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As filed with the Securities and Exchange Commission
on November 21, 1995
Registration No. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
THE DIAL CORP
(Exact name of registrant as specified in its charter)
Delaware 36-1169950
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
Dial Tower, Phoenix, Arizona 85077
(Address of Principal Executive Offices) (Zip Code)
THE DIAL COMPANIES CAPITAL ACCUMULATION PLAN
(Full title of plan)
---------------
L. Gene Lemon, Esq.
Vice President-General Counsel
The Dial Corp
Dial Tower
Phoenix, Arizona 85077
(Name and address of agent for service)
(602) 207-4000
(Telephone number, including area code,
of agent for service)
---------------
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CALCULATION OF REGISTRATION FEE
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Title of Amount Proposed Maximum Proposed Maximum
Securities to be Offering Price Aggregate Amount of
to be Registered Per Share Offering Price Registration
Registered (1) (2) (2) Fee
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Common 1,200,000 $24.75 $29,700,000 $10,241.38
Stock
$1.50 par
value (1)(2)
- ------------------------------------------------------------------------
(1) Represents maximum aggregate number of shares of Common Stock
issuable under the Plan that are covered by this Registration
Statement pursuant to Rule 457(h). This Registration Statement
also pertains to Rights to purchase shares of Junior Participating
Preferred Stock of the Registrant (the "Rights"). One Right is
included with each share of Common Stock. Until the occurrence of
certain prescribed events, the Rights are not exercisable, are
evidenced by the certificates for the Common Stock and will be
transferred along with and only with such securities. Thereafter,
separate Rights certificates will be issued representing one Right
for each share of Common Stock held, subject to adjustment pursuant
to antidilution provisions.
(2) The amounts are based upon the average of the high and low sale
prices for the Common Stock as reported on the New York Stock
Exchange on November 16, 1995, and are used solely for the purpose
of calculating the registration fee pursuant to Rule 457(c) under
the Securities Act of 1933.
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
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PART I
INFORMATION REQUIRED IN PROSPECTUS
The information called for in Part I of Form S-8 is not
being filed with or included in this Form S-8 (by incorporation
by reference or otherwise) in accordance with the rules and
regulations of the Securities and Exchange Commission (the
"SEC").
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
---------------------------------------
The following documents previously filed by The Dial Corp
(the "Corporation") with the SEC pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act") are
incorporated in this Registration Statement by reference and
shall be deemed to be a part hereof:
(1) The Annual Report on Form 10-K filed by the Corporation
for the year ended December 31, 1994.
(2) The Annual Report on Form 11-K filed by The Dial
Companies Capital Accumulation Plan for the year ended December
31, 1994.
(3) All other reports filed pursuant to Section 13(a) or
15(d) of the Exchange Act since the end of the fiscal year
covered by the registrant document referred to in (1) above.
(4) The description of the Corporation's Common Stock
contained in the Corporation's Registration Statement on Form 8-B
filed with the SEC pursuant to Section 12 of the Exchange Act on
February 25, 1992.
(5) The description of the Corporation's Rights contained
in the Corporation's Registration Statement on Form 8-A filed
with the SEC pursuant to Section 12 of the Exchange Act on
February 24, 1992.
In addition, all documents filed by the Corporation pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act after
the date of this registration statement and prior to the filing
of a post-effective amendment which indicates that all securities
offered hereby have been sold or which deregisters all such
securities then remaining unsold, shall be deemed to be
incorporated in this registration statement by reference and to
be a part hereof from the date of filing of such documents.
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Any statement contained in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this registration
statement to the extent that a statement contained herein or in
any subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute
a part of this Registration Statement.
Item 4. Description of Securities.
-------------------------
Not Applicable.
Item 5. Interests of Named Experts and Counsel.
--------------------------------------
The legality of the securities offered pursuant to this
Registration Statement has been passed upon for the Corporation
by L. Gene Lemon, Vice President-General Counsel of the
Corporation. Mr. Lemon owns, and has options to purchase, shares
of Common Stock of the Corporation.
Item 6. Indemnification of Directors and Officers.
-----------------------------------------
The Restated Certificate of Incorporation (the "Certificate
of Incorporation") of the Corporation provides that each person
who is or was or had agreed to become a director or officer of
the Corporation, or each such person who is or was serving or who
had agreed to serve at the request of the Board of Directors of
the Corporation or an officer of the Corporation as an employee
or agent of the Corporation or as a director, officer, employee
or agent of another corporation, partnership, joint venture,
trust or other enterprise (including the heirs, executors,
administrators or estate of such person), will be indemnified by
the Corporation, in accordance with the Bylaws, to the full
extent permitted from time to time by Delaware law, as the same
exists or may hereafter be amended (but, in the case of any such
amendment, only to the extent that such amendment permits the
Corporation to provide broader indemnification rights than said
law permitted the Corporation to provide prior to such amendment)
or any other applicable laws as presently or hereafter in effect.
In addition, the Corporation may enter into one or more
agreements with any person providing for indemnification greater
or different than that provided in the Certificate of
Incorporation.
The Bylaws of the Corporation (the "Bylaws") provide that
each person who was or is made a party or is threatened to be
made a party to or is involved in any action, suit, or
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proceeding, whether civil, criminal, administrative or
investigative (a "Proceeding"), by reason of the fact that he or
she or a person of whom he or she is the legal representative is
or was a director, officer or employee of the Corporation or is
or was serving at the request of the Corporation as a director,
officer, employee or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, including
service with respect to employee benefit plans, whether the basis
of such Proceeding is alleged action in an official capacity as a
director, officer, employee or agent or in any other capacity
while serving as a director, officer, employee or agent, will be
indemnified and held harmless by the Corporation to the fullest
extent authorized by Delaware law as the same exists or may in
the future be amended (but, in the case of any such amendment,
only to the extent that such amendment permits the Corporation to
provide broader indemnification rights than said law permitted
the Corporation to provide prior to such amendment), against all
expense, liability and loss (including attorneys, fees,
judgments, fines, ERISA excise taxes or penalties and amounts
paid in settlement) reasonably incurred or suffered by such
person in connection therewith and such indemnification will
continue as to a person who has ceased to be a director, officer,
employee or agent and will inure to the benefit of his or her
heirs, executors and administrators; however, except as described
in the following paragraph with respect to Proceedings to enforce
rights to indemnification, the Corporation will indemnify any
such person seeking indemnification in connection with a
Proceeding (or part thereof) initiated by such person only if
such Proceeding (or part thereof) was authorized by the Board of
Directors of the Corporation.
Pursuant to the Bylaws, if a claim described in the
preceding paragraph is not paid in full by the Corporation within
thirty days after a written claim has been received by the
Corporation, the claimant may at any time thereafter bring suit
against the Corporation to recover the unpaid amount of the
claim, and, if successful in whole or in part, the claimant will
be entitled to be paid also the expense of prosecuting such
claims. The Bylaws provide that it will be a defense to any such
action (other than an action brought to enforce a claim for
expenses incurred in defending any Proceeding in advance of its
final disposition where the required undertaking, if any is
required, has been tendered to the Corporation) that the claimant
has not met the standards of conduct which make it permissible
under the General Corporation Law of the State of Delaware (the
"Delaware Law") for the Corporation to indemnify the claimant for
the amount claimed, but the burden of proving such defense will
be on the Corporation. The Certificate of Incorporation and the
Bylaws provide that any such determination will be made by
independent legal counsel selected by the claimant, approved by
the Board of Directors of the Corporation (the "Board") (which
approval may not be unreasonably withheld) and retained by the
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Board on behalf of the Corporation. Neither the failure of the
Corporation (including the Board, independent legal counsel or
stockholders) to have made a determination prior to the
commencement of such action that indemnification of the claimant
is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in the Delaware Law, nor
an actual determination by the Corporation (including the Board,
independent legal counsel or stockholders) that the claimant has
not met such applicable standard of conduct, will be a defense to
the action or create a presumption that the claimant has not met
the applicable standard of conduct.
The Bylaws provide that the right to indemnification and the
payment of expenses incurred in defending a Proceeding in advance
of its final disposition conferred in the Bylaws will not be
exclusive of any other right which any person may have or may in
the future acquire under any statute, provision of the
Certificate of Incorporation, the Bylaws, agreement, vote of
stockholders or disinterested directors or otherwise. The Bylaws
permit the Corporation to maintain insurance, at its expense, to
protect itself and any director, officer, employee or agent of
the Corporation or another corporation, partnership, joint
venture, trust or other enterprise against any expense, liability
or loss, whether or not the Corporation would have the power to
indemnify such person against such expense, liability or loss
under the Delaware Law. The Corporation has obtained directors
and officers liability insurance providing coverage to its
directors and officers. In addition, the Bylaws authorize the
Corporation, to the extent authorized from time to time by the
Board, to grant rights to indemnification, and rights to be paid
by the Corporation the expenses incurred in defending any
Proceeding in advance of its final disposition, to any agent of
the Corporation to the fullest extent of the provisions of the
Bylaws with respect to the indemnification and advancement of
expenses of directors, officers and employees of the Corporation.
The Bylaws provide that the right to indemnification
conferred therein is a contract right and includes the right to
be paid by the Corporation the expenses incurred in defending any
such Proceeding in advance of its final disposition, except that
if Delaware law requires, the payment of such expenses incurred
by a director or officer in his or her capacity as a director or
officer (and not in any other capacity in which service was or is
rendered by such person while a director or officer, including,
without limitation, service to an employee benefit plan) in
advance of the final disposition of a Proceeding will be made
only upon delivery to the Corporation of an undertaking by or on
behalf of such director or officer to repay all amounts so
advanced if it is ultimately determined that such director or
officer is not entitled to be indemnified under the Bylaws or
otherwise.
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The Corporation has entered into indemnification agreements
with each of the Corporation's directors. The indemnification
agreements, among other things, require the Corporation to
indemnify the officers and directors to the fullest extent
permitted by law, and to advance to the directors all related
expenses, subject to reimbursement if it is subsequently
determined that indemnification is not permitted. The
Corporation must also indemnify and advance all expenses incurred
by directors seeking to enforce their rights under the
indemnification agreements, and cover directors under the
Corporation's directors' liability insurance. Although the form
of indemnification agreement offers substantially the same scope
of coverage afforded by provisions in the Certificate of
Incorporation and the Bylaws, it provides greater assurance to
directors that indemnification will be available, because, as a
contract, it cannot be modified unilaterally in the future by the
Board or by the stockholders to eliminate the rights it provides,
an action that is possible with respect to the relevant
provisions of the Bylaws, at least as to prospective elimination
of such rights.
Item 7. Exemption from Registration Claimed.
-----------------------------------
Not Applicable.
Item 8. Exhibits.
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Exhibit
Number Description
- ------- -----------
4.1 - Restated Certificate of Incorporation of the
Registrant filed as Exhibit (3)(A) to Registrant's
1991 Form 10-K.*
4.2 - Bylaws of the Registrant filed as Exhibit (3)(B)
to Registrant's 1991 Form 10-K.*
4.3 - The Dial Companies Capital Accumulation Plan.
4.4 - Rights Agreement dated as of February 15, 1992
between the Registrant and the Rights Agent named
therein filed as Exhibit 4.4 to Registrant's Form
S-8 Registration Statement for The Dial Corp 1992
Stock Incentive Plan.*
5 - Opinion of the Registrant's General Counsel as to
the legality of securities offered under The Dial
Companies Capital Accumulation Plan.
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23.1 - Consent of Independent Auditors, Deloitte & Touche
LLP.
23.2 - Consent of Counsel (contained in the Opinion of
the Registrant's General Counsel, Exhibit 5
hereto).
24 - Power of Attorney (included on signature page of
this Registration Statement).
- ---------------------------------
* Incorporated herein by reference.
Item 9. Undertakings.
------------
(a) The Corporation hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the
Registration Statement (or the most recent post-
effective amendment thereof) which, individually, or in
the aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
(iii) To include any material information with
respect to the plan of distribution not previously
disclosed in the Registration Statement or any material
change to such information in the Registration
Statement;
Provided, however, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the information required to be
included in a post-effective amendment by those paragraphs
is contained in periodic reports filed by the Registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act
that are incorporated by reference in the Registration
Statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
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(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The Registrant hereby undertakes that, for the purpose
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 Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(h) Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the Registrant pursuant to
the foregoing provisions, or otherwise, the Registrant has been
informed that in the opinion of the SEC such indemnification is
against public policy as expressed in the Act and is therefore
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of
any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final
adjudication of such issue.
Experts
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The financial statements incorporated in this Registration
Statement on Form S-8 by reference from the Corporation's Annual
Report on Form 10-K for the year ended December 31,1994, have
been audited by Deloitte & Touche LLP, independent auditors, as
stated in their report (which report expresses an unqualified
opinion and includes an explanatory paragraph referring to the
Corporation's change in the method of accounting for
postretirement benefits other than pensions in 1992) which is
incorporated herein by reference, and has been so incorporated in
reliance upon the reports of such firm given upon their authority
as experts in accounting and auditing.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe 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 Phoenix, and
State of Arizona, on the 16th day of November, 1995.
THE DIAL CORP
By: /s/ John W. Teets
Chairman and
Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below hereby authorizes and
appoints Richard C. Stephan, as his attorney-in-fact, with full power
of substitution and resubstitution, to sign and file on his or her
behalf individually and in each such capacity stated below any and all
amendments and post-effective amendments to this Registration
Statement, as fully as such person could do in person, hereby
verifying and confirming all that said attorney-in-fact, or his
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 and on the dates indicated.
Signatures Title Date
- ---------- ----- ----
Principal Executive
Officer
/s/ John W. Teets Director; Chairman, 11/16/95
and Chief
Executive Officer
Principal Financial
Officer
/s/ Ronald G. Nelson Vice President-Finance 11/16/95
and Treasurer
Principal Accounting
Officer
/s/ Richard C. Stephan Vice President-Controller 11/16/95
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Directors
/s/ Joe T. Ford 11/16/95
/s/ Thomas L. Gossage 11/16/95
/s/ Donald E. Guinn 11/16/95
/s/ Jess Hay 11/16/95
/s/ Judith K. Hofer 11/16/95
/s/ Andrew S. Patti 11/16/95
/s/ Jack F. Reichert 11/16/95
/s/ Linda Johnson Rice 11/16/95
/s/ Dennis C. Stanfill 11/16/95
/s/ A. Thomas Young 11/16/95
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THE PLAN
Pursuant to the requirements of the Securities Act of 1933, the
Plan Administrators have duly caused this registration statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Phoenix, State of Arizona, on the 16th day of November,
1995.
THE DIAL COMPANIES CAPITAL
ACCUMULATION PLAN
By: /s/ C.D. Walling
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Exhibit 4.3
DIAL COMPANIES CAPITAL ACCUMULATION PLAN
Restated 6/15/94
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DIAL COMPANIES CAPITAL ACCUMULATION PLAN
INDEX
Article Description Page
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I Purpose
II Definitions and Construction
2.1 Definitions
Accounts
Actual Deferral Percentages
Adoption Agreement
Affiliate
Aggregate Limit
Annual Additions
Authorized Leave of Absence
Average Contribution Percentage
Beneficiary
CODA
Code
Committee
Compensation
Contribution Percentage
Contribution Percentage Amounts
Disability
Elective Deferrals
Eligible Employee
Eligible Participant
Employee
Employee Contribution
Employee Contribution Account
Employer
Employer Contribution Account
Employer Stock
Excess Aggregate Contributions
Excess Contribution
Excess Elective Deferrals
Effective Date
Entry Date
ERISA 11
Family Member
Fiduciaries
GFCFC Stock Account
Highly Compensated Employee
Income
Investment Fund(s)
Matching Contribution
Participant
Participation
Plan
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Qualified Matching Contributions
Qualified Non-elective Contributions
Salary Contribution Account
Special Valuation Date
Trust (or Trust Fund)
Trustee
Valuation Date
Vested Rollover Contribution Account
Year
2.2 Construction
III Participation
3.1 Participation
3.2 Termination of Employment
3.3 Transfers
3.4 Suspension
IV Contributions
4.1 Employer Contributions
4.2 Code Section 401(k) Salary Reduction
4.3 Employee Contributions
4.4 After-Tax Salary Deduction
4.5 Rollover Amount From Other Plans
V Allocations to Participant's Account
5.1 Individual Accounts
5.2 Account Adjustments
5.3 Actual Deferral Percentage Test
5.4 Average Contribution Percentage Test
5.5 Distribution of Excess Aggregate Contributions
5.6 Distribution of Excess Elective Deferrals
5.7 Distribution of Excess Contributions
5.8 Recharacterization
5.9 Maximum Additions
5.10 Recognition of Different Investment Funds
5.11 Top-Heavy Provisions
5.12 Securities Law Requirements
VI Benefits
6.1 Entitlement to Benefits
6.2 Death
6.3 Payment of Benefits
6.4 Designation of Beneficiary
6.5 Withdrawals
6.6 Debiting of Investment Funds
6.7 Required Distributions
6.8 Distribution Requirements
6.9 Loans to Participants
6.10 Eligible Rollover Distributions
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VII Investment Options, Trust Fund
7.1 Participant Directed Individual Account Plan
7.2 Employee Selected Investment Options
Investment Funds
7.3 Investment Elections
7.4 Investment Transfers
7.5 Trust Fund
7.6 Tender Offers
7.7 Voting of Stock
7.8 GFCFC Common Stock Fund
7.9 Exercise of Control
7.10 Adjustment of Accounts
7.11 Limitation of Liability And Responsibility
7.12 Former Participants And Beneficiaries
VIII Administration
8.1 Allocation of Responsibility Among Fiduciaries for
Plan and Trust Administration
8.2 Appointment of Committee
8.3 Claims Procedure
8.4 Records and Reports
8.5 Other Committee Powers and Duties
8.6 Rules and Decisions
8.7 Committee Procedures
8.8 Authorization of Benefit Payments
8.9 Application and Forms for Benefits
8.10 Facility of Payment
8.11 Indemnification of the Committee
IX Miscellaneous
9.1 Nonguarantee of Employment
9.2 Rights to Trust Assets
9.3 Nonalienation of Benefits
9.4 Nonforfeitability of Benefits
X Amendments and Action by Employer
10.1 Amendments
10.2 Action by The Dial Corp
XI Successor Employer and Merger or Consolidation of Plans
11.1 Successor Employer
11.2 Conditions Applicable to Mergers or Consolidations
of Plans
XII Plan Termination
12.1 Right to Terminate
12.2 Partial Termination
12.3 Liquidation of the Trust Fund
XIII Adoption of Plan
13.1 Adoption Agreement
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DIAL COMPANIES CAPITAL ACCUMULATION PLAN
ARTICLE I. - PURPOSE
Effective as of January 1, 1985 (the "Effective Date"), the
Employer adopted the Plan set forth herein, formerly called the
Greyhound Employees' Capital Accumulation Plan.
The Dial Companies Capital Accumulation Plan Trust, formerly
called the Greyhound Employees' Capital Accumulation Plan Trust,
as established by trust agreement executed effective as of
January 1, 1985 ("Trust") is intended to form a part of the Plan.
The Plan and Trust are intended to meet the requirements of
Sections 401(a), 401(k) and 501(a) of the Internal Revenue Code
of 1986, as amended.
The provisions of this Plan shall apply only to an Eligible
Employee who is actively employed by an Employer after the
Effective Date and who is a Participant, as defined in Section
2.1 of the Plan.
The Plan and Trust have been amended from time to time since
they were established principally to conform to law changes.
The Plan is restated on June 27, 1994, to incorporate Plan
amendments approved June 27, 1994 which, unless otherwise
provided, were effective retroactive to January 1, 1993. These
amendments were primarily to comply with Code section 401(a)(31),
added by the Unemployment Compensation Amendments of 1992, and
the new compensation limit established by the Omnibus Budget
Reconciliation Act of 1993.
ARTICLE II. - DEFINITIONS AND CONSTRUCTION
2.1 DEFINITIONS: Where the following words and phrases
appear in this Plan, they shall have the respective meanings set
forth in this Article, unless the context clearly indicates to
the contrary.
(a) ACCOUNT(S): One or all of the Employee Contribution
Account, Employer Contribution Account, Salary Reduction
Contribution Account and Vested Rollover Contribution Account, as
the case may be, and as appropriate in the context of each
provision of the Plan containing such term, for each Participant.
(b) ACTUAL DEFERRAL PERCENTAGE: shall mean, for a
specified group of Participants for a Plan Year, the average of
the ratios (calculated separately for each Participant in such
group) of (1) the amount of Employer contributions actually paid
over to the Trust on behalf of such Participant for the Plan Year
to (2) the Participant's Compensation for such Plan Year (whether
or not the Employee was a Participant for the entire Plan Year).
Employer contributions on behalf of any Participant shall
<PAGE> 6
include: (1) any Elective Deferrals made pursuant to the
Participant's deferral election, including Excess Elective
Deferrals of Highly Compensated Employees, but excluding Elective
Deferrals that are taken into account in the Contributions
Percentage test (provided the ADP test is satisfied both with and
without exclusion of these Elective Deferrals); and (2) at the
election of the Employer, Qualified Non-elective Contributions
and Qualified Matching Contributions. For purposes of computing
Actual Deferral Percentages, an Employee who would be a
Participant but for the failure to make Elective Deferrals shall
be treated as a Participant on whose behalf no Elective Deferrals
are made.
(c) ADOPTION AGREEMENT: The agreement executed by each
Affiliate Employer in order to adopt the Plan pursuant to the
provisions of Article XIII.
(d) AFFILIATE: An entity which, by reason of Code Section
414(b), 414(c), or 414(m), is treated as a single Employer with
The Dial Corp.
(e) AGGREGATE LIMIT: The sum of (i) 125 percent of the
greater of the ADP of the Non-highly Compensated Employees for
the Plan Year or the ACP of Non-highly Compensated Employees
under the plan subject to Code Section 401(m) for the Plan Year
beginning with or within the Plan Year of the CODA and (ii) the
lesser of 200% or two plus the lesser of such ADP or ACP.
"Lesser" is substituted for "greater" in "(i)" above, and
"greater" is substituted for "lesser" after "two plus the" in
"(ii)" if it would result in a larger Aggregate Limit.
(f) ANNUAL ADDITIONS: With respect to each Year, the total
of the Employer contributions allocated to a Participant's Salary
Reduction Contribution Account, Employee Contribution Account and
Employer Contribution Account. Amounts allocated, after March
31, 1984, to an individual medical account, as defined in Section
415(l)(2) of the Code, which is part of a pension or annuity plan
maintained by the Employer are treated as Annual Additions to a
defined contribution plan. Also amounts derived from
contributions paid or accrued after December 31, 1985, in taxable
years ending after such date, which are attributable to
post-retirement medical benefits, allocated to the separate
account of a key Employee, as defined in Section 419A(d)(3) of
the Code, under a welfare benefit fund, as defined in Section
419(e) of the Code, maintained by the Employer are treated as
Annual Additions to a defined contribution plan. For this
purpose, any excess amount applied under Section 5.9(b) in the
Year to reduce Employer contributions will be considered Annual
Additions for such Year.
(g) AUTHORIZED LEAVE OF ABSENCE: Any absence authorized by
the Employer under the Employer's standard personnel practices
provided that all persons under similar circumstances must be
treated alike in the granting of such Authorized Leaves of
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Absence and provided further that the Employee returns to
employment with the Employer or retires within the period of
authorized absence. An absence due to service in the Armed
Forces of the United States shall be considered an Authorized
Leave of Absence provided that the Employee complies with all of
the requirements of federal law in order to be entitled to
reemployment and provided further that the Employee returns to
employment with the Employer within the period provided by such
law.
(h) AVERAGE CONTRIBUTION PERCENTAGE: The average of the
Contribution Percentages of the Eligible Participants in a group.
(i) BENEFICIARY: A person or persons (natural or
otherwise) designated by a Participant in accordance with the
provisions of Section 6.4 to receive any death benefit payable
under this Plan.
(j) CODA: A cash or deferred arrangement as described in
Section 401(k) of the Code.
(k) CODE: The Internal Revenue Code of 1986, as amended.
(l) COMMITTEE: The persons appointed pursuant to Article
VIII to assist the Dial Corp in the administration of the Plan
in accordance with said Article.
(m) COMPENSATION: Subject to the other provisions of the
Plan and except as defined in the Adoption Agreement of an
Employer in accordance with Article XIII, hereof, the total of
all amounts paid to a Participant by the Employer for personal
services as would be reported on the Participant's Federal Income
Tax Withholding Statement (Form W-2) had Participant not been a
Participant under the Plan or any Plan sponsored by the Employer
which is qualified under Sections 125 or 129 of the Code and
excluding fringe benefits, overtime, bonuses and any benefits
paid under this Plan; provided, however, that consistent with
past practice the Committee, in its discretion, may use any
definition of "compensation" to determine whether the various
nondiscrimination tests are met as long as such definition
satisfies Code Section 414(s) and is applied uniformly to all
Participants. For purposes of allocating the Employer's
contribution for the Year in which a Participant begins or
resumes Participation, Compensation allocable to time periods
before his or her Participation began or resumed shall be
disregarded.
The annual Compensation of each Participant taken into account
under the Plan for any year shall not exceed $200,000, as
adjusted by the Secretary of Treasury at the same time and in the
same manner as under Section 415(d) of the Code. If, as a result
of the application of such rules the adjusted $200,000 limitation
is exceeded, then the limitation shall be prorated among affected
individuals in proportion to each such individual's Compensation
<PAGE> 8
as determined under this Section prior to the application of this
limitation. In determining the Compensation of a Participant for
purposes of this limitation, the rules of Section 414(q)(6) of
the Code shall apply, except in applying such rules, the term
"Family" shall include only the spouse of the Participant and any
lineal descendants of the Participant who have not attained age
19 before the close of the year. In addition to the other
applicable limitations set forth in the Plan, and notwithstanding
any other provision of the Plan to the contrary, for Plan Years
beginning on or after January 1, 1994, the annual Compensation of
each Employee taken into account under the Plan shall not exceed
the "OBRA '93 annual compensation limit." The "OBRA '93 annual
compensation limit" is $150,000 as adjusted by the Commissioner
for increases in the cost-of-living in accordance with Section
401(a)(17)(B) of the Code. The cost-of-living adjustment in
effect for a calendar year applies to any period, not exceeding
12 months, over which Compensation is determined (the
"determination period") beginning in such calendar year. If a
determination period consists of fewer than 12 months, the OBRA
'93 annual compensation limit will be multiplied by a fraction,
the numerator of which is the number of months in the
determination period, and the denominator of which is 12. For
Plan Years beginning on or after January 1, 1994, any reference
in this Plan to the limitation under Section 401(a)(17) of the
Code shall mean the OBRA '93 annual compensation limit set forth
in this provision. If Compensation for any prior determination
period is taken into account in determining an Employee's
benefits accruing in the current Plan Year, the Compensation for
that prior determination period is subject to the OBRA '93 annual
compensation limit in effect for that prior determination period.
For this purpose, for determination periods beginning before the
first day of the first Plan Year beginning on or after January 1,
1994, the OBRA '94 annual compensation limit is $150,000.
(n) CONTRIBUTION PERCENTAGE: The ratio (expressed as a
percentage) of the Participant's Contribution Percentage Amounts
to the Participant's Compensation for the Plan Year (whether or
not the Employee was a Participant for the entire Plan Year).
(o) CONTRIBUTION PERCENTAGE AMOUNTS: The sum of the
Employee Contributions, Matching Contributions, and Qualified
Matching Contributions (to the extent not taken into account for
purposes of the ADP test) made under the plan on behalf of the
Participant for the Plan Year. Such Contribution Percentage
Amounts shall include forfeitures of Excess Aggregate
Contributions or Matching Contributions allocated to the
Participant's account which shall be taken into account in the
year in which such forfeiture is allocated. The Employer may
include Qualified Non-elective Contributions in the Contribution
Percentage Amounts. The Employer also may elect to use Elective
Deferrals in the Contribution Percentage Amounts so long as the
ADP test is met before the Elective Deferrals are used in the ACP
test and continues to be met following the exclusion of those
Elective Deferrals that are used to meet the ACP test.
<PAGE> 9
(p) DISABILITY: A physical or mental condition which, in
the sole judgement of the Committee, based upon medical reports
and other evidence satisfactory to the Committee, permanently
prevents an Employee from satisfactorily performing his or her
usual duties for the Employer and the duties of any other
position or job for the Employer for which such Employee is
qualified by reason of his or her training, education or
experience.
(q) ELECTIVE DEFERRALS: Any Employer contributions made to
the plan at the election of the Participant, in lieu of cash
compensation, and shall include contributions made pursuant to a
salary reduction agreement or other deferral mechanism. With
respect to any taxable year, a Participant's Elective Deferral is
the sum of all Employer contributions made on behalf of such
Participant pursuant to an election to defer under any qualified
CODA as described in Section 401(k) of the Code, any simplified
Employee pension cash or deferred arrangement as described in
402(h)(1)(B), any eligible deferred compensation plan under
Section 457, any plan as described under Section 501(c)(18), and
any Employer contributions made on the behalf of a Participant
for the purchase of an annuity contract under Section 403(b)
pursuant to a salary reduction agreement.
(r) ELIGIBLE EMPLOYEE: Any Employee whose customary
employment is for not less than 1000 hours of service (as defined
in Section 3.1) per year and for a regular fixed compensation,
except an Employee who is covered by a collective bargaining
agreement.
(s) ELIGIBLE PARTICIPANT: Any Employee who is eligible to
make an Employee Contribution, or an Elective Deferral (if the
Employer takes such contributions into account in the
calculation of the Contribution Percentage), or to receive a
Matching Contribution (including forfeitures) or a Qualified
Matching Contribution. If an Employee Contribution is required
as a condition of participation in the plan, any Employee who
would be a Participant in the plan if such Employee made such a
contribution shall be treated as an Eligible Participant on
behalf of whom no Employee Contributions are made.
(t) EMPLOYEE: Any person who is actively employed by an
Employer or an Affiliate.
(u) EMPLOYEE CONTRIBUTION: Any contribution made to the
Plan by or on behalf of a Participant that is included in the
Participant's gross income in the year in which made and that is
maintained under a separate account to which earnings and losses
are allocated.
(v) EMPLOYEE CONTRIBUTION ACCOUNT: The account maintained
pursuant to Section 4.3, hereof, to record for a Participant his
or her after-tax contributions and adjustments relating thereto.
<PAGE> 10
(w) EMPLOYER: The Dial Corp, or any Affiliate that has
adopted the Plan.
(x) EMPLOYER CONTRIBUTION ACCOUNT: The account maintained
pursuant to Section 4.1(b), hereof, to record for a Participant
his or her share of the contributions of the Employer, if any,
and adjustments relating thereto.
(y) EMPLOYER STOCK: The common stock, $1.50 par value, of
The Dial Corp.
(z) EXCESS AGGREGATE CONTRIBUTIONS: Shall mean, with
respect to any Plan Year, the excess of:
(1) The aggregate Contribution Percentage Amounts taken into
account in computing the numerator of the Contribution Percentage
actually made on behalf of Highly Compensated Employees for such
Plan Year, over
(2) The maximum Contribution Percentage Amounts permitted by the
ACP test (determined by reducing contributions made on behalf of
Highly Compensated Employees in order of their Contribution
Percentages beginning with the highest of such percentages).
Such determination shall be made after first determining Excess
Elective Deferrals and then determining Excess Contributions.
In computing the Average Contribution Percentage, the Employer
shall take into account, and include as Contribution Percentage
Amounts Elective Deferrals, and Qualified Non-elective
Contributions under this plan or any other plan of the Employer,
as provided by regulations.
Forfeitures of Excess Aggregate Contributions shall be:
(1) Applied to reduce Employer contributions for the Plan Year
in which the excess arose, but allocated as in (2), below, to
the extent the excess exceeds Employer contributions or the
Employer has already contributed for such Plan Year.
(2) Allocated, after all other forfeitures under the plan, to
the Matching Contribution account of each Non-highly Compensated
Participant who made Elective Deferrals or Employee Contributions
in the ratio which each such Participant's Compensation for the
Plan Year bears to the total Compensation of all such
Participants for such Plan Year.
The Employer may elect to make Qualified Non-elective
Contributions under the plan on behalf of Employees.
(aa) EXCESS CONTRIBUTION: Shall mean, with respect to any
Plan Year, the excess of:
(1) The aggregate amount of Employer contributions actually
taken into account in computing the ADP of Highly Compensated
Employees for such Plan Year over
<PAGE> 11
(2) The maximum amount of such contributions permitted by the ADP
test (determined by reducing contributions made on behalf of
Highly Compensated Employees in order of the ADPs, beginning with
the highest of such percentages).
(bb) EXCESS ELECTIVE DEFERRALS: shall mean those Elective
Deferrals that are includible in a Participant's gross income
under Section 402(g) of the Code to the extent such Participant's
Elective Deferrals for a taxable year exceed the dollar
limitation under such Code section. Excess Elective Deferrals
shall be treated as annual additions under the Plan unless such
amounts are distributed no later than the first April 15
following the close of the Participant's taxable year.
(cc) EFFECTIVE DATE: January 1, 1985, the date on which the
provisions of this Plan became effective, or with respect to an
Affiliate who adopts the Plan on a later date, the date set forth
in the Adoption Agreement.
(dd) ENTRY DATE: The first day of each calendar month.
(ee) ERISA: Public Law No. 93-406, the Employee Retirement
Income Security Act of 1974, as amended.
(ff) FAMILY MEMBER: A member of the Employee's family as
defined in Section 414(q)(6) of the Code.
(gg) FIDUCIARIES: The Committee and the Trustee, but only
with respect to the specific responsibilities of each for Plan
and Trust administration, all as described in Section 8.1.
(hh) GFCFC STOCK ACCOUNT: The account maintained pursuant
to Sections 5.1 and 7.1, hereof, to record for a Participant his
or her shares of common stock of GFC Financial Corporation
("GFCFC Stock") credited to the Plan as of March 18, 1992.
(ii) HIGHLY COMPENSATED EMPLOYEE: Includes active Highly
Compensated Employees and former Highly Compensated Employees.
An active Highly Compensated Employee includes any Employee who
performs service for the Employer during the determination year
and who during the look-back year: (i) received compensation
from the Employer in excess of $75,000 as adjusted pursuant to
Section 415(d) of the Code); (ii) received compensation from the
Employer in excess of $50,000 (as adjusted pursuant to Section
415(d) of the Code) and was a member of the top-paid group for
such year; or (iii) was an officer of the Employer and received
compensation during such year that is greater than 50% of the
dollar limitation in effect under Section 415(b)(1)(A) of the
Code. The term Highly Compensated Employee also includes: (i)
Employees who are both described in the preceding sentence if the
term "determination year" is substituted for the term "look-back
<PAGE> 12
year" and the Employee is one of the 100 Employees who receive
the most compensation from the Employer during the determination
year; and (ii) Employees who are 5-percent owners at any time
during the look-back year or determination year. If no officer
has satisfied the compensation requirements of (iii) above during
either a determination year or look-back year, the highest paid
officer for such year shall be treated as a Highly Compensated
Employee. For this purpose, the determination year shall be the
Plan Year. The look-back year shall be the twelve-month period
immediately preceding the determination year. A former Highly
Compensated Employee includes any Employee who separated from
service (or was deemed to have separated) prior to the
determination year, performs no service for the Employer during
the determination year, and was an active Highly Compensated
Employee for either the separation year or any determination year
ending on or after the Employee's 55th birthday.
If an Employee is, during a determination year or look-back year,
a Family Member of either a 5-percent owner who is an active or
former Employee or a Highly Compensated Employee who is one of
the 10 most Highly Compensated Employees ranked on the basis of
compensation paid by the Employer during such year, then the
Family Member and the 5-percent owner or top ten Highly
Compensated Employee shall be aggregated. In such case, the
Family Member and 5-percent owner or top ten Highly Compensated
Employee shall be treated as a single Employee receiving
compensation and Plan contributions or benefits equal to the sum
of such compensation and contributions or benefits of the Family
Member and 5-percent owner or top ten Highly Compensated
Employee. For purposes of this Section, Family member includes
the spouse, lineal ascendants and descendants of the Employee or
former Employee and the spouses of such lineal ascendants and
descendants.
The determination of who is a Highly Compensated Employee,
including the determinations of the number and identity of
Employees in the top-paid group, the top 100 Employees, the
number of Employees treated as officers and the compensation that
is considered, will be made in accordance with Section 414(q) of
the Code and the regulations thereunder.
The Employer may elect to use the calendar year to determine
whether an Employee is a Highly Compensated Employee in the
look-back year (as defined in Treasury Regulations under Section
414(q) of the Code) calculation. The calendar year used will be
the calendar year ending with or within the determination year
(as defined in the regulations under Section 414(q) of the Code).
The determination year shall be the months (if any) in the
current Plan Year which follow the end of the calendar year look
back year. If the Employer elects to make the calendar year
calculation election with respect to any plan, entity or
arrangement, such election must apply with respect to all plans,
entities and arrangements of the Employer.
<PAGE> 13
(jj) INCOME: The net gain or loss of the Trust Fund from
investments, as reflected by interest payments, dividends,
realized and unrealized gains and losses on securities, other
investment transactions and expenses paid from the Trust Fund.
In determining the Income of the Trust Fund as of any date,
assets shall be valued on the basis of their fair market value.
(kk) INVESTMENT FUND(S): The investment funds described in
Section 7.1.
(ll) MATCHING CONTRIBUTION: An Employer contribution made to
this or any other defined contribution plan on behalf of a
Participant on account of an Employee Contribution made by such
Participant, or on account of a Participant's Elective Deferral,
under a plan maintained by the Employer.
(mm) PARTICIPANT: An Employee participating in the Plan in
accordance with the provisions of Section 3.1.
(nn) PARTICIPATION: The period commencing as of the date
the Employee became a Participant and ending on the date his or
her employment with the Employer terminated in accordance with
Section 3.2, hereof.
(oo) PLAN: The Dial Companies Capital Accumulation Plan,
the Plan set forth herein, as amended from time to time.
(pp) QUALIFIED MATCHING CONTRIBUTIONS: Matching
Contributions which are subject to the distribution and
nonforfeitability requirements under Section 401(k) of the Code
when made.
(qq) QUALIFIED NON-ELECTIVE CONTRIBUTIONS: Contributions
(other than Matching Contributions or Qualified Matching
Contributions) made by the Employer and allocated to
Participants' Accounts that the Participants may not elect to
receive in cash until distributed from the Plan; that are
nonforfeitable when made; and that are distributable only in
accordance with the distribution provisions that are applicable
to Elective Deferrals and Qualified Matching Contributions.
(rr) SALARY REDUCTION CONTRIBUTION ACCOUNT: The account
maintained to record for a Participant his or her pre-tax salary
reduction contributions made by the Employer pursuant to Section
4.1(a) and 4.2 hereof, and adjustments relating thereto.
(ss) SPECIAL VALUATION DATE: The date on which a special
valuation is made pursuant to Section 5.2.
(tt) TRUST (OR TRUST FUND): The fund known as the Dial
Companies Capital Accumulation Plan Trust, maintained in
accordance with the terms of the trust agreement, as from time to
time amended, which constitutes a part of the Plan.
<PAGE> 14
(uu) TRUSTEE: The corporation or individuals appointed by
the Board of Directors of The Dial Corp to administer the Trust.
(vv) VALUATION DATE: The last day of each calendar quarter
or more frequent accounting period determined pursuant to Section
5.2(a), provided that the last day of the Plan Year shall always
be a Valuation Date.
(ww) VESTED ROLLOVER CONTRIBUTION ACCOUNT: The account
maintained pursuant to Section 4.5, hereof, to record for a
Participant rollover amounts transferred to the Trust Fund and
adjustments relating thereto.
(xx) YEAR: The 12-month period commencing on January 1 and
ending on December 31.
2.2 CONSTRUCTION: The words "hereof," "herein,"
"hereunder," and other similar compounds of the word "here" shall
mean and refer to the entire Plan and not to any particular
provision or Section. Article and Section headings are included
for convenience of reference and are not intended to add to, or
subtract from, the terms of the Plan.
ARTICLE III. - PARTICIPATION
3.1 PARTICIPATION: An Eligible Employee shall become a
Participant as of the later of the Effective Date or the first
Entry Date coincident with or next following the last twelve
consecutive month period during which he or she has at least
1,000 hours of service with the Employer, provided that said
Eligible Employee has entered into a duly executed salary
reduction agreement under Section 4.2 in advance of said Entry
Date and has fulfilled the Plan's enrollment procedures as
provided by the Committee. Participation under the Plan shall
cease and a person shall no longer be a Participant upon
termination of employment with the Employer, as defined in
Section 3.2, hereof. A rehired Eligible Employee shall fulfill
all of the requirements of the first sentence of this Section 3.1
in their entirety in order to become a Participant; except that a
rehired former Participant need not fulfill the 1000 hours of
service requirement if such former Participant is rehired as an
Eligible Employee. The term "hour of service" shall mean for the
purposes hereof, each hour (i) for which an Eligible Employee is
paid, or entitled to payment for the performance of duties for
the Employer or (ii) during which the Eligible Employee is absent
due to an Authorized Leave of Absence, vacation, holiday,
temporary sickness, maternity or paternity leave under ERISA
Section 203(b), but in each case only to the extent such Eligible
Employee is or would be (but for the absence) entitled to payment
for the performance of his or her regular duties for the
Employer, as reasonably determined by the Committee consistent
with U.S. Department of Labor regulations, during the applicable
computation period.
<PAGE> 15
3.2 TERMINATION OF EMPLOYMENT: "Termination of Employment"
shall be deemed to be the date:
(i) The Participant quit, was discharged (for any reason,
including, by reason of Disability), died or retired; or
(ii) The first anniversary of the date the Participant was
continuously absent (with or without pay) for any other
reason, such as vacation, holiday, temporary sickness,
Authorized Leave of Absence or layoff, or the date within
such 12-month period when the Participant quit, was
discharged, died or retired.
3.3 TRANSFERS: For the purposes of determining eligibility
to Participate in the Plan under Section 3.1, an Eligible
Employee shall receive credit for employment with an Employer or
an Affiliate.
3.4 SUSPENSION: If a Participant (i) elects to defer
distribution of his or her benefit pursuant to Section 6.3(c),
(ii) is transferred to employment with an Affiliate that has not
adopted the Plan, (iii) ceases to be an Eligible Employee, (iv)
goes on an unpaid maternity or paternity leave under ERISA
Section 203(b), (v) receives a hardship withdrawal in accordance
with Section 6.5, or (vi) commences an Authorized Leave of
Absence, as reasonably determined by the Committee, his or her
Participation under the Plan shall be suspended, provided,
however, that during the period of his or her employment in such
ineligible status or position: (a) he or she shall cease to have
any right to make contributions pursuant to Article IV, hereof;
(b) his or her Employer Contribution Account shall receive no
Employer contribution allocation under Section 5.2(c); (c) he or
she shall continue to participate in Income allocations pursuant
to Section 5.2(a); (d) the withdrawal privileges under the
provisions of Article VI, other than the loan provision of
Section 6.9, shall continue to apply except for a Participant who
has deferred distribution of his or her benefit pursuant to
Section 6.3(c); and (d) the investment Fund transfer provisions
of Section 7.3 shall continue to apply.
ARTICLE IV. - CONTRIBUTIONS
4.1 EMPLOYER CONTRIBUTIONS: (a) For each Year, the
Employer shall contribute an amount to a Participant's Salary
Reduction Contribution Account equal to the total amount of
contributions agreed to be made by it pursuant to a salary
reduction agreement under Section 4.2 entered into between the
Employer and the Participant for such Year. Contributions made
by Employer for a given payroll period pursuant to salary
reduction agreements under Section 4.2 shall be promptly
deposited in the Trust Fund as soon as practicable after the
payroll period to which they relate.
<PAGE> 16
(b) In addition, for each Year, each Employer may contribute such
additional amounts to the Participants' Employer Contribution
Accounts as its Board of Directors shall determine in its sole
discretion from time to time. Such additional contributions with
respect to each Participant may be conditioned upon and keyed to
the amount of contributions agreed to by such Participant under
Section 4.2. Such additional contributions shall be allocated
among Participants either with regard to a uniform percentage of
each Participant's Compensation; or with regard to a uniform
percentage of the amount of contributions agreed to by the
Participant under Section 4.2; or a combination of the two. The
formulation decided upon by the Board of Directors shall operate
in a nondiscriminatory manner. Such additional contributions
shall be deemed made on account of a Year if either (a) the Board
of Directors of the particular Employer determines the amount of
such contribution by appropriate action and announces the amount
in writing to its Employees before the close of such Year, or (b)
the Employer designates such amount in writing to the Trustee as
payment on account of such Year or (c) the Employer claims such
amount as a deduction on its federal tax return for such Year.
All additional contributions of an Employer shall be paid to the
Trustee and payment shall be made not later than the time
prescribed by law for filing the federal income tax return of the
Employer, including any extensions which have been granted for
the filing of such tax return. Amounts credited to a
Participant's Employer Contribution Account shall be 100% vested
and non-forfeitable at all times.
4.2 CODE SECTION 401(K) SALARY REDUCTION: (a) In addition
to the other terms and conditions herein, each Eligible Employee
shall enter into prior to the Entry Date that such Eligible
Employee's Participation under the Plan is to commence pursuant
to Section 3.1 a written salary reduction agreement with the
Employer which will be applicable to Compensation for payroll
periods after such Entry Date within such Year. The terms of any
such salary reduction agreement shall provide for the purposes of
Section 4.1(a) hereof that the Eligible Employee as a Participant
agrees to accept a reduction in salary from the Employer equal to
any dollar amount or percentage of his Compensation per payroll
period, not to exceed 12% of such Compensation, or be less than
the lesser of 1% of such Compensation or One Hundred Twenty
Dollars ($120.00) per calendar quarter. In consideration of such
agreement, the Employer will make a salary reduction contribution
to the Participant's Salary Reduction Contribution Account on
behalf of the Participant for such Year in an amount equal to the
total amount by which the Participant's Compensation from the
Employer was reduced during the Year pursuant to the salary
reduction agreement. Amounts credited to a Participant's Salary
Reduction Contribution Account are intended to qualify for income
tax deferral under 401(k) of the Code and, as such, shall be
100% vested and non-forfeitable at all times. If a Participant
enters into a salary reduction agreement with the Employer for a
given Year, his or her Compensation for such Year for all other
purposes of this Plan, except with respect to a salary deduction
agreement under Section 4.4, hereof, shall be equal to his or her
Compensation after application of the salary reduction agreement.
<PAGE> 17
(b) Unless otherwise amended or terminated in accordance with
(ii), below, a Participant's salary reduction agreement shall be
deemed automatically renewed from year to year, while this Plan
remains in force and effect. Further, salary reduction
agreements shall include, but not by way of limitation, and be
governed by the following:
(i) A salary reduction agreement shall apply to each
payroll period during which an effective salary reduction
agreement is on file with the Employer.
(ii) A salary reduction agreement may be amended or
terminated by a Participant only once during each calendar
quarter if the purpose of the amendment is to decrease or
increase the amount of such Participant's Compensation which
is subject to salary reduction during the remainder of such
Year.
(iii) Any amendment or termination of a salary reduction
agreement shall be effective on the following Entry date
after at least 30 days prior written notice by a Participant
in the form required by Employer.
(iv) The Employer may amend or revoke its salary reduction
agreement with any Participant at any time, if the Committee
determines that such revocation or amendment is necessary to
insure that a Participant's Additions for any Year will not
exceed the limitations of Section 415 of the Code or to
insure that the discrimination tests of Section 401(k) and
401(m) of the Code are met for such Year.
(v) The Employer may revoke its salary reduction
agreements with all Participants or amend its salary
reduction agreements with all Participants on a uniform
basis, if it determines that it will not have sufficient
current or accumulated earnings to make the contributions to
the Plan that may be required by the salary reduction
agreements.
(vi) Except as provided above, a salary reduction agreement
applicable to any given Year, once made, may not be revoked
or amended by the Participant.
(vii) No amounts may be withdrawn by a Participant from any
of his Accounts, except as provided in Section 6.5, hereof.
All withdrawal elections shall be made by a Participant on
forms supplied by the Committee for that purpose.
(c) The Committee may from time to time alter and/or add to the
requirements for salary reduction agreements expressed in Section
4.2(b). The Employer shall abide by the Committee's
determinations and directions with respect to all matters covered
in salary reduction agreements.
<PAGE> 18
4.3 EMPLOYEE CONTRIBUTIONS: Subject to the provisions of
Section 4.4, hereof, a Participant may contribute each Year to an
Employee Contribution Account an amount pursuant to a written
salary deduction agreement under Section 4.4 not intended to
qualify for income tax deferral under Code 401(k), but to be
subtracted from such Participant's Compensation on an after-tax
basis. Amounts credited to a Participant's Employee Contribution
Account shall remain 100% vested and non-forfeitable at all
times.
4.4 AFTER-TAX SALARY DEDUCTION: A Participant may elect to
enter into a written salary deduction agreement with Employer
which shall be in the form and substance acceptable to Employer
and the Committee and will be applicable to all payroll periods
within a Year. A salary deduction agreement may be amended or
terminated only once during each calendar quarter if the purpose
of the amendment is to decrease or increase the amount of such
Participant's Compensation which is subject to salary deduction
agreement during the remainder of such Year. The terms of such
salary deduction agreement shall provide, among other things,
that for the purposes of Section 4.3 the Participant agrees to
accept a deduction from salary from the Employer equal to any
whole percentage of his Compensation per payroll period, not to
exceed 10% of such Compensation.
4.5 ROLLOVER AMOUNT FROM OTHER PLANS: (a) An Employee
eligible to Participate in the Plan, regardless of whether he or
she has satisfied the Participation requirements of Section 3.1,
may, with the approval of the Committee, in its sole and
exclusive discretion, transfer to the Trust Fund a "Qualifying
Rollover Distribution," defined in Section 402(a)(5)(D)(i) of the
Code as "1 or more distributions (I) within one taxable year of
the Employee on account of a termination of the plan of which the
trust is a part or, in the case of a profit-sharing stock bonus
plan, a complete discontinuance of contributions under such plan,
or (II) which constitutes a lump sum distribution within the
meaning of subsection (e)(4)(A) (determined without reference to
subparagraphs (B) and (H) of subsection (e)(4) which, in part,
defines lump sum distribution as "the distribution or payment
within one taxable year of the recipient of the balance to the
credit of an Employee which becomes payable to the recipient (i)
on account of the Employee's death, (ii) after the Employee
attains age 59, (iii) on account of the Employee's separation
from service, or (iv) after the Employee has become disabled",
provided that such distribution is from a plan which meets the
requirements of Section 401(a) of the Code (the "Other Plan").
The procedure approved by the Committee shall provide that such a
transfer may be made only if the following conditions are met:
(a) the transfer occurs on or before the 60th day following the
Employee's receipt of the distribution from the Other Plan; and
(b) the amount transferred is equal to any portion of the
distribution the Employee received from the Other Plan, subject
<PAGE> 19
to the maximum rollover provision of Section 402(a)(5)(B) of the
Code, limiting such amount to the fair market value of all
property received in such a distribution reduced by Employee
contributions, as defined in Section 402(a)(5)(d)(ii) of the
Code.
(b) Notwithstanding the foregoing, if an Employee had deposited
a distribution previously received from an Other Plan into an
individual retirement account ("IRA"), as defined in Section 408
of the Code, he or she may transfer the amount of such
distribution, plus earnings thereon from the IRA, to this Plan;
provided such rollover amount is deposited with the Trustee on or
before the 60th day following receipt thereof from the IRA.
(c) The Committee shall develop such procedures, and may require
such information from an Employee desiring to make or effectuate
any transfer under this Section 4.5, as it deems necessary or
desirable to determine that the proposed transfer will meet the
requirements of this Section. Upon approval by the Committee,
the amount transferred shall be deposited in the Trust Fund and
shall be credited to a Vested Rollover Contribution Account.
Such account shall be 100% vested in the Employee, shall share in
Income allocations in accordance with Section 5.2(a), but shall
not share in Employer contribution allocations. Upon termination
of employment, the total amount of the Employee's Vested Rollover
Contribution Account shall be distributed in accordance with
Article VI.
(d) Upon such a transfer by an Employee who is otherwise
eligible to participate in the Plan but who has not yet completed
the Participation requirements of Section 3.1, his or her Vested
Rollover Contribution Account shall represent his or her sole
interest in the Plan until he or she becomes a Participant.
ARTICLE V. - ALLOCATIONS TO PARTICIPANT'S ACCOUNT
5.1 INDIVIDUAL ACCOUNTS: The Committee shall create and
maintain adequate records to disclose the interest in the Trust
of each Participant and Beneficiary. Such records shall be in
the form of individual Accounts, and credits and charges shall be
made to such Accounts in the manner herein described. When
appropriate, a Participant shall have four separate Accounts, an
Employer Contribution Account, an Employee Contribution Account,
a Salary Reduction Contribution Account and a Vested Rollover
Contribution Account. Where necessary, the Committee shall
create and maintain subaccounts adequate to distinguish between
funds in an Account for the purposes of the Plan (e.g., Qualified
Matching Contribution and Matching Contribution subaccounts of
the Employer Contribution Account). The maintenance of
individual Accounts and subaccounts is only for accounting
purposes, and a segregation of the assets of the Trust Fund to
each Account or subaccount shall not be required. Distributions
and withdrawals made from an Account shall be charged to the
Account as of the date paid. A GFCFC Stock Account shall be
created to reflect a Participant's interest in GFC Financial
Corporation stock.
<PAGE> 20
5.2 ACCOUNT ADJUSTMENTS: The Accounts of Participants
shall be adjusted no less frequently than quarterly, recognizing
the Participant's elections pursuant to Section 5.5, hereof, in
accordance with the following:
(a) Income: The Income of the Trust Fund for each accounting
period within the Plan Year (which shall be no less frequent than
quarterly) shall be allocated to the Accounts of Participants who
had unpaid balances in their Accounts on the Valuation Date
corresponding to the end of such period, in proportion to the
balances in such Accounts as of the beginning of the period, as
adjusted to reflect and give appropriate weighting to any receipt
or distributions during the period, based on generally acceptable
principals of trust accounting agreed to by the Committee, the
Trustee, and the recordkeeper for the Plan and consistently
applied. At any time when the accounting period is less frequent
than daily, the Committee may in its sole and exclusive
discretion instruct the Trustee to pick a "Special Valuation
Date" to determine the Income since the last Valuation Date, in
which event the Accounts of any Participant who receives a
withdrawal in accordance with Section 6.5 or loan in accordance
with Section 6.9 or who has a distribution paid out due to a
termination of employment pursuant to Section 6.1 or Section 6.2
shall be adjusted to reflect this determination. Each valuation
shall be based on the fair market value of assets in the Trust
Fund on the Valuation Date or Special Valuation Date, as the case
may be.
(b) Salary Reduction Contributions: The Employer contributions
for a calendar quarter (or more frequent account period) that are
made pursuant to a salary reduction agreement entered into with a
Participant under Section 4.2 shall be allocated to the
Participant's Salary Reduction Contribution Account as of each
Valuation Date or Special Valuation Date for the accounting
period in which they are received.
(c) Additional Employer Contributions: As of each Valuation
Date the Employer's additional contribution described in Section
4.1(b), if any, shall be allocated among the Employer
Contribution Accounts of Participants in accordance with Section
4.1(b).
(d) Contributions: A Participant's contributions shall be
allocated to his or her Employee Contribution Account as of each
Valuation Date.
5.3 ACTUAL DEFERRAL PERCENTAGE TEST: Notwithstanding any
other provisions of the Plan,
(a) the Actual Deferral Percentage (hereinafter "ADP") for
Participants who are Highly Compensated Employees for each Plan
<PAGE> 21
Year and the ADP for Participants who are Non-highly Compensated
Employees for the same Plan Year must satisfy one of the
following tests:
(i) The ADP for Participants who are Highly Compensated
Employees for the Plan Year shall not exceed the ADP for
Participants who are Non-highly Compensated Employees for
the same Plan Year multiplied by 1.25; or
(ii) The ADP for Participants who are Highly Compensated
Employees for the Plan Year shall not exceed the ADP for
Participants who are Non-highly Compensated Employees for
the same Plan Year multiplied by 2.0, provided that the ADP
for Participants who are Highly Compensated Employees does
not exceed the ADP for Participants who are Non-highly
Compensated Employees by more than two (2) percentage
points.
(b) The ADP for any Participant who is a Highly Compensated
Employee for the Plan Year and who is eligible to have Elective
Deferrals (and Qualified Non-elective Contributions or Qualified
Matching Contributions, or both, if treated as Elective Deferrals
for purposes of the ADP test) allocated to his or her accounts
under two or more arrangements described in Section 401(k) of the
Code, that are maintained by the Employer, shall be determined as
if such Elective Deferrals (and, if applicable, such Qualified
Non-elective Contributions or Qualified Matching Contributions,
or both) were made under a single arrangement. If a Highly
Compensated Employee participates in two or more cash or deferred
arrangements that have different Plan Years, all cash or deferred
arrangements ending with or within the same calendar year shall
be treated as a single arrangement.
(c) In the event that this Plan satisfies the requirements of
Sections 401(k), 401(a)(4), or 410(b) of the Code only if
aggregated with one or more other plans, or if one or more other
plans satisfy the requirements of such Sections of the Code only
if aggregated with this plan, then this Section shall be applied
by determining the ADP of Employees as if all such plans were a
single plan. For Plan Years beginning after December 31, 1989,
plans may be aggregated in order to satisfy Section 401(k) of the
Code only if they have the same Plan Year.
(d) For purposes of determining the ADP of a Participant who is
a 5-percent owner or one of the ten most highly-paid Highly
Compensated Employees, the Elective Deferrals (and Qualified
Non-elective Contributions or Qualified Matching Contributions,
or both, if treated as Elective Deferrals for purposes of the ADP
test) and Compensation of such Participant shall include the
Elective Deferrals (and, if applicable, Qualified Non-elective
Contributions and Qualified Matching Contributions, or both) and
Compensation for the Plan Year of Family Members (as defined in
Section 414(q)(6) of the Code). Family Members, with respect to
such Highly Compensated Employees, shall be disregarded as
separate Employees in determining the ADP both for Participants
who are Non-highly Compensated Employees and for Participants who
are Highly Compensated Employees.
<PAGE> 22
(e) For purposes of determining the ADP test, Elective
Deferrals, Qualified Non-elective Contributions and Qualified
Matching Contributions must be made before the last day of the
twelve-month period immediately following the Plan Year to which
contributions relate.
(f) The Employer shall maintain records sufficient to
demonstrate satisfaction of the ADP test and the amount of
Qualified Non-elective Contributions or Qualified Matching
Contributions, or both, used in such test.
(g) The determination and treatment of the ADP amounts of any
Participant shall satisfy such other requirements as may be
prescribed by the Secretary of the Treasury.
(h) Qualified Matching Contributions and Qualified Non-elective
Contributions may be taken into account as Elective Deferrals for
purposes of calculating the Actual Deferral Percentages.
5.4 AVERAGE CONTRIBUTION PERCENTAGE TEST: Notwithstanding
any other provision of the Plan,
(a) Employee Contributions and Matching Contributions must meet
the nondiscrimination requirements of Section 401(a)(4) of the
Code, and the Average Contribution Percentage (hereinafter ACP)
test of Section 401(m) of the Code. The ACP test is required in
addition to the ADP test under Code Section 401(k). Qualified
Matching Contributions and Qualified Non-elective Contributions
used to satisfy the ADP test may not be used to satisfy the ACP
test.
(b) The ACP for Participants who are Highly Compensated
Employees for each Plan Year and the ACP for Participants who are
Non-highly Compensated Employees for the same Plan Year must
satisfy one of the following tests:
(i) The ACP for Participants who are Highly Compensated
Employees for the Plan Year shall not exceed the ACP for
Participants who are Non-highly Compensated Employees for
the same Plan Year multiplied by 1.25; or
(ii) The ACP for Participants who are Highly Compensated
Employees for the Plan Year shall not exceed the ACP for
Participants who are non-highly Compensated Employees for
the same Plan Year multiplied by two (2), provided that the
ACP for Participants who are Highly Compensated Employees
does not exceed the ACP for Participants who are Non-highly
Compensated Employees by more than two (2) percentage
points.
<PAGE> 23
(c) Multiple Use: If one or more Highly Compensated Employees
participate in both a CODA and a plan subject to the ACP test
maintained by the Employer and the sum of the ADP and ACP of
those Highly Compensated Employees subject to either or both
tests exceeds the Aggregate Limit, then the ACP of those Highly
Compensated Employees who also participate in a CODA will be
reduced (beginning with such Highly Compensated Employee whose
ACP is the highest) so that the limit is not exceeded. The
amount by which each Highly Compensated Employee's Contribution
Percentage Amounts is reduced shall be treated as an Excess
Aggregate Contribution. The ADP and ACP of the Highly
Compensated Employees are determined after any corrections
required to meet the ADP and ACP tests. Multiple use does not
occur if either the ADP or ACP of the Highly Compensated
Employees does not exceed 1.25 multiplied by the ADP and ACP of
the Non-highly Compensated Employees.
(d) For purposes of this Section, the Contribution Percentage
for any Participant who is a Highly Compensated Employee and who
is eligible to have Contribution Percentage Amounts allocated to
his or her account under two or more plans described in Section
401(a) of the Code, or arrangements described in Section 401(k)
of the Code that are maintained by the Employer, shall be
determined as if the total of such Contribution Percentage
Amounts was made under each plan. If a Highly Compensated
Employee participates in two or more cash or deferred
arrangements that have different plan years, all cash or deferred
arrangements ending with or within the same calendar year shall
be treated as a single arrangement.
(e) In the event that this plan satisfies the requirements of
Sections 401(m), 401(a)(4) or 410(b) of the Code only if
aggregated with one or more other plans, or if one or more other
plans satisfy the requirements of such Sections of the Code only
if aggregated with this plan, then this Section shall be applied
by determining the Contribution Percentage of Employees as if all
such plans were a single plan. For plan years beginning after
December 31, 1989, plans may be aggregated in order to satisfy
Section 401(m) of the Code only if they have the same Plan Year.
(f) For purposes of determining the Contribution percentage of a
Participant who is a five-percent owner or one of the ten most
highly-paid Highly Compensated Employees, the Contribution
Percentage Amounts and Compensation of such Participant shall
include the Contribution Percentage Amounts and Compensation for
the Plan Year of Family Members (as defined in Section 414(q)(6)
of the Code). Family Members, with respect to Highly Compensated
Employees, shall be disregarded as separate Employees in
determining the Contribution Percentage both for Participants who
are Non-highly Compensated Employees and for Participants who are
Highly Compensated Employees.
<PAGE> 24
(g) For purposes of determining the Contribution Percentage
test, Employee Contributions are considered to have been made in
the Plan Year in which contributed to the trust. Matching
Contributions and Qualified Non-elective Contributions will be
considered made for a Plan Year if made no later than the end of
the twelve-month period beginning on the day after the close of
the Plan Year.
The Employer shall maintain records sufficient to demonstrate
satisfaction of the ACP test and the amount of Qualified
Non-elective Contributions or Qualified Matching Contributions,
or both, used in such test.
The determination and treatment of the Contribution Percentage of
any Participant shall satisfy such other requirements as may be
prescribed by the Secretary of the Treasury.
5.5 DISTRIBUTION OF EXCESS AGGREGATE CONTRIBUTIONS:
(a) Notwithstanding any other provisions of this Plan, Excess
Aggregate Contributions, plus any income and minus any loss
allocable thereto, shall be forfeited, if forfeitable, or if not
forfeitable, distributed no later than the last day of each Plan
Year to Participants to whose accounts such Excess Aggregate
Contributions were allocated for the preceding Plan Year. This
forfeiture or distribution of Excess Aggregate Contributions
shall be made for the Participants who are Highly Compensated
Employees in the order of their contribution percentages
described in Section 5.4, beginning with those having the highest
percentage and then continuing with others who have the next
highest percentage, until the requirements for the ACP test in
Section 5.4 are met. For this purpose, each forfeiture or
distribution of Excess Aggregate Contributions that occurs shall
be treated as reducing both the amount of such contributions and
the adjusted percentage that is determined for the affected
Participant under Section 5.4. Excess Aggregate Contributions
shall be allocated to Participants who are subject to the family
member aggregation rules of Section 414(q)(6) of the Code in the
manner prescribed by the regulations. If such Excess Aggregate
Contributions are distributed more than 2-1/2 months after the
last day of the Plan Year in which such excess amounts arose, a
ten (10) percent excise tax will be imposed on the Employer
maintaining the plan with respect to those amounts. Excess
Aggregate Contributions shall be treated as Annual Additions
under the Plan.
(b) Excess Aggregate Contributions shall be adjusted for any
income or loss up to the end of the Plan Year for which they were
determined to occur (excluding any gap period after the end of
that Plan Year and up to the date of distribution in the
subsequent Plan Year). The income or loss allocable to Excess
Aggregate Contributions shall be as determined under the Plan's
normal method of accounting.
(c) Forfeitures of Excess Aggregate Contributions may either be
reallocated to the Accounts of Non-highly Compensated Employees
or applied to reduce Employer contributions.
<PAGE> 25
(d) Excess Aggregate Contributions shall be forfeited, if
forfeitable or distributed on a pro-rata basis from the
Participant's Accounts.
(e) In addition, in lieu of distributing Excess Contributions as
provided in the Plan, or Excess Aggregate Contributions as
provided in the Plan, the Employer may make Qualified
Non-elective Contributions on behalf of Non-highly Compensated
Employees that are sufficient to satisfy either the Actual
Deferral Percentage test or the Average Contribution Percentage
Test, or both, pursuant to the regulations under the Code.
5.6 DISTRIBUTION OF EXCESS ELECTIVE DEFERRALS: (a) No
Participant shall be permitted to have Elective Deferrals made
under this Plan, or any other qualified plan maintained by the
Employer, during any taxable year in excess of the dollar
limitation contained in Section 402(g) of the Code in effect at
the beginning of such taxable year.
(b) A Participant may assign to this plan any Excess Elective
Deferrals made during a taxable year of the Participant by
notifying the Committee on or before the date specified in
Section 5.6(e) of the amount of the Excess Elective Deferrals to
be assigned to the Plan.
(c) Notwithstanding any other provision of the Plan, Excess
Elective Deferrals, plus any income and minus any loss allocable
thereto, shall be distributed no later than April 15 to any
Participant to whose account Excess Elective Deferrals were
assigned for the preceding year and who claims Excess Elective
Deferrals for such taxable year. In addition, excess deferrals
and other contributions described in Section 5.3, plus any income
and minus any loss allocable thereto, shall be distributed no
later than the end of each Plan Year to Participants to whose
accounts they were allocated for the preceding Plan Year. This
distribution of excess amounts pursuant to Section 5.3 shall be
made for the Participants who are Highly Compensated Employees in
the order of their deferral percentages described in Section 5.3,
beginning with those having the highest percentage and then
continuing with others who have the next highest percentage,
until the requirements of the ADP test in Section 5.3 are met.
For this purpose, each distribution of excess deferrals and other
contributions that occurs shall be treated as reducing both the
amount of the deferrals and the adjusted percentage that is
determined for the affected Participant under Section 5.3.
(d) Excess Elective Deferrals shall be adjusted for any income
or loss up to the end of the Plan Year for which they were
determined to occur (excluding any gap period after the end of
that Plan Year and up to the date of distribution in the
subsequent Plan Year). The income or loss allocable to Excess
Elective Deferrals shall be as determined under the Plan's normal
method of accounting.
<PAGE> 26
(e) Participants who claim Excess Elective Deferrals for the
preceding taxable year must submit their claims in writing to the
Committee by March 15.
5.7 DISTRIBUTION OF EXCESS CONTRIBUTIONS: (a)
Notwithstanding any other provision of this Plan, Excess
Contributions, plus any income and minus any loss allocable
thereto, shall be distributed no later than the last day of each
Plan Year to Participants to whose accounts such Excess
Contributions were allocated for the preceding Plan Year. If
such excess amounts are distributed more than 2-1/2 months after
the last day of the Plan Year in which such excess amounts arose,
a ten (10) percent excise tax will be imposed on the Employer
maintaining the Plan with respect to such amounts. Such
distributions shall be made to Highly Compensated Employees on
the basis of the respective portions of the Excess Contributions
attributable to each of such Employees. Excess Contributions
shall be allocated to Participants who are subject to the family
member aggregation rules of Section 414(q)(6) of the Code in the
manner prescribed by the regulations.
(b) Excess Contributions (including the amounts recharacterized)
shall be treated as Annual Additions under the Plan.
(c) Excess Contributions shall be adjusted for any income or
loss up to the end of the Plan Year for which they were
determined to occur (excluding any gap period after the end of
the Plan Year and up to the date of distribution in the
subsequent Plan Year). The income or loss allocable to Excess
Contributions shall be as determined under the Plan's normal
method of accounting.
(d) Excess Contributions shall be distributed from the accounts
to which the Participant's Elective Deferrals and Qualified
Matching Contributions (if applicable) were allocated in
proportion to the Participant's Elective Deferrals and Qualified
Matching Contributions (to the extent used in the ADP test) for
the Plan Year. Excess Contributions shall be distributed from
the Participant's Qualified Non-elective Contribution account
only to the extent that such Excess Contributions exceed the
balance in the Participant's Elective Deferral account and
Qualified Matching Contribution account.
5.8 RECHARACTERIZATION: (a) A Participant may treat his
or her Excess Contributions as an amount distributed to the
Participant and then contributed by the Participant to the plan.
Recharacterized amounts will remain nonforfeitable and subject to
the same distribution requirements as Elective Deferrals.
Amounts may not be recharacterized by a Highly Compensated
Employee to the extent that such amount in combination with other
Employee Contributions made by that Employee would exceed any
stated limit under the Plan on Employee Contributions.
Recharacterization must occur no later than two and one-half
months after the last day of the Plan Year in which such Excess
<PAGE> 27
Contributions arose and is deemed to occur no earlier than the
date the last Highly Compensated Employee is informed in writing
of the amount recharacterized and the consequences thereof.
Recharacterized amounts will be taxable to the Participant for
the Participant's tax year in which the Participant would have
received them in cash.
5.9 MAXIMUM ADDITIONS: (a) Notwithstanding anything
contained herein to the contrary, the total Annual Additions made
to the Salary Reduction Contribution Account, Employer
Contribution Account, Employee Contribution Account of a
Participant for any Year shall not exceed the lesser of
$30,000.00 or 25 percent of the Participant's Compensation (as
defined in Code Section 415 and after application of the salary
reduction agreement set forth in Section 4.2) for such Year,
except that such $30,000 shall be increased as permitted by
Internal Revenue Service regulations to reflect cost-of-living
adjustments.
(b) If such Additions exceed the above limitations, the
contributions for the Year which cause the excess shall be
returned to the Participant in the following order:
(i) Any contributions to such Participant's Employee
Contribution Account, to the extent they would reduce the
excess amount, will be returned to the Participant.
(ii) If after the application of paragraph (i) an excess
amount still exists, any contributions to such Participant's
Salary Reduction Contribution Account, to the extent they
would reduce the excess amount, will be returned to the
Participant.
(iii) If after the application of paragraph (ii) an excess
amount still exists, and the Participant is covered by the
Plan at the end of the Year, the excess amount in
Participant's account will be used to reduce Employer
contributions to such Participant's Employer Contribution
Account, for such Participant in the next Year, and each
succeeding Year if necessary.
(iv) If after the application of paragraph (ii) an excess
amount still exists, and the Participant is not covered by
the Plan at the end of the Year, the excess amount will be
held unallocated in a suspense account. The suspense
account will be applied to reduce future Employer
contributions of that Participant's Employer to Employer
Contribution Accounts for all remaining Participants in the
next Year, and each succeeding Year if necessary. If a
suspense account is in existence at any time during the Year
pursuant to this Section, it will not participate in the
allocation of the Trust Income.
<PAGE> 28
(c) Notwithstanding the foregoing, the otherwise permissible
annual Additions for any Participant under this Plan may be
further reduced to the extent necessary, as determined by the
Committee, to prevent disqualification of the Plan under Section
415 of the Code, which imposes the following additional
limitations on the benefits payable to Participants who also may
be participating in other tax-qualified pension, profit-sharing,
savings or stock bonus plans maintained by the Employer or any of
the members of the controlled group of corporations (for the
purposes of this Section "Employers") of which the Employer is a
part: If an individual is a Participant at any time in both a
defined benefit plan and a defined contribution plan maintained
by any of the Employers, the sum of the defined benefit plan
fraction and the defined contribution plan fraction for any Year
may not exceed 1.0. The defined benefit plan fraction for any
Year is a fraction, the numerator of which is the Participant's
projected annual benefit under the plan (determined at the close
of the Year) and the denominator of which is the lesser of (i)
the product of 1.25, multiplied by the dollar limitation in
effect under Section 415(b)(1)(A) of the Code, or (ii) the
product of 1.4, multiplied by the amount which may be taken into
account under Section 415(b)(1)(B) of the Code with respect to
such Participant under the Plan for such Year. The defined
contribution plan fraction for any year is a fraction, the
numerator of which is the sum of the annual Additions to the
Participant's accounts as of the close of the Year, and the
denominator of which is the sum of the lesser of the following
amounts determined for such year and for each prior year of
service with the Employer; (i) the product of 1.25, multiplied by
the dollar limitation in effect under Section 415(c)(1)(A) of the
Code for such year, or (ii) the product of 1.4, multiplied by the
amount which may be taken into account under Section 415(c)(1)(B)
with respect to such Participants under the Plan for such year.
When the term "Annual Additions" is used in the context of other
defined contribution plans under this Section, it shall have the
same meaning as set forth in Section 2.3(b), hereof, but with
respect to Employer contributions and Employee contributions made
under such other plans. For purposes of this limitation, all
defined benefit plans of the Employers, whether or not
terminated, are to be treated as one defined benefit plan and all
defined contribution plans of the Employers, including the Plan
whether or not terminated, are to be treated as one defined
contribution plan. As such, annual benefits and Annual Additions
of such plans are to be aggregated for the purposes of
determining the defined benefit plan fraction and the defined
contribution plan fraction. The extent to which Annual Additions
under the Plan shall be reduced, as compared with the extent to
which annual benefits or Annual Additions under any defined
benefit plans or any other defined contribution plans shall be
reduced in order to achieve compliance with the limitations of
Code Section 415 shall be dependent on the provisions of such
other plans. To the extent any such other plan or plans provide
for a reduction first in benefits from or Annual Additions to
such other plan or plans, the necessary reductions shall be under
such other plan or plans. To the extent any such other plan or
<PAGE> 29
plans do not provide for a reduction first in benefits from or
Annual Additions to such other plan or plans, the reduction in
Annual Additions necessary to achieve compliance with Code
Section 415 shall be under the Plan. If the reduction is under
the Plan, the Committee shall advise affected Participants of any
additional limitations on their Annual Additions required by this
Section 5.9.
5.10 RECOGNITION OF DIFFERENT INVESTMENT FUNDS: (a) Subject
to the terms and conditions herein stated, and as provided in
Article VII, initially four Investment Funds shall be established
by the Trustee and each Participant shall direct what portion of
the aggregate of his or her Account balances shall be deposited
in each such Investment Fund. The Committee may direct the
Trustee to change the number and type of Investment Funds made
available under the Plan from time to time. Consequently, when
appropriate, a Participant shall have a percentage of the
aggregate of his or her Salary Reduction Contribution Account,
Vested Rollover Contribution Account and/or Employee Contribution
Account in each such Investment Fund and the allocations
described in Section 5.2 shall be adjusted in such manner as is
appropriate to recognize the existence of such Investment Funds.
(b) Because Participants have a choice of Investment Funds, any
reference in this Plan to a Salary Reduction Contribution
Account, a Vested Rollover Contribution Account or an Employee
Contribution Account shall be deemed to mean and include all
accounts of a like nature which are maintained for the
Participant under each Investment Fund.
(c) A Participant's Employer Contribution Account balance shall
be invested only in the Employer Stock, and the Participant shall
have no choice of Investment Funds with respect to such balance.
5.11 TOP-HEAVY PROVISIONS: (a) The following provisions
shall become effective in any Year in which the Plan is
determined to be a Top-Heavy Plan, notwithstanding any contrary
provision in the Plan. The Plan will be considered a Top-Heavy
Plan for the Year if as of the last day of the preceding Year,
(1) the value of the sum of Salary Reduction Contribution
Accounts, Employer Contribution Accounts and Employee
Contribution Accounts (but not including any allocations to be
made as of such last day of the Year except contributions
actually made on or before that date and allocated pursuant to
Section 5.2) of Participants who are Key Employees (as defined in
Section 416(i) of the Code) exceeds 60% of the value of the sum
of Salary Reduction Contribution Accounts, Employer Contribution
Accounts and Employee Contribution Accounts (but not including
any allocations to be made as of such last day of the Year except
contributions actually made on or before that date and allocated
pursuant to Section 5.2) of all Participants (the "60% Test") or
(2) the Plan is part of a required aggregation group (within the
meaning of Section 416(g) of the Code and the required
aggregation group is top-heavy. However, and notwithstanding the
<PAGE> 30
result of the 60% Test, the Plan shall not be considered a
Top-Heavy Plan for any Year in which the Plan is a part of a
required or permissive aggregation group (within the meaning of
Section 416(g) of the Code) which is not top-heavy.
(b) Notwithstanding any contrary provision of the Plan, and
except as otherwise provided in (c) and (d) below, for any Year
during which the Plan is deemed a Top-Heavy Plan, Employer
contributions pursuant to Section 5.2(c) which are allocated to
Employer Contribution Accounts on behalf of any Participant who
is not a Key Employee shall not be less than the lesser of:
(i) Three percent of such Participant's Compensation;
or
(ii) In the case where the Employer has no defined
benefit plan which designates the Plan to satisfy
Section 416(f) of the Code, the largest percentage
of Employer contributions as a percentage of the
first $200,000 of the Key Employee's Compensation
allocated on behalf of any Key Employee for that
Year.
The above mentioned minimum allocation is determined without
regard to any Social Security contribution. The minimum
allocation shall be made even though, under other Plan
provisions, the Participant would not otherwise be entitled to
receive an allocation, or would have received a lesser allocation
for the Year.
(c) The provisions of (b), above, shall not apply to any
Participant who was not employed by the Employer on the last day
of the Year preceding the Year the Plan is considered to be a
Top-Heavy Plan.
(d) The provisions of (b), above, shall not apply to any
Participant to the extent the Participant is covered under any
other plan or plans of the Employer and the Employer has provided
in the Adoption Agreement that the minimum allocation or benefit
requirement applicable to top-heavy plans will be met in the
other plan or plans.
(e) The minimum allocation required in (b), above, (to the extent
required to be nonforfeitable under Section 416(b) of the Code)
may not be forfeited under Code Section 411(a)(3)(B) or
411(a)(3)(D).
(f) If a Participant's termination of employment occurs while the
Plan is a Top-Heavy Plan, such Participant's vested percentage in
his Employer Contribution Account shall not be less than the
percentage determined in accordance with the following table:
<PAGE> 31
Vested Forfeited
Years of Service Percentage Percentage
- ---------------- ---------- ----------
less than 2 0% 100%
2 but less than 3 20% 80%
3 but less than 4 40% 60%
4 but less than 5 60% 40%
5 but less than 6 80% 20%
6 or more 100% 0%
(g) For any Year in which the Plan is a Top-Heavy Plan, the
compensation limitation described in Section 416(d) of the Code
shall apply.
(h) If the Plan becomes a Top-Heavy Plan and subsequently ceases
to be such, the vesting schedule in Subsection (f) of this
Section to the extent it is more favorable than any vesting
schedule that may be contained in the Plan shall continue to
apply in determining the vested percentage of any Participant who
had at least five years of Service as of December 31 in the last
Year of top-heaviness. For other Participants, said more
favorable schedule shall apply only to their Employer
Contribution Account balance as of such December 31. For the
purposes of Subsection (f), Year of Service shall be defined in
the same manner as the term Year of Service is used for vesting
purposes in the event the Plan is amended to include a vesting
provision. In the event that the Plan is amended to change or
modify any vesting schedule, a Participant with at least three
(3) Years of Service as of the expiration of the election period
may elect to have his nonforfeitable percentage computed under
the Plan without regard to such amendment. If a Participant
fails to make such election, then such Participant shall be
subject to the new vesting schedule. The Participant's election
period shall commence on the adoption date of the amendment and
shall end 60 days after the latest of:
(1) the adopted date of the amendment;
(2) the effective date of the amendment, or
(3) the date the Participant receives written notice of the
amendment from the Employer or Administrator.
(i) Notwithstanding any contrary provisions contained herein,
for any Year in which the Plan is a Top-Heavy Plan, any benefits
to which the Participant who is a Key Employee is entitled shall
commence not later than the Participant's taxable year in which
he or she attains age 70, whether or not his or her employment
has terminated in such year. If a benefit distribution under the
Plan is made to a Key Employee before he or she attains age 59,
and during a Year in which the Plan is a Top-Heavy Plan, the
Participant shall be advised by the Committee that an additional
income tax may be imposed equal to 10% of the portion of the
amount so received which is included in his or her gross income
for such taxable year, unless such distribution is made on
account of death or Disability.
<PAGE> 32
(j) For any Year in which the Plan is a Top-Heavy Plan, Section
5.4(c) shall be read by substituting the number "1.00" for the
number "1.25" wherever it appears therein except such
substitution shall not have the effect of reducing any benefit
accrued under a defined benefit plan prior to the first day of
the Year in which this provision becomes applicable.
(k) Neither Elective Deferrals nor Matching Contributions may be
taken into account for the purpose of satisfying the minimum
top-heavy contribution requirement.
5.12 SECURITIES LAW REQUIREMENTS: The Plan is intended to
comply with the requirements for exemption from liability under
Section 16(b) of the Securities Exchange Act of 1934 ("1934 Act")
in the case of any transaction that is reportable under Section
16(a) of the 1934 Act. As of September 1, 1992, the Company has
chosen, for purposes of liability under Section 16(b) of the
Exchange Act, to apply the new Section 16 rules that became
effective May 1, 1991, for reporting purposes. Accordingly, the
Plan shall be interpreted and administered so as to preserve such
exemption under Rule 16b-3 or any other applicable rules and
regulations promulgated pursuant to Section 16 of the 1934 Act
with respect to any Plan transaction that is reportable by a
Participant, Beneficiary, or other person, including, if
applicable, the Trust, who is a Company officer, director, or ten
percent beneficial owner subject to Section 16 of the 1934 Act
(hereinafter, a "Section 16 Insider"). This section of the Plan
provides special rules allowing the Plan to satisfy certain
conditions for exemption from Section 16(b) liability. This
section also contains references to other Plan sections that, in
addition to being included in the Plan for other reasons, enable
the Plan to satisfy other conditions for such exemption.
The Plan is a written pension or retirement plan with broad-based
Employee participation and objective, nondiscriminatory rules that
are subject to the Code's qualification requirements and the requirements
of the Employee Retirement Income Security Act of 1974 ("ERISA"),
including ERISA reporting rules that make the Plan subject to an annual
audit by independent accountants and ERISA fiduciary rules that protect
the interests of all Plan Participants and Beneficiaries, including
Section 16 Insiders. Article III of the Plan provides rules for determining
eligibility to participate, as it relates to Section 16 Insiders and
other Employees; and Articles IV through VII contain detailed rules for
Plan contributions, benefits, investments, and accounting that include
rules setting forth the method for determining the price and amount of
Employer Stock that can be allocated to the Accounts of Section 16
Insiders and other Employees. Accordingly, the Plan satisfies the general
conditions for 16(b) exemption relating to a written plan described in Rule
16b-3(a)(1) that is exempt from the Rules 16b-3(b) requirement to obtain
approval by the Company's security holders. Moreover, the limitations in
Article V of the Plan,
<PAGE> 33
including the Code Section 415 limitations that are expressed in
Section 5.9 of the Plan, operate in conjunction with other Plan
provisions relating to contributions and benefits in a manner
that permits a determination of the maximum number of shares of
Employer Stock that can be provided to Section 16 Insiders under
the Plan each year. Therefore, to the extent that current rules
continue to subject the Plan to a requirement similar to that in
former Rule 16b-3(c) to specify the maximum number of shares that
the Plan makes available to Section 16 Insiders, the Plan
satisfies such requirement. In addition, Section 9.3 of the Plan
restricts the assignment of Plan benefits in a manner required by
the Code and ERISA. In the event that the Plan is ever deemed to
issue derivative securities, Section 9.3 shall be interpreted and
applied with respect to Section 16 Insiders in a manner that also
satisfies the requirements to include a transferability
restriction, as described in Rule 16b-3(a)(2).
The Plan's rules for contributions, benefits, investments, and
accounting in Articles IV through VII collectively provide a
formula that uses objective criteria to determine the amount,
price, and timing of Employer Stock allocations to Section 16
Insiders and other Participants in a manner that satisfies Rule
16b-3(c)(ii)(A). Notwithstanding Section 10.1 or any other Plan
provision, to the extent required by Rule 16b-3(c)(2)(ii)(B),
such Plan provisions shall not be amended more than once every
six months, other than to comport with changes in the Code,
ERISA, or the rules thereunder. Moreover, the Committee is
authorized to approve and enforce administrative restrictions
that, without discriminating in favor of Section 16 Insiders for
purposes of Plan qualification under the Code, ensure compliance
with the requirement of Rule 16b-3(c)(1) to satisfy a six-month
holding requirement with respect to the grant and award
transactions of Section 16 Insiders under the Plan or ensure
compliance with a requirement of Rule 16b-3(d) with respect to
Participant-directed transactions of Section 16 Insiders that
must meet such requirement as a condition for exemption under
Section 16(b) of the 1934 Act. In order to permit compliance
with Rule 16b-3(d) the restrictions that the Committee may apply
to Employer Stock-related transactions of Section 16 Insiders may
include requirements that cause them to make an irrevocable
election six months in advance, to cease further Plan
participation or Employer Stock purchases for six months, or to
make elections for intra-Plan investment transfers no more often
than every six months and during a specified period if which
recently released financial data for the Company is available to
the public.
In addition to the foregoing, the Plan is intended to comply with
the following rules in order to ensure that it will be exempt
from any requirement to obtain approval by the Company's security
holders even if it is not treated as a pension or retirement
plan. Thus, the following limitation shall apply notwithstanding
<PAGE> 34
other Plan provisions for allocations. In no event shall
Employer Stock be allocated to the Account of a Section 16
Insider if such allocation would cause the aggregate fair market
value of Employer Stock that is held in the Trust and credited to
the Accounts of Section 16 Insiders to equal or exceed twenty
percent of the market value of all Employer Stock held in the
Trust. Any reduction in the number of shares of Employer Stock
in the Accounts of Section 16 Insiders that is necessary to
comply with this limitation shall be made on a proportionate
basis for all such Section 16 Insiders and shall be allocated
among the remaining Participants in the same manner as shares of
Employer Stock are allocated to them.
ARTICLE VI. - BENEFITS
6.1 ENTITLEMENT TO BENEFITS: If a Participant's employment
with the Employer is terminated for any reason, he or she shall
be vested in the entire amount in each of his or her Accounts as
of the Valuation Date or Special Valuation Date which occurs on
or following such termination of employment as determined in
accordance with Section 5.2(a), hereof. Except as provided in
Section 6.3(c), hereof, payment of benefits shall commence
promptly after such termination of employment, but in no event
shall such Participant be entitled to receive such entire amount
sooner than 45 days after such Valuation Date.
6.2 DEATH: (a) In the event that the termination of
employment of a Participant is caused by his or her death, his or
her Beneficiary shall be vested in, and paid the entire amount
of, each of the deceased Participant's Accounts as of the
Valuation Date or Special Valuation Date which occurs on or
following such termination of employment as determined in
accordance with Section 5.2(a), hereof, but in no event shall
such Beneficiary be entitled to receive such entire amount
earlier than the later of (i) 45 days after such Valuation Date,
or (ii) the date the Committee is reasonably satisfied that such
Beneficiary is otherwise entitled to receive such entire amount.
(b) Payment of benefits due under this Section shall be made in
accordance with Section 6.3.
6.3 PAYMENT OF BENEFITS: (a) Upon a Participant's or
Beneficiary's entitlement to payment of benefits under Section
6.1 or 6.2 he or she shall file with the Committee his or her
written application therefor on such form or forms, and subject
to such reasonable conditions, as the Committee shall provide.
(b) The Committee shall follow a Participant's Beneficiary
designation made pursuant to Section 6.4. The Committee shall
make payment of benefits in lump sum only. Payment to a
Participant's Beneficiary shall be made or commence as soon as
practicable after a Participant death and upon such proofs of
death and entitlement to benefits as the Committee may require.
<PAGE> 35
(c) Except as otherwise provided below, every Participant who
has a separation from service for any reason, including
retirement, death or Disability, shall have his or her vested
Account, valued as of the Valuation Date or Special Valuation
Date coinciding with or immediately preceding the date of the
distribution, and distributed as soon as practicable following
the separation from the service. If the vested balance, in a
Participant Account exceeds $3,500, then no distribution shall be
made to the Participant before the date specified in Section 6.7,
unless the Participant consents in writing to an earlier
distribution. Thus, if under the age specified in Section 6.7, a
Participant whose vested Account balance exceeds $3,500 may elect
to defer receipt of such balance until that date by withholding
written consent to the distribution. A Beneficiary does not have
a similar right to defer a distribution of the Participant's
vested Account balance following the Participant's death.
(d) The amount which a Participant or Beneficiary is entitled to
receive at any time and from time to time may be paid, in the
discretion of the Participant or Beneficiary, in cash or in
Employer Stock, or in any combination thereof, provided, however,
payment in Employer Stock may be limited to the extent a
Participant's Account balances are invested in whole shares of
such Employer Stock under Section 7.1(i), and the Committee may
require that all such Employer Stock be transferred to such
Participant or Beneficiary.
(e) To the extent required by the regulations issued under Code
Section 411(a)(11), at least 30 days but not more than 90 days
before a Participant's schedule benefit commencement date, the
Committee shall provide to the Participant a written explanation
of his right to defer receipt of the distribution. If a
distribution is one to which Section 401(a)(11) and 417 of the
Code do not apply, such distributions may commence less than 30
days after the notice required under Section 1.411 (a)-11(c) of
the income tax regulations is given, provided that:
(i) the Committee clearly informs the Participant that the
Participant has a right to a period of at least 30 days after
receiving the notice to consider the decision of whether or not
to elect a distribution (and, if applicable, a particular
distribution option); and
(ii) the Participant, after receiving the notice,
affirmatively elects a distribution.
6.4 DESIGNATION OF BENEFICIARY: (a) Each Participant from
time to time may designate any person or persons (who may be
designated contingently or successively and who may be an entity
other than a natural person) as his or her Beneficiary or
Beneficiaries to whom his Plan benefits are paid if he or she
dies before receipt of all such benefits. Each Beneficiary
designation shall be in the form prescribed by the Committee,
will be effective only when filed with the Committee during the
<PAGE> 36
Participant's lifetime, and, if the Committee allows, may specify
the method of payment of his or her benefits to the Beneficiary.
Each Beneficiary designation filed with the Committee will cancel
all Beneficiary designations previously filed with the Committee.
The revocation of a Beneficiary designation by a Participant no
matter how effected, shall not require the consent of any
designated Beneficiary unless the Beneficiary affected is the
Participant's spouse, in which case such spouse's consent shall
be required to effect any such revocation in accordance with
Section 6.4(c). By designating a Beneficiary or Beneficiaries as
hereunder provided, a Participant grants the Committee the
discretion, in good faith, to make benefit payment(s) to any
Beneficiary or Beneficiaries named by such Participant despite
any dispute by any person or persons claiming such benefits, and
holds the Plan, the Employer and the Committee harmless from any
claims arising out of any such good faith payment(s) of benefits.
Each Participant by designating a Beneficiary or Beneficiaries,
authorizes the Committee to retain any benefits otherwise payable
in the Trust Fund or, in its sole discretion, pay-over such
benefits to a court or other tribunal of competent jurisdiction
pending the final and binding disposition of any dispute as to
the proper Beneficiary or Beneficiaries by agreement of the
parties or by a judgement of such court or other tribunal of
competent jurisdiction, as the case may be.
(b) If any Participant fails to designate a Beneficiary in the
manner provided above, or if the Beneficiary or Beneficiaries
designated by a deceased Participant die(s) before him or her or
before complete distribution of the Participant's benefits, the
Committee, in its sole discretion, may direct the Trustee to
distribute such Participant's benefits (or the balance thereof)
in the following order to:
(i) The surviving spouse of such Participant or, if not
living,
(ii) The estate of such Participant.
(c) Notwithstanding anything contained herein to the contrary, a
Participant may not name as a Beneficiary someone other than his
or her spouse, and such designation shall have no effect, unless
his or her spouse consents thereto, in a signed writing which is
notarized or witnessed by a Plan representative, or if the
Committee determines in its sole discretion that such consent is
not obtainable for good cause shown, consistent with applicable
law.
6.5 WITHDRAWALS: (a) Subject to Subsections (b), (c), (d),
and (e) of this Section 6.5, any Participant may make a
withdrawal of all or part of his or her Employee Contribution
Account, Salary Reduction Contribution Account and Vested
Rollover Contribution Account, provided, however, that
withdrawals must be made of all amounts in each classification
below (listed in descending order) before amounts in the next
lower classification may be withdrawn.
<PAGE> 37
(i) Employee Contribution Account.
(ii) Salary Reduction Contribution Account.
(iii) Vested Rollover Contribution Account.
(b) A Participant must have attained age 59 or have been
determined by the Committee to have a "hardship" in accordance
with Section 6.5(d) in order to qualify for a withdrawal under
Section 6.5(a) with respect to his or her Salary Reduction
Contribution Account and/or Vested Rollover Contribution Account
balances. Except for a Participant who is age 59 or older and
who withdraws his entire Account balances, a Participant may not
withdraw any amounts from his or her Employer Contribution
Account.
(c) Application for withdrawals shall be made on such forms as
the Committee prescribes and as permitted herein, and may be made
once each calendar month. Except as provided in Section 6.5(e),
distribution of withdrawals shall be made in a lump sum within 45
days following the Valuation Date or Special Valuation Date
immediately following receipt by the Committee of a properly
completed application. Withdrawal distributions shall be based
on the value of the Participant's Account(s) as of the Valuation
Date or the Special Valuation Date occurring in the same calendar
month as the application is received, and subject to the
provisions of Section 6.6, may be made in the discretion of the
Participant in the form of cash, or in Employer Stock or in any
combination thereof, provided, however, payment in Employer Stock
shall be limited to the extent a Participant's Account balances
are invested in whole shares of such Employer Stock under Section
7.1(i) and the Committee may require that all such Employer Stock
be transferred to such Participant or Beneficiary.
(d) Distribution of Elective Deferrals (and earnings thereon
accrued as of December 31, 1988) may be made to a Participant in
the event of hardship. For the purposes of this Section,
hardship is defined as an immediate and heavy financial need of
the Employee where such Employee lacks other available resources.
The following are the only financial needs considered immediate
and heavy: deductible medical expenses (within the meaning of
Section 213(d) of the Code) of the Employee, the Employee's
spouse, children, or dependents; the purchase (excluding mortgage
payments) of a principal residence for the Employee; payment of
tuition for the next quarter or semester of post-secondary
education for the Employee, the Employee's spouse, children or
dependents; or the need to prevent the eviction of the Employee
from, or a foreclosure on the mortgage of, the Employee's
principal residence. A distribution will be considered as
necessary to satisfy an immediate and heavy financial need of the
Employee only if:
<PAGE> 38
(i) The Employee has obtained all distributions other
than hardship distributions, and all nontaxable
loans under all plans maintained by the Employer:
(ii) All plans maintained by the Employer provide that
the Employee's Elective Deferrals (and Employee
Contributions) will be suspended for twelve months
after the receipt of the hardship distribution;
(iii) The distribution is not in excess of the amount of
an immediate and heavy financial need; and
(iv) All plans maintained by the Employer provide that
the Employee may not make Elective Deferrals for
the Employee's taxable year immediately following
the taxable year of the hardship distribution in
excess of the applicable limit under Section
402(g) of the Code for such taxable year less the
amount of such Employee's Elective Deferrals for
the taxable year of the hardship distribution.
A distribution based upon financial hardship cannot exceed the
amount required to meet the immediate financial need created by
the hardship and not reasonably available from other resources of
the Participant. Entitlement to a distribution based on
financial hardship shall be determined by the Committee in its
sole and exclusive discretion. The Committee may require such
reasonable proof of immediate financial need as it deems
necessary to uniformly and fairly administer this Section 6.5, as
a condition precedent to any distribution by reason of financial
hardship.
(e) Notwithstanding anything contained in Section 6.5(b)
regarding the age of a Participant or financial hardship, to the
contrary, a Participant may withdraw all or a portion of his or
her Employee Contribution Account once each calendar month
regardless of his or her age or the existence of any financial
hardship if such Participant satisfies all of the other terms and
conditions contained in this Section 6.5.
6.6 DEBITING OF INVESTMENT FUNDS: If a Participant making
less than a total withdrawal of his or her Accounts under Section
6.5 has his or her Accounts invested in more than one Investment
Fund, the amount withdrawn from his or her Accounts shall be
debited, on a pro rata basis, against each Investment Fund in
which such Accounts are invested.
6.7 REQUIRED DISTRIBUTIONS: Distribution of the Account
balances of a Participant will be made by April 1 of the year
following the calendar year in which such Participant attains age
70, and any balances that arise thereafter will be distributed
by each December 31 thereafter. If the Participant has not yet
terminated employment and has balances invested in Employer Stock
under the Common Stock Fund, the distribution of such balances
shall, to the maximum extent possible, be made in whole shares of
Employer Stock.
<PAGE> 39
6.8 DISTRIBUTION REQUIREMENTS: (a) Elective Deferrals,
Qualified Non-elective Contributions, and Qualified Matching
Contributions and income allocable to each, must comply with the
distribution requirements under Section 401(k)(2)(B) of the Code.
(b) Elective Deferrals, Qualified Non-elective Contributions,
and Qualified Matching Contributions, and income allocable to
each are not distributable to a Participant or his or her
Beneficiary or Beneficiaries in accordance with such
Participant's or Beneficiary or Beneficiaries' election, earlier
than upon separation from service, death or disability.
(c) Such amounts may also be distributed upon:
(i) Termination of the Plan without the establishment of
another defined contribution plan.
(ii) The disposition by a corporation to an unrelated
corporation of substantially all of the assets (within the
meaning of Section 409(d)(2) of the Code) used in a trade or
business of such corporation if such corporation continues
to maintain this Plan after the disposition, but only with
respect to Employees who continue employment with the
corporation acquiring such assets.
(iii) The disposition by a corporation to an unrelated
entity of such corporation's interest in a subsidiary
(within the meaning of Section 409(d)(3) of the Code) if
such corporation continues to maintain this plan, but only
with respect to Employees who continue employment with such
subsidiary.
(iv) The attainment of age 59 in the case of a
profit-sharing plan.
(v) The hardship of the Participant subject to the
provisions of Section 6.5(d) of the Plan.
All distributions that may be made pursuant to one or more of the
fore-going distributable events are subject to the spousal and
Participant consent requirements (if applicable) contained in
Sections 401(a)(11) and 417 of the Code.
6.9 LOANS TO PARTICIPANTS: (a) The Committee may, in its
sole discretion, and upon such terms and conditions as it may
require, direct the Trustee to loan a Participant an amount
which, when added to all loans outstanding under the Plan and
made by the Participant does not exceed the allowable portion, as
determined under the following table, of the Participant's total
Account balances:
<PAGE> 40
Maximum Loan
(Allowable Portion of Total
Total Vested Balance Account Balances)
- -------------------- ---------------------------
0 - 999 0%
$1,000 or more 50% but not to
exceed $50,000
(b) If the Participant participates in another plan or plans by
the Employer or any of the members of the controlled group of
corporations of which the Employer is a part which allow(s)
loans, the maximum loan limits reflected in the above table apply
in the aggregate to the Plan and any such other plan or plans
less any Matching Contributions made under the Plan.
(c) For purposes of this Section, "Total Account Balance" means
the total dollar value, as of the Valuation Date or Special
Valuation Date coinciding with or immediately preceding the date
of the loan, of the Participant's Accounts.
(d) Although used in determining the Total Account Balances, the
Employer Contribution Account balance is not available for loan.
(e) All loans shall be subject to the approval of the Committee
which shall investigate each application for a loan.
(f) In addition to such rules and regulations as the Committee
may adopt, all loans shall comply the following terms and
conditions:
1. An application for a loan by a Participant shall be made in
writing to the Committee whose action thereon shall be final.
2. The period of repayment for any loan shall be arrived at by
mutual agreement between the Committee and the borrower, but such
period in no event shall exceed five years, except that such
five-year repayment rule shall not apply to any loan used for the
purpose of establishing or preserving a home which is the
Participant's principal residence.
3. Each loan shall be made against collateral being the
assignment of the borrower's entire right, title and interest in
and to the Trust Fund, supported by the borrower's collateral
promissory note for the amount of the loan, including interest,
payable to the order of the Trustee.
4. Each loan shall bear interest at a rate to be fixed by the
Committee and, in determining the interest rate, the Committee
shall take into consideration interest rates currently being
charged. The Committee shall not discriminate among Participants
in the matter of interest rates; but loans granted at different
times may bear different interest rates if, in the opinion of the
Committee, the difference in rates is justified by a change in
general economic conditions. Each loan shall bear interest at an
<PAGE> 41
effective annual percentage rate which is not less than the prime
rate currently being charged to the Trustee in its banking
business, provided that such rate does not violate any applicable
usury laws.
5. No distribution, other than a hardship withdrawal which is
approved by the Committee pursuant to Section 6.5 shall be made
to any Participant or to a Beneficiary of any such Participant
unless and until all unpaid loans, including accrued interest
thereon, have been repaid.
6. Notwithstanding anything contained herein to the contrary, a
Participant may not obtain a loan unless it is consented to by
his or her spouse in a signed writing which is notarized or
witnessed by a Plan representative or if the Committee determines
in its sole discretion that such consent is not obtainable for
good cause shown, consistent with applicable law.
6.10 ELIGIBLE ROLLOVER DISTRIBUTIONS: (a) This Section
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
Section, a distributee may elect, at the time and in the manner
prescribed by the Committee, to have any portion of an "eligible
rollover distribution" paid directly to an "eligible retirement
plan" specified by the "distributee" in the "direct rollover."
(b) For purposes of this Section, the following definitions
shall apply:
(i) "Eligible rollover distribution" - An eligible
rollover distribution is any distribution of all
or any portion of the balance to the credit of the
distributee, except that an eligible rollover
distribution does not include: any distribution
that is one of a series of substantially equal
periodic payments (not less frequently than
annually) made for the life (or life expectancy)
of the distributee or the joint lives (or joint
life expectancies) of the distributee and the
distributee's designated Beneficiary, or for a
specified period of ten years or more; any
distribution to the extent such distribution is
required under Section 401(a)(9) of the Code; and
the portion of any distribution that is not
includable in gross income (determined without
regard to the exclusion of net unrealized
appreciation with respect to Employer securities).
(ii) "Eligible retirement plan" - An eligible
retirement plan is an individual retirement
account described in Section 408(a) of the Code,
an individual retirement annuity described in
Section 408(b) of the Code, an annuity plan
<PAGE> 42
described in Section 403(a) of the Code, or a
qualified trust described in Section 401(a) of the
Code, that accepts that distributee's eligible
rollover distribution. However, in the case of an
eligible rollover distribution to the surviving
spouse, an eligible retirement plan is an
individual retirement account or individual
retirement annuity.
(iii) "Distributee" - A distributee includes an Employee
or former Employee. In addition, the Employee's
or former Employee's surviving spouse and the
Employee's or former Employee's spouse or former
spouse who is the alternate payee under a
qualified domestic relations order, as defined in
Section 414(p) of the Code, are distributees with
regard to the interest of the spouse or former
spouse.
(iv) "Direct rollover" - A direct rollover is a payment
by the Plan to the eligible retirement plan
specified by the distributee.
ARTICLE VII. - INVESTMENT OPTIONS, TRUST FUND
7.1 PARTICIPANT DIRECTED INDIVIDUAL ACCOUNT PLAN: This
Plan is intended to constitute a participant directed individual
account plan under Section 404(c) of ERISA. As such,
Participants shall be provided the opportunity to exercise
control over the investment of a portion of their Accounts under
the Plan and to choose from a broad range of investment
alternatives.
7.2 EMPLOYEE SELECTED INVESTMENT OPTIONS, INVESTMENT FUNDS:
(a) Each Participant shall designate, on a form supplied by the
Committee, signed by the Participant and delivered to the
Committee, the Investment Fund(s) established pursuant to
paragraph (b) below to which contributions made pursuant to
Sections 4.1(a), and 4.3 and 4.5, hereof, are to be invested.
(b) The Investment Funds into which Plan Participants may direct
the investment of their Accounts shall include the following:
(i) A common stock fund, consisting of Employer Stock;
(ii) An equity fund or equity funds, consisting of
common stock and other equity securities, held
directly or indirectly;
(iii) A money market fund;
(iv) A bond fund, consisting of interest bearing
accounts, certificates of deposit, or bonds,
debentures and other evidences of indebtedness
issued by corporations and governmental units; and
<PAGE> 43
(v) A fixed fund, consisting of "guaranteed"
investment contracts with insurance companies.
The available Investment Funds may be changed or
supplemented from time to time by action of the Committee.
(c) Following the Company's distribution of common stock of GFC
Financial Corporation ("GFCFC") to the Plan and the Company's
other stockholders, and the Committee's decision to establish a
new Investment Fund in connection with that distribution, the new
Investment Fund indicated below shall be added to the list set
forth in paragraph (b):
(i) A GFCFC Common Stock Fund consisting of GFCFC
common stock. This Investment Fund shall be
subject to the special rules in Section 7.8.
7.3 INVESTMENT ELECTIONS: (a) Each Participant may, except
as hereinafter provided, elect with respect to future
contributions to his Employee Contribution Account, Salary
Reduction Contribution Account and Vested Rollover Contribution
Account to have the aggregate contributions to such Account(s) be
invested in a single Fund, or he may direct that 10% increments
(or multiples of 10% increments), of such Accounts be invested in
such Funds as he shall desire.
(b) Each Participant may change his investment directions in
accordance with the provisions of Section 7.3(a) to provide for
the investment of future contributions among the various Funds in
10% increments (or multiples of 10% increments), as he shall
desire. Any such change may be made in accordance with
procedures established by the Committee.
7.4 INVESTMENT TRANSFERS: Generally, a Participant may
transfer amounts between the Investment Funds in accordance with
procedures established by the Committee. The transfers shall be
made in accordance with Section 7.3 in 10% increments (or
multiples of 10% increments).
7.5 TRUST FUND: (a) All contributions under this Plan
shall be paid to the Trustee and deposited in the Trust Fund.
However, all contributions made by the Employer are expressly
conditioned upon the continued qualification of the Plan under
the Code, including any amendments to the Plan. Upon the
Employer's request, a contribution which was made by a mistake of
fact, or conditioned upon qualification of the Plan or any
amendment thereof shall be returned to the Employer within one
year after the payment of the contribution, or the denial of the
qualification, whichever is applicable.
(b) Except as provided above, all assets of the Trust Fund,
including investment Income, shall be retained for the exclusive
benefit of Participants and Beneficiaries and shall be used to
pay benefits to such persons or to pay administrative expenses of
the Plan and Trust Fund to the extent not paid by the Employer
and shall not revert to or inure to the benefit of the Employer.
<PAGE> 44
7.6 TENDER OFFERS: As soon as practicable after the
commencement of a tender offer or exchange offer ("Offer") for
shares of Employer Stock or GFCFC Stock, the Committee shall use
its reasonable best efforts to cause each Participant (who has an
Account allocated in whole or in part to Employer Stock or GFCFC
Stock) to be advised in writing of the terms of the Offer,
together with forms by which the Participant may instruct the
Committee to instruct the Trustee, or revoke such instruction, to
tender shares credited to his or her Account, to the extent
permitted under the terms of any such Offer. The Trustee shall
follow the directions of the Committee but the Trustee shall not
tender shares for which no instructions are received. In
advising Participants of the terms of the Offer, the Committee
may include statements from the management of The Dial Corp
setting forth its position with respect to the Offer. The giving
of instructions to the Trustee to tender shares of Employer Stock
or GFCFC Stock and the tender thereof shall not be deemed a
withdrawal or suspension from the Plan or a forfeiture of any
portion of the Participant's interest in the Plan. The number of
shares of Employer Stock or GFCFC Stock, as the case may be, to
which a Participant may provide instructions shall be the total
number of shares credited to his or her Account(s), whether or
not the shares are vested, as of the close of business on the day
preceding the date on which the tender offer commences or such
earlier date which shall be designated by the Committee, which
the Committee, in its sole discretion, deems appropriate for
reasons of administrative convenience. Any securities received
by the Trustee as a result of a tender of shares hereunder shall
be held, and any cash so received shall be invested in short-term
investments, for the account of each Participant with respect to
whom shares of Employer Stock or GFCFC Stock were tendered
pending any reinvestment by the Trustee, as it may deem
appropriate, consistent with the purposes of the Plan.
7.7 VOTING OF STOCK: (a) Each Participant (whose Account
has allocated to it any shares of Employer Stock or GFCFC Stock)
shall be entitled to instruct the Committee to instruct the
Trustee in writing how to vote, at each meeting of shareholders,
such shares of Employer Stock or GFCFC Stock, and to revoke any
such instruction, to the extent permitted under the terms of such
vote. Such instruction or revocation thereof shall apply to the
total number of shares of Employer Stock or GFCFC Stock credited
to the Participant's Accounts, whether or not vested, as of the
date coinciding with or immediately preceding the record date for
the shareholders' meeting or such earlier date which shall be
designated by the Committee which the Committee, in its sole
discretion, deems appropriate for reasons of administrative
convenience. All the shares of Employer Stock or GFCFC Stock for
which no instructions are received shall be voted by the Trustee
<PAGE> 45
in a uniform manner as a single block in accordance with the
instructions received with respect to a majority of such shares
for which instruction is received, unless the Trustee, in
exercising its discretion as a fiduciary with respect to the
voting of such shares, determines that the interest of
Participants and Beneficiaries requires it to vote in a different
way. The Committee shall use its reasonable best efforts to
cause each Participant (whose Account has allocated to it any
shares of Employer Stock or GFCFC Stock) to receive such notices
and informational statements as are furnished to the shareholders
in respect of the exercise of voting rights, together with forms
by which the Participant may instruct the Committee to instruct
the Trustee, or revoke such instruction, with respect to the vote
of shares of Employer Stock or GFCFC Stock credited to his or her
Account.
(b) Subsequent to a Participant's investment in any Investment
Fund other than one comprised of Employer Stock or GFCFC Stock,
all proxies relating to the exercise of voting rights incidental
to the ownership of any asset which is held in such Investment
Fund shall be passed through, either directly or indirectly, to
the Participant. Each Participant who so receives any proxies
shall be entitled to instruct the Committee to instruct the
Trustee in writing how to vote such proxies and to revoke any
such instruction, to the extent permitted under the terms of the
proxy. Neither the Committee nor the Trustee shall have
authority to vote proxies for which no instructions have been
received.
7.8 GFCFC COMMON STOCK FUND: (a) The Plan is authorized to
receive GFCFC common stock that is distributed to it (i) when the
Company distributes such stock to the Plan and its other
stockholders and (ii) from the Dial ESOP. In addition, following
the Plan's receipt of GFCFC Stock, the Committee may institute a
special program that allows Participants to retain such stock in
accordance with the rules set forth below.
(b) If the Committee chooses to implement a special program for
the retention of GFCFC Stock in this Plan, it shall provide a
special investment election to Participants within a reasonable
time after the Company's distribution of GFCFC Stock to its
stockholders. The timing shall be no later than 90 days after
such distribution of GFCFC Stock unless the satisfaction of
legally required preconditions for the election or other special
circumstances require a longer waiting period. In providing the
election, the Committee shall identify the GFCFC Stock that is
allocated to the Accounts of Participants, and shall allow all
Participants who remain in the employ of an Employer under this
Plan (excluding Participants who are employed by GFCFC or another
employer that participants in GFCFC's new qualified plans) to
make a one-time election to keep or dispose of all the GFCFC
Stock in their Account. This election may be coordinated with a
similar election relating to GFCFC Stock that is allocated to
such Participant's accounts in The Dial Corp Employees' Stock
Ownership Plan so that a single election to keep or dispose of
GFCFC Stock will apply to all of a Participant's GFCFC Stock in
both that Plan and this Plan. Effective May 1, 1994,
Participants may freely dispose of GFCFC Stock allocated to their
Accounts.
<PAGE> 46
(c) For Participants who elect to dispose of GFCFC Stock, the
following investment rules shall apply.
(i) If such GFCFC Stock was in a Participant's
Employer Contribution Account, it shall be
replaced with Employer Stock (by means of either a
sale and reinvestment or an arm's-length exchange
with a person who is not a party in interest under
ERISA or a disqualified person under the Code) and
invested in the Common Stock Fund. Thereafter,
such Employer Stock in the Employer Contribution
Accounts of such Participants will be subject to
the Plan's normal rules requiring such investments
to remain in the Employer Stock, as provided in
Section 5.10(c), and to the Plan's normal rules
for making distributions of balances in the
Employer Contribution Account that are invested in
this manner.
(ii) If such GFCFC Stock was in a Participant's
Employee Contribution Account, Salary Reduction
Contribution Account, or Vested Rollover
Contribution Account, it shall be sold in an
arm's-length transaction and the proceeds shall be
reinvested in available Investment Funds according
to the Participant's most recent investment
election for Elective Deferrals and shall
thereafter be subject to the Plan's normal rules
for investments and distributions of balances in
such Accounts.
(d) For Participants who elect to keep GFCFC Stock, it shall be
invested in the GFCFC Common Stock Fund and retained for them in
the GFCFC Stock Account until the time for distribution under the
rules of the Plan, or, if sooner, the time at which the
Participant decides to dispose of his GFCFC stock, provided,
however, that it may be converted to cash for the purpose of
making a loan in accordance with the special rules in Section
7.8(e) below. When a distribution is due from the GFCFC Common
Stock Fund following a Participant's termination of employment,
the usual rules of the Plan shall apply, except that the
Participant or Beneficiary shall be allowed to elect to receive
the distribution from such Investment Fund in the form of whole
shares of GFCFC common stock (plus cash in lieu of any fractional
share) instead of receiving it in cash. Except in the case of
stock dividends, stock splits, or nontaxable distributions with
respect to GFCFC Stock, no GFCFC Stock or other assets shall be
added to the GFCFC Common Stock Fund, and the dividends on GFCFC
<PAGE> 47
common stock and any other earnings of the GFCFC Common Stock
Fund shall be reinvested in other investment funds as provided
below.
(i) If such GFCFC Stock is in a Participant's Employer
Contribution Account, the dividends on such stock
and any other earnings of the GFCFC Common Stock
Fund for such Account shall be used to acquire
Employer Stock by means of reinvestment in the
Common Stock Fund.
(ii) If such GFCFC Stock is in a Participant's Employee
Contribution Account, Salary Reduction
Contribution Account, or Vested Rollover Account,
the dividends on such stock and any other earnings
of the GFCFC Common Stock Fund for such Accounts
shall be reinvested in other Investment Funds
according to the Participant's most recent
investment election for Elective Deferrals.
(e) GFCFC Stock that is being retained in a Participant's
Employee Contribution Account, Salary Reduction Contribution
Account, or Vested Rollover Account (but not GFCFC Stock that is
being retained in a Participant's Employer Contribution Account)
can be liquidated to the extent necessary to provide a loan to
the Participant. For this purpose, the Committee may establish
uniform rules providing that such liquidation will not occur
unless all other Account balances and investments that are
available to provide the loan funds have been used first. To the
extent that loan funds are provided to a Participant from the
GFCFC Common Stock Fund, the Participant's loan repayments shall
be reinvested in the GFCFC Common Stock Fund.
(f) The Committee shall establish special rules and accounting
procedures as necessary to preserve any distribution forms or
other valuable rights that are protected by Code Section
411(d)(6) with respect to amounts attributable to assets
transferred directly to this Plan from The Dial Corp Employees'
Stock Ownership Plan, including, to the extent applicable, rules
requiring (i) the tracking of such amounts in special accounts,
and (ii) the preservation of the Code Section 401(a)(28) right of
diversification, the Code Section 4975(e)(7) right to receive
distributions in the form of Employer Stock, and the Code Section
409(o) right to receive a distribution that complies with certain
special timing requirements.
7.9 EXERCISE OF CONTROL: (a) The Committee shall provide
each Participant with the opportunity to obtain sufficient
information to make informed decisions with regard to investment
alternatives available under the Plan, and incidents of ownership
appurtenant to such investments. The Committee shall promulgate
and distribute to Participants an explanation that the Plan is
intended to comply with Section 404(c) of ERISA and any relief
from fiduciary liability resulting therefrom, a description of
<PAGE> 48
investment alternatives available under the Plan, an explanation of the
circumstances under which Participants may give investment instructions and any
limitations thereon, along with all other information and explanations required
under Department of Labor Regulation Section 2550.404c-1(b)(2)(B)(1). In
addition, the Committee shall provide information to Participants upon request
as required by Department of Labor Regulation Section 2550.404c-1(b)(2)(B)(2).
Neither the Employer, Committee, Trustee, nor any other individual associated
with the Plan or the Employer shall give investment advice to Participants with
respect to Plan investments. The providing of information pursuant to this
Article VII shall not in any way be deemed to be the providing of investment
advice, and shall in no way obligate the Employer, Committee, Trustee or any
other individual associated with the Plan or the Employer to provide any
investment advice.
(b) The Committee, pursuant to uniform and nondiscriminatory
rules, may charge each Participant's Accounts for the reasonable
expenses of carrying out investment instructions directly related
to such Account, provided that each Participant is periodically
(not less than quarterly) informed of such actual expenses
incurred with respect to his or her respective Accounts.
(c) The Committee shall decline to implement any Participant
instructions if the instruction is inconsistent with any
provisions of the Plan or Trust Agreement or any investment
direction policies adopted by the Committee from time to time.
The Committee also may decline to implement any Participant
instructions to the extent permitted by Department of Labor
regulations issued under Section 404(c) of ERISA. The Committee,
pursuant to uniform and nondiscriminatory rules, may promulgate
additional limitations on investment instruction consistent with
Section 404(c) of ERISA from time to time.
(d) A Participant shall be given the opportunity to make
independent investment directions. No Plan fiduciary shall
subject any Participant to improper influence with respect to any
investment decisions, and nor shall any Plan fiduciary conceal
any non-public facts regarding a Participant's Plan investment
unless disclosure is prohibited by law. Plan fiduciaries shall
remain completely neutral in all regards with respect to
Participant investment direction. A Plan fiduciary may not
accept investment instructions from a Participant known to be
legally incompetent, and any transactions with a fiduciary,
otherwise permitted under this Article VII and the uniform and
nondiscriminatory rules regarding investment direction
promulgated by the Committee, shall be fair and reasonable to the
Participant in accordance with Department of Labor Regulation
Section 404c-1(c)(3).
7.10 ADJUSTMENT OF ACCOUNTS: Adjustments pursuant to
Section 5.2 shall be made on a separate fund basis. Gains and
Income or losses attributable to each Investment Fund shall be
allocable strictly to the Investment Fund and Accounts invested
therein. Each Investment Fund shall be invested in accordance
with the provisions of the Plan and the Trust Agreement.
<PAGE> 49
7.11 LIMITATION OF LIABILITY AND RESPONSIBILITY: The
Trustee, the Committee and the Employer shall not be liable for
acting in accordance with the directions of a Participant
pursuant to this Article VII or for failing to act in the absence
of any such direction. The Trustee, the Committee and the
Employer shall not be responsible for any loss resulting from any
direction made by a Participant and shall have no duty to review
any direction made by a Participant. The Trustee shall have no
obligation to consult with any Participant regarding the
propriety or advisability of any selection made by the
Participant.
7.12 FORMER PARTICIPANTS AND BENEFICIARIES: For purposes of
this Article VII, the term "Participant" shall be deemed to
include former Participants and the Beneficiaries of any deceased
Participants.
ARTICLE VIII. - ADMINISTRATION
8.1 ALLOCATION OF RESPONSIBILITY AMONG FIDUCIARIES FOR PLAN
AND TRUST ADMINISTRATION: The Fiduciaries shall have only those
specific powers, duties, responsibilities and obligations as are
specifically given them under the Plan or the Trust. The Board
of Directors of The Dial Corp shall have the sole authority to
appoint and remove the Trustee. The Dial Corp shall have the
sole authority to appoint and remove the Committee. The Board of
Directors of The Dial Corp shall have the authority to amend or
terminate, in whole or in part, any provision of this Plan or the
Trust. The Chief Executive Officer of The Dial Corp also shall
have the authority to amend any provision of this Plan or the
Trust, provided that such amendment does not materially increase
the cost of the Plan. The Dial Corp shall have the final
responsibility for administration of the Plan, which
responsibility is specifically described in this Plan and the
Trust. The Committee, appointed pursuant to Section 8.2, hereof,
shall have the specific delegated powers and duties described in
the further provisions of this Article VIII, and such further
powers and duties as hereinafter may be delegated to it by The
Dial Corp. The Trustee shall have sole responsibility for the
administration of the Trust and the management of the assets held
under the Trust, all as specifically provided in the Trust. Each
Fiduciary warrants that any direction given, information
furnished, or action taken by it shall be in accordance with the
provisions of the Plan or the Trust, as the case may be,
authorizing or providing for such direction, information or
action. Furthermore, each Fiduciary may rely upon any such
direction, information or action of another Fiduciary as being
proper under this Plan or the Trust, and is not required under
the Plan or the Trust to inquire into the propriety of any such
direction, information or action. It is intended under the Plan
<PAGE> 50
and the Trust that each Fiduciary shall be responsible for the
proper exercise of its own powers, duties, responsibilities and
obligations under this Plan and the Trust and shall not be
responsible for any act or failure to act of another Fiduciary.
No Fiduciary guarantees the Trust Fund in any manner against
investment loss or depreciation in asset value.
8.2 APPOINTMENT OF COMMITTEE: A Committee consisting of at
least three persons shall be appointed by and serve at the
pleasure of the Chief Executive Officer of The Dial Corp to
assist in the administration of the Plan. All usual and
reasonable expenses of the Committee may be paid in whole or in
part by the Employer, and any expenses not paid by the Employer
shall be paid by the Trustee out of the principal or income of
the Trust Fund. Any members of the Committee who are Employees
shall not receive compensation with respect to their services for
the Committee.
8.3 CLAIMS PROCEDURE: The Committee shall make all
determinations as to the right of any person to a benefit. Any
denial by the Committee of the claim for benefits under the Plan
by a Participant or Beneficiary shall be stated in writing by the
Committee and delivered or mailed to the Participant or
Beneficiary at his or her last address shown on Plan records; and
such notice shall set forth the specific reasons for the denial,
written to the best of the Committee's ability in a manner that
may be understood without legal or actuarial counsel. In
addition, the Committee shall afford a reasonable opportunity to
any Participant or Beneficiary whose claim for benefits has been
denied for a review of the decision denying the claim and, in the
event of continued disagreement, may appeal to The Dial Corp (or
a benefits review committee appointed by it) whose decision shall
be final.
8.4 RECORDS AND REPORTS: The Dial Corp (or the Committee
if so designated by it) shall exercise such authority and
responsibility as it deems appropriate in order to comply with
ERISA, other applicable law and governmental regulations issued
thereunder relating to records of Participant's employment,
Account balances, notifications to Participants' and annual
reports to the Internal Revenue Service and Department of Labor.
Each Employer agrees to abide by the directions of The Dial Corp
or its designee, in the exercise of its responsibilities
hereunder.
8.5 OTHER COMMITTEE POWERS AND DUTIES: The Committee shall
have such power and authority as may be necessary to discharge
its duties hereunder, including, but not by way of limitation,
the discretionary authority to do the following:
(a) To construe and interpret the Plan, decide all question of
eligibility and determine the amount, manner, and time of payment
of any benefits hereunder;
<PAGE> 51
(b) To select, monitor and replace the Investment Manager or add
new Investment Funds;
(c) To prescribe procedures to be followed by Participants and
Beneficiaries filing applications for benefits;
(d) To prepare and distribute, in such manner as the Committee
determines to be appropriate, information explaining the Plan.
(e) To receive from the Employer and from Participants and
Beneficiaries such information as shall be necessary for the
proper administration of the Plan;
(f) To furnish the Employer, upon request, such annual reports
with respect to the administration of the Plan as are reasonable
and appropriate.
(g) To receive, review and keep on file (as it deems convenient
or proper) reports of the financial condition, and of the
receipts and disbursements, of the Trust Fund from the Trustee;
and
(h) To appoint or employ individuals to assist in the
administration of the Plan and any other agents it deems
advisable, including legal and actuarial counsel.
Except as otherwise provided by the Plan, the Committee shall
have no power to add to, subtract from or modify any of the terms
of the Plan, or to change or add to any benefits provided by the
Plan, or to waive or fail to apply any requirement of eligibility
for a benefit under the Plan. All decisions, interpretations,
and actions of the Committee pursuant to the Plan shall be
conclusive and binding on all persons, and shall be given the
maximum deference permitted by law. The decision of the
Committee upon all matters within the scope of its authority
shall be binding and conclusive on all persons.
8.6 RULES AND DECISIONS: The Committee may adopt such
rules as it deems necessary, desirable or appropriate. All rules
and decisions of the committee shall be uniformly and
consistently applied to all Participants and Beneficiaries in
similar circumstances. When making a determination or
calculation, the Committee shall be entitled to rely upon
information furnished by a Participant or Beneficiary, the
Employer, the legal counsel of any such person or the Trustee.
8.7 COMMITTEE PROCEDURES: The Committee may act at a
meeting or in writing without a meeting. The Committee shall
elect one of its members as chairman, appoint a secretary, who
may or may not be a Committee member, and advise the Trustee of
such actions in writing. The secretary shall keep a record of
all meetings and forward all necessary communications to the
Employer, or the Trustee. The Committee may adopt such bylaws
and regulations as it deems desirable for the conduct of its
<PAGE> 52
affairs. All decisions of the Committee shall be made by the
vote of the majority including actions in writing taken without a
meeting. A dissenting Committee member who, within a reasonable
time after he or she has knowledge of any action or failure to
act by the majority, registers his or her dissent in writing
delivered to the other committee members, the Employer and the
Trustee shall not be responsible for any such action or failure
to act.
8.8 AUTHORIZATION OF BENEFIT PAYMENTS: The Committee shall
issue directions to the Trustee concerning all benefits which are
to be paid from the Trust Fund pursuant to the provisions of the
Plan, and shall warrant to the Trustee that all such directions
are in accordance with the Plan.
8.9 APPLICATION AND FORMS FOR BENEFITS: The Committee may
require a Participant or Beneficiary to complete and file with
the Committee an application for a benefit on the forms approved
by the Committee, as a condition precedent to payment of
benefits. The Committee may rely upon all such information so
furnished it, including the Participant's or Beneficiary's
current mailing address.
8.10 FACILITY OF PAYMENT: Whenever, in the Committee's
opinion, a person entitled to receive any payment of a benefit or
installment thereof hereunder is under a legal disability or is
incapacitated in any way so as to be unable to manage his or her
financial affairs, the Committee may direct the Trustee to make
payments to such person or to his or her legal representative or
to a relative or friend of such person for his or her benefit, or
the Committee may direct the Trustee to apply the payment for the
benefit of such person in such manner as the Committee may direct
the Trustee to apply the payment for the benefit of such person
in such manner as the Committee considers advisable. Any payment
of a benefit or installment thereof in accordance with the
provisions of this Section shall be a complete discharge of any
liability for the making of such payment under the provisions of
the Plan.
8.11 INDEMNIFICATION OF THE COMMITTEE: The Committee and
the individual members thereof shall be indemnified by the
Employer and not from the Trust Fund against any and all
liability arising by reason of any act or failure to act made in
good faith pursuant to the provisions of the Plan, including
expenses reasonably incurred in the defense of any claim relating
thereto.
ARTICLE IX. - MISCELLANEOUS
9.1 NONGUARANTEE OF EMPLOYMENT: Nothing contained in the
Plan shall be construed as a contract of employment between the
Employer and any Employee, or as a right of any Employee to be
continued in the Employment of the Employer, or as a limitation
of the right of the Employer to discharge any of its Employees,
with or without cause.
<PAGE> 53
9.2 RIGHTS TO TRUST ASSETS: No Employee, Participant, or
Beneficiary shall have any right to, or interest in, any assets
of the Trust Fund at any time, including upon termination of his
or her employment or otherwise, except as provided from time to
time under the Plan, and then only to the extent of the benefits
properly payable under the Plan to a Participant or Beneficiary
out of the assets of the Trust Fund. All payment of benefits as
provided for the in Plan shall be made solely out of the assets
of the Trust Fund to the extent sufficient, and none of the
Fiduciaries or Employers shall be liable therefore in any manner.
9.3 NONALIENATION OF BENEFITS: (a) Except as provided in
Article VI or as required by law, benefits payable under the Plan
shall not be subject in any manner to anticipation, alienation,
sale, transfer, assignment, pledge, encumbrance, charge,
garnishment, execution or levy of any kind, either voluntary or
involuntary, prior to actually being received by the person
entitled to the benefit under the terms of the Plan; and any
attempt to anticipate, alienate, sell, transfer, assign, pledge,
encumber, charge or otherwise dispose of any right to benefits
payable hereunder, shall be void. The Trust Fund shall not in
any manner be liable for, or subject to, the debts, contracts,
liabilities, engagements or torts of any person entitled to
benefits hereunder.
9.4 NONFORFEITABILITY OF BENEFITS: Subject only to the
specific provisions of the Plan, nothing shall be deemed to
divest a Participant of his or her right to the nonforfeitable
benefit to which he or she becomes entitled in accordance with
the provisions of the Plan.
ARTICLE X. - AMENDMENTS AND ACTION BY EMPLOYER
10.1 AMENDMENTS: The Dial Corp reserves the right to make
from time to time any amendment or amendments to the Plan which
do not cause (i) any adverse consequences to any Participant's
rights in his or her Account balances and Funds in which such
balances are invested, or (ii) any part of the Trust Fund to be
used for, or diverted to, any purpose other than the exclusive
benefit of Participants or their Beneficiaries, provided,
however, that The Dial Corp may make any amendment it determines
necessary or desirable, with or without retroactive effect, to
comply with the Code and other applicable law
10.2 ACTION BY THE DIAL CORP: Any action by The Dial Corp
under the Plan may be by resolution of its Board of Directors, or
by any person or persons duly authorized by resolution of said
Board to take such action.
<PAGE> 54
ARTICLE XI. - SUCCESSOR EMPLOYER AND MERGER
OR CONSOLIDATION OF PLANS
11.1 SUCCESSOR EMPLOYER: In the event of the dissolution,
merger, consolidation or reorganization of an Employer, provision
may be made in the sole discretion of The Dial Corp by which the
Plan and Trust will be continued by the successor; and, in that
event, such successor shall be substituted for Employer under the
Plan. The substitution of the successor shall constitute an
assumption of Plan liability by the successor and the successor
shall have all of the powers, duties and responsibilities of the
Employer under the Plan.
11.2 CONDITIONS APPLICABLE TO MERGERS OR CONSOLIDATIONS OF
PLANS: In the event of any merger or consolidation of the Plan
with, or transfer in whole or in part of the assets and
liabilities of the Trust Fund to another trust fund held under,
any other plan of deferred compensation maintained or to be
established for the benefit of all or some of the Participants of
the Plan, the assets of the Trust Fund applicable to such
Participants shall be merged or consolidated with or transferred
to the other trust fund only if:
(i) Each Participant would (if either this Plan or the
other plan then terminated) receive a benefit
immediately after the merger, consolidation or
transfer which is equal or greater than the
benefit he would have been entitled to receive
immediately before the merger, consolidation or
transfer (if this Plan had then been terminated);
and the determination of such benefits shall be
made in the manner and at the time prescribed in
regulations issued under ERISA;
(ii) Resolutions of the Boards of Directors of the
Employer under the Plan, or of any new or
successor Employer of the affected Participants,
shall authorize such transfer of assets; and, in
the case of the new or successor Employer of the
affected Participants, its resolutions shall
include an assumption; of liabilities with respect
to such Participants' inclusion in the new
Employer's plan; and
(iii) Such other plan and trust are qualified under
Sections 401(a) and 501(a) of the Code.
Pursuant to this section and consistent with the agreement
between the Company and GFCFC, the Account balances and assets
for Participants who are covered by the GFC Financial Corporation
Capital Accumulation Plan shall be transferred to that plan
following the Company's distribution of GFCFC common stock to the
Plan and its other shareholders. In addition to the foregoing,
any merger, consolidation, or transfer of assets described in
this section shall comply with applicable requirements of Code
Section 411(d)(6) to preserve optional forms of benefits and
other valuable rights that are legally protected.
<PAGE> 55
ARTICLE XII. - PLAN TERMINATION
12.1 RIGHT TO TERMINATE: In accordance with the procedures
set forth in this Article, The Dial Corp may terminate the Plan
at any time in its entirety or with respect to any Employer or
group of Employees or Participants. The Board of Directors of an
Employer may terminate the Plan at any time with respect to its
Employees or any group of its Employees or Participants, provided
such Employer has made all contributions due to the Plan to the
date of such termination.
12.2 PARTIAL TERMINATION: Upon termination of the Plan by
The Dial Corp or by the Employer with respect to such Employer or
a group of Employees or Participants of such Employer, the
Trustee shall, in accordance with the directions of the
Committee, allocate and segregate for the benefit of the
Participants with respect to which the Plan is being terminated
the proportionate interest of such Participants in the Trust
Fund. The funds so allocated and segregated shall be used by the
Trustee to pay benefits to or on behalf of Participants in
accordance with Section 12.3.
12.3 LIQUIDATION OF THE TRUST FUND: (a) Upon termination
or partial termination of the Plan, the accounts of all
Participants affected thereby shall become fully vested, and the
Committee may direct the Trustee: (a) to continue to administer
the Trust fund and pay Account balances in accordance with
Article VI to Participants affected by the termination upon their
termination of employment or to their Beneficiaries upon such a
Participant's death, until the Trust Fund has been liquidated; or
(b) to distribute the assets remaining in the Trust Fund, after
payment of any expenses properly chargeable thereto, to
Participants and Beneficiaries in proportion to their respective
Account balances or rights thereto.
(b) In case the Committee directs liquidation of the Trust Fund
pursuant to (a) above, the expenses of administering the Plan and
Trust, if not paid by the Employer, shall be paid from the Trust
Fund.
(c) The Trustee may delay distribution of assets under Section
12.3 pending receipt of written determination by the Internal
Revenue Service that the Plan is qualified upon termination.
ARTICLE XIII. - ADOPTION OF PLAN
13.1 ADOPTION AGREEMENT: (a) Subject to the approval of The
Dial Corp and consistent with the provisions of ERISA and other
applicable law, an Affiliate may adopt the Plan for its Eligible
Employees by entering into an Adoption Agreement in the form and
substance prescribed by the Committee. To the extent approved by
the Committee, each Affiliate may:
(i) Modify the definition of Eligible Employee set
forth in Section 2.2(d) hereof, with respect to
its Employees; and
<PAGE> 56
(ii) Modify the definition of Compensation set forth in
Section 2.3(d), hereof, with respect of its
Employees.
Any such modification shall be reflected in the Adoption
Agreement and may be amended from time to time by a written
supplement to the Adoption Agreement with the approval of the
Committee. Each Employer may determine the level of Employer
contributions to be made by the Employer to the Employer
Contribution Accounts of its Eligible Employees in each Year.
(b) The Committee may prospectively require that all provisions
of the Plan be uniformly applied to an Employer, as set forth in
the Plan, notwithstanding any modification provisions in an
Adoption Agreement. The Dial Corp may prospectively revoke or
modify any Employer's participation in the Plan at any time and
for any or no reason, without regard to the terms of any Adoption
Agreement, or terminate the Plan with respect to such Employer's
Employee Participants.
(c) By Execution of an Adoption Agreement (each of which by this
reference shall become a part of the Plan), the Employer agrees
to be bound by all the terms and conditions of the Plan.
<PAGE> 1
Exhibit 5
November 17, 1995
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: The Dial Corp Registration Statement on Form S-8
The Dial Companies Capital Accumulation Plan
Gentlemen:
This opinion is delivered in connection with the
registration by The Dial Corp, a Delaware corporation (the
"Corporation"), on Form S-8 (the "Registration Statement"), under
the Securities Act of 1933, as amended, for 1,200,000 shares of
the Corporation's Common Stock ("Common Stock"), together with
the associated preferred stock purchase rights ("Rights"),
issuable pursuant to The Dial Companies Capital Accumulation Plan
(the "Plan").
In arriving at this opinion, I have examined such corporate
instruments, documents, statements and records of the Corporation
and others as I have deemed relevant and necessary or appropriate
for the purposes of this opinion.
I have assumed the genuineness of all signatures and the
authenticity of all documents submitted to me as originals, the
conformity to original documents of all the documents submitted
to me as certified or photostatic copies, and the authenticity of
the originals of such latter documents.
Based upon the foregoing, I am of the opinion that the
1,200,000 shares of Common Stock to be sold pursuant to the
Registration Statement, together with the associated Rights, when
issued and delivered by the Corporation in accordance with the
terms of the Plan, will be legally issued, fully paid and
nonassessable securities of the Corporation.
The provisions of the written documents constituting the
Plan are in compliance with the requirements of ERISA pertaining
to such provisions.
<PAGE> 2
I hereby consent to the reference to my name in the
Registration Statement and further consent to the inclusion of
this opinion as Exhibit 5 to the Registration Statement. In
giving this consent, I do not hereby admit that I am in the
category of persons whose consent is required under Section 7 of
the Act or the rules and regulations of the Securities and
Exchange Commission.
Very truly yours,
/s/ L.G. Lemon
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in this
Registration Statement of The Dial Corp on Form S-8 of our report
dated February 24, 1995, which report expresses an unqualified
opinion and includes an explanatory paragraph referring to the
Company's change in the method of accounting for postretirement
benefits other than pensions in 1992, appearing in the Annual
Report on Form 10-K of The Dial Corp for the year ended December
31, 1994, and of our report dated June 14, 1995, appearing in the
Annual Report on Form 11-K of The Dial Companies Capital
Accumulation Plan for the year ended December 31, 1994,
respectively.
We also consent to the reference to us under the heading
"Experts" in such Registration Statement.
Deloitte & Touche LLP
Phoenix, Arizona
November 17, 1995
