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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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THE CARBIDE/GRAPHITE GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 25-1575609
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
ONE GATEWAY CENTER, 19TH FLOOR
PITTSBURGH, PENNSYLVANIA 15222
(Address of principal executive offices) (Zip Code)
THE CARBIDE/GRAPHITE GROUP, INC. SAVINGS INVESTMENT PLAN
(Full title of the plan)
NICHOLAS T. KAISER
CHIEF EXECUTIVE OFFICER
ONE GATEWAY CENTER, 19TH FLOOR
PITTSBURGH, PENNSYLVANIA 15222
(Name and address of agent for service)
(412) 562-3700
(Telephone number, including area code, of agent for service)
------------
Copies of all communications to:
DAVID A. GERSON, ESQUIRE
MORGAN, LEWIS & BOCKIUS LLP
ONE OXFORD CENTRE
PITTSBURGH, PA 15219-1417
(412) 560-3300
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CALCULATION OF REGISTRATION FEE
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Proposed Maximum Proposed Maximum Amount of
Amount to be Offering Price Per Aggregate Offering Registration
TITLE OF SECURITIES TO BE REGISTERED Registered Share(2) Price(2) Fee(2)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
COMMON STOCK, PAR VALUE $.01 PER SHARE
The Carbide/Graphite Group, Inc. Savings 100,000 shares $19.625 $1,962,500 $677
Investment Plan (1)
===========================================================================================================================
</TABLE>
(1) In addition, pursuant to Rule 416(c) under the Securities Act of 1933,
this registration statement also covers an indeterminate amount of
interests to be offered or sold pursuant to the employee benefit plan
described herein. Pursuant to Rule 457(h)(2), a separate fee is not
required with respect to the plan interests.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(h). The fee is calculated on the basis of the average
of the high and low sale prices of the registrant's Common Stock reported
on the Nasdaq National Market on November 22, 1996.
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This Registration Statement on Form S-8 (the "Registration Statement") of The
Carbide/Graphite Group, Inc. (the "Corporation") relates to (i) the
registration of the offer and sale of up to an aggregate of 100,000 shares of
the Corporation's Common Stock, par value $.01 per share ("Common Stock"),
pursuant to The Carbide/Graphite Group, Inc. Savings Investment Plan (the
"Plan") and (ii) the registration of an indeterminate number of interests in
the Plan .
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by the Corporation with the Securities and
Exchange Commission (the "Commission") are incorporated by reference into this
Registration Statement.
1. The Corporation's Form 10-K, filed with the Commission for
the fiscal year ended July 31, 1996.
2. The Corporation's Form 11-K, filed with the Commission for
the Plan fiscal year ended December 31, 1995.
3. The Corporation's Form 8-K, dated September 23, 1996.
4. The description of the Corporation's Common Stock contained in
the Corporation's Registration Statement on Form 8-A filed on September 12, 1995
under Section 12(g) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), including all amendments and reports updating such description.
All documents subsequently filed by the Corporation and the Plan with the
Commission pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act
after the date of this Registration Statement, but prior to the filing of a
post-effective amendment to this Registration Statement which indicates that
all securities offered by this Registration Statement have been sold or which
deregisters all such securities then remaining unsold, shall be deemed to be
incorporated by reference into this Registration Statement. Each document
incorporated by reference into this Registration Statement shall be deemed to
be a part of this Registration Statement from the date of the filing of such
document with the Commission until the information contained therein is
superseded or updated by any subsequently filed document which is incorporated
by reference into this Registration Statement or by any document which
constitutes part of the prospectus relating to the Plan meeting the
requirements of Section 10(a) of the Securities Act of 1933, as amended (the
"Securities Act").
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 102(b)(7) of the Delaware General Corporation Law (the "DGCL") permits
a corporation, in its certificate of incorporation, to limit or eliminate the
liability of a director to the corporation or its stockholders for monetary
damages for breaches of fiduciary duty, except for liability for (i) any breach
of the director's duty of loyalty to the corporation or its stockholders, (ii)
acts or omissions not in good faith or which involve intentional misconduct or
a knowing violation of law, (iii) any matter in respect of which such director
shall be liable under Section 174 of the DGCL or any amendment thereto or
successor provision thereof, or (iv) any transaction from which the director
derived an improper personal benefit. The Corporation's Certificate of
Incorporation provides that the personal liability of directors of the
Corporation is eliminated to the fullest extent permitted by Section 102(b)(7)
of the DGCL. If the DGCL is amended to authorize further elimination or
limitation of liability of directors, then the liability of a director of the
Corporation shall be eliminated to the fullest extent permitted by the DGCL.
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Under Section 145 of the DGCL, a corporation has the power to indemnify
directors and officers under certain prescribed circumstances and, subject to
certain limitations, against certain costs and expenses, including attorneys'
fees, actually and reasonably incurred in connection with any action, suit or
proceeding, whether civil, criminal, administrative or investigative, to which
any of them is a party by reason of his being a director or officer of the
corporation if it is determined that he acted in accordance with the applicable
standard of conduct set forth in such statutory provision. Article VII of the
Corporation's Restated By-Laws provides that the Corporation, to the full
extent permitted, and in the manner required, by the laws of the State of
Delaware, shall indemnify any person who was or is made a party to or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding (including any appeal thereof), whether civil, criminal,
administrative, regulatory or investigative in nature (other than an action by
or in right of the Corporation) by reason of the fact such person is or was a
director or officer of the Corporation, or, if at a time when he or she was a
director or officer of the Corporation, is or was, either serving at the
request of, or to represent the interests of, the Corporation as a director,
officer, partner, trustee, fiduciary, employee or agent (a "Subsidiary
Officer") of another corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise (an "Affiliated Entity"), against expenses
(including attorneys' fees and disbursements), costs, judgments, fines,
penalties and amounts paid in settlement actually and reasonably incurred by
such person in connection with such action, suit or proceeding if such person
acted in good faith and in a manner which such person reasonably believed to be
in the best interests of the Corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his or her conduct was
unlawful.
With respect to any action, suit or proceeding, by or in the right of the
Corporation, the Corporation's Restated By-Laws provide that the Corporation,
to the full extent permitted, and in the manner required, by the laws of the
State of Delaware, shall indemnify any person who was or is made a party to or
is threatened to be made a party to any threatened, pending or completed action
or suit (including any appeal thereof) by reason of the fact that such person
is or was a director or officer of the Corporation, is or was serving at the
request of, or to represent the interests of, the Corporation as a Subsidiary
Officer of an Affiliated Entity against expenses (including attorneys' fees and
disbursements) and costs actually and reasonably incurred by such person in
connection with the defense or settlement of such action or suit if such person
acted in good faith and in a manner such person reasonably believed to be in or
not opposed to the best interests of the Corporation, except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the Corporation
unless, and only to the extent that, the Court of Chancery of the State of
Delaware or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses and costs as the Court of Chancery of the State of
Delaware or such other court shall deem proper.
The Corporation maintains directors' and officers' liability insurance.
ITEM 8. EXHIBITS.
The following exhibits are filed herewith or incorporated by reference as part
of this Registration Statement:
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EXHIBIT NO. DESCRIPTION
----------- ----------------------------------------------------------------------------------
<S> <C>
4.1 Form of Restated Certificate of Incorporation of the Corporation (incorporated
herein by reference to Exhibit 3.1 to the Corporation's Registration Statement on
Form S-1, No. 33-91102)
4.2 Form of Restated By-Laws of the Corporation (incorporated herein by reference to
Exhibit 3.2 to the Corporation's Registration Statement on Form S-1, No. 33-
91102)
4.3 The Carbide/Graphite Group, Inc. Savings Investment Plan (filed herewith)
23.1 Consent of Coopers & Lybrand L.L.P. (filed herewith)
24.1 Power of Attorney (set forth on signature page of this Registration Statement)
</TABLE>
The registrant will submit or has submitted the Plan and any amendment thereto
to the Internal Revenue Service ("IRS") in a timely manner and has made or will
make all changes required by the IRS to qualify the Plan.
II - 2
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ITEM 9. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(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
Securities Exchange Act of 1934 that are incorporated by reference in
the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 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 advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
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SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Pittsburgh, Commonwealth of
Pennsylvania, on this 26th day of November, 1996.
The Carbide/Graphite Group, Inc.
By: /s/ Nicholas T. Kaiser
-------------------------------------
Nicholas T. Kaiser
President and Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned directors
and officers of The Carbide/Graphite Group, Inc. hereby constitutes and
appoints Nicholas T. Weaver and Stephen D. Weaver, and each of them, his true
and lawful attorneys-in-fact and agents, for him and in his name, place and
stead, in any and all capacities, to sign one or more amendments to this
Registration Statement on Form S-8 under the Securities Act of 1933, including
post-effective amendments and other related documents, and to file the same
with the Securities and Exchange Commission under said Act, hereby granting
power and authority to do and perform any and all acts and things requisite and
necessary to be done in and about the premises, as fully as to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents may lawfully do or cause to be done by
virtue hereof
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement and the foregoing Power of Attorney have been signed by
the following persons in the capacities indicated on November 26, 1996:
<TABLE>
<CAPTION>
Signature Title
<S> <C>
/s/ Nicholas T. Kaiser* Chairman of the Board, Chief Executive Officer, President
- ----------------------------- and Director (Principal Executive Officer)
Nicholas T. Kaiser
/s/ Ronald N. Clawson* President-Carbide Products Division and Director
- -----------------------------
Ronald N. Clawson
/s/ Walter B. Fowler* President-Electrodes and Graphite Speciality Products
- ----------------------------- Division and Director
Walter B. Fowler
/s/ Stephen D. Weaver Vice President-Finance and Chief Financial Officer
- ----------------------------- (Principal Financial Officer)
Stephen D. Weaver
/s/ Jeffrey T. Jones Controller-Corporate Finance (Principal Accounting
- ----------------------------- Officer)
Jeffrey T. Jones
/s/ James G. Baldwin* Director
- -----------------------------
James G. Baldwin
/s/ Paul F. Balser* Director
- -----------------------------
Paul F. Balser
Director
- -----------------------------
James R. Ball
Director
- -----------------------------
Ronald B. Kalich
/s/ Robert M. Howe* Director
- -----------------------------
Robert M. Howe
- -----------------------------
* Signatures representing a majority of the
Company's Board of Directors
</TABLE>
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SIGNATURES
The Plan. Pursuant to the requirements of the Securities Act of 1933,
the administrator of The Carbide/Graphite Group, Inc. Savings Investment Plan
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Pittsburgh, Commonwealth
OF Pennsylvania, on November 26, 1996.
THE CARBIDE/GRAPHITE GROUP, INC.
SAVINGS INVESTMENT PLAN
By: /s/ Walter E. Damian
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Walter E. Damian
Plan Administrator
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EXHIBIT INDEX
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SEQUENTIAL
EXHIBIT PAGE
NO. DESCRIPTION NUMBER
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<S> <C> <C>
4.1 Form of Restated Certificate of Incorporation (incorporated
herein by reference to Exhibit 3.1 to the Corporation's
Registration Statement on Form S-1, No. 33-91102)
4.2 Form of Restated Bylaws (incorporated herein by reference
to Exhibit 3.2 to the Corporation's Registration Statement
on Form S-1, No. 33-91102)
4.3 The Carbide/Graphite Group, Inc. Savings Plan
23.1 Consent of Coopers & Lybrand L.L.P.
24.1 Power of Attorney (set forth on signature page to this
Registration Statement)
</TABLE>
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EXHIBIT 4.3
<PAGE> 2
Exhibit 4.3
The Carbide/Graphite Group, Inc.
Savings Investment Plan
as amended and restated effective May 1, 1996
(except as otherwise provided herein)
<PAGE> 3
PREAMBLE
Effective as of August 1, 1988, The Carbon/Graphite Group, Inc. Savings
Investment Plan (the "Plan") was established by Carbon/Graphite Group, Inc.
(the "Company") for the benefit of eligible employees. This Plan is intended to
encourage savings on the part of the employees by furnishing them an incentive
through matching a portion of their savings with Company contributions, to
supplement retirement benefits by permitting employees to share in the
Company's profits, and to provide tax-sheltered income and appreciation on
invested assets and tax deferral on Company contributions. The Plan is intended
to be a profit sharing plan.
The Plan was amended effective January 1, 1990, January 1, 1992 and May 26,
1992, and was amended and restated, effective January 1, 1989, except as
otherwise provided therein, to reflect the requirements of the Tax Reform Act
of 1986 and for certain other purposes, including the change of the name of the
Company to The Carbide/Graphite Group, Inc. and the change of the name of the
Plan to The Carbide/Graphite Group, Inc. Savings Investment Plan.
Effective as of May 1, 1996, except as otherwise provided herein, the Plan is
amended and restated in its entirety as hereinafter set forth.
The Plan applies to persons in the employment of the Company and certain of its
subsidiaries and affiliates on or after May 1, 1996 (except as otherwise
provided herein) and to transactions under the Plan on and after such date. The
terms and provisions of the Plan as in effect prior to May 1, 1996 fix and
determine the rights and obligations with respect to Members whose employment
terminated before May 1, 1996.
The amendment of the Plan in its entirety is intended to comply with the
provisions of Section 401(a) of the Internal Revenue Code and applicable
regulations thereunder, and the adoption of the provisions of the Plan with
respect to Tax Deferred Contributions is intended to comply with the
requirements of Section 401(k) of the Internal Revenue Code and applicable
regulations thereunder, and such amendment is expressly conditioned upon
receipt of a favorable determination letter from the Internal Revenue Service
with respect to the Plan as set forth in this document.
(i)
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THE CARBIDE/GRAPHITE GROUP, INC.
SAVINGS INVESTMENT PLAN CONTENTS
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Page
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<S> <C> <C> <C>
ARTICLE 1 Definitions........................................................... 1
ARTICLE 2 Eligibility and Membership............................................ 8
ARTICLE 3 Contributions......................................................... 10
ARTICLE 4 Limitations on Contributions.......................................... 23
ARTICLE 5 Investment of Contributions........................................... 27
ARTICLE 6 Valuation of Member's Accounts........................................ 30
ARTICLE 7 Vesting............................................................... 31
ARTICLE 8 Withdrawals During Employment......................................... 32
ARTICLE 9 Distributions on Termination of Employment............................ 36
ARTICLE 10 Administration of the Plan............................................ 38
ARTICLE 11 Adoption and Amendment of the Plan.................................... 42
ARTICLE 12 Discontinuance of the Plan............................................ 43
ARTICLE 13 Participation in the Plan by Subsidiaries or Affiliates............... 45
ARTICLE 14 Loans................................................................. 46
ARTICLE 15 In Event Plan Becomes Top-Heavy....................................... 48
ARTICLE 16 General Provisions.................................................... 52
</TABLE>
(ii)
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ARTICLE 1
DEFINITIONS
As used herein, the following terms shall have the following respective
meanings, unless a different meaning is required by the context. Some of the
words and phrases used in the Plan are not defined in this Article 1, but for
convenience are defined as they are introduced into the text.
1.1 "Accounts" means a Member's Employee Regular Contributions Account, Tax
Deferred Contributions Account, Company Profit-Sharing Contributions
Account, Company Matching Contributions Account, Prior Company Matching
Contributions Account, effective January 1, 1990, Rollover Account, and
Qualified Contribution Account or any subaccount thereof, as the context
requires.
1.2 "Additional Savings Account" means the separate subaccount maintained
within the Employee Regular Contributions Account or the Tax Deferred
Contributions Account of a Member to reflect such Member's share of the
Trust Fund attributable to contributions made by and on behalf of the
Member, which contributions are not eligible for Company Matching
Contributions pursuant to Section 3.5, or any subaccount thereof, as the
context requires.
1.3 "Administrator" means the plan administrator referred to in Article 10.
1.4 "Appropriate Form" means the form provided or prescribed by the
Administrator for the particular purpose.
1.5 "Basic Savings Account" means the separate subaccount maintained within
the Employee Regular Contributions Account or the Tax Deferred
Contributions Account of a Member to reflect such Member's share of the
Trust Fund attributable to contributions made by and on behalf of the
Member, which contributions are eligible for Company Matching
Contributions pursuant to Section 3.5, or any subaccount thereof, as the
context requires.
1.6 "Beneficiary" means such beneficiary as may be designated from time to
time by the Member, on the Appropriate Form (or in such manner as the
Administrator may prescribe), to receive any benefit payable in the
event of death.
Notwithstanding anything in this Section 1.6 to the contrary, the
Beneficiary of a married Member shall automatically be the Member's
surviving spouse unless the spouse consents in writing to the
designation of another Beneficiary (or the consent of the spouse
expressly permits designations by the Member without any requirement of
further consent by the spouse), and the spouse's consent acknowledges
the effect of such election and is witnessed by a notary public or a
Plan representative. If spousal consent cannot be obtained because the
spouse cannot be located or because of other circumstances which may be
provided by applicable law and those facts have been established to the
satisfaction of the Administrator, then consent is deemed to have been
obtained. Any consent or deemed consent with respect
1
<PAGE> 6
to a spouse which satisfies these requirements shall be effective only
with respect to such spouse, and may not be revoked by such spouse with
respect to the election designation or other action to which such
consent pertains.
Any Beneficiary so designated may be changed by the Member at any time
(subject to his spouse's consent, if applicable) by signing and filing
the Appropriate Form with the Committee (or by notifying the Committee
in such manner as the Committee may prescribe). In the event that no
Beneficiary had been designated or that no designated Beneficiary
survives the Member, the following Beneficiaries (if then living) shall
be deemed to have been designated in the following priority: (1) spouse,
(2) children, including adopted children, in equal shares, per stirpes,
(3) parents, in equal shares, (4) the persons(s) designated as
beneficiary under any group life insurance maintained by the Company,
and (5) the Member's estate.
1.7 "Board of Directors" means the Board of Directors of the Corporation.
1.8 "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
1.9 "Committee" means the Administrative Committee or such other committee
appointed by the Board of Directors to be responsible for the
administration of the Plan in accordance with Article 10.
1.10 "Company" means the Corporation with respect to its Employees and any
member of the Group to which this Plan may be made applicable in
accordance with Section 13.1 with respect to its Employees.
1.11 "Company Matching Contributions" means the Company contributions made to
the Trust Fund pursuant to Section 3.5.
1.12 "Company Matching Contributions Account" means the separate account for
each Member which shall reflect such Member's share of the Trust Fund
attributable to Company Matching Contributions made on such Member's
behalf.
1.13 "Company Profit-Sharing Contributions" means the Company contributions
made to the Trust Fund pursuant to Section 3.7.
1.14 "Company Profit-Sharing Contributions Account" means the separate
account for each Member which reflect such Member's share of the Trust
Fund attributable to Company Profit-Sharing Contributions made on such
Member's behalf.
1.15 "Compensation" means total compensation in each payroll period before
reduction under Section 3.1 and before reduction for any before-tax
contributions pursuant to Section 125 of the Code made under any plan
maintained by the Company providing for such reductions. In addition,
the Committee may determine, on a basis consistent with the Plan, that
some or all compensation payable by a company which is a member of the
Group shall be Compensation for purposes of the Plan. Effective for
calendar years beginning after
2
<PAGE> 7
December 31, 1988 and ending prior to January 1, 1994, Compensation with
respect to a Member for all payroll periods in any calendar year shall
be limited to $200,000, and thereafter shall be limited to $150,000,
subject to adjustment as provided in Section 401(a)(17) of the Code. In
determining the compensation of an employee, the rules of Section
414(q)(6) shall apply, except that in applying such rules, the term
"family" shall include only the spouse of the employee and any lineal
descendants of the employee who have not attained age 19 before the
close of the year. If, as a result of the application of such rules, the
adjusted dollar limitation of Section 401(a)(17) of the Code applicable
to family members is exceeded, then such limitation shall be prorated
among the affected individuals in proportion to each such individual's
Compensation as determined under this Section prior to the application
of the limitation.
1.16 "Continuous Service" means the aggregate of all periods of employment as
an employee with any member of the Group, whether or not consecutive,
including such employment before the Effective Date, and counting as a
complete month any month in which an employee is paid, or entitled to
payment, for the performance of duties.
"Continuous Service" shall include (i) a period of up to 12 months of
absence from employment for any reason other than because of quit,
retirement, death or discharge and (ii) the period from the date an
employee quits, retires or is discharged if he returns to employment
with any member of the Group within 12 months of such quit, retirement
or discharge. Service also shall include (i) such period of service in
the armed forces of the United States as shall be required to be
recognized under applicable federal law with respect to military
service, (ii) any unpaid leave taken pursuant to the Family and Medical
Leave Act of 1993 or similar state laws (to the extent required by such
laws, but only to the extent such leave is not otherwise credited under
this Section 1.16) and also any employment as a leased employee within
the meaning of Section 414(n) of the Code.
Solely for determining participation under Article 2 and vesting under
Article 7, "Continuous Service" shall also include employment, whether
or not consecutive, with The BOC Group, Inc. prior to August 1, 1988.
An Employee's leave of absence from work for maternity/paternity reasons
means an absence by reason of (i) the pregnancy of the Employee (ii) the
birth of the Employee's child or (iii) the placement of a child with the
Employee in connection with the adoption of such child by such Employee,
or (iv) caring for such child for a period immediately following such
birth or placement. Such absence shall be counted as Continuous Service
up until the first anniversary of the Employee's absence. Continued
absence beyond that first anniversary shall not be counted as Continuous
Service. However, continued absence during the twelve month period
immediately following the first anniversary of an absence due to the
above-mentioned causes shall not be included as part of the sixty
consecutive months of separation mentioned in Section 7.4.
1.17 "Corporation" means The Carbide/Graphite Group, Inc. as now constituted
or as may be constituted hereafter, or any person, firm, corporation or
partnership which may succeed to its business by merger, purchase or
otherwise.
3
<PAGE> 8
1.18 "Custodian" means any person, or any firm or corporation qualified so to
act, which the Corporation appoints pursuant to Section 10.7 hereof to
hold assets of the Plan.
1.19 "Disability" means permanent and total disability which renders a Member
permanently unable to perform his duties satisfactorily.
1.20 "Effective Date" means August 1, 1988, or such later date on which the
Plan is made applicable in accordance with Section 13.1.
1.21 "Employee" means a person in the employ of the Company or subsidiary;
provided, however, that a person shall not be considered an Employee for
purposes of this Plan if:
(a) such person is a leased employee within the meaning of Section
414(n) of the Code;
(b) such person is a member of a collective bargaining unit for which
retirement benefits were the subject of good faith bargaining
between the Company and the representatives of such unit unless
eligibility for participation in this Plan is provided for by an
agreement between the Company and such representative; or
(c) such person is in an employment classification or is employed by an
operating unit of the Company which the Board of Directors has
excluded from eligibility for membership in the Plan.
1.22 "Employee Regular Contributions" means those contributions made by a
Member pursuant to Section 3.2.
1.23 "Employee Regular Contributions Account" means (i) the separate Account
for each Member which shall reflect such Member's share of the Trust
Fund attributable to such Member's Employee Regular Contributions, and
(ii) pursuant to Section 16.14, any transfers of a Member's account
attributable to Employee Regular Contributions made to The BOC Group,
Inc. Savings Investment Plan, including any subaccounts that may be
established.
1.24 "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
1.25 "Family Member" means an Employee who, during a determination year or
look-back year, is the spouse, lineal ascendant or lineal descendant (or
spouse of such lineal ascendants or descendants) of an Employee or
former Employee who is either (i) a 5% owner (as defined in Section
416(i)(1) of the Code) with respect to any member of the Group; or (ii)
a Highly Compensated Employee who is one of the 10 most highly
compensated Employees ranked on the basis of Section 414(q) compensation
during such year.
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1.26 "Group" means the Corporation and any other company which is related to
the Corporation as a member of a controlled group of corporations in
accordance with Section 414(b) of the Code or as a trade or business
under common control in accordance with Section 414(c) of the Code, any
organization which is part of an affiliated service group in accordance
with Section 414(m) of the Code, or any entity required to be aggregated
with the Corporation in accordance with Section 414(o) of the Code and
the regulations thereunder. For purposes under the Plan of determining
whether or not a person is an Employee and the period of employment of
such person, each such other company shall be included in the "Group"
only for such period or periods during which such other company is so a
member of a controlled group, under common control, an affiliated
service group or otherwise required to be aggregated.
1.27 "Highly Compensated Employee" means an individual determined in
accordance with Section 414(q) of the Code, and with such rules and
regulations as shall be promulgated by the Internal Revenue Service
pursuant to such Section, and shall mean an Employee who, at any time
during the Plan Year being tested (the "determination year") or the
twelve-month period immediately preceding the determination year (the
"look-back year") (i) was a 5% owner (as defined in Section 416(i)(1) of
the Code) with respect to a Company or a member of the Group, (ii)
earned more than $54,480 of Section 414(q) compensation (as defined in
Section 414(q)(7) of the Code) and was among the "top-paid group" (as
defined in Section 414(q)(4) of the Code), (iii) earned more than
$81,720 of Section 414(q) compensation, or (iv) was one of the fifty
highest-paid officers who earned more than $49,032 of Section 414(q)
compensation (or, if greater, an amount equal to 50% of the defined
benefit plan dollar limit in effect under Section 415(b)(1)(A) of the
Code with respect to such year). For purposes of this Section 1.27, the
$54,480 and $81,720 amounts are to be indexed at the same time and in
the same manner as is the dollar limit applicable to defined benefit
plans under Section 415 of the Code.
For purposes of the foregoing paragraph,
(a) In the case of any determination year for which an Employee is being
tested, an Employee not described in subparagraph (ii), (iii) or
(iv) above for the look-back year (without regard to this
subparagraph (a)) shall not be treated as being described in
subparagraph (ii), (iii) or (iv) above for the determination year
unless such Employee is a member of the group consisting of the 100
Employees paid the greatest Section 414(q) compensation during the
determination year; and
(b) A former Employee shall be treated as a Highly Compensated Employee
if (i) such Employee was a Highly Compensated Employee when such
Employee separated from service, or (ii) such Employee was a Highly
Compensated Employee at any time after attaining age 55.
Notwithstanding the provisions of the foregoing paragraphs, for purposes
of determining a Highly Compensated Employee, the following elections
shall apply:
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<PAGE> 10
(a) Highly Compensated Employees may, at the election of the Company, be
determined under the calendar year election method described in
Treasury Regulation Section 1.414(q)-1T, Q&A-14(b), which election
shall apply to all other plans maintained by the Company or member
of the Group; and
(b) For purposes of determining the number of Employees who are in the
"top paid group" for any determination year, the Company or a member
of the Group shall elect in accordance with Treasury Regulation
Section 1.414(q)-1T, Q&A-9(b)(2), to make such determination based
on all Employees of the Group.
1.28 "Investment Manager" means any person, firm or corporation which is
registered as an investment advisor under the Investment Advisers Act of
1940, is a bank as defined in that Act, or is an insurance company
qualified to manage, acquire or dispose of assets of a plan under the
laws of more than one State, and which the Board of Directors appoints
pursuant to Section 10.7 hereof to manage assets of the Plan.
1.29 "Member" means any Employee who becomes a participant in the Plan as
provided in Article 2. A Member shall continue as such as long as such
Member retains an interest in any Accounts. Notwithstanding the
preceding, effective January 1, 1990, Member means any Employee who
becomes a participant in the Plan as provided in Article 2. Except for
purposes of Sections 2.2, 2.3 and Article 3 under this Plan, an Employee
who has made a rollover to the Plan which meets the requirements of
Section 16.15 and for whom a Rollover Account is maintained under the
Plan shall be treated as a Member and such Employee shall become a
Member for all purposes under the Plan after meeting the requirements of
Sections 2.2 and 2.4. A Member shall continue as such as long as such
Member retains an interest in any Accounts.
1.30 "Normal Retirement Age" means a Member's attainment of age 65.
1.31 "Plan" means The Carbide/Graphite Group, Inc. Savings Investment Plan as
in effect on August 1, 1988 and herein set forth, or as it may be
amended from time to time.
1.32 "Plan Year" means the period from January 1 through December 31, except
that the first Plan Year shall mean the period from August 1, 1988 to
December 31, 1988.
1.33 "Prior Company Matching Contributions" means the Company matching
contributions made to the BOC Group, Inc. Savings Investment Plan that
are transferred to the Trust Fund pursuant to Section 16.14.
1.34 "Prior Company Matching Contributions Account" means an Account
established to reflect pursuant to Section 16.14 any transfers of a
Member's account attributable to Company Matching Contributions from the
BOC Group, Inc. Savings Investment Plan, including any subaccounts that
may be established.
1.35 "Qualified Contribution" means a Company contribution made to the Trust
Fund pursuant to Section 4.5.
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1.36 "Qualified Contribution Account" means the separate Account maintained
for a Member to record his share of the Trust Fund attributable to
Qualified Contributions made on his behalf.
1.37 "Retirement" means termination of employment after a Member's attainment
of Normal Retirement Age.
1.38 "Rollover Account" means the separate Account maintained for a Member to
record his share of the Trust Fund attributable to a rollover meeting
the requirements of Section 16.15, effective as of January 1, 1990.
1.39 "Tax Deferred Contributions" means those contributions made by the
Company on a Member's behalf pursuant to an election by the Member to
reduce the Member's otherwise payable compensation, in accordance with
the provisions of Section 3.1.
1.40 "Tax Deferred Contributions Account" means (i) the separate account for
each Member which shall reflect such Member's share of the Trust Fund
attributable to Tax Deferred Contributions made on such Member's behalf,
and (ii) pursuant to Section 16.14, any transfers of a Member's account
attributable to Tax Deferred Contributions to The BOC Group, Inc.
Savings Investment Plan, including any subaccounts that may be
established.
1.41 "Transaction Date" means the first day of any month; however, payroll
deductions will commence with the first pay date on or after such date.
1.42 "Trust Agreement" means the trust agreement between the Corporation and
the Trustee, established for the purpose of funding benefits under the
Plan, or any successor trust agreement or agreements.
1.43 "Trust Fund" means the aggregate funds held by the Trustee under this
Plan, consisting of Funds A, B, C, D, E, F, G and Has described in
Article 5.
1.44 "Trustee" means the Trustee or Trustees appointed pursuant to Article 10
which at any time is acting as such under this Plan.
1.45 "Valuation Date" means any business date during a Plan Year and any
other date the Company may designate. In the event of market conditions
inconsistent with the daily valuation procedures adopted for the Plan,
the Company reserves the right to process Plan transactions in a manner
consistent with corresponding actual market transactions.
1.46 "Value" means, when used to refer to the interest of a Member in the
Trust Fund on any date, the value thereof determined as of the next
Valuation Date in accordance with Section 6.1 or such other Valuation
Date which may be specified under the applicable provisions.
1.47 The use of the masculine pronoun shall include the feminine and the
singular shall include the plural.
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ARTICLE 2
ELIGIBILITY AND MEMBERSHIP
2.1 Each Employee who was a Member of the Plan on April 30, 1996, shall
remain a Member of the Plan on May 1, 1996.
2.2 Each other Employee shall become a Member as of the Transaction Date
coincident with or following the third monthly anniversary of the date
such person was first employed by the Group.
2.3 Each eligible Employee who is a Member may elect to make Employee
Regular Contributions or to have Tax Deferred Contributions made on his
behalf by giving prior notice to the Administrator on the Appropriate
Form (or by notifying the Administrator in such manner as the
Administrator may prescribe), within the time period prescribed by the
Administrator, on which the following shall be designated: (i) the rate
of Employee Regular Contributions elected to be contributed by the
Employee pursuant to Section 3.2, and authorization for the Company to
make regular payroll deductions of such Employee Regular Contributions,
(ii) authorization for the Company to reduce the Member's cash
compensation by the amount of the Tax Deferred Contribution the Member
elects to have contributed to the Plan on his behalf pursuant to Section
3.1, (iii) investment elections pursuant to Section 5.2, and (iv)
designation of a Beneficiary. Any such payroll authorization or
investment election shall remain in effect until changed by notice given
to the Administrator on the Appropriate Form or in such manner as the
Administrator may prescribe, within the time period prescribed by the
Administrator, in advance of the date the change is to take effect.
2.4 A Member who ceases to be an Employee but continues in the employment of
the Group shall be a suspended Member (until the resumption of such
suspended Member's status as an Employee), subject to the following
conditions:
(a) During the period of suspension, the Member may not make Employee
Regular Contributions or have Tax Deferred Contributions, Company
Matching Contributions or Company Profit-Sharing Contributions made
on his behalf under the Plan.
(b) During the period of suspension, the Member's Continuous Service
with the Group shall be counted for purposes of Article 7.
(c) If, during the period of suspension, the suspended Member's
employment is terminated for any reason, there shall be a
distribution of Accounts in accordance with the provisions of
Article 9.
(d) If, and when, a suspended Member again becomes an Employee, such
Member may resume making Employee Regular Contributions, and may
resume having Tax Deferred Contributions, Company Matching
Contributions, and Company Profit-
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Sharing Contributions made on his behalf, as of the next Transaction
Date thereafter, by giving prior notice to the Administrator on the
Appropriate Form or in such manner as the Administrator may
prescribe (within the time period prescribed by the Administrator)
prior to such Transaction Date.
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<PAGE> 14
ARTICLE 3
CONTRIBUTIONS
3.1 (a) Subject to the limitations prescribed in Sections 3.8 and 4.2 and
the provisions of Section 8.2, a Member may elect to have the cash
compensation otherwise payable by the Company but not yet paid after
the effective date of such election reduced and have the Company, in
lieu of paying the full amount of cash compensation otherwise
payable, make contributions to the Trustee as soon as practicable in
an amount equal to such reduction for credit to such Member's Tax
Deferred Contributions Account. Such reduction will be referred to
as Tax Deferred Contributions.
(b) Such election shall be made by filing with the Administrator on the
Appropriate Form filed with the Administrator, or in such manner as
the Administrator may prescribe, in accordance with Section 2.4,
pursuant to which such Member's Compensation shall be reduced by the
amount of Tax Deferred Contributions. The Tax Deferred Contributions
amounts shall be equal to 2%, 3% 4% 5%, 6%, 7%, 8%, 9%, 10%, 11%,
12%, 13%, 14%, 15% or 16% (or such other percentage as may be
prescribed by the Administrator) of the Member's Compensation, as
shall be agreed upon between the Member and the Company, subject to
the limitations of Sections 3.8 and 4.2. However, the amount of a
Member's Tax Deferred Contributions and Employee Regular
Contributions shall be limited so that the sum of such contributions
does not exceed 16% of the Member's Compensation.
In no event shall the aggregate of Tax Deferred Contributions (and
such other "elective deferrals", as defined in Section 402(g)(3) of
the Code and Treasury Regulation Section 1.402(g)-1(b)) made on a
Member's behalf with respect to any calendar year after 1988 exceed
$7,627 (or such higher dollar limit as may be in effect with respect
to such year in accordance with Section 402(g)(5) of the Code and
Treasury Regulation Section 1.402(g)-1(c)(1)).
3.2 (a) Subject to the limitations prescribed in Sections 3.10 and 4.2 and
the provisions of Section 8.2, a Member may elect to make Employee
Regular Contributions to the Plan in an amount equal to 2%, 3%, 4%,
5%, 6%, 7%, 8%, 9%, 10%, 11%, 12%, 13%, 14%, 15% or 16% of the
Member's Compensation, as such Member shall have designated on the
Appropriate Form filed with the Administrator, or in such manner as
the Administrator may prescribe, in accordance with Section 2.4,
within such time period as is prescribed by the Administrator.
However, the amount of a Member's Tax Deferred Contributions and
Employee Regular Contributions shall be limited so that the sum of
such contributions does not exceed 16% of the Member's Compensation.
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<PAGE> 15
(b) The Company shall deduct each Member's Employee Regular
Contributions pursuant to this Section 3.2 by means of payroll
deductions from his Compensation each payroll period and shall pay
them to the Trustee as soon as practicable to be credited to the
Member's Employee Regular Contributions Account.
3.3 As of any Transaction Date, a Member may elect to change (i) subject to
the limitations of Sections 3.10 and 4.2, the rate of Employee Regular
Contributions pursuant to Section 3.2 to any other rate permitted under
Section 3.2 or (ii) subject to the limitations of Sections 3.8 and 4.2,
the rate of Tax Deferred Contributions made pursuant to Section 3.1 to
any other rate permitted under Section 3.1. Such election shall be made
by giving prior notice to the Administrator on the Appropriate Form, or
in such manner as the Administrator may prescribe, (within the time
period prescribed by the Administrator); subject to such other frequency
limitation as the Administrator may prescribe.
3.4 (a) As of any Transaction Date, a Member may elect to suspend all Tax
Deferred Contributions made on such Member's behalf pursuant to
Section 3.1 and/or Employee Regular Contributions made pursuant to
Section 3.2, by giving prior notice to the Administrator on the
Appropriate Form, or in such manner as the Administrator may
prescribe, (within the time period prescribed by the Administrator);
subject to such other limitation as the Administrator may prescribe.
(b) Contributions pursuant to Sections 3.1 and 3.2 may be resumed as of
any Transaction Date coincident with or following at least three (3)
months (or such other limitations as the Administrator prescribe)
after the date of commencement of the voluntary suspension by giving
prior notice to the Administrator on the Appropriate Form, or in
such manner as the Administrator may prescribe, (within the time
period prescribed by the Administrator), subject to such conditions
as shall be prescribed with respect to contributions made pursuant
to Sections 3.1 and 3.2, as applicable.
3.5 (a) Subject to the limitations of Sections 3.10 and 4.2, for each
calendar month, the Company shall make Company Matching
Contributions on behalf of each Member equal to 50% of that amount
(i) which is contributed by the Company at the Member's election
pursuant to Section 3.1 and, in the case of Members who have elected
to contribute less than 6% pursuant to Section 3.1, by the Member
pursuant to Section 3.2, and (ii) which does not exceed 6% of the
Member's Compensation for the applicable pay period. Those
contributions by or on behalf of a Member that are eligible for
matching by Company Matching Contributions shall be called "Basic
Savings Contributions" and those contributions by or on behalf of a
Member that are not eligible for such matching shall be called
"Additional Savings Contributions."
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<PAGE> 16
(b) Company Matching Contributions shall be credited to the Member's
Company Matching Contributions Account, and, after being reduced by
any amounts forfeited pursuant to Section 7.3 which are then being
applied to reduce such contributions, shall be paid to the Trustee
as soon as practicable after each Valuation Date.
3.6 (a) Company Matching Contributions shall be in cash.
(b) In addition to any other Company contributions under Section 3.5,
the Company also shall make such other contributions as may be
required to restore amounts which have been forfeited under the
circumstances described in Section 7.3.
3.7 (a) With respect to each taxable year, the Corporation or any other
member of the Group may contribute under the Plan out of its
respective current or accumulated earnings and profits as a Company
Profit-Sharing Contribution, such amounts as the Board of Directors
of such company, in its absolute discretion, shall determine. This
provision shall not be construed as requiring the company to make
Company Profit-Sharing Contributions in any specific taxable year,
whether or not there exists current or accumulated earnings and
profits out of which such Company Profit-Sharing Contributions could
be made.
(b) Company Profit-Sharing Contributions made on behalf of each Member
who is an Employee during the taxable year of the Company making the
contributions, shall be based on the individual's pay rate as of
July 31 of such taxable year, provided that such Member is an
Employee on July 31 of such taxable year.
Notwithstanding the foregoing, for each Member who is an Employee on
July 31 of the taxable year but who was not an Employee on August 1
of such taxable year, any Company Profit-Sharing Contribution made
for such taxable year shall be based on the individual's pay rate as
of July 31 of such taxable year multiplied by a fraction, the
numerator of which is the number of full months during the taxable
year the Employee was employed and the denominator of which is
twelve (12).
(c) Company Profit-Sharing Contributions made pursuant to this Section
3.7 shall be allocated to the Company Profit-Sharing Account of each
eligible Member as of the October 31 Valuation Date (or such other
Valuation Date as the Committee may elect) of the taxable year with
respect to which such contributions are made.
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(d) Notwithstanding the foregoing paragraph, if any portion of the
Company Profit Sharing Contribution would cause an individual to
exceed the Annual Addition as defined in Section 4.2, the portion of
such Profit Sharing Contribution that would create such excess shall
not be contributed to the Plan.
3.8 (a) Notwithstanding the foregoing provisions of this Article 3 to the
contrary, the Committee shall limit the amount of Tax Deferred
Contributions made on behalf of each Employee who is a Highly
Compensated Employee for each Plan Year to the extent necessary to
ensure that either of the following tests is satisfied:
(i) the "Actual Deferral Percentage" (as hereinafter defined) for
the group of Employees eligible to participate under the
Plan, at any time during the Plan Year, who are Highly
Compensated Employees is not more than the Actual Deferral
Percentage of all other Employees eligible to participate
under the Plan multiplied by 1.25; or
(ii) the excess of the Actual Deferral Percentage for the group of
Employees eligible to participate under the Plan, at any time
during the Plan Year, who are Highly Compensated Employees
over that of all other Employees eligible to participate
under the Plan is not more than two percentage points, and
the Actual Deferral Percentage for the group of Employees
eligible to participate under the Plan who are Highly
Compensated Employees is not more than the Actual Deferral
Percentage of all other Employees eligible to participate
under the Plan multiplied by 2.0.
(b) For purposes of this Section 3.8, the term "Actual Deferral
Percentage" shall mean, for any specified group of Employees
eligible to participate in the Plan at any time during the Plan
Year, the average of such Employees' Deferral Percentages (as
defined below).
(c) For purposes of this Section 3.8, the term "Deferral Percentage"
means, for any Employee eligible to participate under the Plan at
any time during the Plan Year, the ratio of:
(i) the aggregate of the Tax Deferred Contributions which, in
accordance with the rules set forth in Treasury Regulation
Section 1.401(k)-1(b)(4), are in fact taken into account
with respect to such Plan Year, to
(ii) such eligible Employee's Section 414(s) compensation (as
determined under Section 414(s) of the Code and the
regulations thereunder) for such Plan Year. For this
purpose, Section 414(s) compensation shall mean cash
compensation reported on Form W-2, and shall also include
all amounts currently not included in the Employee's gross
income by reason of Sections 125 and 402(a)(8) of the Code.
In the case of an Employee who begins, resumes, or ceases to
be eligible to make Tax Deferred Contributions during a Plan
Year, the amount of Section 414(s) compensation included in
the Actual Deferral
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<PAGE> 18
Percentage test is the amount of Section 414(s) compensation
received by the Employee during the entire Plan Year.
(d) The Deferral Percentage for any Member who is a Highly Compensated
Employee for the Plan Year and who is eligible to have Tax Deferred
Contributions made on his behalf under two or more arrangements
described in Section 40l(k) of the Code that are maintained by the
Company, or a member of the Group, shall be determined as if such
Tax Deferred Contributions were made under a single arrangement.
Notwithstanding the foregoing, certain plans shall be treated as
separate if mandatorily disaggregated under Treasury Regulation
Section 1.401(k)-1(b)(3)(ii)(B).
If the Plan is permissibly aggregated or is required to be
aggregated with other plans having the same plan year, as provided
under Treasury Regulation Section 1.401(k)-1(b)(3) for purposes of
determining whether or not such plans satisfy Sections 401(k),
401(a)(4), or 410(b) of the Code, then the provisions of this
Section 3.8 shall be applied by determining the Actual Deferral
Percentage of Employees who are eligible to participate in the Plan
as if all such plans were a single plan.
(e) In determining the Deferral Percentage for a Plan Year for a Highly
Compensated Employee described in Section 414(q)(6)(A) of the Code,
the Tax Deferred Contributions and Section 414(s) compensation of
such Member shall, to the extent required under Treasury Regulation
Section 1.401(k)-1(g)(1)(ii)(C), be aggregated with the Tax
Deferred Contributions and Section 414(s) compensation of any
individual who is a Family Member. The Deferral Percentage obtained
by such aggregation shall be combined with the Deferral Percentages
of the Highly Compensated Employees who are Members in determining
the Actual Deferral Percentage for such group. Any Member or Family
Member whose Deferral Percentage is so aggregated shall not have his
Deferral Percentage separately taken into account with respect to
any group of Employees in determining the Actual Deferral Percentage
for such group.
(f) In the event it is determined prior to any payroll period that the
amount of Tax Deferred Contributions elected to be made thereafter
would cause the limitation prescribed in this Section 3.8 to be
exceeded, the amount of Tax Deferred Contributions allowed to be
made on behalf of Members who are Highly Compensated Employees
(and/or such other Members as the Committee may prescribe) shall be
reduced to a rate determined by the Committee (including a rate of
0% if the Committee so determines), and any elections of future Tax
Deferred Contributions which exceed the rate determined by the
Committee shall be deemed to be Employee Regular Contributions for
the remainder of the Plan Year, notwithstanding the limitations on
contribution rate changes in Section 3.3. Except as is hereinafter
provided, the Members to whom such reduction is applicable and the
amount of such reduction shall be determined pursuant to such
uniform and nondiscriminatory rules as the Committee shall
prescribe.
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(g) Notwithstanding the foregoing, with respect to any Plan Year in
which Tax Deferred Contributions on behalf of Members who are Highly
Compensated Employees exceed the applicable limit set forth in this
Section 3.8, the Committee may reduce the amount of the excess Tax
Deferred Contributions made on behalf of the Members who are Highly
Compensated Employees as described in the following sentence. The
Deferral Percentage of the Member who is a Highly Compensated
Employee with the highest Deferral Percentage shall be reduced to
the extent necessary to satisfy the Actual Deferral Percentage Test
or cause such percentage to equal the Deferral Percentage of the
Member who is a Highly Compensated Employee with the next highest
percentage. This process shall be repeated until the Actual Deferral
Percentage test is satisfied, in accordance with Treasury Regulation
Section 1.401(k)-1(f)(2). Such excess Tax Deferred Contributions
shall be distributed (along with earnings attributable to such
excess Tax Deferred Contributions, as determined in accordance with
subsection (h)) to the affected Members who are Highly Compensated
Employees as soon as practicable after the end of such Plan Year,
and in all events prior to the end of the next following Plan Year.
If, by application of the provisions of the preceding paragraph,
excess Tax Deferred Contributions are required to be distributed to
a Member and one or more of his Family Members whose Deferral
Percentages are required to be aggregated in accordance with Section
3.8(e), the amount of the excess Tax Deferred Contributions (and
income allocable thereto) to be distributed to each such individual
shall be determined by multiplying such excess Tax Deferred
Contributions by a fraction, the numerator of which is each such
individual's Tax Deferred Contributions for the Plan Year, and the
denominator of which is the aggregate Tax Deferred Contributions
contributed on behalf of the Member and his Family Member(s) for the
Plan Year.
(h) Income on a Member's excess Tax Deferred Contributions shall be
determined by multiplying the income allocated to his Tax Deferred
Contribution Account for the Plan Year in which such excess Tax
Deferred Contribution was made by a fraction, the numerator of which
is the excess Tax Deferred Contributions for such Member for the
Plan Year, and the denominator of which is the total Tax Deferred
Contribution Account balance for such Member as of the first day of
the Plan Year, plus the Tax Deferred Contributions made on behalf of
the Member during the Plan Year.
Upon the distribution of the excess Tax Deferred Contributions, the
amount of income required to be distributed with respect to the
period between the last day of such Plan Year and the date on which
the excess is distributed (the "gap period") shall be 10% of the
amount of income allocable to excess Tax Deferred Contributions for
such Plan Year (as determined under the preceding paragraph)
multiplied by the number of calendar months that have elapsed since
the end of the Plan Year. For purposes of determining the number of
calendar months that have elapsed since the last day of the Plan
Year, if the distribution is made on or before the 15th day of the
month, such month shall not be included, and if the distribution is
made after the 15th day of the month, such month shall be included.
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<PAGE> 20
(i) Notwithstanding any distributions or recharacterizations pursuant to
the provisions of this Section 3.8, excess Tax Deferred
Contributions shall be treated as Annual Additions for purposes of
Section 4.2.
(j) Distributions pursuant to this Section 3.8 shall be made
proportionately from the Investment Funds with respect to the
Member's Account or Accounts from which distribution is made.
(k) The Committee may, to the extent permitted under Treasury Regulation
Section 1.401(k)-1(f)(3), recharacterize as Employee Regular
Contributions for such Plan Year all or a portion of the Tax
Deferred Contributions for Members who are Highly Compensated
Employees to the extent necessary to comply with the applicable
limit set forth in this Section 3.8. Recharacterized amounts will
remain nonforfeitable and subject to the same distribution
requirements as Tax Deferred Contributions. Amounts may not be
recharacterized by a Highly Compensated Employee to the extent that
such amount, in combination with other Employee Regular
Contributions made by such Employee, would exceed the limitations
under the Plan with respect to Employee Regular Contributions.
Recharacterization shall occur no later than two and one-half months
after the last day of the Plan Year in which such excess Tax
Deferred Contributions arose.
(l) In the event that the Company elects to make a Qualified
Contribution on behalf of any or all Members in the Plan, such
Qualified Contribution, to the extent specified, shall be treated as
a Tax Deferred Contribution solely for purposes of this Section 3.8.
(m) The Committee may, in its sole discretion, elect to use any
combination of the methods described in this Section 3.8 to satisfy
the limitations contained herein; provided, however, that such
combination of methods shall be applied in a uniform and
nondiscriminatory manner.
(n) The Committee also shall take all appropriate steps to meet the
aggregate limitation test contained in Section 4.4.
3.9 (a) Notwithstanding any other provision of the Plan, Excess Deferrals
(as hereinafter defined), plus any income and minus any loss
allocable thereto for both the calendar year and the "gap period"
between the end of the calendar year and the date the distribution
is made (determined in the same manner as the method described in
Section 3.8(h)) shall be distributed to Members who claim such
allocable Excess Deferrals no later than April 15 of the calendar
year following the calendar year in which the excess occurred.
(b) For purposes of this Section 3.9, "Excess Deferrals" shall mean the
amount of a Member's Tax Deferred Contributions (and other "elective
deferrals" within the meaning of Section 402(g)(3) of the Code) for
a calendar year that the Member
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<PAGE> 21
allocates to this Plan pursuant to the claim procedure set forth in
subsection 3.9(c) hereof.
(c) A Member may make a claim for the distribution of Excess Deferrals
pursuant to the terms and conditions of this subsection (c). Such
Member's claim shall be in writing; shall be submitted to the
Committee no later than March 1 of the calendar year following the
calendar year of the Excess Deferrals; shall specify the amount of
the Member's Excess Deferrals for the preceding calendar year; and
shall be accompanied by (i) the Member's written statement that if
such amounts are not distributed, such Excess Deferrals, when added
to amounts deferred under other plans or arrangements described in
Sections 401(k), 408(k) or 403(b) or 501(c)(18) of the Code, exceeds
the limit imposed on the Member in accordance with the applicable
provisions of the Code for the year in which the deferral occurred
and (ii) such documentation as the Committee, in its sole
discretion, shall require to substantiate the Member's written
statement. The Committee may, on a uniform and nondiscriminatory
basis, automatically deem the Member to have made a claim for a
distribution of Excess Deferrals if such excess arises by taking
into account only those elective deferrals made to this Plan and any
other plans of the Company and any member of the Group.
(d) The Excess Deferrals distributed to a Member with respect to a
calendar year shall be adjusted for income and, if there is a loss
allocable to the Excess Deferrals, shall in no event exceed the
lesser of the Member's Tax Deferred Contributions Account under the
Plan or the Member's Tax Deferred Contributions for the year.
(e) Excess Deferrals shall be treated as annual additions under the
Plan, unless such amounts are distributed no later than the first
April 15th following the close of the Member's taxable year in which
such excess occurred.
3.10 (a) Notwithstanding the foregoing provisions of this Article 3, the
Committee shall limit the amount of Employee Regular Contributions
and Company Matching Contributions made by or on behalf of each
Highly Compensated Employee who is eligible to participate in the
Plan for each Plan Year, to the extent necessary to ensure that
either of the following tests is satisfied:
(i) the "Actual Employee Regular and Company Matching
Contribution Percentage" (as hereinafter defined) for the
group of Highly Compensated Employees who are eligible to
participate under the Plan is not more than the Actual
Employee Regular and Company Matching Contribution
Percentage of all other Employees eligible to participate
under the Plan multiplied by 1.25; or
(ii) the excess of the Employee Regular and Company Matching
Contribution Percentage for the group of Highly Compensated
Employees who are eligible to participate under the Plan
over that of all other Employees eligible to participate
under the Plan is not more than two percentage points, and
the Employee Regular and Company Matching Contribution
Percentage for the
17
<PAGE> 22
group of Highly Compensated Employees eligible to
participate under the plan is not more than the Actual
Employee Regular and Company Matching Contribution
Percentage of all other Employees eligible to participate
under the Plan multiplied by 2.0.
(b) For purposes of this Section 3.10, the term "Actual Employee Regular
and Company Matching Contribution Percentage" shall mean, for a
specified group of Employees who are eligible to participate under
the Plan for each Plan Year, the average of such Employee Regular
and Company Matching Contribution Percentage (as defined below).
(c) For purposes of this Section 3.10, the term "Employee Regular and
Company Matching Contribution Percentage" means for any Employee
eligible to participate in the Plan at any time during the Plan
Year, the ratio of:
(i) the aggregate of the Employee Regular Contributions
(including amounts recharacterized pursuant to Section 3.8)
and Company Matching Contributions (which, in accordance
with the rules set forth in Treasury Regulation Section
1.401(m)-1(b)(4), are taken into account with respect to
such Plan Year), to
(ii) such eligible Employee's Section 414(s) compensation (as
determined under Section 3.8 of the Plan) for such Plan
Year. In the case of an Employee who begins, resumes, or
ceases to be eligible to make Employee Regular Contributions
or have Company Matching Contributions made on his behalf
during a Plan Year, the amount of Section 414(s)
compensation included in the Employee Regular and Company
Matching Contribution Percentage test is the amount of
Section 414(s) compensation received by the Employee during
the entire Plan Year.
(d) The Employee Regular and Company Matching Contribution Percentage
for a Member who is a Highly Compensated Employee for the Plan Year
and who is eligible to make after-tax contributions, or to have
matching employer contributions (within the meaning of Section
40l(m)(4)(A) of the Code) made on his behalf under two or more plans
described in Section 40l(a) of the Code, or arrangements described
in Section 40l(k) of the Code, that are maintained by the Company or
a member of the Group, shall be determined as if the total of such
after-tax contributions and matching contributions were made under a
single arrangement. Notwithstanding the foregoing, certain plans
shall be treated as separate if mandatorily disaggregated under
Treasury Regulation Section 1.401(m)-1(b)(3)(ii).
If the Plan is permissibly aggregated or is required to be
aggregated with other plans having the same plan year, as provided
under Treasury Regulation Section 1.401(m)-1(b)(3) for purposes of
determining whether or not such plans satisfy Sections 401(m),
401(a)(4), or 410(b) of the Code, then the provisions of this
Section 3.10 shall be applied by determining the Actual Employee
Regular and Company Matching
18
<PAGE> 23
Contribution Percentage of Employees who are eligible to participate
in the Plan as if all such plans were a single plan.
(e) In determining the Actual Employee Regular and Company Matching
Contribution Percentage of a Member who is a Highly Compensated
Employee, Employee Regular Contributions, Company Matching
Contributions and the Section 414(s) compensation of such Member
shall, to the extent required under Treasury Regulation Section
1.401(m)-1(f)(1)(ii)(C), include Employee Regular Contributions and
Company Matching Contributions made by and on behalf of, and the
Section 414(s) compensation of, any individual who is a Family
Member. The Employee Regular and Company Matching Contribution
Percentage obtained by such aggregation shall be combined with the
Employee Regular and Company Matching Contribution Percentages of
the applicable group of Highly Compensated Employees in determining
the Actual Employee Regular and Company Matching Contribution
Percentage for such group. Any Member or Family Member whose
Employee Regular and Company Matching Contribution Percentage is so
aggregated shall not have his Employee Regular and Company Matching
Contribution Percentage separately taken into account with respect
to any group of Employees in determining the Actual Employee Regular
and Company Matching Contribution percentage for such group.
(f) In the event it is determined prior to any payroll period that the
amount of Employee Regular Contributions and Company Matching
Contributions to be made thereafter would cause the limitation
prescribed in this Section 3.10 to be exceeded, the amount of such
contributions allowed to be made by or on behalf of Members who are
Highly Compensated Employees (and/or such other Members as the
Committee may prescribe) shall be reduced to a rate determined by
the Committee (including a rate of 0% if the Committee so
determines), notwithstanding the limitations on contribution rate
changes in Section 3.3. Except as is hereinafter provided, the
Members to whom such reduction is applicable and the amount of such
reduction shall be determined pursuant to such uniform and
nondiscriminatory rules as the Committee shall prescribe.
(g) Notwithstanding the foregoing, with respect to any Plan Year in
which Employee Regular Contributions and Company Matching
Contributions made by or on behalf of Highly Compensated Employees
exceed the applicable limit set forth in this Section 3.10, the
Committee may reduce the amount of Employee Regular Contributions
and Company Matching Contributions made by or on behalf of the
Members who are Highly Compensated Employees as described in the
following sentence. The Employee Regular Contributions and Company
Matching Contribution Percentage of the Member who is a Highly
Compensated Employees with the highest Employee Regular Contribution
and Company Matching Contribution Percentage shall be reduced to the
extent necessary to satisfy the Actual Employee Regular Contribution
and Company Matching Contribution Percentage test or cause such
percentage to equal the Employee Regular Contribution and Company
Matching Contribution Percentage of the Member who is a Highly
Compensated Employee with the next highest percentage. This process
shall be repeated until the Actual Employee Regular
19
<PAGE> 24
Contribution and Company Matching Contribution Percentage test is
satisfied, in accordance with Treasury Regulation Section
1.401(m)-1(e)(2). The following order shall be used: (i) Employee
Regular Contributions for the Plan Year allocated to the Member's
Employee Regular Contributions Account that are attributable to the
Member's Additional Savings Account and (ii) Employee Regular
Contributions for the Plan Year allocated to the Member's Employee
Regular Contributions Account that are attributable to the Member's
Basic Savings Account and the vested portion of Company Matching
Contributions made on behalf of the Member for the Plan Year that
are attributable to such Employee Regular Contributions, determined
pro rata, and distribute such excess Employee Regular Contributions
and Company Matching Contributions (along with earnings attributable
to such excess contributions, as determined pursuant to subsection
(h)) to the affected Members who are Highly Compensated Employees as
soon as practicable after the end of such Plan Year, and in all
events prior to the end of the next following Plan Year. The amount
of excess Company Matching Contributions that are not vested shall
be forfeited, and shall be held in a suspense account and used to
reduce the Company's future Company Matching Contributions.
If, by application of the provisions of the preceding paragraph,
excess Employee Regular Contributions and Company Matching
Contributions are to be distributed to a Member and one or more of
his Family Members whose Employee Regular and Matching Contribution
Percentages are required to be aggregated in accordance with Section
3.10, the amount of the excess Employee Regular Contributions and
Company Matching Contributions (and income allocable thereto) to be
distributed to each such individual shall be determined by
multiplying such excess Employee Regular Contributions and Company
Matching Contributions by a fraction, the numerator of which is each
such individual's Employee Regular Contributions and Company
Matching Contributions for the Plan Year, and the denominator of
which is the aggregate Employee Regular Contributions and Company
Matching Contributions contributed by or on behalf of the Member and
the Family Member(s) for the Plan Year.
(h) Income on a Member's excess Employee Regular Contributions and
Company Matching Contributions shall be determined by multiplying
the income allocated for the Plan Year in which such excess Employee
Regular Contributions and Company Matching Contributions were made
by a fraction, the numerator of which is the excess Employee Regular
Contributions and Company Matching Contributions for such Member for
the Plan Year, and the denominator of which is the aggregate
Employee Regular Contribution Account and Company Matching
Contribution Account balances for such Member as of the first day of
the Plan Year, plus the Employee Regular Contributions and Company
Matching Contributions made by or on behalf of the Member during the
Plan Year.
Upon the distribution of excess Employee Regular Contributions and
Company Matching Contributions, the amount of income required to be
distributed with respect to the period between the last day of such
Plan Year and the date on which the excess is
20
<PAGE> 25
distributed (the "gap period") shall be 10% of the amount of income
allocable to the excess Employee Regular Contributions and Company
Matching Contributions for the Plan Year (as determined under the
preceding paragraph) multiplied by the number of calendar months
that have elapsed since the end of the Plan Year. For purposes of
determining the number of calendar months, if the distribution is
made on or before the 15th day of the month, such month shall not be
included, and if the distribution is made after the 15th day of the
month, such month shall be included.
(i) Notwithstanding any distributions pursuant to the foregoing
provisions, excess Employee Regular Contributions and Company
Matching Contributions shall be treated as Annual Additions for
purposes of Section 4.2.
(j) Distributions pursuant to this Section 3.10 shall be made
proportionately from the Investment Funds with respect to the
Member's Account or Accounts from which distribution is made.
(k) In the event that the Company elects to make a Qualified
Contribution on behalf of any or all Members in the Plan, any such
Qualified Contribution, to the extent specified, shall be treated as
a Company Matching Contribution solely for purposes of this Section
3.10
(l) In determining whether the requirements of this Section 3.10 is
satisfied, the Committee may in its discretion, in accordance with
regulations, take into account Member's Tax Deferred Contributions
made to the Plan pursuant to Section 3.1, provided that such
contributions are not taken into account in order to satisfy the
requirements of Section 3.8.
(m) The Committee may, in its sole discretion, elect to use any
combination of the methods described in this Section 3.10 to satisfy
the limitations contained herein; provided, however, that such
combination of methods shall be applied in a uniform and
nondiscriminatory manner.
(n) The Committee shall also take all appropriate steps to meet the
aggregate limitation test contained in Section 4.4.
3.11 (a) The amount of excess Tax Deferred Contributions to be
recharacterized or distributed under Section 3.8 with respect to a
Member for the Plan Year shall be reduced by any Excess Deferrals
previously distributed to such Member under Section 3.9 for the
Member's taxable year ending with or within such Plan Year.
(b) The amount of Excess Deferrals that may be distributed under
Section 3.9 with respect to a Member for a taxable year shall be
reduced by any excess Tax Deferred Contributions previously
distributed to such Member or recharacterized with respect to such
Member for the Plan Year beginning with or within such taxable year.
21
<PAGE> 26
3.12 Tax Deferred Contributions and the income allocable thereto shall
in no event be distributed to a Member or Beneficiary, as the case may
be, before the earlier of such Member's retirement, death, Disability,
termination of employment, or before the occurrence of one of the
following events:
(a) Termination of the Plan without the establishment or maintenance
of another defined contribution plan (other than an employee stock
ownership plan, as defined in Section 4975(e)(7) of the Code).
(b) The disposition by the Company 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 Company
if such Company continues to maintain the Plan after the
disposition and such unrelated corporation that purchases the
assets does not maintain the Plan after the disposition, but
distribution may only be made with respect to Employees who
continue employment with the corporation acquiring such assets.
(c) The disposition by the Company to an unrelated entity of such
Company's interest in a subsidiary (within the meaning of Section
409(d)(3) of the Code) if the Company continues to maintain the
Plan and such unrelated entity that purchases the subsidiary does
not maintain the Plan after the disposition, but distribution may
only be made with respect to Employees who continue employment with
such subsidiary.
(d) The attainment by the Member of age 59-1/2.
(e) Hardship distribution, as described in Section 8.2 of the Plan.
With respect to a distribution to a Member on account of an event
described in paragraphs (a), (b), or (c) above, such distribution shall
be paid in the form of a lump sum (as defined in Section 402(d)(4) of
the Code, without regard to clauses (i), (ii), (iii), and (iv) of
subparagraph (A), subparagraph (B), or subparagraph (F) thereof).
22
<PAGE> 27
ARTICLE 4
LIMITATIONS ON CONTRIBUTIONS
4.1 (a) Each Company shall pay a share of the aggregate contribution with
respect to each payroll period equal to the amount to be allocated
to the Accounts of Members employed by it during that payroll period.
(b) If any Company which is a member of an affiliated group (within the
meaning of Section 1504 of the Code) that includes the Company is
prevented from making a contribution which it would otherwise have
made under the Plan with respect to any payroll period, by reason of
having no current or accumulated earnings or profits or because such
earnings or profits are less than the contribution which it would
otherwise have made, then that portion of the contribution which such
Company was so prevented from making may be made, for the benefit of
the Members employed by such Company, by any one or more of the other
Companies that are members of such affiliated group (to the extent of
current or accumulated earnings or profits).
4.2 Notwithstanding any provision of the Plan to the contrary, in no event
in any Plan Year shall the "Annual Addition" (as hereinafter defined) on
behalf of any Member exceed the lesser of:
(a) 25% of the Member's "Section 415(c) compensation" (as determined
under Section 415(c)(3) of the Code and in Treasury Regulation
Section 1.415-2(d)(11)(i); or
(b) $30,000, or such greater amount as is permissible under Section
415(c)(1)(A), subject to any adjustment under Section 415(d) of
the Code.
For purposes of this Section 4.2, with respect to each Plan Year
beginning on or after the Effective Date, the term "Annual Addition"
with respect to any Member means the sum of
(a) Tax Deferred Contributions made in accordance with Section 3.1,
(b) Employee Regular Contributions made in accordance with Section 3.2,
(c) Company Matching Contributions made in accordance with Section 3.5,
(d) Company Profit Sharing Contributions made in accordance with
Section 3.7, and
(e) Qualified Contributions made in accordance with Section 4.5
If a Member is also participating in another tax-qualified defined
contribution plan maintained by any member of the Group (as modified
by Section 415(h) of the Code), the otherwise applicable limitation on
Annual Additions under this Plan shall be reduced by the
23
<PAGE> 28
amount of annual additions (within the meaning of Section 415(c)(2)
of the Code) under any such other defined contribution plan.
If a Member in this Plan is a participant in any qualified defined
benefit plan maintained by any member of the Group, the overall
limitation of Section 415(e) of the Code shall be complied with by
limiting the amount of pension payable to such person under such
defined benefit plan without adjustment to the limitation applicable
to such Member under this Plan.
If the limitations applicable to any Member in accordance with this
Section 4.2 would be exceeded, then the contributions made by or on
behalf of a Member under the Plan shall be reduced in the following
order, but only to the extent necessary to meet the limitations: (i)
Employee Regular Contributions pursuant to Section 3.2, (ii) Tax
Deferred Contributions pursuant to Section 3.1, (iii) Company Matching
Contributions pursuant to Section 3.5, (iv) Company Profit Sharing
Contributions pursuant to Section 3.7, and (v) Qualified Contributions
made pursuant to Section 4.5.
In the event that, notwithstanding the foregoing provisions of this
Section 4.2, the limitations with respect to Annual Additions
prescribed hereunder are exceeded with respect to any Member and such
excess arises as a consequence of an error in estimating Compensation,
the allocation of forfeitures, if any, or a reasonable error in
determining the amount of Tax Deferred Contributions,
(i) The Employee Regular Contribution and Tax Deferred
Contribution portions of such excess shall be
returned to the Member, along with any income
attributable thereto; and
(ii) The Company Matching Contribution portion shall be
held in a suspense account and, if such Member
remains a Member, used to reduce Company Matching
Contributions for such Member for the succeeding Plan
Years. If such Member ceases to be an active Member
in the Plan, the suspense account shall be used to
reduce Company Matching Contributions for all Members
in the Plan Year in which he ceases to be a Member,
and all succeeding years, as necessary.
4.3 Notwithstanding any provision of the Plan to the contrary, and to
the extent permitted by law, a contribution made to the Plan by a
Company may be returned to it if:
(a) the contribution is made by reason of mistake of fact;
(b) the contribution is conditioned on its deductibility under
Section 404 of the Code (all contributions being conditioned
upon their deductibility under said Section 404), and the
deduction is disallowed; or,
(c) the contribution is conditioned on initial qualification of the
Plan under Section 401(a) of the Code;
24
<PAGE> 29
provided such return of contribution is made within one year of the
mistaken payment of the contribution or the disallowance of the
deduction or the failure of the Plan to qualify initially, as the case
may be.
4.4 Any other provision of the Plan to the contrary notwithstanding,
the provisions of this Section 4.4 shall apply with respect to a Plan
Year commencing after December 31, 1988 if the conditions of both (a)
and (b) below are satisfied:
(a) the sum of (i) the "Actual Deferral Percentage" (as defined in
Section 3.8) for the group of Highly Compensated Employees who are
eligible to participate in the Plan and (ii) the "Actual Employee
Regular and Company Matching Contribution Percentage" (as defined
in Section 3.10 of the Plan) for such group of Highly Compensated
Employees exceeds the "Aggregate Limit" (as hereinafter defined),
and
(b) both (i) the Actual Deferral Percentage for the group of Highly
Compensated Employees who are eligible to participate in the Plan
exceeds 125% of the Actual Deferral Percentage of all other
Employees who are eligible to participate in the Plan and (ii) the
Actual Employee Regular and Company Matching Contribution
Percentage of such group of Highly Compensated Employees exceeds
125% of the Actual Contribution Percentage of all such other
Employees.
The term "Aggregate Limit" means the greater of the sum of (i) and
(ii) below or the sum of (iii) and (iv) below:
(i) 125% of the greater of (1) the Actual Deferral
Percentage of the group of Employees eligible to
participate in the Plan who are not Highly Compensated
Employees, or (2) the Actual Employee Regular and Company
Matching Contribution Percentage of the group of
Employees eligible to participate in the Plan who are not
Highly Compensated Employees, and
(ii) Two plus the lesser of (i)(1) or (i)(2) above (but in
no event more than 200% of the lesser of (i)(1) or
(i)(2) above).
(iii) 125% of the lesser of (1) the Actual Deferral Percentage
of the group of Employees eligible to participate in the
Plan who are not Highly Compensated Employees, or (2) the
Actual Employee Regular and Company Matching Contribution
Percentage of the group of Employees eligible to
participate in the Plan who are not Highly Compensated
Employees, and
(iv) Two plus the greater of (iii)(1) or (iii)(2) above (but
in no event more than 200% of the greater of (iii)(1)
or (iii)(2) above).
If the Actual Deferral Percentage and/or Actual Employee Regular and
Company Matching Contribution Percentage for the group of Highly
Compensated Employees who are eligible to participate in the Plan,
determined after any corrective distribution or recharacterization
25
<PAGE> 30
of excess amounts in accordance with the provisions of Sections 3.8 and
3.10 have been effectuated, exceeds an amount which would cause the
limits set forth in the foregoing provisions of this Section 4.4 to be
exceeded, first the amount of Tax Deferred Contributions and then the
amount of Employee Regular Contributions and Company Matching
Contributions shall be reduced, in the same manner and at the same time
as such contributions are reduced in accordance with Sections 3.8 and
3.10, but only to the extent necessary to bring the Plan into compliance
with the applicable limits set forth in this Section 4.4.
4.5 A Company may, in its sole discretion, make a Qualified Contribution in
order to satisfy the requirements of Sections 3.8, 3.10 or 4.4. A
Qualified Contribution is a contribution that (i) is made by the Company
that may be aggregated with other contributions in accordance with
Sections 3.8 and 3.10; (ii) is nonforfeitable at all times; (iii) may
not be distributed to a Member or any Beneficiary until the earliest
date provided for in Section 401(k)(2)(B) of the Code (determined
without regard to subsection (i)(IV) of such Section) and (iv) complies
with the requirements of Treasury Regulation Section 1.401(k)-1(b)(5).
A Qualified Contribution may take the form of a qualified matching
contribution (as defined in Treasury Regulation Section
1.401(k)-1(g)(13)(i)), or a qualified nonelective contribution (as
defined in Treasury Regulation Section 1.401(k)-1(g)(13)(ii)). The
Company shall specify the form of the Qualified Contribution, and the
Members to whom such contribution is to be allocated.
26
<PAGE> 31
ARTICLE 5
INVESTMENT OF CONTRIBUTIONS
5.1 The Trust Fund shall consist of Fund A, Fund B, Fund C, Fund D, Fund E,
Fund F, Fund G, and Fund H which shall be invested by the Trustee, in
accordance with Section 5.2, as follows:
(a) Fund A (the "C/G Stable Value Fund")shall consist primarily of a
guaranteed investment contract or contracts with an insurance
company or companies containing such terms and conditions with
respect to payment of principal and interest as may be agreed upon
by the parties to such contract or contracts, and other contracts
bearing a fixed rate of return for a specified period.
(b) Fund B (the "Putnam Income Fund")shall be invested primarily
incorporate and government bonds that pay a rate of interest in
regularly scheduled payments.
(c) Fund C (the "George Putnam Fund of Boston")shall be invested
primarily ina diversified portfolio of stocks and bonds that seeks
to produce both capital growth and current income.
(d) Fund D (the "Putnam Fund for Growth and Income")seeks current
income and capital growth primarily through income-producing
stocks.
(e) Fund E (the "Putnam Voyager Fund")seeks above-average, long term
growth by investing in common stocks. It is anticipated that the
principal value of the investments will fluctuate more often and
more widely than would a more conservative investment.
(f) Fund F (the "Putnam Overseas Growth Fund")seeks long term growth
through investment opportunities outside North America.
(g) Fund G (the "Putnam New Opportunities Fund")seeks above-average,
long term growth by investing in companies in the world's fastest
growing industry sectors.
(h) Fund H ("Carbide/Graphite Group Company Stock")shall be invested
in Carbide/Graphite Group, Inc. common stock.
Any portion of an investment fund may, pending its permanent investment
or distribution, be invested in short term securities issued or
guaranteed by the United States of America or any agency or
instrumentality thereof or any other investments of a short term nature,
including corporate obligations or participations therein, even though
the same may not be legal investments for Trustees under the laws
applicable hereto. Any portion of an investment fund may be maintained
in cash.
27
<PAGE> 32
5.2 All contributions under the Plan shall be invested as elected by the
Member pursuant to Section 2.4, or as subsequently changed in accordance
with Section 5.3, at the Member's option, in one or more of the
investment funds, in multiples of 5%.
In the absence of such an investment election by a Member, the
Member's contributions will be invested in Fund A (the "C/G Stable
Value Fund").
Any other provision of the Plan to the contrary notwithstanding,
during the months of May and June, 1996 (hereinafter referred to as
the "Transition Period" for purposes of this Article 5 and Article
14), the investment of preexisting Account balances in the Funds that
were available under the Plan as of April 30, 1996 will be transferred
and invested in the "like" Funds under the Plan on and after May 1,
1996 as follows:
<TABLE>
<CAPTION>
April 30, 1996 Funds "Like" Funds
-------------------------------------------------------------
<S> <C>
Money Market Fund C/G Stable Value Fund
Guaranteed Income Fund C/G Stable Value Fund
PNC Balanced Fund George Putnam Fund of Boston
American Mutual Fund Putnam Fund for Growth and Income
20th Century Ultra Fund Putnam Voyager Fund
Mentor Perpetual Global A Putnam Overseas Growth Fund
</TABLE>
Any other provision of the Plan to the contrary notwithstanding,
during the Transition Period, Participants will neither have access to
their Accounts nor have the ability to effectutate any changes to
their Accounts. As soon as practicable after the Transition Period
ends, Participants will be able to access their Plan Accounts, monitor
their investments and process Account transactions.
5.3 A Member may change investment elections, subject to the limitations
set forth in Section 5.2, on any Valuation Date with respect to
contributions to be made thereafter, by giving prior notice to the
Administrator on the Appropriate Form, or in such manner as the
Administrator may prescribe, within the time period prescribed by the
Administrator.
5.4 The aggregate Value of a Member's Accounts may be transferred (as of the
next Valuation Date, but no earlier than the end of the Transition
Period) among the various investment funds, in multiplies of 5%, by
giving prior notice to the Administrator on the Appropriate Form, or in
such manner as the Administrator may prescribe.
There shall be no limit on the number of times a Member may make a
transfer pursuant to this Section 5.4; provided, however, that the
Administrator may impose a reasonable transfer charge for every transfer
in excess of four that a Member makes in any one Plan Year.
5.5 Dividends, interest and other distributions received by the
Trustee in respect of any investment fund shall be reinvested in the
same investment fund.
5.6 With respect to shares of Carbide/Graphite Group Company Stock
(both full and fractional shares) held in Fund H allocated to the
Accounts of a Member, the Member shall have the
28
<PAGE> 33
right to direct the Trustee or its nominee as to the manner of voting
his shares, and to exercise those rights with respect to shares, as if
he were the shareholder of record. If the Trustee shall not receive
timely instruction from a Member (or Beneficiary) as to the manner in
which to vote the shares, the Trustee shall not vote any shares of
Carbide/Graphite Group Company Stock with respect to which the Member
(or Beneficiary) has the right of direction
5.7 Each Member (or, in the event of the Member's death, his Beneficiary)
is, for purposes of this Section 5.7, hereby designated a "named
fiduciary" within the meaning of Section 403(a) of ERISA and shall have
the right, to the extent of shares of Carbide/Graphite Group Company
Stock (including fractional shares) allocated to the Member's Account,
to direct the Trustee in writing as to the manner in which to respond to
a tender or exchange offer with respect to shares of such stock. The
Trustee shall use its best efforts to timely distribute or cause to be
distributed to each Member (or Beneficiary) such information as will be
distributed to stockholders of the Company in connection with such
tender or exchange offer. Upon timely receipt of such instructions, the
Trustee shall respond as instructed with respect to the number shares of
Carbide/Graphite Group Company Stock allocated to such Member's Account.
The instructions received by the Trustee from Members shall be held by
the Trustee, in accordance with the terms of the Trust, in strict
confidence and shall not be divulged or released to any person,
including officers or employees of the Company. If the Trustee shall not
receive timely instruction from a Member (or Beneficiary) as to the
manner in which to respond to such a tender or exchange offer, the
Trustee shall not tender or exchange any shares of Carbide/Graphite
Group Company Stock with respect to which the Member (or Beneficiary)
has the right of direction
29
<PAGE> 34
ARTICLE 6
VALUATION OF MEMBER'S ACCOUNTS
6.1 The Value of the Trust Fund shall be determined by the Trustee on
the basis of book value for Fund A and market values for Funds B, C, D,
E, F, G, and H as of each business day of each calendar month. The
Administrator shall maintain or cause to be maintained a separate
Additional Savings Account, Basic Savings Account, Employee Regular
Contributions Account, a Tax Deferred Contributions Account, a Company
Matching Contributions Account, Prior Company Matching Contributions
Account, a Company Profit-Sharing Contributions Account, a Qualified
Contribution Account and, effective January 1, 1990, a Rollover Account
for each Member which shall reflect the portion of the Member's interest
in the Trust Fund which is attributable to the Member's Employee Regular
Contributions, Tax Deferred Contributions, Company Matching
Contributions, Prior Company Matching Contributions, Company
Profit-Sharing Contributions, Qualified Contributions and, effective
January 1, 1990, rollovers meeting the requirements of Section 16.15.
As of each Valuation Date, each Member's Accounts shall be adjusted as
follows:
(a) Income earned or accrued, expenses and any increase or decrease in
the Value of the Trust Fund since the preceding Valuation Date will
be proportionately credited based on the balances, as of the
preceding Valuation Date, of each Member's Accounts;
(b) Employee Regular Contributions, Tax Deferred Contributions and,
effective January 1, 1990, rollovers meeting the requirements of
Section 16.15 made since the preceding Valuation Date will be
credited;
(c) Company Matching Contributions, Company Profit-Sharing
Contributions, and Qualified Contributions for the current
valuation period will be determined and credited;
(d) Withdrawals, loans and distributions payable as of the current
Valuation Date will be deducted; and
(e) Interfund transfers effective as of the current Valuation Date will
be credited to and deducted from the appropriate investment funds.
6.2 At least once each Plan Year, the Administrator shall furnish each
Member with a written statement of such Member's Accounts.
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ARTICLE 7
VESTING
7.1 A Member's Employee Regular Contributions Account, Tax Deferred
Contributions Account, Prior Company Matching Contributions Account and,
effective January 1, 1990, Rollover Account, and Qualified Contribution
Account shall be 100% vested at all times.
7.2 A Member's Company Matching Contributions Account and Company
Profit-Sharing Contributions Account shall be 100% vested in such Member
in the event of termination or partial termination of the Plan (if such
Member is affected by such partial termination), complete discontinuance
of Company contributions to the Plan, the Member's death prior to
termination of employment, Retirement, attainment of age 65, termination
of employment due to Disability, or completion of 4 years of Continuous
Service with the Group.
7.3 Any portion of a Member's Company Matching Contributions Account in
which such Member does not have a vested interest at the time of
termination of employment shall be forfeited and shall be applied to
reduce Company Matching Contributions in accordance with Section 3.5(b).
7.4 If a former Member whose termination resulted in a forfeiture pursuant
to Section 7.3 is reemployed as an Employee prior to the expiration of a
period of sixty consecutive months during which the former Member was
not credited with Continuous Service, the amount of the forfeiture shall
be restored to such former Member's Company Matching Contributions
Account or Company Profit-Sharing Account, as the case may be, by means
of a Company contribution pursuant to Section 3.6(b).
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ARTICLE 8
WITHDRAWALS DURING EMPLOYMENT
8.1 A Member may elect to withdraw in cash from such Member's Accounts, as
of the following Valuation Date, an amount determined in accordance
with the following options:
OPTION I: Any specified amount up to 100% of the value of his Employee
Regular Contributions Account and, effective January 1, 1990, his
Rollover Account.
Under this Option I, any amounts withdrawn shall be paid in the
following order:
first, from the Member's pre-1987 Employee Regular
Contributions that were not matched;
second, from his pre-1987 Employee Regular Contributions that
were matched;
third, from the value of the Member's Employee Regular
Contributions Account attributable to Employee Regular
Contributions made after December 31, 1986 (including the
earnings thereon);
fourth, from the remaining value in the Employee Regular
Contributions Account; and
fifth, effective January 1, 1990, from the Member's Rollover
Account.
OPTION II: A Member who has withdrawn the full amount available under
Option I, and who suffers a financial hardship for one of the reasons
stated below, may apply in writing for payment of part or all of such
Member's then vested interest in such Member's Prior Company Matching
Contributions Account and Company Matching Contributions Accounts. Such
amounts will be paid first out of the amounts available under Option I,
and then from the Member's Prior Company Matching Contributions Account
and then from the Member's Company Matching Contributions Accounts.
For purposes of this Option II of this section 8.2, a Member will be
deemed to suffer a financial hardship for the following reasons:
(a) personal bankruptcy or garnishment of wages;
(b) unreimbursed medical bills for the Member, such Member's spouse or
dependents;
(c) payment of tuition and room and board for post-secondary education
for the Member, such Member's spouse or dependents;
(d) the purchase of the Member's principal residence;
(e) damage to the Member's principal residence caused by fire or "acts
of God" and not reimbursed by insurance;
(f) funeral expenses for a member of the Member's immediate family;
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(g) an unexpected need for a car for use by the Member to provide
transportation to work;
(h) tax levies from the IRS if a dispute is resolved against the
Employee.
OPTION III: A Member who has withdrawn the full amount under Option II
may withdraw, in the event of "Hardship" (as defined in this Option III
of this Section 8.2), all or any portion of his Tax Deferred
Contributions (plus an amount equal to earnings credited to the Tax
Deferred Contribution Account as of December 31, 1988). Subject to the
approval of the Committee, the Member may be paid such amount from his
Tax Deferred Contributions Account as the Committee shall determine is
necessary to relieve the Hardship.
For purposes of this Option III of this Section 8.2, the term "Hardship"
means a circumstance resulting from an immediate and heavy financial
need of the Member. The Administrator shall not allow a Hardship
distribution to be made to a Member unless the requirements of
subsections (a) and (b) below are satisfied:
(a) The Member incurs a "Hardship" arising from one of the following
expenses:
(1) Medical expenses described in Section 213(d) of the Code
previously incurred by the Member, the Member's spouse or
dependents (as defined in Section 152 of the Code) or
necessary for these persons to obtain medical care described
in Section 213(d) of the Code;
(2) Costs directly related to the purchase of a principal
residence for the Member (excluding mortgage payments
thereon);
(3) The cost of tuition and related educational fees for the next
12 months of post-secondary education for the Member, the
Member's spouse, children, or dependents; or
(4) The amount needed to prevent the eviction of the Member from
his principal residence or foreclosure of a mortgage on his
principal residence.
The determination of the existence of Hardship and the determination of
the amount required to be distributed to meet the need created by the
Hardship shall be made by the Administrator pursuant to uniform and
non-discriminatory rules, consistent with the requirements of the Code
and applicable regulations. The Administrator may require documentation
from the Member for this purpose. The Administrator shall reasonably
rely on the documentation submitted by the Member, unless the
Administrator has actual knowledge to the contrary.
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(b) The distribution by reason of Hardship:
(1) May not be more than the amount of the Member's immediate
and heavy financial need and any amount necessary to pay any
Federal, state or local income taxes or penalties reasonably
anticipated to result from the withdrawal;
(2) May not be made unless the Member has obtained all
distributions, other than Hardship distributions, and all
non-taxable loans that are currently available under all
qualified and nonqualified plans of the Company or any member
of the Group;
(3) May not be made unless the Member is suspended from making
Employee Regular Contributions and Tax Deferred Contributions
to the Plan (and all other qualified and nonqualified plans of
deferred compensation maintained by the Company, including
solely for this purpose any stock option, stock purchase and
similar plans maintained by a Company or other member of the
Group, excluding mandatory employee contributions to a defined
benefit plan or health or welfare benefit plans) for the
twelve month period beginning after receipt of the withdrawal
pursuant to this Option III; and
(4) Will result in a limitation on the amount of Tax Deferred
Contributions which may be made on a Member's behalf under the
Plan (and all other plans maintained by a Company) for the
taxable year following the taxable year of the Hardship
distribution, with such limitation being equal to the Code
Section 402(g) limit for such following taxable year less the
amount of such Member's Tax Deferred Contributions for the
taxable year of the Hardship distribution.
After the 12-month period of suspension under (3) above ceases, the
Member may resume contributions by filing a form in accordance with
Section 2.3.
The Company may, by amendment, change the conditions necessary to obtain
a Hardship withdrawal, or may discontinue the Hardship withdrawal
provisions of this Section 8.2, to the extent permitted by applicable
law or regulation.
OPTION IV: In the case of a Member who has attained age 59-1/2, the full
amount payable under Option III, plus up to 100% of the remaining vested
value in such Member's Account.
8.2 A Member may not replace any amounts voluntarily withdrawn under
this Article 8.
8.3 Any amounts withdrawn pursuant to this Article 8 shall be paid to
a Member in a lump sum in cash, as soon as practicable after the
Valuation Date as of which the withdrawal election is effective or the
determination of the Administrator is made (as is appropriate).
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8.4 All withdrawals from a Member's Accounts shall be made from Fund A,
Fund B, Fund C, Fund D, Fund E, Fund F, Fund G, and Fund H in
proportion to the Value of the Member's Accounts in each such
investment fund.
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ARTICLE 9
DISTRIBUTIONS ON TERMINATION OF EMPLOYMENT
9.1 (a) Upon termination of a Member's employment with the Group by reason
other than Retirement or death, the distribution of the full Value
of such Member's Employee Regular Contributions Account, Tax
Deferred Contributions Account, Prior Company Matching
Contributions Account, Qualified Contribution Account, and,
effective January 1, 1990, Rollover Account, and, if such Member's
Company Matching Contributions Account and Company Profit-Sharing
Contributions Accounts are vested pursuant to Section 7.2, the full
Value of such Member's Company Matching Contributions Account and
Company Profit-Sharing Contributions Account, if any, shall be
deferred until his attainment of age 65.
(b) Notwithstanding the provisions of the preceding paragraph, upon
termination of a Member's employment with the Group, such Member may
irrevocably elect, by filing the Appropriate Form with the
Administrator, or in such manner as the Administrator may prescribe,
within 10 days prior to termination (or such other period as the
Administrator may prescribe), to have the distribution of benefits
pursuant to this Section 9.1 paid, in a lump sum, (i) as soon as
practicable after the Valuation Date coincident with or next
following the date of such termination of employment, (ii) as soon
as possible after the beginning of the calendar year immediately
following the calendar year in which such Member's employment
terminated, or (iii) to defer distribution of benefits until his
attainment of age 65. Such distribution shall be made in cash,
except that, with respect to distributions from the Fund H (the
Carbide/Graphite Group Company Stock Fund) distribution shall be
made in cash or shares of stock, as the Participant shall elect.
If the Member elects to receive such distribution as soon as
possible after the Valuation Date coincident with or next following
the date of such termination of employment, the distribution will be
the Value of such Member's Accounts as of such Valuation Date.
If the Member elects to receive such distribution as soon as
possible after the beginning of the calendar year immediately
following the calendar year in which the Member's employment
terminated, the distribution shall be the Value of such Member's
Accounts as of the last day of the calendar year in which such
Member's employment terminated.
If the Member does not elect to receive a distribution, or elects to
defer receipt of such distribution until attainment of age 65, the
distribution shall be the Value of such Member's Account as of the
Valuation Date coincident with or immediately following such
Member's attainment of age 65.
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9.2 (a) Upon termination of employment of a Member by reason of
Retirement or death, the full Value of such Member's Accounts shall
be distributed to the Member (or such Member's Beneficiary, as is
appropriate) in a lump sum in cash except that, with respect to
distributions from the Fund H (the Carbide/Graphite Group Company
Stock Fund) distribution shall be made in cash or shares of stock,
as the Participant (or Beneficiary) shall elect..
(b) A Member (or such Member's Beneficiary, as is appropriate), who
has attained Normal Retirement Age or died, or has attained age 60,
may receive the distribution of benefits pursuant to this Section
9.2 in 1, 2, 3, 4, or 5 annual installment payments providing that
such form of payment is not contrary to the requirements of Section
401(a)(9) of the Code.
9.3 Distributions pursuant to this Article 9 shall be made or commenced in
all events before the 60th day after the latest of the close of the
Plan Year in which:
(i) occurs the date on which the Member attains age 65;
(ii) occurs the tenth anniversary of the year in which the
Member commenced participation in the Plan; or,
(iii) the Member terminates employment.
9.4 Notwithstanding the preceding paragraph, payment of benefits to
any Member shall begin not later than the April 1 following the
calendar year in which such Member attains age 70-1/2. Any payments
under this Plan shall be adjusted to meet the requirements of Section
401(a)(9) of the Code and the regulations thereunder. Thus, the entire
interest of each Member (a) shall be distributed to him not later than
the required beginning date as defined in Section 401(a)(9)(C) of the
Code, or (b) shall be distributed, beginning not later than the
required beginning date, in accordance with regulations, over the life
of the Member or over the life of the Member and Beneficiary (or over
a period not extending beyond the life expectancy of the Member or the
life expectancy of the Member and Beneficiary). In addition, any
distribution required under the incidental death benefit rule of
Section 401(a)(9)(G) of the Code shall be treated as a distribution
required under the preceding paragraph.
In the event a Member's termination of employment is by reason of
death (including for this purpose, death after termination of
employment) any undistributed amount in such Member's Account, as of
the Valuation Date coincident with or next following the Member's
death, shall be distributed to the Member's Beneficiary in a lump sum
in cash (or shares of stock from Fund H (the Carbide/Graphite Group
Company Stock Fund) as soon as practicable after such Valuation Date.
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ARTICLE 10
ADMINISTRATION OF THE PLAN
10.1 The Board of Directors shall appoint the Committee, which shall
consist of not fewer than three nor more than five persons, and any or
all of whom also may serve in a similar capacity with respect to any
other employee benefit plan maintained by the Corporation. Any member
of the Committee may resign or be removed by the Board of Directors
and new members may be appointed by the Board of Directors. The
Committee shall be free to act, despite a vacancy in its membership,
so long as a majority of the Committee remains in office. Except for
those functions reserved within the Plan to the Board of Directors, or
delegated to the Administrator, the Committee shall control and manage
the operation and administration of the Plan.
10.2 The Board of Directors shall appoint the Chairman of the Committee and
may appoint a Secretary (who may, but need not, be a member of the
Committee) to keep its records and to assist it in any action taken
by the Committee.
10.3 A majority of the members of the Committee at the time in office
shall constitute a quorum for the transaction of the business at any
meeting. Any determination or action of the Committee may be made or
taken by a majority of the members present at any meeting thereof, or
without a meeting by a resolution or written memorandum concurred in
by a majority of the members then in office.
10.4 In addition to the duties specifically set forth in other sections of
the Plan, the Committee shall have the following duties:
(a) To review the performance of the Administrator;
(b) To construe and interpret the Plan and to exercise discretion
where necessary or appropriate in the interpretation and
administration of the Plan, and to hear and decide such other
questions as may be referred to it by the Administrator;
(c) To review and report to the Board of Directors with respect to
the performance of the Trustee and an Investment Manager in
investing, managing and controlling the Plan's assets; and,
(d) To make recommendations to the Board of Directors regarding the
appointment, retention or removal and replacement of any Trustee
and any Investment Manager and changes and amendments to, and
termination of, the Plan.
10.5 The Committee shall designate, and may remove and replace, a person
who may or may not be a member of the Committee as the Administrator
with full authority and responsibility for the performance of those
duties which are required of the "Administrator" as that term is used in
ERISA and those duties which the Committee may properly delegate to such
person.
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The Administrator shall have the power and the duty to take all action
necessary or proper to carry out the duties required under ERISA and
delegated to such person by the Committee. Without limiting the
generality of the foregoing, the Administrator shall have the power to
establish, enforce and amend such rules and regulations with respect to
the performance of the Administrator's duties under the Plan as such
person shall deem appropriate, including without limitation, the power:
(a) To require any person to furnish such information as the
Administrator may request for the purpose of the proper
administration of the Plan;
(b) Unless an interpretation of the Plan by the Committee is required,
to decide questions concerning the eligibility of any Employee to
participate in the Plan, any person's eligibility for vested
benefits, and the amount of benefits which shall be payable to any
person in accordance with the provisions of the Plan; and in
connection therewith to provide a full and fair review to any
person whose claim for benefits has been denied in whole or in
part;
(c) To establish time periods, as specified in the Plan, within which
elections must be made and Appropriate Forms must be filed or other
notification made;
(d) To limit, as provided by the Plan, the amount of Tax Deferred
Contributions and/or Employee Regular Contributions that may be
made on a Member's behalf.
To the extent of the responsibilities delegated to such person by the
Committee, the Administrator shall act as a named fiduciary within the
meaning of ERISA.
10.6 Insofar as responsibility has been delegated to the Committee or
the Administrator, each of them may from time to time:
(a) Allocate and delegate in writing part of all of its
responsibilities and other duties to designated persons whether or
not such designated persons are officers or employees of the
Corporation, except that the Committee may not delegate its
authority under Section 10.5 to designate or remove an
Administrator; and
(b) Retain such counsel and employ such actuarial, accounting,
clerical, medical and other assistance as it may require in
carrying out the provisions of the Plan or in complying with
requirements imposed by ERISA.
10.7 (a) The Board of Directors shall from time to time appoint, and may
remove and replace, one or more Trustees each of whom shall have
exclusive authority and discretion (except as may otherwise be
provided in the Plan and ERISA) to invest, manage and control the
assets subject to their respective agreements and each of whom
shall perform such other fiduciary and other duties with respect to
their respective agreements, as are required by ERISA, the Plan,
any agreement between the Corporation and it, any trust agreement,
and any other provision of applicable law.
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(b) The Board of Directors may appoint, and may remove and replace, one
or more Investment Managers to manage any assets of the Plan,
including the power to acquire and dispose of Trust Fund assets and
perform such other services as the Board of Directors shall deem
necessary or desirable in connection with the management of the
Trust Fund. Such Investment Manager shall acknowledge in writing to
the Committee that it is (or they are) a fiduciary with respect to
the Plan.
(c) The Board of Directors may appoint, and may remove and replace, one
or more Custodians to hold any assets of the Plan, and to perform
such other services as the Board of Directors shall deem necessary
or desirable in connection with the acquisition, retention or sale
of assets of the Trust Fund.
10.8 Except as otherwise required by law, the Corporation, the officers and
directors thereof, the Committee, the Administrator and any other person
to whom a duty or power is delegated in connection with administering
the Plan, shall be entitled to rely conclusively upon, and shall be
fully protected in any action taken or suffered by them in good faith in
the reliance upon, any enrolled actuary, counsel, accountant, or other
specialist, or other persons selected by the Committee, or in reliance
upon any tables, valuations, certificates, opinions or reports which
shall be furnished by any of them or by the Trustee. Further, to the
extent permitted by law, no member of the Committee, nor the
Administrator, nor the Corporation, nor the officers or directors
thereof, shall be liable for any neglect, omission or wrongdoing of the
Trustee or any other member of the Committee or of any person who has
been delegated a duty or responsibility under the Plan.
10.9 All expenses of the Plan that shall arise in connection with the
administration of the Plan, including but not limited to the
compensation of the Trustee, administrative expenses and proper charges
and disbursements of the Trustee and compensation and other expenses and
charges of any enrolled actuary, counsel, accountant, specialist, or
other person who shall be employed by the Board of Directors, the
Committee, or Administrator in connection with the administration
thereof, shall be paid from the Trust Fund to the extent not paid by the
Corporation or any Company. Brokerage fees, commissions, stock transfer
taxes and other charges and expenses in the Trust Fund shall be charged
within the Trust Fund to the investment fund to which such charges and
expenses are attributable.
10.10 The Committee may authorize one or more of its number to act on
its behalf, or to execute or deliver any instrument on its behalf.
10.11 Unless otherwise agreed to by the Corporation, the Administrator and
the members of the Committee shall serve without compensation for
services as such, but all reasonable expenses incurred in the
performance of their duties shall, to the extent not paid by the
Corporation or any Company, be paid from the Trust Fund. Unless
otherwise determined by the Board of Directors or unless required by any
federal or state law, neither the Administrator nor any member of the
Committee shall be required to give any bond or other security in any
jurisdiction.
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10.12 For purposes of the Plan, a claim for benefit is a written
application for benefit filed with the Committee. In the event that any
Member or other payee claims to be entitled to a benefit under the Plan,
and the Committee determines that such claim should be denied in whole
or in part, the Committee shall, in writing, notify such claimant within
90 days of receipt of such claim that his claim has been denied, setting
forth the specific reasons for such denial. Such notification shall be
written in a manner reasonably expected to be understood by such Member
or other payee and shall set forth the pertinent sections of the Plan
relied on, and where appropriate, an explanation of how the claimant can
obtain review of such denial. Within 60 days after the mailing or
delivery by the Committee of such notice, such claimant may request, by
mailing or delivery of written notice to the Committee, a review and/or
hearing by the Committee of the decision denying the claim. If the
claimant fails to request such a review and/or hearing within such 60
day period, it shall be conclusively determined for all purposes of this
Plan that the denial of such claim by the Committee is correct. If such
claimant requests a hearing within such 60 day period, the Committee
shall designate a time (which time shall be no less than 7 nor more than
60 days from the date of such claimant's notice to the Committee) and a
place for such hearing, and shall promptly notify such claimant of such
time and place. If only a review is requested, the Member or other payee
shall have 30 days after filing a request for review to submit
additional written material in support of the claim. After such review
and/or hearing, the Committee shall determine whether such denial of the
claim was correct and shall notify such claimant in writing of its
determination. If such determination is favorable to the claimant, it
shall be binding and conclusive. If such determination is adverse to
such claimant, it shall be binding and conclusive unless the claimant
notifies the Committee within 90 days after the mailing or delivery to
him by the Committee of its determination that he intends to institute
legal proceedings challenging the determination of the Committee, and
actually institutes such legal proceeding within 180 days after such
mailing or delivery.
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ARTICLE 11
ADOPTION AND AMENDMENT OF THE PLAN
11.1 The adoption of this Plan, and of any amendments thereof adopted
subsequently, shall be conditioned on qualification of the Plan under
Sections 401(a) and 401(k) of the Code.
11.2 This Plan may be wholly or partially amended or otherwise modified at
any time by the Board of Directors, provided, however, that:
(a) No amendment or modification can be made, at any time prior to
the satisfaction of all liabilities under the Plan with respect to
Members and their Beneficiaries and with respect to the expenses of
the Plan, which would permit any part of the corpus or income of
the Trust Fund to be used for or diverted to purposes other than
for the exclusive benefit of such persons under the Plan and for
the payment of the expenses of the Plan;
(b) No amendment or modification shall have any retroactive effect so
as to deprive any person of any benefit already accrued, except
that any amendment may be made retroactive which is necessary to
bring the Plan into conformity with governmental regulations in
order to qualify the Plan for tax purposes and meet the
requirements of ERISA;
(c) No amendment or modification may be made which shall increase the
duties or liabilities of the Trustee, the Committee, or any Company
without the written consent of the party so affected.
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ARTICLE 12
DISCONTINUANCE OF THE PLAN
12.1 While the Corporation intends to continue the Plan indefinitely,
nevertheless it assumes no contractual obligation as to its continuance.
The Plan may be terminated in whole or in part at any time by the Board
of Directors by written notice to each Company, to the Committee, to the
Administrator, and to the Trustee at the time acting hereunder, but only
upon condition that such action is taken as shall render it impossible
for any part of the corpus or income of the Trust Fund to be used for or
diverted to purposes other than for the exclusive benefit of the Members
and their Beneficiaries under the Plan and for the payment of the
administrative costs of the Plan.
12.2 If the Plan is terminated pursuant to Section 12.1 or in the event the
Plan is terminated by operation of law and the Board of Directors
determines that the Trust shall be terminated, of which determination
written notice shall be given to each Company, to the Committee, to the
Administrator, and to the Trustee at the time acting hereunder, the
Members' Company Matching Contributions Accounts and Company
Profit-Sharing Accounts shall become fully vested, the Trust Fund shall
be revalued as if the termination date were a Valuation Date, and the
current value of all Accounts shall be distributed in accordance with
Article 9 to the extent permissible under applicable law and regulation.
12.3 If the Plan is terminated by the Board of Directors but the Board of
Directors determines that the Trust Fund shall be continued pursuant to
its terms and the provisions of this Article 12, no further
contributions shall be made by either Members or any Company, and the
Member's Company Matching Contributions Accounts and Company
Profit-Sharing Contributions Account shall become fully vested, but the
Trust Fund shall be administered as though the Plan otherwise were in
full force and effect. If the Trust Fund subsequently is terminated, the
provisions of Section 12.2 hereof shall then apply.
12.4 In addition to the right to amend or terminate the Plan, any Company may
at any time, by resolution of its board of directors, permanently and
completely discontinue Members' Company Matching contributions and
Company Profit-Sharing Contributions under the Plan. If any Company
completely discontinues contributions under the Plan, either by
resolution of its board of directors or for any other reason, the
amounts credited to the Members' Company Matching Contributions Accounts
and Company Profit-Sharing Contributions Accounts of such Company shall
become fully vested and non-forfeitable. In such event, the Corporation
and the Trustee shall proceed under Section 12.2 or Section 12.3,
depending upon whether in connection with such complete discontinuance
of contributions the Board of Directors has terminated the Plan and
Trust Fund or has terminated the Plan and continued the Trust Fund in
effect. If no action has been taken by the Board of Directors in
connection with a complete discontinuance of contributions to the Plan,
it shall be deemed that Section 12.3 is applicable.
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12.5 No merger or consolidation with, or transfer of assets or liabilities
to, any other pension or retirement plan shall be made unless the
benefit each Member in this Plan would receive if the Plan were
terminated immediately after such merger or consolidation, or transfer
of assets and liabilities, would be at least as great as the benefit
such Member would have received had the Plan terminated immediately
before such merger, consolidation or transfer.
12.6 The Corporation expressly reserves the right at any time from time to
time to add or withdraw from participation in the Plan any Company by
action of the Board of Directors. Any such withdrawal shall be a
termination of the Plan to the extent required by applicable law.
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ARTICLE 13
PARTICIPATION IN THE PLAN BY SUBSIDIARIES OF AFFILIATES
13.1 Any parent, subsidiary or affiliate of the Corporation, for itself or
any of its divisions, may, upon 30 days notice to and with the consent
of the Board of Directors, become a party to this Plan by adopting the
Plan for some or all of its employees and by executing the Trust
Agreement if required under such Trust Agreement. Upon the filing with
the Trustee of a certified copy of the resolutions or other documents
evidencing the adoption of this Plan and the notice to and the consent
of the Board of Directors of the Corporation to participation by such
parent, subsidiary or affiliate, and upon the execution of the Trust
Agreement by such subsidiary or affiliate, if required under such Trust
Agreement, it shall thereupon be included in the Plan as a Company, and
shall be bound by all the terms thereof as they relate to its employees.
The Board of Directors may also extend the Plan to any other division of
the Corporation, thereby bringing such division within the definition of
Company in Article 1. Any contributions provided for in the Plan and
made by such Company shall become a part of the Trust Fund and shall be
held by the Trustee subject to the terms and provisions of the Trust
Agreement. With respect to any such employees to which this Plan is made
applicable, the term Effective Date refers to the date as of which the
Plan is made applicable to such employees.
With the approval of the Corporation, a participating Company may elect
to have special provisions apply with respect to its Employees. Such
special provisions, which may differ from the provisions of the Plan
applicable to employees of other Companies, shall be stated in an
Appendix to the Plan which is applicable to such Company.
13.2 In the event that an organization which has become a Company pursuant
to the provisions of Section 13.1 shall cease to be a parent, subsidiary
or affiliate of the Corporation, such organization shall forthwith be
deemed to have withdrawn from the Plan and the Trust Agreement. Any one
or more of the Companies may voluntarily withdraw from the Plan by
giving six (6) months notice in writing of such intention to withdraw to
the Board of Directors of the Corporation and to the Committee (unless a
shorter notice shall be agreed to by the Board of Directors of the
Corporation and by the Committee).
Upon any such withdrawal by any such Company, the Committee shall
determine that portion of the Trust Fund allocable to the Members and
their Beneficiaries thereby affected, consistent with the provisions of
ERISA and the regulations thereunder. Subject to the provisions of ERISA
and regulations thereunder, the Committee shall then instruct the
Trustee to set aside from the trust assets then held by it, such
securities and other property as it shall, with the approval of the
Committee, deem to be equal in value to the portion of the Trust Fund so
allocable to the withdrawing Company. The Committee shall direct the
Trustee, in the discretion of the Committee and subject to the
provisions of ERISA and regulations thereunder, either (1) to hold such
assets so set aside and to apply the same for the exclusive benefit of
the Members and Beneficiaries so affected on the same basis as if the
Trust Fund had been terminated pursuant to Section 12.1 upon the date of
such withdrawal, or (2) to deliver such assets to trustees to be
selected by such withdrawing Company.
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ARTICLE 14
LOANS
14.1 Subject to such uniform and nondiscriminatory rules as the
Administrator may establish pursuant to Section 14.2, the Administrator
in its sole discretion may direct the Trustee to lend money as of the
next Valuation Date (but not during the Transition Period [as defined in
Section 5.2]) following the Administrator's receipt of written notice
out of the Trust Fund in an amount not less than $1,000, and not
exceeding the lesser of:
(i) $50,000 reduced by the Member's highest outstanding
aggregate balance of loans from the Plan during the
previous twelve months,
(ii) one half of the vested portion of a Member's Account
balance or
(iii) the vested value of the Member's Tax Deferred
Contributions Account, Prior Company Matching
Contributions Account, Company Matching Contributions
Account, Company Profit-Sharing Contributions Account,
Qualified Contribution Account and, effective January 1,
1990, Rollover Account.
14.2 Loans pursuant to this Article 14 shall be granted subject to the
following rules and restrictions:
(a) Loans shall be made available to Members and Beneficiaries who
are "parties in interest" within the meaning of Section 3(14) of
ERISA.
(b) Loans shall not be made available to Highly Compensated Employees,
officers, or shareholders in an amount greater than the amount made
available to other Members and Beneficiaries.
(c) Each loan shall bear a reasonable rate of interest to be determined
by the Administrator at the time the loan is made. The interest
rate on any new loan that is granted shall be redetermined from
time to time pursuant to such uniform and non-discriminatory rules
as the Administrator shall prescribe.
(d) The note executed with respect to the loan shall be secured by a
security interest granted by the Member of the Member's vested
Account balance in the Trust Fund existing then or at some future
time.
(e) The note executed with respect to the loan shall mature not later
than 54 months from the date of execution or upon earlier
termination of employment, except that loans used to acquire, the
principal residence of a Member, shall mature not later than 120
months from the date of execution.
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(f) Repayment of principal and interest shall be by payroll deduction.
Such notes shall be considered as part of the assets of the Trust
Fund. The Member's Accounts in Funds A, B, C, D, E, F, G, and H
shall be reduced by the amount of the loan, and the Member's
Accounts in Funds A, B, C, D, E, F, G, and H shall be increased to
reflect loan repayments for purposes of revaluing the Account
balance pursuant to Article 6. Repayment will be made so that the
loan is repaid in substantially level amounts not less frequently
than quarterly over the term of the loan.
(g) Upon termination of employment for any reason, the term of the loan
shall be accelerated to the Member's date of termination, and the
balance of the loan amount, plus any interest owing, shall become
due and payable at such date. No distribution may be made pursuant
to the provisions of Article 9 prior to payment of the amounts
described in the immediately preceding sentence.
Except as is otherwise hereinafter specifically provided, for loans
granted prior to October 19, 1989, the loan program shall be
administered in accordance with and pursuant to the terms and provisions
of the Plan as in effect prior to October 19, 1989 and as stated in
Section 14.2.
Notwithstanding any other provision of the Plan to the contrary, for
loans granted or renewed on or after October 19, 1989, the loan program
shall be administered in accordance with and pursuant to the terms and
conditions set forth in the Loan Procedures forming part of this Plan, a
copy of which is attached hereto.
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ARTICLE 15
IN EVENT PLAN BECOMES TOP-HEAVY
The purpose of this Article 15 is to conform to the requirements of
Section 401(a)(10)(B) of the Code that the Plan contains provisions (a)
which will take effect if it becomes Top-Heavy and (b) which meet the
requirements of Section 416 of the Code. This Article 15 will in no way
affect the amount of or eligibility for any benefits provided under the
Plan unless and until it becomes Top-Heavy.
15.1 For purposes of this Article 15, the following terms shall have the
following meanings:
(a) "Determination Date" means, with respect to any Plan Year, the last
Valuation Date of the preceding Plan Year.
(b) "Key Employee" means a Member or former Member who is a "key
employee" as defined in Section 416(i) of the Code.
(c) "Permissive Aggregation Group" means, with respect to a given Plan
Year, this Plan and all other plans of the Company and members of
the Group (other than those included in the Required Aggregation
Group) which, when aggregated with the plans in the Required
Aggregation Group, continue to meet the requirements of Sections
401(a)(4) and 410(b) of the Code.
(d) "Present Value of Accounts" means, as of a given Determination
Date, the sum of as of such Determination Date of the Member's
Accounts under the Plan as of such Valuation Date plus any
contributions made after the Valuation Date but before the
Determination Date. The determination of the Present Value of
Accounts shall take into consideration any distributions made to or
on behalf of the Member in the Plan Year ending on the
Determination Date and the four preceding Plan Years, but shall not
take into consideration the Accounts of any Member who has not
performed services for the Company during the five year period
ending on the Determination Date.
(e) "Required Aggregation Group" means with respect to a given Plan
Year, (A) this Plan (B) each other plan of the Company or members
of the Group in which a Key Employee is a participant and (C) each
other plan of the Company or member of the Group which enables a
plan described in (A) or (B) to meet the requirements of Sections
401(a)(4) and 410(b) of the Code. In addition, any terminated plan
which would have been required to be included in such Required
Aggregation Group but for such termination shall be included.
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(f) "Top-Heavy" means, with respect to the Plan for a Plan Year:
(1) that the Present Value of Accounts of Key Employees exceeds
60% of the Present Value of Accounts of all Members; or
(2) the Plan is part of a Required Aggregation Group and such
Required Aggregation Group is a Top-Heavy Group,
unless the Plan or such Top-Heavy Group is itself part of a
Permissive Aggregation Group which is not a Top-Heavy Group.
(g) "Top-Heavy Group" means, with respect to a given Plan Year, a
group of Plans of the Company which, in the aggregate, meet the
requirements of the definition contained in Section 416(g)(2)(B)
of the Code.
(h) "Service", for purposes of this Article 15, means the aggregate of
all periods of a person's employment after the Effective Date with
the Company or the Group, whether or not consecutive, and any
service with The BOC Group, Inc. prior to August 1, 1988.
Service shall include (i) a period of up to 12 months of absence
from employment for any reason other than because of quit,
retirement, death or discharge and (ii) the period from the date
the employee quits, retires or is discharged if he returns to
employment with the Company or the Group within 12 months of such
quit, retirement or discharge. Service also shall include such
period of service in the armed forces of the United States as shall
be required to be recognized under applicable federal law with
respect to military service.
15.2 Notwithstanding any other provision of the Plan to the contrary,
the following provisions of this Section 15.2 shall automatically
become operative and shall supersede any conflicting provisions of the
Plan if, in any Plan Year, the Plan is Top-Heavy.
(a) Except as provided in Subparagraph (d) below, the minimum Company
contribution during the Plan Year on behalf of a Member who is not
a Key Employee shall be equal to the lesser of (1) 3% of such
Member's compensation (within the meaning of Section 415 of the
Code); or (2) the percentage of compensation at which Company
contributions (including Company Matching Contributions, Company
Profit-Sharing Contributions and Tax Deferred Contributions) are
made (or required to be made) under the Plan on behalf of the Key
Employee for whom such percentage is the highest.
(b) In the event of termination of employment of a Member with at least
three years of Continuous Service with the Group (other than by
reason of Retirement, death or Disability or after age 65) such
Member shall be entitled to a 100% vested interest in his Company
Matching Contributions Account.
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(c) In order to comply with the requirements of Section 416(h) of the
Code, in the case of a Member who is or has also participated in a
defined benefit plan of the Company (or any member of the Group
that is required to be aggregated with the Company in accordance
with Section 415(h) of the Code) in any Plan Year in which the Plan
is Top-Heavy, there shall be imposed under such defined benefit
plan the following limitation in addition to any limitation which
may be imposed as described in Section 4.2. In any such year, for
purposes of satisfying the aggregate limit on contributions and
benefits imposed by Section 415(e) of the Code, benefits payable
from the defined benefit plan shall, except as hereinafter
described, be reduced so as to comply with a limit determined in
accordance with Section 415(e) of the Code, but with the number
"1.0" substituted for the number "1.25" in the "defined benefit
plan fraction" (as defined in Section 415(e)(2) of the Code) and in
the "defined contribution plan fraction" (as defined in Section
415(e)(3) of the Code). Notwithstanding the foregoing, if the
application of the additional limitation set forth in this
Subparagraph (c) would result in the reduction of accrued benefits
of any Member under the defined benefit Plan, such additional
limitation shall not become operative, so long as (1) no additional
Company contributions, forfeitures or voluntary nondeductible
contributions are allocated to such Member's accounts under any
defined contribution plan maintained by the Company including this
Plan and (2) no additional benefits accrue to such Member under any
defined benefit plan maintained by the Company. Accordingly, in any
Plan Year that the Plan is Top-Heavy, no additional benefits shall
accrue under the defined benefit plan on behalf of any Member whose
overall benefits under the defined benefit plan otherwise would be
reduced in accordance with the limitation described in this
Subparagraph (c).
(d) In the case of a Member under this Plan who also participates in a
defined benefit pension plan of the Group which contains provisions
intended to comply with Section 416 of the Code in the event such
plan becomes a Top-Heavy plan, the provisions of Subparagraph (a)
above shall be inapplicable to the extent such defined benefit
pension plan provides for a defined benefit minimum pension benefit
in accordance with Section 416(c)(1) of the Code.
(e) Solely for the purpose of determining if the Plan, or any other
plan included in a Required Aggregation Group of which this Plan is
a part is Top-Heavy, the accrued benefit of a Member other than a
Key Employee shall be determined under (i) the method, if any that
uniformly applies for the accrual purposes under all plans
maintained by the Group, or (ii) if there is no such method, as if
such benefit accrued not more rapidly than the slowest accrual rate
permitted under the fractional accrual rate of Section 411(b)(1)(C)
of the Code.
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(f) In the event that Congress should provide by statute, or the
Treasury Department should provide by regulation or ruling, that
the limitations provided in this Article 15 are no longer necessary
for the Plan to meet the requirements of Section 401 or other
applicable law then in effect, such limitations shall become void
and shall no longer apply, without the necessity of further
amendment to the Plan.
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ARTICLE 16
GENERAL PROVISIONS
16.1 All benefits under the Plan shall be paid or provided solely from
the Trust Fund and the Company assume no liability or responsibility
therefor, except to the extent required by law.
16.2 Nothing contained in the Plan shall be deemed to give any Employee the
right to be retained in the service of the Company or to interfere with
the right of the Company to discharge, retire, or otherwise treat any
Employee without any regard to the effect which such treatment might
have upon such Employee as a Member of the Plan.
16.3 Except as may otherwise be specifically provided in the Plan, and
subject to applicable laws, no benefit, interest, distribution or
payment under the Plan at any time shall be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, levy,
garnishment, attachment, charge or encumbrance of any kind, whether
voluntary or involuntary. Any attempt to alienate, sell, transfer,
assign, pledge, levy, garnish, attach, charge, or otherwise encumber
any such benefit, whether presently or thereafter payable, shall be
void. Neither any benefit, interest, distribution or payment, nor the
Trust Fund shall, in any manner, be liable for or subject to the
debts, contracts, engagements, torts, or liabilities of any Employee
included in this Plan or any Beneficiary.
Notwithstanding the foregoing, the creation, assignment or recognition
of a right to any benefit payable with respect to a Member pursuant to a
"qualified domestic relations order" (as defined in Section 414(p) of
the Code) shall not be treated as an assignment or alienation prohibited
by this Section 16.3. Any other provision of the Plan to the contrary
notwithstanding, if a qualified domestic relations order requires the
distribution of all or part of a Member's benefits under the Plan to an
alternate payee, the alternate payee's benefits under the Plan shall in
all events be paid to the alternate payee in a lump sum in cash as soon
as possible.
The Administrator shall adopt such procedures as it deems necessary and
appropriate to carry out the provisions of this Section.
16.4 If any provision of this Plan is held invalid or unenforceable, such
invalidity or unenforceability shall not affect any other provisions
hereof, and this Plan shall be construed and enforced as if such
invalid or unenforceable provision had not been included.
16.5 The determination of the Committee or its designate as to the
identity of the proper payee of any benefit payment from the Trust
Fund and the amount properly payable shall be conclusive, and payments
in accordance with such determination shall constitute a complete
discharge of all obligations on account thereof.
16.6 It shall be the sole duty and responsibility of a Member or Beneficiary
to keep the Administrator apprised of his whereabouts and of his most
current mailing address. If any
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benefit to be paid under the Plan is unclaimed, within such time period
as the Administrator shall prescribe, it shall be forfeited and applied
to reduce Company Matching Contributions in accordance with Section 3.5;
provided, however, that such forfeiture shall be reinstated if a claim
is made by the Member or Beneficiary for the forfeited benefit.
16.7 If the Administrator determines that any person entitled to
payments under the Plan is an infant or incompetent by reason of
physical or mental disability, it may cause all payments thereafter
becoming due to such person to be made to any other person for the
benefit of the person entitled to payment, without responsibility to
follow application of amounts so paid. Payments made pursuant to this
provision shall completely discharge the Plan, the Committee, the
Administrator, and the Trustee.
16.8 All elections, designations, requests, notices, instructions and
other communications required or permitted under the Plan from a
Company, a Member, Beneficiary or other person to the Committee or
Administrator shall be on the Appropriate Form or in such other form
as the Committee or Administrator may prescribe, shall be mailed by
first-class mail, delivered to such location or transmitted in such
manner as shall be specified by such Committee or Administrator, and
shall be deemed to have been given, delivered and/or transmitted only
upon actual receipt thereof by such Committee or Administrator at such
location or in such manner.
16.9 All notices, statements, reports and other communications required or
permitted under the Plan or by law or governmental regulation from a
Company, the Committee or the Administrator to any Employee, Member,
Beneficiary or other person, shall be deemed to have been duly given
when delivered to, or when mailed by first-class mail, postage prepaid,
and addressed to such person at his address last appearing on the
records of the Committee or Administrator.
16.10 Any person or group of persons may serve in more than one fiduciary
capacity with respect to the Plan and any trust agreement which
provides for the Trust Fund.
16.11 Except to the extent governed by Federal law, the Plan shall be
administered and interpreted in accordance with the laws of the State
of Delaware.
16.12 Titles to Articles are for general information only and the Plan is
not to be construed by reference thereto.
16.13 In the event of a transfer from a qualified plan (other than a plan
subject to the requirements of Section 417 of the Code), and at the
discretion of the Corporation, and pursuant to procedures issued by the
Committee, the individuals who were participants in such plan may be
given the opportunity to elect to have their entire interests in such
plan transferred directly on a trust-to-trust basis into this Plan. Any
such transferred amounts shall be allocated to Accounts of Participants
as determined by the Committee.
16.14 In the event of a transfer from the BOC Group, Inc. Savings Investment
Plan, and pursuant to procedures issued by the Committee, the
individuals who were members in such plan and
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who made such election shall have their entire interests in such plan
transferred directly on a trust-to-trust basis into this Plan.
16.15 Effective January 1,1990, an Employee who has had distributed to him
all or part of his interest in another plan which meets the requirements
of Section 401(a) of the Code (the "Other Plan") may, in accordance with
procedures established by the Administrator, if the Committee determines
to accept rollovers from time to time, roll over all or a portion of
such distribution to the Trustee provided the following conditions are
met:
(a) the rollover occurs on or before the 60th day following his receipt
of such distribution from the Other Plan; and
(b) the distribution from the Other Plan qualifies for rollover
treatment under Section 402(a)(5) of the Code; and
(c) the rollover does not include any amounts considered contributed by
the Employee within the meaning of Section 402(e)(4)(D)(i) of the
Code.
If the Committee determines to accept rollovers from time to time, the
Administrator shall develop such procedures, and may require such
information from an Employee desiring to make such a rollover, as it
deems necessary or desirable to determine that the proposed rollover
will meet the requirements of this Section. Any such rollover amount
shall be invested as directed by an Employee's separate investment
election consistent with the principles of Article 5.
16.16 This Section 16.16 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 16.16, a distributee may elect, at the time and in the
manner prescribed by the Committee, to have any portion of an eligible
rollover distribution paid directly to an eligible retirement plan
specified by the distributee in a direct rollover.
Definitions:
(a) Eligible rollover distribution: An eligible rollover distribution
is any distribution of all or any portion of the balance to the
credit of the distributee, except that an eligible rollover
distribution does not include:
(i) 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;
(ii) any distribution to the extent such distribution is required
under Section 401(a)(9) of the Code;
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(iii) the portion of any distribution that is not includable in
gross income (determined without regard to the exclusion
for net unrealized appreciation with respect to employer
securities); and
(iv) any distribution with a value of $200 or less.
(b) Eligible retirement plan: An eligible retirement plan is an
individual retirement account described in Section 408(a) of the
Code, an individual retirement annuity described in Section 408(b)
of the Code, an annuity plan described in Section 403(a) of the
Code, or a qualified trust described in Section 401(a) of the Code,
that accepts the distributee's eligible rollover distribution.
However, in the case of an eligible rollover distribution to the
surviving spouse, an eligible retirement plan is an individual
retirement account or individual retirement annuity.
Notwithstanding anything herein to the contrary, only one eligible
retirement plan may be designated with respect to any eligible
rollover distribution.
(c) Distributee: A distributee includes an Employee or former Employee.
In addition, 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.
(d) Direct rollover: A direct rollover is a payment by the Plan to the
eligible retirement plan specified by the distributee.
Notwithstanding anything herein to the contrary, only one direct
rollover may be made with respect to any eligible rollover
distribution.
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EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration
statement on Form S-8, to be used in registering Common Stock under The
Carbide/Graphite Group, Inc. Savings Investments Plan, of our reports dated
September 10, 1996, on our audits of the consolidated financial statements and
financial statement schedule of The Carbide/Graphite Group, Inc. and
Subsidiaries (The Company) as of July 31, 1996 and 1995, and for each of the
three years in the period ended July 31, 1996, which report is incorporated by
reference or included in the Company's Annual Report on Form 10-K for the fiscal
year ended July 31, 1996.
Pittsburgh, Pennsylvania /s/ COOPERS & LYBRAND L.L.P.
November 25, 1996 ----------------------------
