contributions under
a discretionary formula, the Advisory Committee will allocate the
discretionary matching contributions to the Account of each
Participant who satisfies the accrual requirements for matching
contributions specified in Section 3.06 of the Employer's Adoption
Agreement. The allocation of discretionary matching contributions to a
Participant's Account is in the same proportion that each
Participant's eligible contributions bear to the total eligible
contributions of all Participants. If the discretionary formula is a
tiered formula, the Advisory Committee will make this allocation
separately with respect to each tier of eligible contributions,
allocating in such manner the amount of the matching contributions
made with respect to that tier. "Eligible contributions" are the
Participant's deferral contributions or nondeductible contributions
eligible for an allocation of matching contributions, as specified in
Section 3.01 of the Employer's Adoption Agreement.
If the matching contribution formula applies both to deferral
contributions and to Participant nondeductible contributions, the matching
contributions apply first to deferral contributions. Furthermore, the matching
contribution formula does not apply to deferral contributions that are excess
deferrals under Section 14.07. For this purpose: (a) excess deferrals relate
first to deferral contributions for the Plan Year not otherwise eligible for a
matching contribution; and (2) if the Plan Year is not a calendar year, the
excess deferrals for a Plan Year are the last elective deferrals made for a
calendar year. Under a Standardized Plan, an Employee forfeits any matching
contribution attributable to an excess contribution or to an excess aggregate
contribution, unless distributed pursuant to Sections 14.08 or 14.09. Under a
Nonstandardized Plan, this forfeiture rule applies only if specified in
Adoption Agreement Section 3.06. The provisions of Section 3.05 govern
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DEFINED CONTRIBUTION MASTER PLAN
the treatment of any forfeiture described in this paragraph, and the Advisory
Committee will compute a Participant's ACP under 14.09 by disregarding the
forfeiture.
(C) QUALIFIED NONELECTIVE CONTRIBUTIONS. If the Employer, at the time of
contribution, designates a contribution to be a qualified nonelective
contribution for the Plan Year, the Advisory Committee will allocate that
qualified nonelective contribution to the Qualified Nonelective Contributions
Account of each Participant eligible for an allocation of that designated
contribution, as specified in Section 3.04 of the Employer's Adoption
Agreement. The Advisory Committee will make the allocation to each eligible
Participant's Account in the same ratio that the Participant's Compensation for
the Plan Year bears to the total Compensation of all eligible Participants for
the Plan Year. The Advisory Committee will determine a Participant's
Compensation in accordance with the general definition of Compensation under
Section 1.12 of the Plan, as modified by the Employer in Sections 1.12 and 3.06
of its Adoption Agreement.
(D) NONELECTIVE CONTRIBUTIONS. To the extent the Employer makes
nonelective contributions for the Plan Year which, at the time of contribution,
it does not designate as qualified nonelective contributions, the Advisory
Committee will allocate those contributions in accordance with the elections
under Section 3.04 of the Employer's Adoption Agreement. For purposes of the
special nondiscrimination tests described in Sections 14.08 and 14.09, the
Advisory Committee may treat nonelective contributions allocated under this
paragraph as qualified nonelective contributions, if the contributions
otherwise satisfy the definition of qualified nonelective contributions.
14.07 ANNUAL ELECTIVE DEFERRAL LIMITATION.
(A) ANNUAL ELECTIVE DEFERRAL LIMITATION. An Employee's elective deferrals
for a calendar year beginning after December 31, 1986, may not exceed the
402(g) limitation. The 402(g) limitation is the greater of $7,000 or the
adjusted amount determined by the Secretary of the Treasury. If, pursuant to a
salary reduction agreement or pursuant to a cash or deferral election, the
Employer determines the Employee's elective deferrals to the Plan for a
calendar year would exceed the 402(g) limitation, the Employer will suspend the
Employee's salary reduction agreement, if any, until the following January 1
and pay in cash the portion of a cash or deferral election which would result
in the Employee's elective deferrals for the calendar year exceeding the 402(g)
limitation. If the Advisory Committee determines an Employee's elective
deferrals already contributed to the Plan for a calendar year exceed the 402(g)
limitation, the Advisory Committee will distribute the amount in excess of the
402(g) limitation (the "excess deferral"), as adjusted for allocable income, no
later than April 15 of the following calendar year. If the Advisory Committee
distributes the excess deferral by the appropriate April 15, it may make the
distribution irrespective of any other provision under this Plan or under the
Code. The Advisory Committee will reduce the amount of excess deferrals for a
calendar year distributable to the Employee by the amount of excess
contributions (as determined in Section 14.08), if any, previously distributed
to the Employee for the Plan Year beginning in that calendar year.
If an Employee participates in another plan under which he 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, irrespective of whether the Employer
maintains the other plan, he may provide the Advisory Committee a written claim
for excess deferrals made for a calendar year. The Employee must submit the
claim no later than the March 1 following the close of the particular calendar
year and the claim must specify the amount of the Employee's elective deferrals
under this Plan which are excess deferrals. If the Advisory Committee receives
a timely claim, it will distribute the excess deferral (as adjusted for
allocable income) the Employee has assigned to this Plan, in accordance with
the distribution procedure described in the immediately preceding paragraph.
(B) ALLOCABLE INCOME. For purposes of making a distribution of excess
deferrals pursuant to this Section 14.07, allocable income means net income or
net loss allocable to the excess deferrals for the calendar year in which the
Employee made the excess deferral, determined in a manner which is uniform,
nondiscriminatory and reasonably reflective of the manner used by the Plan to
allocate income to Participants' Accounts.
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DEFINED CONTRIBUTION MASTER PLAN
14.08 ACTUAL DEFERRAL PERCENTAGE ("ADP") TEST. For each Plan Year,
the Advisory Committee must determine whether the Plan's Code Section 401(k)
arrangement satisfies either of the following ADP tests:
(i) The average ADP for the Highly Compensated Group does not
exceed 1.25 times the average ADP of the Nonhighly Compensated Group;
or
(ii) The average ADP for the Highly Compensated Group does not
exceed the average ADP for the Nonhighly Compensated Group by more
than two percentage points (or the lesser percentage permitted by the
multiple use limitation in Section 14.10) and the average ADP for the
Highly Compensated Group is not more than twice the average ADP for
the Nonhighly Compensated Group.
(A) CALCULATION OF ADP. The average ADP for a group is the average of the
separate ADPs calculated for each Eligible Employee who is a member of that
group. An Eligible Employee's ADP for a Plan Year is the ratio of the Eligible
Employee's deferral contributions for the Plan Year to the Employee's
Compensation for the Plan Year. For aggregated family members treated as a
single Highly Compensated Employee, the ADP of the family unit is the ADP
determined by combining the deferral contributions and Compensation of all
aggregated family members. A Nonhighly Compensated Employee's ADP does not
include elective deferrals made to this Plan or to any other Plan maintained by
the Employer, to the extent such elective deferrals exceed the 402(g)
limitation described in Section 14.07(A).
The Advisory Committee, in a manner consistent with Treasury
regulations, may determine the ADPs of the Eligible Employees by taking into
account qualified nonelective contributions or qualified matching
contributions, or both, made to this Plan or to any other qualified Plan
maintained by the Employer. The Advisory Committee may not include qualified
nonelective contributions in the ADP test unless the allocation of nonelective
contributions is nondiscriminatory when the Advisory Committee takes into
account all nonelective contributions (including the qualified nonelective
contributions) and also when the Advisory Committee takes into account only the
nonelective contributions not used in either the ADP test described in this
Section 14.08 or the ACP test described in Section 14.09. For Plan Years
beginning after December 31, 1989, the Advisory Committee may not include in
the ADP test any qualified nonelective contributions or qualified matching
contributions under another qualified plan unless that plan has the same plan
year as this Plan. The Advisory Committee must maintain records to demonstrate
compliance with the ADP test, including the extent to which the Plan used
qualified nonelective contributions or qualified matching contributions to
satisfy the test.
For Plan Years beginning prior to January 1, 1992, the Advisory
Committee may elect to apply a separate ADP test to each component group under
the Plan. Each component group separately must satisfy the commonality
requirement of the Code Section 401(k) regulations and the minimum coverage
requirements of Code Section 410(b). A component group consists of all the
allocations and other benefits, rights and features provided that group of
Employees. An Employee may not be part of more than one component group. The
correction rules described in this Section 14.08 apply separately to each
component group.
(B) SPECIAL AGGREGATION RULE FOR HIGHLY COMPENSATED EMPLOYEES. To
determine the ADP of any Highly Compensated Employee, the deferral
contributions taken into account must include any elective deferrals made by
the Highly Compensated Employee under any other Code Section 401(k) arrangement
maintained by the Employer, unless the elective deferrals are to an ESOP. If
the plans containing the Code Section 401(k) arrangements have different plan
years, the Advisory Committee will determine the combined deferral
contributions on the basis of the plan years ending in the same calendar year.
(C) AGGREGATION OF CERTAIN CODE SECTION 401(k) ARRANGEMENTS. If the
Employer treats two plans as a unit for coverage or nondiscrimination purposes,
the Employer must combine the Code Section 401(k) arrangements under such plans
to determine whether either plan satisfies the ADP test. This
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DEFINED CONTRIBUTION MASTER PLAN
aggregation rule applies to the ADP determination for all Eligible Employees,
irrespective of whether an Eligible Employee is a Highly Compensated Employee
or a Nonhighly Compensated Employee. For Plan Years beginning after December
31, 1989, an aggregation of Code Section 401(k) arrangements under this
paragraph does not apply to plans which have different plan years and, for Plan
Years beginning after December 31, 1988, the Advisory Committee may not
aggregate an ESOP (or the ESOP portion of a plan) with a non-ESOP plan (or
non-ESOP portion of a plan).
(D) CHARACTERIZATION OF EXCESS CONTRIBUTIONS. If, pursuant to this Section
14.08, the Advisory Committee has elected to include qualified matching
contributions in the average ADP, the Advisory Committee will treat excess
contributions as attributable proportionately to deferral contributions and to
qualified matching contributions allocated on the basis of those deferral
contributions. If the total amount of a Highly Compensated Employee's excess
contributions for the Plan Year exceeds his deferral contributions or qualified
matching contributions for the Plan Year, the Advisory Committee will treat the
remaining portion of his excess contributions as attributable to qualified
nonelective contributions. The Advisory Committee will reduce the amount of
excess contributions for a Plan Year distributable to a Highly Compensated
Employee by the amount of excess deferrals (as determined in Section 14.07), if
any, previously distributed to that Employee for the Employee's taxable year
ending in that Plan Year.
(E) DISTRIBUTION OF EXCESS CONTRIBUTIONS. If the Advisory Committee
determines the Plan fails to satisfy the ADP test for a Plan Year, it must
distribute the excess contributions, as adjusted for allocable income, during
the next Plan Year. However, the Employer will incur an excise tax equal to 10%
of the amount of excess contributions for a Plan Year not distributed to the
appropriate Highly Compensated Employees during the first 2 1/2 months of that
next Plan Year. The excess contributions are the amount of deferral
contributions made by the Highly Compensated Employees which causes the Plan to
fail to satisfy the ADP test. The Advisory Committee will distribute to each
Highly Compensated Employee his respective share of the excess contributions.
The Advisory Committee will determine the respective shares of excess
contributions by starting with the Highly Compensated Employee(s) who has the
greatest ADP, reducing his ADP (but not below the next highest ADP), then, if
necessary, reducing the ADP of the Highly Compensated Employee(s) at the next
highest ADP level (including the ADP of the Highly Compensated Employee(s)
whose ADP the Advisory Committee already has reduced), and continuing in this
manner until the average ADP for the Highly Compensated Group satisfies the ADP
test. If the Highly Compensated Employee is part of an aggregated family group,
the Advisory Committee, in accordance with the applicable Treasury regulations,
will determine each aggregated family member's allocable share of the excess
contributions assigned to the family unit.
(F) ALLOCABLE INCOME. To determine the amount of the corrective
distribution required under this Section 14.08, the Advisory Committee must
calculate the allocable income for the Plan Year in which the excess
contributions arose. "Allocable income" means net income or net loss. To
calculate allocable income for the Plan Year, the Advisory Committee will use a
uniform and nondiscriminatory method which reasonably reflects the manner used
by the Plan to allocate income to Participants' Accounts.
14.09 NONDISCRIMINATION RULES FOR EMPLOYER MATCHING
CONTRIBUTIONS/PARTICIPANT NONDEDUCTIBLE CONTRIBUTIONS. For Plan Years
beginning after December 31, 1986, the Advisory Committee must determine
whether the annual Employer matching contributions (other than qualified
matching contributions used in the ADP under Section 14.08), if any, and the
Employee contributions, if any, satisfy either of the following average
contribution percentage ("ACP") tests:
(i) The ACP for the Highly Compensated Group does not exceed 1.25
times the ACP of the Nonhighly Compensated Group; or
(ii) The ACP for the Highly Compensated Group does not exceed the
ACP for the Nonhighly Compensated Group by more than two percentage
points (or the lesser percentage permitted by the multiple use
limitation in Section 14.10) and the ACP for the Highly Compensated
Group is not more than twice the ACP for the Nonhighly Compensated
Group.
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DEFINED CONTRIBUTION MASTER PLAN
(A) CALCULATION OF ACP. The average contribution percentage for a group is
the average of the separate contribution percentages calculated for each
Eligible Employee who is a member of that group. An Eligible Employee's
contribution percentage for a Plan Year is the ratio of the Eligible Employee's
aggregate contributions for the Plan Year to the Employee's Compensation for
the Plan Year. "Aggregate contributions" are Employer matching contributions
(other than qualified matching contributions used in the ADP test under Section
14.08) and employee contributions (as defined in Section 14.03). For aggregated
family members treated as a single highly Compensated Employee, the
contribution percentage of the family unit is the contribution percentage
determined by combining the aggregate contributions and Compensation of all
aggregated family members.
The Advisory Committee, in a manner consistent with Treasury
regulations, may determine the contribution percentages of the Eligible
Employees by taking into account qualified nonelective contributions (other
than qualified nonelective contributions used in the ADP test under Section
14.08) or elective deferrals, or both, made to this Plan or to any other
qualified Plan maintained by the Employer. The Advisory Committee may not
include qualified nonelective contributions in the ACP test unless the
allocation of nonelective contributions is nondiscriminatory when the Advisory
Committee takes into account all nonelective contributions (including the
qualified nonelective contributions) and also when the Advisory Committee takes
into account only the nonelective contributions not used in either the ADP test
described in Section 14.08 or the ACP test described in this Section 14.09. The
Advisory Committee may not include elective deferrals in the ACP test, unless
the Plan which includes the elective deferrals satisfies the ADP test both with
and without the elective deferrals included in this ACP test. For Plan Years
beginning after December 31, 1989, the Advisory Committee may not include in
the ACP test any qualified nonelective contributions or elective deferrals
under another qualified plan unless that plan has the same plan year as this
Plan. The Advisory Committee must maintain records to demonstrate compliance
with the ACP test, including the extent to which the Plan used qualified
nonelective contributions or elective deferrals to satisfy the test. For Plan
Years beginning prior to January 1, 1992, the component group testing rule
permitted under Section 14.08(A) also applies to the ACP test under this
Section 14.09.
(B) SPECIAL AGGREGATION RULE FOR HIGHLY COMPENSATED EMPLOYEES. To
determine the contribution percentage of any Highly Compensated Employee, the
aggregate contributions taken into account must include any matching
contributions (other than qualified matching contributions used in the ADP
test) and any Employee contributions made on his behalf to any other plan
maintained by the Employer, unless the other plan is an ESOP. If the plans have
different plan years, the Advisory Committee will determine the combined
aggregate contributions on the basis of the plan years ending in the same
calendar year.
(C) AGGREGATION OF CERTAIN PLANS. If the Employer treats two plans as a
unit for coverage or nondiscrimination purposes, the Employer must combine the
plans to determine whether either plan satisfies the ACP test. This aggregation
rule applies to the contribution percentage determination for all Eligible
Employees, irrespective of whether an Eligible Employee is a Highly Compensated
Employee or a Nonhighly Compensated Employee. For Plan Years beginning after
December 31, 1989, an aggregation of plans under this paragraph does not apply
to plans which have different plan years and, for Plan Years beginning after
December 31, 1988, the Advisory Committee may not aggregate an ESOP (or the
ESOP portion of a plan) with a non-ESOP plan (or non-ESOP portion of a plan).
(D) DISTRIBUTION OF EXCESS AGGREGATE CONTRIBUTIONS. The Advisory Committee
will determine excess aggregate contributions after determining excess
deferrals under Section 14.07 and excess contributions under Section 14.08. If
the Advisory Committee determines the Plan fails to satisfy the ACP test for a
Plan Year, it must distribute the excess aggregate contributions, as adjusted
for allocable income, during the next Plan Year. However, the Employer will
incur an excise tax equal to 10% of the amount of excess aggregate
contributions for a Plan Year not distributed to the appropriate Highly
Compensated Employees during the first 2 1/2 months of that next Plan Year. The
excess aggregate contributions are the amount of aggregate contributions
allocated on behalf of the Highly Compensated Employees which causes the Plan
to fail to satisfy the ACP test. The Advisory
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DEFINED CONTRIBUTION MASTER PLAN
Committee will distribute to each Highly Compensated Employee his respective
share of the excess aggregate contributions. The Advisory Committee will
determine the respective shares of excess aggregate contributions by starting
with the Highly Compensated Employee(s) who has the greatest contribution
percentage, reducing his contribution percentage (but not below the next
highest contribution percentage), then, if necessary, reducing the contribution
percentage of the Highly Compensated Employee(s) at the next highest
contribution percentage level (including the contribution percentage of the
Highly Compensated Employee(s) whose contribution percentage the Advisory
Committee already has reduced), and continuing in this manner until the ACP for
the Highly Compensated Group satisfies the ACP test. If the Highly Compensated
Employee is part of an aggregated family group, the Advisory Committee, in
accordance with the applicable Treasury regulations, will determine each
aggregated family member's allocable share of the excess aggregate
contributions assigned to the family unit.
(E) ALLOCABLE INCOME. To determine the amount of the corrective
distribution required under this Section 14.09, the Advisory Committee must
calculate the allocable income for the Plan Year in which the excess aggregate
contributions arose. "Allocable income" means net income or net loss. The
Advisory Committee will determine allocable income in the same manner as
described in Section 14.08(F) for excess contributions.
(F) CHARACTERIZATION OF EXCESS AGGREGATE CONTRIBUTIONS. The Advisory
Committee will treat a Highly Compensated Employee's allocable share of excess
aggregate contributions in the following priority: (1) first as attributable to
his Employee contributions which are voluntary contributions, if any; (2) then
as matching contributions allocable with respect to excess contributions
determined under the ADP test described in Section 14.08; (3) then on a pro
rata basis to matching contributions and to the deferral contributions relating
to those matching contributions which the Advisory Committee has included in
the ACP test; (4) then on a pro rata basis to Employee contributions which are
mandatory contributions, if any, and to the matching contributions allocated on
the basis of those mandatory contributions; and (5) last to qualified
nonelective contributions used in the ACP test. To the extent the Highly
Compensated Employee's excess aggregate contributions are attributable to
matching contributions, and he is not 100% vested in his Accrued Benefit
attributable to matching contributions, the Advisory Committee will distribute
only the vested portion and forfeit the nonvested portion. The vested portion
of the Highly Compensated Employee's excess aggregate contributions
attributable to Employer matching contributions is the total amount of such
excess aggregate contributions (as adjusted for allocable income) multiplied by
his vested percentage (determined as of the last day of the Plan Year for which
the Employer made the matching contribution). The Employer will specify in
Adoption Agreement Section 3.05 the manner in which the Plan will allocate
forfeited excess aggregate contributions.
14.10 MULTIPLE USE LIMITATION. For Plan Years beginning after
December 31, 1988, if at least one Highly Compensated Employee is includible in
the ADP test under Section 14.08 and in the ACP test under Section 14.09, the
sum of the Highly Compensated Group's ADP and ACP may not exceed the multiple
use limitation.
The multiple use limitation is the sum of (i) and (ii):
(i) 125% of the greater of: (a) the ADP of the Nonhighly
Compensated Group under the Code Section 401(k) arrangement; or (b)
the ACP of the Nonhighly Compensated Group for the Plan Year beginning
with or within the Plan Year of the Code Section 401(k) arrangement.
(ii) 2% plus the lesser of (i)(a) or (i)(b), but no more than twice
the lesser of (i)(a) or (i)(b).
The Advisory Committee, in lieu of determining the multiple use
limitation as the sum of (i) and (ii), may elect to determine the multiple use
limitation as the sum of (iii) and (iv):
(iii) 125% of the lesser of: (a) the ADP of the Nonhighly
Compensated Group under the Code Section 401(k) arrangement; or (b)
the ACP of the Nonhighly Compensated Group for the Plan Year beginning
with or within the Plan Year of the Code Section 401(k) arrangement.
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DEFINED CONTRIBUTION MASTER PLAN
(iv) 2% plus the greater of (iii)(a) or (iii)(b), but no more than
twice the greater of (iii)(a) or (iii)(b).
The Advisory Committee will determine whether the Plan satisfies the
multiple use limitation after applying the ADP test under Section 14.08 and the
ACP test under Section 14.09 and after making any corrective distributions
required by those Sections. If, after applying this Section 14.10, the Advisory
Committee determines the Plan has failed to satisfy the multiple use
limitation, the Advisory Committee will correct the failure by treating the
excess amount as excess contributions under Section 14.08 or as excess
aggregate contributions under Section 14.09, as it determines in its sole
discretion. This Section 14.10 does not apply unless, prior to application of
the multiple use limitation, the ADP and the ACP of the Highly Compensated
Group each exceeds 125% of the respective percentages for the Nonhighly
Compensated Group.
14.11 DISTRIBUTION RESTRICTIONS. The Employer must elect in Section
6.03 the Adoption Agreement the distribution events permitted under the Plan.
The distribution events applicable to the Participant's Deferral Contributions
Account, Qualified Nonelective Contributions Account and Qualified Matching
Contributions Account must satisfy the distribution restrictions described in
paragraph (m) of Section 14.03.
(A) HARDSHIP DISTRIBUTIONS FROM DEFERRAL CONTRIBUTIONS ACCOUNT. The
Employer must elect in Adoption Agreement Section 6.03 whether a Participant
may receive hardship distributions from his Deferral Contributions Account
prior to the Participant's Separation from Service. Hardship distributions from
the Deferral Contributions Account must satisfy the requirements of this
Section 14.11. A hardship distribution option may not apply to the
Participant's Qualified Nonelective Contributions Account or Qualified Matching
Contributions Account, except as provided in paragraph (3).
(1) DEFINITION OF HARDSHIP. A hardship distribution under this
Section 14.11 must be on account of one or more of the following immediate and
heavy financial needs: (1) medical care described in Code Section 213(d)
incurred by the Participant, by the Participant's spouse, or by any of the
Participant's dependents, or necessary to obtain such medical care; (2) the
purchase (excluding mortgage payments) of a principal residence for the
Participant; (3) the payment of post-secondary education tuition and related
educational fees, for the next 12-month period, for the Participant, for the
Participant's spouse, or for any of the Participant's dependents (as defined in
Code Section 152); (4) to prevent the eviction of the Participant from his
principal residence or the foreclosure on the mortgage of the Participant's
principal residence; or (5) any need prescribed by the Revenue Service in a
revenue ruling, notice or other document of general applicability which
satisfies the safe harbor definition of hardship.
(2) RESTRICTIONS. The following restrictions apply to a
Participant who receives a hardship distribution: (a) the Participant may not
make elective deferrals or employee contributions to the Plan for the 12-month
period following the date of his hardship distribution; (b) the distribution is
not in excess of the amount of the 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 the distribution); (c)
the Participant must have obtained all distributions, other than hardship
distributions, and all nontaxable loans (determined at the time of the loan)
currently available under this Plan and all other qualified plans maintained by
the Employer; and (d) the Participant agrees to limit elective deferrals under
this Plan and under any other qualified Plan maintained by the Employer, for
the Participant's taxable year immediately following the taxable year of the
hardship distribution, to the 402(g) limitation (as described in Section
14.07), reduced by the amount of the Participant's elective deferrals made in
the taxable year of the hardship distribution. The suspension of elective
deferrals and employee contributions described in clause (a) also must apply to
all other qualified plans and to all nonqualified plans of deferred
compensation maintained by the Employer, other than any mandatory employee
contribution portion of a defined benefit plan, including stock option, stock
purchase and other similar plans, but not including health or welfare benefit
plans (other than the cash or deferred arrangement portion of a cafeteria
plan).
14.10
<PAGE> 78
DEFINED CONTRIBUTION MASTER PLAN
(3) EARNINGS. For Plan Years beginning after December 31, 1988, a
hardship distribution under this Section 14.11 may not include earnings on an
Employee's elective deferrals credited after December 31, 1988. Qualified
matching contributions and qualified nonelective contributions, and any
earnings on such contributions, credited as of December 31, 1988, are subject
to the hardship withdrawal only if the Employer specifies in an addendum to
this Section 14.11. The addendum may modify the December 31, 1988, date
for purposes of determining credited amounts provided the date is not later
than the end of the last Plan Year ending before July 1, 1989.
(B) DISTRIBUTIONS AFTER SEPARATION FROM SERVICE. Following the
Participant's Separation from Service, the distribution events applicable to
the Participant apply equally to all of the Participant's Accounts, except as
elected in Section 6.03 of the Employer's Adoption Agreement.
(C) CORRECTION OF ANNUAL ADDITIONS LIMITATION. If, as a result of a
reasonable error in determining the amount of elective deferrals an Employee
may make without violating the limitations of Part 2 of Article III, an Excess
Amount results, the Advisory Committee will return the Excess Amount (as
adjusted for allocable income) attributable to the elective deferrals. The
Advisory Committee will make this distribution before taking any corrective
steps pursuant to Section 3.10 or to Section 3.16. The Advisory Committee will
disregard any elective deferrals returned under this Section 14.11(C) for
purposes of Sections 14.07, 14.08 and 14.09.
14.12 SPECIAL ALLOCATION RULES. If the Code Section 401(k)
arrangement provides for salary reduction contributions, if the Plan accepts
Employee contributions, pursuant to Adoption Agreement Section 4.01, or if the
Plan allocates matching contributions as of any date other than the last day of
the Plan Year, the Employer must elect in Adoption Agreement 9.11 whether any
special allocation provisions will apply under Section 9.11 of the Plan. For
purposes of the elections:
(a) A "segregated Account" direction means the Advisory
Committee will establish a segregated Account for the applicable
contributions made on the Participant's behalf during the Plan Year.
The Trustee must invest the segregated Account in Federally insured
interest bearing savings account(s) or time deposits, or a combination
of both, or in any other fixed income investments, unless otherwise
specified in the Employer's Adoption Agreement. As of the last day of
each Plan Year (or, if earlier, an allocation date coinciding with a
valuation date described in Section 9.11), the Advisory Committee will
reallocate the segregated Account to the Participant's appropriate
Account, in accordance with Section 3.04 or Section 4.06, whichever
applies to the contributions.
(b) A "weighted average allocation" method will treat a weighted
portion of the applicable contributions as if includible in the
Participant's Account as of the beginning of the valuation period.
The weighted portion is a fraction, the numerator of which is the
number of months in the valuation period, excluding each month in the
valuation period which begins prior to the contribution date of the
applicable contributions, and the denominator of which is the number
of months in the valuation period. The Employer may elect in its
Adoption Agreement to substitute a weighting period other than months
for purposes of this weighted average allocation.
* * * * * * * * * * *
14.11
<PAGE> 79
ADOPTION AGREEMENT #013
SHORT-FORM NONSTANDARDIZED CODE SECTION 401(k) PROFIT SHARING PLAN
The undersigned, NCI Building Systems, Inc., Houston, Texas
("Employer"), by executing this Adoption Agreement, elects to become a
participating Employer in the NationsBank Defined Contribution Master Plan
(basic plan document #03) by adopting the accompanying Plan and Trust in full as
if the Employer were a signatory to that Agreement. The Employer makes the
following elections granted under the provisions of the Master Plan.
Note: For any "Specify" option, the Employer may attach an addendum to
the Adoption Agreement setting forth its provision if the available space is
not sufficient.
ARTICLE I
DEFINITIONS
1.03 PLAN. The name of the Plan as adopted by the Employer is NCI
401(k) Profit Sharing Plan.
1.07 EMPLOYEE. The following Employees are not eligible to
participate in the Plan: (Choose (a) or at least one of (b) through (e))
[ ] (a) No exclusions.
[ ] (b) Collective bargaining employees (as defined in Section 1.07 of
the Plan). [Note: If the Employer excludes union employees from the
Plan, the Employer must be able to provide evidence that retirement
benefits were the subject of good faith bargaining.]
[X] (c) Nonresident aliens who do not receive any earned income (as
defined in Code Section 911(d)(2)) from the Employer which
constitutes United States source income (as defined in Code Section
861(a)(3)).
[ ] (d) Leased Employees treated as Employees under Section 1.31 of
the Plan.
[ ] (e) (Specify)___________________________________________________
__________________________________________.
RELATED EMPLOYERS. If any member of the Employer's related group (as defined in
Section 1.30 of the Plan) executes a Participation Agreement to this Adoption
Agreement, such member's Employees are eligible to participate in this Plan,
unless excluded by reason of an exclusion classification elected under this
Adoption Agreement Section 1.07. If any member of the Employer's related group
does not execute a Participation Agreement, that related group member's
Employees are not eligible to participate in the Plan unless, in an addendum,
the Employer designates the Employees of that nonparticipating related group
member as eligible to participate in the Plan.
1.12 COMPENSATION. The Employer makes the following election(s)
regarding the definition of Compensation for purposes of the
contribution/allocation formula in Article III: (Choose (a) or at least one of
(b) through (e))
[ ] (a) No modifications to the definition in Section 1.12 of the
Plan.
[x] (b) W-2 wages in lieu of the definition in Section 1.12 of the
Plan. W-2 wages means wages for federal income tax withholding
purposes, as defined under Code Section 3401(a), plus all other
payments to an Employee in the course of the Employer's trade or
business, for which the Employer must furnish the Employee a written
statement under Code Sections 6041(d) and 6051(a)(3), disregarding any
rules limiting the remuneration included as wages under this
definition based on the nature or
1
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<PAGE> 81
1.29 SERVICE FOR PREDECESSOR EMPLOYER. [Note: The Employer may
attach a schedule to this Adoption Agreement Section 1.29 designating
predecessor or prior employers and the applicable service crediting elections.
If this Plan is a successor of a plan maintained by a predecessor employer, see
Section 1.29 of the Plan for certain predecessor service automatically taken
into account.]
1.31 LEASED EMPLOYEES. [Note: If the Plan covers any Leased
Employee who also participates in a plan maintained by the leasing
organization, the Plan will not reduce that Leased Employee's allocation of
Employer contributions under this Plan except as provided in an addendum.]
ARTICLE II
EMPLOYEE PARTICIPANTS
2.01 ELIGIBILITY.
ELIGIBILITY CONDITIONS. To become a Participant in the Plan, an Employee must
satisfy the following eligibility conditions: (Choose at least one of (a), (b)
and (c); (d) and (e) are optional)
[X] (a) Attainment of age 21 (specify age, not exceeding 21).
[X] (b) One Year of Service.
[ ] (c) (Specify) __________________________________________. [Note:
Any specified service requirement may not exceed either the one-year
requirement in (b) or, for any portion of the plan other than the Code
Section 401(k) arrangement, the two-year requirement in Code Section
410(a)(1)(B), depending on the vesting schedule elected in Section
5.03, and any specified age requirement may not exceed 21.]
[x] (d) A Participant prior to the restated Effective Date may not
continue as a Participant unless he satisfies the eligibility
conditions of this Section 2.01. [Note: If the Employer does not elect
(d), current Participants need not complete the eligibility conditions
of this Section 2.01.]
[ ] (e) The eligibility conditions of this Section 2.01 apply solely
to an Employee employed by the Employer after _________. If the
Employee was employed by the Employer on or before the specified date,
the Employee will become a Participant on the later of the Effective
Date or his Employment Commencement Date.
PLAN ENTRY DATE. "Plan Entry Date" means the Effective Date and: (Choose (f) or
(g))
[ ] (f) Semi-annual Entry Dates. The first day of the Plan Year and
the first day of the seventh month of the Plan Year.
[X] (g) (Specify entry dates) March 1, 1993, and then the first day of
the Plan Year and the first day of the seventh month of the Plan Year.
TIME OF PARTICIPATION. An Employee will become a Participant, unless excluded
under Adoption Agreement Section 1.07, on the Plan Entry Date (if employed on
that date): (Choose (h) or (i))
[X] (h) immediately following
[ ] (i) ____________________________________________________________
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<PAGE> 82
the date the Employee completes the eligibility conditions described in this
Adoption Agreement Section 2.01. [Note: Unless otherwise excluded under Section
1.07, the Employee must become a Participant by the earlier of: (1) the first
day of the Plan Year beginning after the date the Employee completes the age
and service requirements of Code Section 410(a); or (2) 6 months after the date
the Employee completes those requirements.]
2.02. YEAR OF SERVICE - PARTICIPATION. (Complete (a) and (b))
[X] (a) HOURS OF SERVICE. An Employee must complete 1,000 Hour(s) of
Service during an eligibility computation period to receive credit for
a Year of Service under Article II. [Note: The number may not exceed
1,000. If left blank, the requirement is 1,000.]
[X] (b) ELIGIBILITY COMPUTATION PERIOD. After the initial eligibility
computation period described in Section 2.02 of the Plan, the Plan
measures the eligibility computation period as: (Choose (1) or (2))
[ ] (1) The 12 consecutive month period beginning with each
anniversary of an Employee's Employment Commencement Date.
[X] (2) The Plan Year, beginning with the Plan Year which
includes the first anniversary of the Employee's Employment
Commencement Date.
2.03 BREAK IN SERVICE - PARTICIPATION. The Break in Service rule
described in Section 2.03(B) of the Plan: (Choose (a) or (b))
[X] (a) Does not apply to the Employer's Plan.
[ ] (b) Applies to the Employer's Plan.
2.06 ELECTION NOT TO PARTICIPATE. The Plan: (Choose (a) or (b))
[X] (a) Does not permit an eligible Employee or a Participant to elect
not to participate.
[ ] (b) Does permit an eligible Employee or a Participant to elect not
to participate in accordance with Section 2.06 and with the following
rules: _____________________________________________.
ARTICLE III
EMPLOYER CONTRIBUTIONS AND FORFEITURES
3.01 AMOUNT.
PART 1. AMOUNT OF EMPLOYER'S CONTRIBUTION. The amount of the Employer's annual
contribution to the Trust will equal: (Choose at least one)
[X] (a) DEFERRAL CONTRIBUTIONS (CODE SECTION 401(k) ARRANGEMENT. The
amount by which the Participants have reduced their Compensation for
the Plan Year, pursuant to their salary reduction agreements. The
Plan refers to these amounts as salary reduction contributions.
[X] (b) MATCHING CONTRIBUTIONS. The matching contributions made
pursuant to Part II of this Adoption Agreement Section 3.01.
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<PAGE> 83
[X] (c) NONELECTIVE CONTRIBUTIONS. The amount (or additional amount)
the Employer may from time to time deem advisable, without regard to
Net Profits. The Employer, in its sole discretion, may designate all
or any portion of its nonelective contributions to be qualified
nonelective contributions.
[ ] (d) FROZEN PLAN. This Plan is a frozen Plan effective ________.
The Employer will not contribute to the Plan for any period following
the stated date.
PART II. MATCHING CONTRIBUTIONS. [Note: Do not complete Part II unless the
Employer elected Option (b).]
[X] (e) MATCHING CONTRIBUTIONS FORMULA. For each Plan Year, the
Employer's matching contribution is: (Choose at least one of (1) and
(2); (3) and (4) are available only as additional options)
[ ] (1) An amount equal to the following percentage(s) of
eligible contributions for the Plan Year:_____________.
The Advisory Committee will allocate the amounts described in
this Option (e)(1) to the: (Choose (i) or (ii))
[ ] (i) Regular Matching Contributions Account.
[ ] (ii) Qualified Matching Contributions Account.
[X] (2) Discretionary formula. An amount (or additional
amount) equal to a matching percentage the Employer from time
to time may deem advisable of the Participant's eligible
contributions for the Plan Year (or tiers of eligible
contributions, if applicable under Option (f)). The Employer
must designate the portion, if any, of its discretionary
matching contribution allocable to the Regular Matching
Contributions Accounts of the eligible Participants and the
portion, if any, of its discretionary matching contribution
allocable to the Qualified Matching Contributions Accounts of
the eligible Participants.
[ ] (3) The following limitations apply to a Participant's
matching contributions: _____________________________________.
[ ] (4) The Advisory Committee will allocate matching
contributions on the following allocation dates:
_______________________________________________________________
____________________. [Note: If the Employer does not check
(4), the last day of the Plan Year is the only allocation date
for matching contributions.]
[X] (f) ELIGIBLE CONTRIBUTIONS. For purposes of applying the matching
contribution formula in Option (e), the term "eligible contributions"
means: (Choose at least one of (1) or (2); (3) through (5) are
available only as additional selections)
[X] (1) Salary reduction contributions.
[ ] (2) Participant mandatory contributions, as designated in
Adoption Agreement Section 4.01. See Section 14.04 of the
Plan.
[X] (3) The Plan disregards eligible contributions exceeding
6% of a Participant's Compensation for the Plan Year.
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<PAGE> 84
[ ] (4) The Plan takes into account eligible contributions in
tiers, defined as follows:
[ ] (5) (Specify) _____________________________________ .
PART III. SPECIAL RULES FOR CODE SECTION 401(K) ARRANGEMENT. (Choose the
applicable elections)
[X] (g) LIMITATION ON AMOUNT. The Employee's salary reduction
contributions are subject to the following limitations: see attached
Addendum. [Note: If the Employer does not elect Option (g), the salary
reduction contributions are not subject to any limitations other than
the annual additions limitation described in Part 2 of Article III and
the 402(g) limitation described in Section 14.07 of the Plan.]
[X] (h) REVOCATION. An Employee, on a prospective basis, may revoke a
salary reduction agreement or may file a new agreement following a
prior revocation: (Choose one)
[ ] (1) As of any Plan Entry Date.
[ ] (2) As of the first day of each quarter.
[X] (3) (Specify at least once per Plan Year) see attached
Addendum.
[X] (i) MODIFYING ELECTIONS. An Employee, on a prospective basis, may
increase or may decrease his salary reduction percentage or dollar
amount: (Choose one)
[ ] (1) As of the beginning of each payroll period.
[ ] (2) As of the first day of each quarter.
[X] (3) As of any Plan Entry Date.
[ ] (4) (Specify at least once per Plan Year) _______________
_____________________________________________________________.
[X] (j) ALLOCATION DATES. The Advisory Committee will allocate salary
reduction contributions on the following allocation dates: Any
business day the United States financial markets are open. [Note: If
the Employer does not check (j), the last day of the Plan Year is the
only allocation date for salary reduction contributions.]
3.04 CONTRIBUTION ALLOCATION. The elections in this Section 3.04
(other than Option (d)) apply only to the allocation of nonelective
contributions (other than qualified nonelective contributions). (Choose an
allocation method under (a) or (b); (c) is mandatory if the Employer elects
(b); (d) and (e) are optional)
[X] (a) NONINTEGRATED ALLOCATION FORMULA. The Advisory Committee will
make the allocation in the same ratio that each Participant's
Compensation for the Plan Year bears to the total Compensation of all
Participants for the Plan Year.
[ ] (b) PERMITTED DISPARITY. The following formula described in
Appendix A applies: (Choose (1), (2) or (3))
[ ] (1) Two-Tiered Formula.
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<PAGE> 85
[ ] (2) Four-Tiered Formula.
[ ] (3) Two-Tiered Formula when the Plan is not top heavy and
the Four-Tiered Formula when the Plan is top heavy.
[ ] (c) EXCESS COMPENSATION. For purposes of Option (b), "Excess
Compensation" means Compensation in excess of the following
Integration Level: (Choose one)
[ ] (1) % of the taxable wage base in effect on the first day
of the Plan Year, rounded to the next highest $___________
(not exceeding the taxable wage base).
[ ] (2) The taxable wage base in effect on the first day of
the Plan Year.
[ ] (3) (Specify - may not exceed the taxable wage base)
____________________________________________________________.
[ ] (d) MODIFICATIONS TO TOP HEAVY MINIMUM ALLOCATION. (Choose (1) or
(2))
[ ] (1) The Employer will satisfy the top heavy minimum
allocation by making any necessary additional contribution to
the following defined contribution plan maintained by the
Employer: __________________________________________________.
[ ] (2) In lieu of 3%, substitute the following percentage to
determine the top heavy minimum allocation:
[ ] (e) RELATED EMPLOYERS. If two or more related employers (as
defined in Section 1.30) contribute to this Plan, the Advisory
Committee will allocate all Employer contributions and forfeitures
only to the Participants directly employed by the contributing
Employer. If a Participant receives Compensation from more than one
contributing Employer, the Advisory Committee will determine the
allocations under this Adoption Agreement Section 3.04 by prorating
among the participating Employers the Participant's Compensation and,
if applicable, the Participant's Integration Level under Option (c).
[Note: If the Employer does not elect (e), the Advisory Committee will
allocate all contributions and forfeitures without regard to which
Participants are directly employed by a contributing related group
member.]
ADDENDUM. In an addendum to this Section 3.04 or to Section 3.01, the Employer
may: (1) specify other modifications to the top heavy rules, to the extent
permissible under Code Section 416; or (2) incorporate special contribution or
allocation provisions affecting Employer contributions or Participant
forfeitures (e.g., different allocation formulas or matching contribution
formulas for different employment classifications). If the top heavy ratio
includes the present value of accrued benefits under a defined benefit plan,
the Advisory Committee will use the actuarial assumptions stated in the defined
benefit plan to determine the top heavy ratio unless the addendum specifies
other assumptions.
3.05 FORFEITURE ALLOCATION. The Advisory Committee will allocate a
Participant forfeiture: (Choose at least one)
[X] (a) As if the forfeiture were an additional Employer nonelective
contribution for the Plan Year in which the forfeiture occurs.
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<PAGE> 86
[ ] (b) To reduce Employer contributions (including matching
contributions, if applicable) for the Plan Year: (Choose one)
[ ] (1) in which the forfeiture occurs.
[ ] (2) following the Plan Year in which the forfeiture
occurs.
[X] (c) To the extent attributable to matching contributions: see
attached Addendum.
EXCESS AGGREGATE CONTRIBUTIONS. To the extent Section 14.09 of the Plan results
in a forfeiture of nonvested excess aggregate contributions, the Advisory
Committee will allocate the forfeited amount as described in (a), (b) or (c),
whichever applies, or in an addendum to Section 3.04, if applicable. An
allocation of forfeited amounts as discretionary contributions (including
discretionary matching contributions) must disregard the Highly Compensated
Employees who incurred the forfeitures.
3.06 ACCRUAL OF BENEFIT.
COMPENSATION TAKEN INTO ACCOUNT. For the Plan Year in which the Employee first
becomes a Participant, the Advisory Committee will determine the allocation of
nonelective contributions (including, qualified nonelective contributions) by
taken into account: (Choose (a) or (b))
[ ] (a) The Employee's Compensation for the entire Plan Year.
[X] (b) The Employee's Compensation only for the portion of the Plan
Year in which the Employee actually is a Participant in the Plan.
ACCRUAL REQUIREMENTS. The Plan does not apply any accrual requirement to salary
reduction contributions. To receive an allocation of matching contributions or
of nonelective contributions (including qualified nonelective contributions)
and forfeitures, a Participant must satisfy the conditions described in the
following elections: (Choose at least one)
[ ] (c) SAFE HARBOR RULE. The Participant either must be employed by
the Employer on the last day of the Plan Year or must complete at
least 501 Hours of Service during the Plan Year.
[X] (d) HOURS OF SERVICE CONDITION. The Participant must complete at
least the following number of Hours of Service for the Plan Year:
1,000. [Note: The number may not exceed 1,000.]
[X] (e) EMPLOYMENT CONDITION. The Participant must he employed by the
Employer on the last day of the Plan Year.
[X] (f) EXCEPTION. Any condition specified in (d) and (e) does not
apply if the Participant terminates employment during the Plan Year on
account of death, disability or attainment of Normal Retirement Age in
the current Plan Year or in a prior Plan Year.
[ ] (g) (Specify other conditions, if applicable): ___________________
____________________________.
[X] (h) SUSPENSION OR ACCRUAL REQUIREMENTS. The suspension of accrual
requirements of Section 3.06(E) of the Plan applies to the Employer's
Plan, subject to any modifications stated in an addendum. [Note: If
the Employer does not elect Option (h), Section 3.06(E) of the Plan
does not apply.]
Unless otherwise specified in (g) the Advisory Committee will allocate qualified
nonelective contributions only to Participants who are Nonhighly Compensated
Employees for the Plan Year.
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<PAGE> 87
3.15 MORE THAN ONE PLAN LIMITATION. Unless otherwise provided in
an addendum, if the provisions of Section 3.15 apply, the Excess Amount
attributed to this Plan equals the product of:
(a) the total Excess Amount allocated as of such date (including
any amount which the Advisory Committee would have allocated but for
the limitations of Code Section 415), times
(b) the ratio of (1) the amount allocated to the Participant as of
such date under this Plan divided by (2) the total amount allocated as
of such date under all qualified defined contribution plans
(determined without regard to the limitations of Code Section 415).
3.18. DEFINED BENEFIT PLAN LIMITATION. The limitation under Section
3.18 applies to the Employer's Plan if the Employer maintains (or ever
maintained) a defined benefit plan. To the extent necessary to satisfy the
limitation under Section 3.18, the Employer will reduce the Participant's
projected annual benefit under the defined benefit plan under which the
Participant participates, if the Employer still maintains the defined benefit
plan as an active plan. If the Employer has frozen or terminated the defined
benefit plan, the Employer will reduce its contribution or allocation on behalf
of the Participant to the defined contribution plan(s) under which the
Participant participates. The Employer may prescribe an alternate means of
satisfying the Section 3.18 limitation in an addendum.
ARTICLE IV
PARTICIPANT CONTRIBUTIONS
4.01 PARTICIPANT NONDEDUCTIBLE CONTRIBUTIONS. The following
elections apply to nondeductible contributions: (Choose (a) or (b); (c), (d)
and (e) are available only as additional options)
[X] (a) The Plan does not permit Participant nondeductible
contributions.
[ ] (b) The Plan permits Participant nondeductible contributions. See
Section 14.04 of the Plan.
[ ] (c) The Plan treats the following portion of the Participant's
nondeductible contributions for the Plan Year as "mandatory"
contributions: ______________________________________________________.
[ ] (d) The Advisory Committee will allocate Participant nondeductible
contributions on the following allocation dates: ____________________
_______________________________________________________. [Note: If the
Employer does not elect (d), the last day of the Plan Year is the only
allocation date for Participant nondeductible contributions.]
[ ] (e) In lieu of the withdrawal rules under Section 4.05, the
following rules apply to Participant nondeductible contributions:
______________________________________________________________________.
ARTICLE V
TERMINATION OF SERVICE - PARTICIPANT VESTING
5.01 NORMAL RETIREMENT. A Participant attains Normal Retirement
Age under the Plan on the following date: (Choose (a) or (b))
[X] (a) The date he attains age 65 [Note: The age may not exceed age
65].
[ ] (b) The later of the date he attains ______ years of age or the
________ anniversary of the first day of the Plan Year in which he
commenced participation in the Plan. [Note. The age may not exceed age
65 and the anniversary may not exceed the 5th.]
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5.02 PARTICIPANT DEATH OR DISABILITY. The 100% vesting rule under
Section 5.02 of the Plan applies to death and to disability, unless the
Employer provides a different vesting rule in an addendum.
5.03 VESTING SCHEDULE. The vesting elections in this Section 5.03
apply only to the Regular Matching Contributions Account, if any, and the
Employer Contributions Account, if any. 100% immediate vesting applies to all
other Accounts. The Employer elects the following vesting schedule: (Choose (a)
or (b); (c), (d) and (e) are available only in addition to (b))
[ ] (a) IMMEDIATE VESTING. 100% Nonforfeitable at all times.
[X] (b) GRADUATED VESTING SCHEDULES. (Complete (1); (2) is optional in
addition to (1))
[X] (1) TOP HEAVY SCHEDULE [X] (2) NON TOP HEAVY SCHEDULE
<TABLE>
<CAPTION>
Years of Nonforfeitable Years of Nonforfeitable
Service Percentage Service Percentage
---------- -------------- -------- --------------
<S> <C> <C> <C>
Less than 1 ............. 0% Less than 1.................. 0%
1 .............. 0% 1 ................. 0%
2 .............. 20% 2 ................. 0%
3 .............. 40% 3 ................. 20%
4 .............. 60% 4 ................. 40%
5 .............. 80% 5 ................. 60%
6 or more ...... 100% 6 ................. 80%
7 or more ......... 100%
</TABLE>
If the Employer does not elect (b)(2), the vesting schedule in (b)(1) applies
to all Plan Years. [Note: The Top Heavy Schedule must satisfy Code Section 416.
If the Employer elects Option (b)(2), the Non Top Heavy Schedule must satisfy
Code Section 411(a)(2).]
[ ] (c) MINIMUM VESTING AMOUNT. The lesser of $ __________ or his
entire Accrued Benefit, even if the application of the graduated
vesting schedule under Option (b) would result in a smaller
Nonforfeitable Accrued Benefit.
[X] (d) APPLICATION OF TOP HEAVY SCHEDULE. The Top Heavy Schedule
applies in the Plan Year for which the Plan first is top heavy and
then in all subsequent Plan Years. [Note: If the Employer elects
(b)(2) but not (d), the Top Heavy Vesting Schedule applies only in top
heavy Plan Years.]
[X] (e) SPECIAL VESTING, RULES. (Specify) A Participant's Accrued
Benefit attributable to insurance contracts is 100% vested at all
times. [Note: Any special rule must satisfy Code Section 411(a).]
5.04 DEEMED CASH-OUT DISTRIBUTIONS. To determine the timing of
forfeitures for 0% vested Participants, the deemed cash-out rule described in
Section 5.04(C) of the Plan: (Choose (a) or (b))
[ ] (a) Does not apply. [X] (b) Applies.
5.06 YEAR OF SERVICE - VESTING. (Complete (a) and (b))
[X] (a) HOURS OF SERVICE. An Employee must complete at least 1,000
Hours of Service during a vesting computation period to receive credit
for a Year of Service under Article V. [Note: The number may not
exceed 1,000. If left blank, the requirement is 1,000.]
10
<PAGE> 89
[X] (b) VESTING COMPUTATION PERIOD. The Plan measures a Year of
Service on the basis of the following 12 consecutive month periods:
(Choose (1) or (2))
[X] (1) Plan Years.
[ ] (2) Employment Years. An Employment Year is the 12
consecutive month period measured from the Employee's
Employment Commencement Date and each successive 12
consecutive month period measured from each anniversary of
that Employment Commencement Date.
5.08 INCLUDED YEARS OF SERVICE - VESTING. The Employer specifically
excludes the following Years of Service: (Choose (a) or at least one of (b)
through (f); choose (a) if the term "Year of Service" does not apply to the
vesting election in Adoption Agreement Section 5.03)
[ ] (a) None other than as specified in Section 5.08(a) of the Plan.
[ ] (b) Any Year of Service before the Participant attained the age of
18.
[X] (c) Any Year of Service during the period the Employer did not
maintain this Plan or a predecessor plan.
[ ] (d) Any Year of Service before a Break in Service if the number of
consecutive Breaks in Service equals or exceeds 5. This exception
applies only if the Participant is 0% vested in his Accrued Benefit
derived from Employer contributions at the time he has a Break in
Service.
[ ] (e) Any Years of Service disregarded under the terms of the Plan
prior to the restated Effective Date.
[ ] (f) (Specify) ___________________________________________. [Note:
Any specified exception must comply with Code Section 411(a)(4).]
ARTICLE VI
TIME AND METHOD OF PAYMENTS OF BENEFITS
6.01 TIME OF PAYMENT OF ACCRUED BENEFIT. The following elections
apply to Section 6.01 of the Plan: ((a) is mandatory; (b), (c) and (d) are
optional in addition to (a))
[X] (a) NONFORFEITABLE ACCRUED BENEFIT NOT EXCEEDING $3,500. The Plan
will distribute a Nonforfeitable Accrued Benefit not exceeding
$3,500: (Choose (1), (2) or (3))
[X] (1) As soon as administratively practicable following
the Participant's Separation from Service.
[ ] (2) As soon as administratively practicable in the
__________________________ Plan Year beginning after the
Participant's Separation from Service.
[ ] (3) (Specify)_______________________________________.
[ ] (b) DISABILITY. If the Participant terminates by reason of a
disability, the following special rules apply to the distribution of
the Participant's Nonforfeitable Accrued Benefit: ____________________
________________________________________.
[ ] (c) HARDSHIP. The Plan permits a hardship distribution, as defined
in Section 14.11(A)(1), to a Participant who has separated from
Service, subject to any special rules provided in an addendum.
11
<PAGE> 90
[X] (d) DEFAULT ON A LOAN. If a Participant or Beneficiary defaults
on a loan made pursuant to a loan policy adopted by the Advisory
Committee pursuant to Section 9.04, the Plan treats the default as a
distributable event. The Trustee, at the time of the default, will
reduce the Participant's Nonforfeitable Accrued Benefit by the lesser
of the amount in default (plus accrued interest) or the Plan's
security interest in that Nonforfeitable Accrued Benefit. In the case
of the portion of the loan attributable to the Participant's Deferral
Contributions Account, Qualified Matching Contributions Account or
Qualified Nonelective Contributions Account, the reduction described
in the preceding sentence will not occur before the earlier of the
Participant's Separation from Service or attainment of age 59 1/2.
6.02 METHOD OF PAYMENT OF ACCRUED BENEFIT. Section 6.02 of the
Plan, which permits lump sum or installment distribution elections, applies
without modification, except as provided in an addendum.
6.03 BENEFIT PAYMENT ELECTIONS. ((a) is mandatory; (b) is optional)
[X] (a) PARTICIPANT ELECTIONS AFTER SEPARATION FROM SERVICE. A
Participant whose Nonforfeitable Accrued Benefit exceeds $3,500 may
elect to commence distribution of his Nonforfeitable Accrued Benefit:
(Choose at least one)
[X] (1) As of the earliest administratively practicable date
following Separation from Service.
[ ] (2) As of the earliest administratively practicable date
in the _______________ Plan Year(s) beginning after Separation
from Service.
[ ] (3) As of the earliest administratively practicable date
after the close of the Plan Year in which the Participant
attains Normal Retirement Age.
[ ] (4) (Specify) ________________________________________.
See Section 6.01(A)(2) if the Participant fails to make an election or
has passed the latest elective date described in this Option (a).
[X] (b) PARTICIPANT ELECTIONS PRIOR TO SEPARATION FROM SERVICE. A
Participant, prior to his Separation from Service, may elect to
receive all or any portion of his Nonforfeitable Accrued Benefit under
the condition(s) specified in this Option (b). Unless otherwise
specified in (b)(4), each event selected represents an independent
withdrawal right and a Participant must have a 100% Nonforfeitable
interest in his Accrued Benefit to be eligible for an in-service
withdrawal. Each election applies to all Accounts unless otherwise
specified. A reference to "restricted Accounts" means the Deferral
Contributions Account, Qualified Matching Contributions Account and
Qualified Nonelective Contributions Account. (Choose at least one of
(1), (2), (3), (4) or (5))
[ ] (1) The Participant has attained age 59 1/2.
[X] (2) The Participant has incurred a hardship under the
rules described in Section 14.11(A). To the extent
distributed from the Regular Matching Contributions Account
and the Employer Contributions Account, the provisions of
Sections 14.11(A)(2) and 14.11(A)(3) do not apply.
[ ] (3) The Participant has participated in the Plan for a
period of not less than 5 years, but only from Accounts
other than restricted Accounts.
[X] (4) If the Employer sells substantially all of the assets
(within the meaning of Code Section 409(d)(2)) used in a trade
or business or sells a Subsidiary (within the meaning of Code
12
<PAGE> 91
Section 409(d)(3)), but only for a Participant who continues
employment with the acquiring corporation. A distribution
under this Option must be a lump sum distribution, determined
in a manner consistent with Code Section 401(k)(10) and the
applicable Treasury regulations.
[X] (5) (Specify) The Participant has attained Normal
Retirement Age. [Note: An in-service distribution from
restricted Accounts may not be available unless the
Participant has attained age 59-1/2, is disabled or satisfies
the hardship rules of Section 1.4.11 of the Plan.]
6.04 ANNUITY DISTRIBUTIONS TO PARTICIPANTS AND SURVIVING SPOUSES.
The annuity distribution requirements of Section 6.04: (Choose (a) or (b))
[X] (a) Do not apply to a Participant, unless the Participant is
described in Section 6.04(E) of the Plan (relating to the profit
sharing exception to the joint and survivor requirements).
[ ] (b) Apply to all Participants.
ARTICLE IX
ADVISORY COMMITTEE - DUTIES WITH RESPECT TO PARTICIPANTS' ACCOUNTS
9.10 VALUE OF PARTICIPANT'S ACCRUED BENEFIT. If a distribution
(other than a distribution from a segregated Account) occurs more than 90 days
after the most recent valuation date, the distribution will include interest at
the following rate: 0. [Note: If left blank, the percentage is 0%.]
9.11 ALLOCATION AND DISTRIBUTION OF NET INCOME GAIN OR LOSS.
Pursuant to Section 14.12, the elections in this Section 9.11 apply to the
allocation of net income, gain or loss attributable to salary reduction
contributions, matching contributions and Participant nondeductible
contributions. Unless otherwise specified, the elections apply to all these
contributions. (Choose at least one)
[X] (a) Apply Section 9.11 without modification.
[ ] (b) Use the segregated account approach described in Section 14.12.
[ ] (c) Use the weighted average method described in Section 14.12,
based on a _________ weighting period.
[ ] (d) Treat as part of the relevant Account at the beginning of the
valuation period ____% of the contributions: (Choose (1) or (2))
[ ] (1) made during that valuation period.
[ ] (2) made by the following specified time: __________.
[ ] (e) (Specify) _________________________________________________.
ARTICLE X
TRUSTEE AND CUSTODIAN, POWERS AND DUTIES
10.03 INVESTMENT POWERS. The following additional investment options
or limitations apply under Section 10.03: see attached Addendum. [Note: Enter
"N/A" if not applicable.]
10.14 VALUATION OF TRUST. In addition to the last day of the Plan
Year, the Trustee must value the Trust Fund on the following valuation date(s):
Any business day the United States financial markets are open. [Note: Enter
"N/A" if not applicable. If left blank, the last day of the Plan Year is the
13
<PAGE> 92
only mandatory valuation date. Regardless of whether the Employer specifies
other valuation dates, the Advisory Committee has the discretion to direct
valuation at any time. See Section 10.14 of the Plan.]
14
<PAGE> 93
EXECUTION PAGE
The Trustee (and Custodian, if applicable), by executing this Adoption
Agreement, accepts its position and agrees to all of the obligations,
responsibilities and duties imposed upon the Trustee (or Custodian) under the
Master Plan and Trust. The Employer hereby agrees to the provisions of this Plan
and Trust, and in witness of its agreement, the Employer by its duly authorized
officers, has executed this Adoption Agreement, and the Trustee (and
Custodian, if applicable) has signified its acceptance, on this 1st day of
February, 1993.
Name of Employer: NCI Building Systems, Inc.
Employer's EIN: 76-0127701
Signed: /s/ DONNIE R. HUMPHRIES
------------------------------------
Vice President and Secretary
Name(s) of Trustee: NationsBank of Georgia, N.A.
Signed: /s/ BERT M. [ILLEGIBLE]
------------------------------------
Signed:
------------------------------------
Name of Custodian (Optional):
------------------------------------
Signed:
------------------------------------
TRUSTEE INVESTMENT POWERS. The Trustee has (check one): [X] discretionary [ ]
nondiscretionary investment powers. See Section 10.03. [Note: The Employer must
check "discretionary" if a Custodian executes this Adoption Agreement.]
PLAN NUMBER. The 3-digit plan number the Employer assigns to this Plan for
ERISA reporting purposes (Form 5500 Series) is:001.
USE OF ADOPTION AGREEMENT. Failure to complete properly the elections in this
Adoption Agreement may result in disqualification of the Employer's Plan. The
3-digit number assigned to this Adoption Agreement (see page 1) is solely for
the Master Plan Sponsor's recordkeeping purposes and does not necessarily
correspond to the plan number the Employer designated in the prior paragraph.
MASTER PLAN SPONSOR. The Master Plan Sponsor identified on the first page of
the basic plan document will notify all adopting employers of any amendment of
this Master Plan or of any abandonment or discontinuance by the Master Plan
Sponsor of its maintenance of this Master Plan. For inquiries regarding the
adoption of the Master Plan, the Master Plan Sponsor's intended meaning of any
plan provisions or the effect of the opinion letter issued to the Master Plan
Sponsor, please contact the Master Plan Sponsor at the following address and
telephone number: NationsBank, Trust - Master Plan Services; 901 Main Street,
16th Floor; Dallas, Texas 75202 (214) 508-1738.
RELIANCE ON OPINION LETTER. The Employer may not rely on the Master Plan
Sponsor's opinion letter covering, this Adoption Agreement. For reliance on the
Plan's qualification. the Employer must obtain a determination letter from the
applicable IRS Key District office.
CODE SECTION 411(d)(6) PROTECTED BENEFITS. To the extent the elections under
Article VI would eliminate a Code Section 411(d)(6) protected benefit, see
Section 13.02 of the Plan. If the elections liberalize the optional forms of
benefit under the Plan, the more liberal options apply on the later of the
adoption date or the Effective Date of this Adoption Agreement.
15
<PAGE> 94
PARTICIPATION AGREEMENT FOR RELATED GROUP MEMBERS
[ ] Check here if not applicable and do not complete this page.
The undersigned Employer, by executing this Participation Agreement,
elects to become a Participating Employer in the Plan identified in Section
1.03 of the accompanying Adoption Agreement, as if the Participating Employer
were a signatory to that Agreement. The Participating Employer accepts, and
agrees to be bound by, all of the elections granted under the provisions of the
Master Pian as made by NCI Building Systems, Inc., Houston, Texas, the
Signatory Employer to the Execution Page of the Adoption Agreement.
1. The Effective Date of the undersigned Employer's participation
in the designated Plan is: January 1, 1993.
2. The undersigned Employer's adoption of this Plan constitutes:
[X] (a) The adoption of a new plan by the Participating Employer.
[ ] (b) The adoption of an amendment and restatement of a plan
currently maintained by the Employer, identified as
________________________, and having an original effective date of
_________________________.
Dated this 1st day of February, 1993.
Name of Participating Employer:
A & S Building Systems, Inc.
Signed: /s/ DONNIE R. HUMPHRIES
---------------------------------
Vice President and Secretary
Participating Employer's EIN:
74-1895020
Acceptance by the Signatory Employer to the Execution Page of the Adoption
Agreement and by the Trustee.
Name of Signatory Employer: NCI
Building Systems, Inc., Houston,
Texas
Accepted: 2-1-93
---------------
[Date] Signed: /s/ DONNIE R. HUMPHRIES
-------------------------------
Vice President and Secretary
Name(s) of Trustee:
NationsBank of Georgia, N.A.
Accepted: 2-12-93
---------------
[Date] Signed: /s/ [ILLEGIBLE]
-------------------------------
[Note: Each Participating Employer must execute a separate Participation
Agreement. See the Execution Page of the Adoption Agreement for important
Master Plan information.]
16
<PAGE> 95
Appendix A (Permitted Disparity Plans Only)
[Note: The Adoption Agreement must include Appendix A even if it does not apply
to the Employer's Plan. The Employer may disregard Appendix A if it elected
Option (a) under Adoption Agreement Section 3.04.]
TWO-TIERED INTEGRATED ALLOCATION FORMULA - MAXIMUM DISPARITY. First, the
Advisory Committee will allocate the annual Employer nonelective contributions
in the same ratio that each Participant's Compensation plus Excess Compensation
for the Plan Year bears to the total Compensation plus Excess Compensation of
all Participants for the Plan Year. The allocation under this paragraph, as a
percentage of each Participant's Compensation plus Excess Compensation, must
not exceed the applicable percentage (5.7%, 5.4% or 4.3%) listed under the
Maximum Disparity Table.
The Advisory Committee then will allocate any remaining Employer nonelective
contributions in the same ratio that each Participant's Compensation for the
Plan Year bears to the total Compensation of all Participants for the Plan
Year.
FOUR-TIERED INTEGRATED ALLOCATION FORMULA. First, the Advisory Committee will
allocate the annual Employer nonelective contributions in the same ratio that
each Participant's Compensation for the Plan Year bears to the total
Compensation of all Participants for the Plan Year, but not exceeding 3% of
each Participant's Compensation. Solely for purposes of this first tier
allocation, a "Participant" means, in addition to any Participant who satisfies
the requirements of Section 3.06 for the Plan Year, any other Participant
entitled to a top heavy minimum allocation under Section 3.04(B) of the Plan.
As a second tier allocation, the Advisory Committee will allocate the annual
Employer nonelective contributions in the same ratio that each Participant's
Excess Compensation for the Plan Year bears to the total Excess Compensation
of all Participants for the Plan Year, but not exceeding 3% of each
Participant's Excess Compensation.
As a third tier allocation, the Advisory Committee will allocate the annual
Employer nonelective contributions in the same ratio that each Participant's
Compensation plus Excess Compensation for the Plan Year bears to the total
Compensation plus Excess Compensation of all Participants for the Plan Year.
The allocation under this paragraph, as a percentage of each Participant's
Compensation plus Excess Compensation, must not exceed the applicable
percentage (2.7%, 2.4% or 1.3%) listed under the Maximum Disparity Table.
The Advisory Committee then will allocate any remaining Employer nonelective
contributions in the same ratio that each Participant's Compensation for the
Plan Year bears to the total Compensation of all Participants for the Plan
Year.
MAXIMUM DISPARITY TABLE. The applicable percentage is:
<TABLE>
<CAPTION>
Integration Level (as Applicable Percentages for Applicable Percentages for
percentage of taxable wage base) Two-Tiered Formula Four-Tiered Formula
- --------------------------------- --------------------------- ---------------------------
<S> <C> <C>
100% 5.7% 2.7%
More than 80% but less than 100% 5.4% 2.4%
More than 20% and not more than 80% 4.3% 1.3%
20% or less 5.7% 2.7%
</TABLE>
[Note: If the Integration Level does not exceed $10,000, use 5.7% for the
Two-Tiered Formula and 2.7% for the Four-Tiered Formula, regardless of the
percentage in the table.]
17
<PAGE> 96
ADDENDUM TO ADOPTION AGREEMENT
PLAN NAME: NCI 401(k) Profit Sharing Plan
EFFECTIVE DATE: March 1, 1993 PLAN NUMBER: 001
For purposes of this Plan, the Advisory Committee will apply the following
changes and/or language to the Adoption Agreement sections as indicated.
SECTION 3.01(g)
LIMITATION ON AMOUNT. The Employee's salary reduction contributions
may not exceed 10% of Compensation for the Plan Year, must equal at
least 1% of Compensation for the Plan Year, and must be contributed in
increments of 1% of Compensation.
SECTION 3.01(h)
REVOCATION. An Employee, on a prospective basis, may revoke a salary
reduction agreement as of the beginning of each payroll period, and
may file a new agreement following a prior revocation as of any
subsequent Plan Entry Date.
SECTION 3.05(c)
The Advisory Committee will allocate a Participant forfeiture, to the
extent attributable to matching contributions, as if the forfeiture
were an additional Employer matching contribution for the Plan Year in
which the forfeiture occurs. However, forfeitures of Employer
nonelective contributions and Employer matching contributions will
first be used to reduce the Plan's ordinary and necessary
administrative expenses, and then will be allocated in accordance with
Sections 3.05(a) and (c).
SECTION 3.06(h)
For Purposes of this Plan, the Advisory Committee will apply Section
3.06(E) of the Plan by using the following substitute language
described in paragraphs 1. and 2. of this addendum.
1. In lieu of the Coverage Test definition in the first
paragraph of Section 3.06(E), the Plan satisfies the
Coverage Test if, on the last day of each quarter of
the Plan Year, the ratio of the Nonhighly Compensated
Employees who benefit under the Plan to the total
number of Includible Nonhighly Compensated Employees
is at least equal to 70% of the ratio of the Highly
Compensated Employees who benefit under the Plan to
the total number of Includible Highly Compensated
Employees. As an alternative to quarterly testing,
the annual testing method may be used. Under this
method, the Plan, as of the last day of the Plan
Year, must take into account all Includible Employees
employed at any time during the Plan Year.
2. The Advisory Committee will apply the third paragraph
of Section 3.06(E), of the Plan first by suspending
the accrual requirements for the Includible Nonhighly
Compensated Employees who are Participants, in the
order described in Section 3.06(E), to the extent
necessary to satisfy the Coverage Test. The Advisory
Committee then will suspend the accrual requirements
for the Includible Highly Compensated Employees who
are Participants, in the order described in Section
3.06(E), only if necessary to satisfy the
Participation Test.
18
<PAGE> 97
SECTION 10.03
INVESTMENT POWERS. Pursuant to Section 10.03[F] of the Plan, the
aggregate investments in qualifying Employer securities may not exceed
100% of Plan assets.
* * * Finis * * *
19
<PAGE> 98
ADVICE OF COUNSEL
The Employer states that it was advised by NationsBank, to obtain legal advice
from Counsel of its own choosing with respect to the adoption of NCI 401(k)
Profit Sharing Plan (The "Plan"), the selection of all options under the
Adoption Agreement (including "Deemed Cash-out" provisions and other IRS
non-Safe Harbor selections) and the effect of the Plan on the Employer, and
represents that it has obtained such legal advice or has chosen on its own
accord not to obtain such legal advice.
NCI Building Systems, Inc.
By: /s/ DONNIE R. HUMPHRIES
--------------------------------
Date: 2-1-93
-----------------------------
<PAGE> 99
[NationsBank LOGO]
TO: ADOPTING EMPLOYERS
NATIONSBANK DEFINED CONTRIBUTION MASTER PLAN AND TRUST
FROM: INSTITUTIONAL ADMINISTRATIVE SERVICES
SUBJECT: ADOPTION OF THE UNEMPLOYMENT COMPENSATION AMENDMENTS
ACT OF 1992
MODEL AMENDMENT
DATE: JULY 8, 1993
We are pleased to enclose an amendment to the NationsBank Defined
Contribution Plan which you have adopted. The amendment adds a special
article (Article A) as an addendum to the basic plan document and does
not modify the adoption agreement you executed. The amendment is
effective for distributions made after December 31, 1992. The purpose Of
the amendment is to comply with new law amendment requirements enacted by
Congress in 1992. The Revenue Service requires us to adopt this amendment
no later than December 31, 1993.
Article A of the plan applies to all plans and provides reliance with
IRS Code Section 401(a)(31) which requires a plan, as a condition of
qualification, to provide a direct rollover option for any eligible
rollover distribution made after December 31, 1992.
PLEASE PLACE THIS ARTICLE A BEHIND SECTION XIV OF YOUR MASTER PLAN BASIC
DOCUMENT FOUND IN YOUR NATIONSBANK NOTEBOOK UNDER PLAN DOCUMENT TAB 1.
Also enclosed is a "Notice to Employees" announcing the amendment. THE
REVENUE SERVICE REQUIRES YOU TO GIVE THIS NOTICE TO ALL EMPLOYEES NO
LATER THAN JULY 21, 1993. By that date, you may give the notice by
posting on an employee bulletin board or by personal delivery to each
employee. If you mail the notice to employees, you should mail the notice
at least three days before that date.
You may contact your NationsBank Client Services Officer if you have a
question. Thank you for your attention to this matter.
<PAGE> 100
ARTICLE A
APPENDIX TO BASIC PLAN DOCUMENT
This Article is necessary to comply with the Unemployment Compensation
Amendments Act of 1992 and is an integral part of the basic plan document.
Section 12.08 applies to any modification or amendment to this Article.
A-1. APPLICATIONS. This Article applies to distributions 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 Plan
Administrator, to have any portion of an eligible rollover distribution paid
directly to an eligible retirement plan specified by the distributee in a
direct rollover.
A-2. DEFINITIONS.
(a) "Eligible rollover distribution." An eligible
rollover distribution is any distribution of all or any portion of the balance
to the credit of the distributee, except that an eligible rollover distribution
does not include: any distribution that is one of a series of substantially
equal periodic payments (not less frequently than annually) made for the life
(or life expectancy) of the distributee or the joint lives (or joint life
expectancies) of the distributee and the distributee's designated beneficiary,
or for a specified period of ten years or more; any distribution to the extent
such distribution is required under Code Section 401(a)(9); and the portion of
any distribution that is not includible in gross income (determined without
regard to the exclusion of net unrealized appreciation with respect to employer
securities).
(b) "Eligible retirement plan." An eligible retirement
plan is an individual retirement account described in Code Section 408(a), an
individual retirement annuity described in Code Section 408(b), an annuity plan
described in Code Section 403(a), or a qualified trust described in Code
Section 401(a), 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.
(c) "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
Code Section 414(p), are distributees with regard to the interest of the spouse
or former spouse.
(d) "Direct rollover." A direct rollover is a payment by
the Plan to the eligible retirement plan specified by the distributee.
<PAGE> 101
NOTICE TO EMPLOYEES OF PLAN AMENDMENT
JULY 21, 1993
NAME OF PLAN: NCI 401(k) Profit Sharing Plan
PLAN NO.: 001
NAME & ADDRESS OF NCI Building Systems, Inc.
PLAN ADMINISTRATOR: 7301 Fairview
Houston, Texas 77041
EMPLOYER'S EIN: 76-0127701
NAME & ADDRESS OF NationsBank of Texas, N.A.
MASTER PLAN SPONSOR: 901 Main Street, 16th Floor
Dallas, Texas 75202
ADDRESS OF KEY Internal Revenue Service
DISTRICT DIRECTOR: EP/EO Division
Mail Code 4950 DAL
1100 Commerce Street
Dallas, Texas 75242
The referenced plan is an adoption of a master plan which has received
an opinion letter from the Key District Director having jurisdiction of the
plan. The Master Plan Sponsor has amended the Master Plan to add a new article
relating to direct rollovers of eligible rollover distributions paid from the
Plan. The Revenue Service does not require the Employer to submit this
amendment for a determination letter because the language conforms to a model
amendment published by the Revenue Service.
RIGHTS OF INTERESTED PARTIES. You have the right to submit to the Key
District Director, at the above address, either individually or jointly with
other interested parties, your comments as to whether the amended plan meets
the qualification requirements of the Internal Revenue Code. You may instead,
individually or jointly with other interested parties, request the Department
of Labor to submit, on your behalf, comments to the Key District Director
regarding qualification of the plan. If the Department declines to comment on
all or some of the matters you raise, you may, individually, or jointly if your
request was made to the Department jointly, submit your comments on these
matters directly to the Key District Director.
REQUESTS FOR COMMENTS BY THE DEPARTMENT OF LABOR. The Department of
Labor may not comment on behalf of interested parties unless requested to do so
by the lesser of 10 employees or 10% of the employees who qualify as interested
parties. If you request the Department to comment, your request must be in
writing and must specify the matters upon which comments are requested, and
must also include:
(1) The name of the Employer, the name of the plan, the plan
number, the opinion letter number, and name and address of the Master Plan
Sponsor, the Employer's EIN, the name and address of the plan administrator and
the address of the Key District Director having jurisdiction of the plan; and
<PAGE> 102
(2) The number of persons needed for the Department to comment.
A request to the Department to comment should be addressed as follows:
Deputy Assistant Secretary
Pension and Welfare Benefits Administration
U.S. Department of Labor
200 Constitution Avenue, N.W.
Washington, D.C. 20210
Attn: 3001 Comment Request
COMMENTS TO THE INTERNAL REVENUE SERVICE. Comments submitted by you to
the Key District Director must be in writing and received no later than 55 days
after the date of this notice. However, if there are matters that you request
the Department of Labor to comment upon on your behalf, and the Department
declines, you may submit comments on these matters to the Key District Director
to be received by him within 15 days from the time the Department notifies you
that it will not comment on a particular matter, or no later than 55 days after
the date of this notice, whichever is later. In no event may the Key District
Director receive your comment later than 70 days after the date of this notice,
even if the Department fails to give you timely notification that it declines
to comment. A request to the Department to comment on your behalf must be
received by it no later than 25 days after the date of this notice if you wish
to preserve your right to comment on a matter upon which the Department
declines to comment, or no later than 35 days after the date of this notice if
you wish to waive that right.
ADDITIONAL INFORMATION. Detailed instructions regarding the
requirements for notification of interested parties may be found in sections
17, 18 and 19 of Revenue Procedure 93-6. Additional information concerning this
application (including, where applicable, an updated copy of the plan and
related trust; the application for determination; any additional documents
dealing with the applications submitted to the IRS; and copies of section 16 of
Revenue Procedure 93-6) is available at the office of the Plan Administrator
accessible to the interested parties during the hours of 9:00 a.m. to 4:00 p.m.
for inspection and copying. There is a nominal charge for copying and mailing.
<PAGE> 103
AMENDATORY AGREEMENT #1
NCI Building Systems, Inc. ("Employer"), and NationsBank of Georgia, N.A.
("Trustee") make this Amendatory Agreement to NCI 401(k) Profit Sharing Plan
("Plan").
WITNESSETH
WHEREAS, it is necessary to make amendment to the Plan Adoption
Agreement in order to give credit for service with a predecessor employer under
the Plan; and
WHEREAS, Section 13.02 of the NationsBank Defined Contribution Master
Plan gives the Employer the authority to make amendments to the elections under
its Plan Adoption Agreement without jeopardizing its participation in the
Master Plan.
NOW THEREFORE, in consideration of the above premises, the Employer
and Trustee agree to amend the Plan Adoption Agreement as follows:
The Plan Sponsor's selection under Section 1.29 of the Adoption
Agreement is hereby added to the Addendum as follows:
SECTION 1.29
SERVICE FOR PREDECESSOR EMPLOYER. In addition to the
predecessor service the Plan must credit by reason of Section
1.29 of the Plan, the Plan credits Service with Ellis Building
Systems as follows:
(a) All years of service will be credited for purposes of
participation under Article II.
(b) Years of service will be credited for purposes of
vesting under Article V, except for service prior to
January 1, 1994.
The amendment made to the election under the Plan Adoption Agreement
under this Amendatory Agreement shall be effective January 1, 1995. In all
other respects, the Plan Adoption Agreement shall remain unchanged and in full
force and effect.
IN WITNESS WHEREOF, the Employer and Trustee have executed this
Amendatory Agreement this 29th day of December, 1994.
NCI Building Systems, Inc.
Attest: /s/ KAREN ROSALES By: /s/ DONNIE R. HUMPHRIES, V.P.
--------------------------- ---------------------------------
NationsBank of Georgia, N.A., Trustee
Accepted: By:
------------------------- ---------------------------------
Date
1
<PAGE> 104
AMENDATORY AGREEMENT #2
NCI Building Systems, Inc., as Employer sponsor ("Employer") and NationsBank of
Georgia, as Trustee ("Trustee") make this Amendatory Agreement to the NCI
401(k) Profit Sharing Plan ("Plan").
WITNESSETH
WHEREAS, it is necessary to make amendment to the Plan in order to
change certain provisions.
WHEREAS, Section 13.02 of the NationsBank Defined Contribution Master
Plan gives the Employer the authority to amend the Plan.
NOW THEREFORE, in consideration of the above premises, the Employer
and Trustee agree to amend the Plan as follows:
1. The Plan Sponsor's selection under Adoption Agreement Section 1.29 in
the Addendum is hereby amended by the addition of a second paragraph as
follows:
The Plan also credits Service with Royal Building Company as follows:
(a) All years of service will be credited for purposes of
participation under Article II.
(b) Years of service will be credited for purposes of vesting
under Article V, except for service prior to July 1, 1994.
2. The Plan Sponsor's selection under Section 3.01(g) in the Addendum is
hereby deleted in its entirety and replaced by the following:
SECTION 3.01(g)
LIMITATION ON AMOUNT. The Nonhighly Compensated Employee's salary
reduction contributions may not exceed 10% of Compensation for the
Plan Year, must equal at least 1% of Compensation for the Plan Year,
and must be contributed in increments of 1% of Compensation. The
Highly Compensated Employee's salary reduction contributions may not
exceed 5% of Compensation for the Plan Year, must equal at least 1% of
Compensation for the Plan Year, and must be contributed in increments
of 1% of Compensation.
3. The Plan Sponsor hereby amends the Addendum to the Adoption Agreement
Section 3.06(i) as follows:
For purposes of this Plan, the Advisory Committee will apply the following
changes and/or language to the Adoption Agreement sections as indicated.
- -SECTION 3.06(h). Suspension of Accrual Requirements. The Advisory Committee
will apply Section 3.06(E) of the Plan by using the substitute language
described in paragraphs 1 and 2 below:
<PAGE> 105
1) In lieu of the Coverage Test definition in the first paragraph of
Section 3.06(E), the Plan satisfies the Coverage Test if the ratio of
the Nonhighly Compensated Employees who benefit under the Plan to the
total number of Includible Nonhighly Compensated Employees is at least
equal to 70% of the ratio of the Highly Compensated Employees who
benefit under the Plan to the total number of Includible Highly
Compensated Employees. The annual testing method will be used. Under
this method the Plan, as of the last day of the Plan Year, must take
into account all Includible Employees employed at any time during the
Plan Year.
2) The Advisory Committee will apply the third paragraph of Section
3.06(E) of the Plan first by suspending the accrual requirements for
the Includible Nonhighly Compensated Employees who are Participants,
in the order described in Section 3.06(E), to the extent necessary to
satisfy the Coverage Test. The Advisory Committee then will suspend
the accrual requirements for the Includible Highly Compensated
Employees who are Participants, in the order described in Section
3.06(E), only if necessary to satisfy the Participation Test.
4. The Plan Sponsor hereby amends Section 3.06(g) as follows:
SECTION 3.06(g)
A Participant will forfeit any matching contribution attributable to
an excess contribution or to an excess aggregate contribution, unless
distributed pursuant to Sections 14.08 or 14.09.
This Amendatory Agreement shall be effective April 1, 1995. In all
other respects, the Plan and Adoption Agreement shall remain unchanged and in
full force and effect.
IN WITNESS WHEREOF, the Employer and Trustee have executed this
Amendatory Agreement in ________________ this 28th day of June, 1995.
NCI Building Systems, Inc.
Attest: By: /s/ DONNIE R. HUMPHRIES, V.P.
----------------------------------- ------------------------------
"EMPLOYER"
NationsBank of Georgia, N.A.
Accepted: By:
--------------------------------- ------------------------------
Date "TRUSTEE"
<PAGE> 106
CERTIFIED COPY OF RESOLUTIONS OF BOARD OF DIRECTORS
OF
NCI BUILDING SYSTEMS, INC.
The President brought before the Board of Directors Amendatory Agreement #2 to
the NCI 401(k) Profit Sharing Plan. The President proposed that the said plan
and trust be amended by adopting the Amendatory Agreement #2. The members of
the Board, having examined the amendatory agreement and after discussion
thereon, upon motion duly made, seconded and unanimously carried, adopted the
following resolutions:
RESOLVED, that the Corporation adopt the amendment to Sections 1.29,
3.01(g), 3.06(i) and 3.06(g) of the adoption agreement for the retirement plan
designated as the NCI 401(k) Profit Sharing Plan. To effect the amendment, the
President and Secretary shall execute Amendatory Agreement #2 circulated at
this meeting.
I, Donnie R. Humphries, Secretary of NCI Building Systems, Inc. hereby
certify that the foregoing resolutions were adopted at a meeting of the Board
of Directors, duly called and held at Atlanta, Georgia, on the 18th day of May,
1995, at which a quorum was present and voted.
/s/ DONNIE R. HUMPHRIES
---------------------------
Secretary
<PAGE> 107
ADVICE OF COUNSEL
The Employer states that it was advised by NationsBank, to obtain legal advice
from Counsel of its own choosing with respect to the adoption of Amendatory
Agreement #2 to NCI 401(k) Profit Sharing Plan (The "Plan"), the selection of
options, and the effect of the Amendatory Agreement of the Plan on the Employer
and represents that it has obtained such legal advice or has chosen on its own
accord not to obtain such legal advice.
NCI Building Systems, Inc.
By: /s/ DONNIE R. HUMPHRIES
--------------------------
Dated: 6/28/95
-----------------------
<PAGE> 108
AMENDATORY AGREEMENT #3
NCI Building Systems, Inc., as Employer ("Employer") and NationsBank, N.A.
(South), as Trustee ("Trustee") make this Amendatory Agreement to the NCI
401(k) Profit Sharing Plan ("Plan").
WITNESSETH
WHEREAS, it is necessary to make amendment to the Plan in order to
change the Service for Predecessor Employer provisions and added a Plan Entry
Date.
WHEREAS, Section 13.02 of the NationsBank Defined Contribution Master
Plan gives the Employer the authority to amend the Plan.
NOW THEREFORE, in consideration of the above premises, the Employer
and Trustee agree to amend the Plan as follows;
1. The Plan Sponsor's selection under Adoption Agreement Section 1.29 in
the Addendum is hereby amended by the addition of a paragraph as follows:
1.29 SERVICE FOR PREDECESSOR EMPLOYER.
In addition to the predecessor service the Plan must credit by
reason by Section 1.29 of the Plan, the Plan credits service
with Mesco Metal Buildings Plants and Doors and Building
Components, Inc. as follows:
(a) All years of service will be credited for purposes of
participation under Article II.
(b) For employees of Mesco Metal Buildings years of
service will be credited for purposes of vesting under
Article V, except for service prior to May 1, 1995.
For employees of Doors and Building Components, Inc.,
years of service will be credited for purposes of
vesting under Article V, except for service prior to
January 1, 1995.
2. The Plan Sponsor's selection under Adoption Agreement Section 2.01(g)
is hereby amended by the addition of a sentence as follows:
2.01 PLAN ENTRY DATE.
[X] (g) "Plan Entry Date" also means a special plan
entry date on May 1, 1996, for employees of Mesco
Metal Buildings employed on or before May 1, 1995.
This Amendatory Agreement shall be effective May 1, 1996. In all other
respects, the Plan and Adoption Agreement shall remain unchanged and in full
force and effect
IN WITNESS WHEREOF, the Employer and Trustee have executed this
Amendatory Agreement in Houston, Texas this 26 day of August, 1996.
NCI BUILDING SYSTEMS, INC.
Attest: By: /s/ DONNIE R. HUMPHRIES, V.P.
------------------------------ ------------------------------
"EMPLOYER"
NATIONSBANK, N.A. (SOUTH)
Accepted: By:
---------------------------- -------------------------------
<PAGE> 1
EXHIBIT 5.1
[GARDERE & WYNNE, L.L.P. LETTERHEAD]
(214) 999-3000
October 24, 1996
NCI Building Systems, Inc.
7301 Fairview
Houston, Texas 77041
Gentlemen:
We have served as counsel for NCI Building Systems, Inc., a Delaware
corporation (the "Company"), in connection with the Registration Statement on
Form S-8 (the "Registration Statement"), filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, with respect to
300,000 shares of Common Stock of the Company to be issued and sold by the
Company pursuant to the Company's 401(k) Profit Sharing Plan (the "Plan"),
including an indeterminate amount of interests to be offered or sold pursuant
to the Plan (the "Shares").
With respect to the foregoing, we have examined such documents and
questions of law as we have deemed necessary to render the opinion expressed
herein. Based upon the foregoing, we are of the opinion that the Shares which
may be issued or sold by the Company pursuant to the Plan, when so issued or
sold in accordance with the Plan, will be duly authorized and validly issued,
and fully paid and nonassessable.
We consent to the use of this opinion as Exhibit 5.1 to the Registration
Statement and to the use of our name in the Registration Statement under the
heading "Interests of Named Experts and Counsel."
Very truly yours,
GARDERE & WYNNE, L.L.P.
By: /s/ John K. Sterling
----------------------------------
John K. Sterling, Partner
<PAGE> 1
EXHIBIT 24.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under Item 3 in the Registration
Statement (Form S-8) pertaining to the NCI 401(k) Profit Sharing Plan and to
the incorporation by reference therein of our report dated December 1, 1995,
with respect to the consolidated financial statements of NCI Building Systems,
Inc. incorporated by reference in its Annual Report (Form 10-K) for the year
ended October 31, 1995 and the related financial statement schedule included
therein, filed with the Securities and Exchange Commission.
/s/ Ernst and Young L.L.P.
Houston Texas
October 25, 1996
