<PAGE>
As filed with the Securities and Exchange Commission on March 30, 1994.
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
ARKANSAS BEST CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 71-0673405
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1000 South 21st Street
Fort Smith, Arkansas 72901
(501) 785-6000
(Address, including zip code, and telephone number, including area
code, of Registrant's principal executive offices)
ARKANSAS BEST CORPORATION EMPLOYEES' INVESTMENT PLAN
(Full title of Plan)
Richard F. Cooper Copy to: Kenneth G. Hawari
Secretary Hughes & Luce, L.L.P.
1000 South 21st Street 1717 Main Street, Suite 2800
Fort Smith, Arkansas 72901 Dallas, Texas 75201
(501) 785-6000
(Name, address, and telephone number,
including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
Title of Each
Class of Amount Proposed Maximum Proposed Maximum Amount of
Securities to to be Offering Price Aggregate Registration
be Registered Registered(1) Per Share(2) Offering Price(2) Fee
Common Stock, 500,000 $12.88 $6,440,000.00 $2,221.00
$.01 par value
Common Stock 500,000 N/A N/A N/A
Rights
(1) Pursuant to Rule 416(c) under the Securities Act of 1933, as amended,
there are also being registered an indeterminate amount of interests to
be offered or sold pursuant to the Arkansas Best Corporation Employees'
Investment Plan. Also being registered is an indeterminate amount of
units in the Arkansas Best Corporation Stock Fund as described in the
Arkansas Best Corporation Employees' Investment Plan and the related
Prospectus.
(2) Estimated solely for the purpose of calculating the registration fee on
the basis of the average of the bid and asked prices paid for a share of
Arkansas Best Corporation Common Stock on March 24, 1994, as reported on
the NASDAQ/National Market System, all in accordance with Rule 457(h)
promulgated under the Securities Act of 1933, as amended.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information.
Not required to be filed with this Registration Statement.
Item 2. Registrant Information and Employee Plan Annual Information.
Not required to be filed with this Registration Statement.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference.
The following documents are incorporated by reference in this
Registration Statement, except to the extent that any statement or
information herein is modified, superseded or replaced by a statement or
information contained in any other subsequently filed document incorporated
herein by reference:
(a) The Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1993 (the "1993 10-K") filed with the Securities and
Exchange Commission (the "Commission"), which contains audited financial
statements of the Registrant for the fiscal year ended December 31, 1993.
(b) All reports filed by the Registrant pursuant to Sections 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), since the end of the fiscal year covered by the 1993 10-K.
(c) The description of the Company's Common Stock and Common Stock
Rights as contained in the Registrant's Form 8-A Registration Statement,
filed with the Commission on March 20, 1992, as amended by Form 8, dated
April 23, 1992, and including any amendment or report filed for the purpose
of updating such description.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-
effective amendment to this Registration Statement which indicates that all
of the shares of Common Stock offered have been sold or which deregisters all
of such shares then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be a part hereof from the
date of filing of such documents.
<PAGE>
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any other subsequently filed document which also is
incorporated or deemed to be incorporated by reference herein modifies or
supersedes such statement. Any statement so modified or superseded shall not
be deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Registrant's Restated Certificate of Incorporation provides that no
director of the Registrant will be personally liable to the Registrant or any
of its stockholders for monetary damages arising from the director's breach
of fiduciary duty as a director, with certain limited exceptions.
Pursuant to the provisions of Section 145 of the Delaware General
Corporation Law, every Delaware corporation has the power to indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding (other than an
action by or in the right of the corporation) by reason of the fact that he
or she is or was a director, officer, employee or agent of any corporation,
partnership, joint venture, trust or other enterprise, against any and all
expenses, judgments, fines and amounts paid in settlement and reasonably
incurred in connection with such action, suit or proceeding. The power to
indemnify applies only if such person acted in good faith and in a manner he
or she reasonably believed to be in the best interest, or not opposed to the
best interest, of the corporation and with respect to any criminal action or
proceeding, had no reasonable cause to believe his or her conduct was
unlawful.
The power to indemnify applies to actions brought by or in the right of
the corporation as well, but only to the extent of defense and settlement
<PAGE>
expenses and not to any satisfaction of a judgment or settlement of the claim
itself, and with the further limitation that in such actions no
indemnification shall be made in the event of any adjudication unless the
court, in its discretion, believes that in the light of all the circumstances
indemnification should apply.
To the extent any of the persons referred to in the two immediately
preceding paragraphs is successful in the defense of the actions referred to
therein, such person is entitled, pursuant to Section 145, to indemnification
as described above.
The Registrant has entered into indemnity agreements with each of its
directors. Each such Indemnification Agreement provides for indemnification
of directors of the Registrant to the fullest extent permitted by the
Delaware General Corporation Law and additionally permits advancing
attorney's fees and all other costs, expenses, obligations, fines and losses,
paid or incurred by a director generally in connection with the
investigation, defense or other participation in any threatened, pending or
completed action, suit or proceeding or any inquiry or investigation thereof,
whether conducted by or on behalf of the Registrant or any other party. If
it is later determined that the director is or was not entitled to
indemnification under applicable law, the Registrant is entitled to
reimbursement by the director.
The Indemnification Agreements further provide that in the event of a
change in control of the Registrant, then with respect to all matters
thereafter arising concerning the rights of directors to indemnity payments
and expense advances, all determinations regarding excludable claims will be
made only by a court of competent jurisdiction or by special independent
legal counsel selected by the director and approved by the Registrant.
To the extent that the board of directors or the stockholders of the
Registrant may in the future wish to limit or repeal the ability of the
Registrant to indemnify directors, such repeal or limitation may not be
effective as to directors who are currently parties to the Indemnification
Agreements, because their rights to full protection are contractually assured
by the Indemnification Agreements. It is anticipated that similar contracts
may be entered into, from time to time, with future directors of the
Registrant.
In addition, the Registrant's Restated Certificate of Incorporation and
Amended and Restated Bylaws provide for indemnification of officers and
directors to the fullest extent permitted by the Delaware General Corporation
Law.
<PAGE>
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
The Exhibits to this Registration Statement are listed in the Index to
Exhibits on page II-9 of this Registration Statement, which Index is
incorporated herein by reference. An opinion of counsel (Exhibit number 5)
is not being filed since the securities being registered are not original
issue securities. The Registrant undertakes to submit the Arkansas Best
Corporation Employees' Investment Plan and any amendment thereto to the
Internal Revenue Service ("IRS") in a timely manner and will make all changes
required by the IRS in order to qualify such plan.
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 of 1993, as amended (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 Exchange Act that are
incorporated by reference in the Registration Statement.
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such
securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is incorporated by
reference in the Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the provisions described in Item 6, or
otherwise, the Registrant has been advised that in the opinion of the
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted 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
Securities Act and will be governed by the final adjudication of such issue.
<PAGE>
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act, 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 Fort Smith, State of Arkansas, on
March 29, 1994.
ARKANSAS BEST CORPORATION
By: /s/ Donald L. Neal
--------------------------
Donald L. Neal,
Senior Vice President -
Chief Financial Officer
Power of Attorney
Each person whose signature appears below hereby constitutes and
appoints Robert A. Young III and Donald L. Neal, and each of them, his true
and lawful attorneys-in-fact and agents with full power of substitution and
resubstitution, for him and in his name, place and stead, and any and all
capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, and hereby grants to such attorneys-in-
fact and agents, and each of them, full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents or any of them or
his or their substitute or substitutes may lawfully do or cause to be done by
virtue hereof.
<PAGE>
Pursuant to the requirements of the Securities Act, this registration
statement or amendment thereto has been signed by the following persons in
the capacities and on the dates indicated.
Signature Title Date
/s/ William A. Marquard Chairman of the Board, March 29, 1994
- ------------------------ Director
William A. Marquard
/s/ Robert A. Young III Director, Chief March 29, 1994
- ------------------------ Executive Officer
Robert A. Young III and President (Principal
Executive Officer)
/s/ Donald L. Neal Senior Vice President March 29, 1994
- ------------------------ Chief Financial Officer
Donald L. Neal (Principal Financial
and Accounting Officer)
/s/ Frank Edelstein Director March 29, 1994
- ------------------------
Frank Edelstein
/s/ Arthur J. Fritz, Jr. Director March 29, 1994
- ------------------------
Arthur J. Fritz, Jr.
/s/ John H. Morris Director March 29, 1994
- ------------------------
John H. Morris
/s/ Alan J. Zakon, Ph.D Director March 29, 1994
- ------------------------
Alan J. Zakon, Ph.D
<PAGE>
The Plan. Pursuant to the requirements of the Securities Act, this
Registration Statement has been signed by the following members of the
Administrative Committee of the Arkansas Best Corporation Employees'
Investment Plan, in the City of Fort Smith, State of Arkansas, on the dates
indicated.
Signature Title Date
/s/ Donald L. Neal Chairman March 29, 1994
- -----------------------
Donald L. Neal
/s/ Richard F. Cooper Member March 29, 1994
- -----------------------
Richard F. Cooper
/s/ James T. Curtis Member March 29, 1994
- -----------------------
James T. Curtis
/s/ Shirley J. Boze Member March 29, 1994
- -----------------------
Shirley J. Boze
/s/ Jerry A. Yarbrough Member March 29, 1994
- -----------------------
Jerry A. Yarborough
/s/ Edward G. Myers Member March 29, 1994
- -----------------------
Edward G. Myers
/s/ Randall M. Loyd Member March 29, 1994
- -----------------------
Randall M. Loyd
<PAGE>
INDEX TO EXHIBITS
Exhibit Sequentially
Number Exhibit Numbered Page
4.1 Restated Certificate of Incorporation of the --
Registrant filed as Exhibit 3.1 to the
Registration Statement on Form S-1 (No. 33-
46483) and incorporated herein by reference.
4.2 Amended and Restated Bylaws of the Company filed --
as Exhibit 3.2 to the Registration Statement on
Form S-1 (No. 33-46483) and incorporated herein
by reference.
4.3 Arkansas Best Corporation Stock Option Plan --
filed as Exhibit 10.3 to the Registration
Statement on Form S-1 (No. 33-46483) and
incorporated herein by reference.
4.4 Arkansas Best Corporation Disinterested Director --
Stockholder Plan, dated May 7, 1993, filed as
Exhibit 4.4 to the Registration Statement on
Form S-8 (No. 33-66694) and incorporated herein
by reference.
4.5 Stockholders' Rights Plan by and between --
Arkansas Best Corporation and Harris Trust and
Savings Bank, as Rights Agent, dated as of April
23, 1992, filed as Exhibit 10.2 to the
Registration Statement on Form S-1 (No. 33-
46483) and incorporated herein by reference.
* 4.6 Arkansas Best Corporation Employees' Investment --
Plan, effective as of January 1, 1994.
* 24.1 Consent of Ernst & Young. --
25 Power of Attorney is found on pages II-6 to II-7 --
hereof.
* Filed Herewith.
<PAGE>
ARKANSAS BEST CORPORATION
EMPLOYEES' INVESTMENT PLAN
Generally Effective as of January 1, 1994
<PAGE>
TABLE OF CONTENTS
SECTION PAGE
ONE PURPOSE AND RESTATEMENT OF THE PLAN AND
ESTABLISHMENT OF THE TRUST FUNDS........ 1
1.1 Restatement of the
Plan........... 1
1.2 Purposes......................... 1
1.3 Trust Agreement.................. 1
TWO DEFINITIONS............................... 2
THREE REQUIREMENTS FOR ELIGIBILITY.............. 12
3.1 Service.......................... 12
3.2 Service with a Predecessor
Employer....................... 12
3.3 Periods of Severance............. 12
3.4 Change in Status of Employee..... 12
FOUR ACTIVE PARTICIPATION IN THE PLAN.......... 13
4.1 Active Participation............. 13
4.2 Rollover Account................. 14
FIVE ADMINISTRATION OF THE PLAN................ 15
5.1 Responsibility for
Administration of the Plan..... 15
5.2 Appointment of Administrative
Committee...................... 15
5.3 Responsibility for Administration
of the Trust Fund.............. 15
5.4 Delegation of Powers............. 15
5.5 Records.......................... 16
5.6 General Administrative Powers.... 16
5.7 Appointment of Professional
Assistants and Investment
Manager........................ 17
5.8 Actions of the Administrative
Committee...................... 17
5.9 Directives of the Administrative
Committee...................... 18
5.10 Discretionary Acts............... 18
5.11 Responsibility of Fiduciaries.... 18
5.12 Indemnity by Participating
Companies...................... 19
5.13 Payment of Fees and Expenses..... 19
5.14 Plan Administrator............... 20
5.15 Allocation and Delegation of
Administrative Committee
Responsibilities............... 20
<PAGE>
SIX DEPOSITS.................................. 20
6.1 Company Matching Deposits........ 20
6.2 Basic and Supplemental Before-
Tax Deposits................... 21
6.3 Date of Payment of Deposits...... 22
6.4 Special Limitations on
Before-Tax Deposits............ 22
6.5 Special Limitation on Company
Matching Deposits.............. 31
6.6 Right to Change Rate of,
Resume or Discontinue
Basic and Supplemental
Before-Tax Deposits............ 35
6.7 Withdrawals from Participant
Accounts....................... 36
SEVEN ALLOCATION TO PARTICIPANTS' ACCOUNTS...... 38
7.1 Methods of Allocating Deposits... 38
7.2 Allocation to a Participant
Transferred to a Participating
Company........................ 39
7.3 Allocation to a Participant
Transferred to an Affiliated
Company Which Has Not Adopted
the Plan....................... 39
7.4 Limitations on Annual Additions.. 39
7.5 Limitations on Annual Additions
for Participating Companies
or Affiliated Companies
Maintaining Other Defined
Contribution Plans............. 42
7.6 Limitations on Benefits and
Annual Additions for
Participating Companies or
Affiliated Companies
Maintaining Defined Benefit
Plans.......................... 42
7.7 Definitions Relating to Annual
Addition Limitations........... 43
EIGHT VALUATION OF TRUST FUND................... 45
NINE PARTICIPANTS' ACCOUNTS.................... 46
9.1 Separate Accounts................ 46
9.2 Accounts of Participants
Transferred to an Affiliated
Company........................ 46
9.3 Adjustment of Participant's
Accounts....................... 46
9.4 Account Investment Direction..... 46
9.5 Arkansas Best Stock Fund......... 48
<PAGE>
TEN COMMON TRUST FUND......................... 50
ELEVEN DESIGNATION OF BENEFICIARIES.............. 50
11.1 Participant's Designation........ 50
11.2 Qualified Consent................ 51
TWELVE DISABILITY BENEFITS....................... 52
12.1 Disability Retirement Benefits... 52
12.2 Determination of Disability...... 52
THIRTEEN RETIREMENT AND DEATH BENEFITS............. 52
13.1 Retirement Benefits.............. 52
13.2 Death Benefits................... 53
FOURTEEN EMPLOYMENT TERMINATION BENEFITS........... 53
14.1 Vesting upon Termination of
Employment..................... 53
14.2 Determination of Vesting Years
of Service..................... 54
14.3 Periods of Severance............. 54
14.4 Forfeiture of Non-Vested Amount.. 55
14.5 Restoration of Forfeited
Non-Vested Amount.............. 56
14.6 Vesting of ESOP Accounts......... 57
FIFTEEN PAYMENT OF BENEFITS....................... 57
15.1 Amount of Payment................ 57
15.2 Method of and Time for
Distribution of Benefits....... 57
15.3 Limitations on Timing............ 59
15.4 Payments on Personal Receipt
Except in Case of Legal
Disability..................... 59
15.5 Benefits Payable in Cash......... 60
15.6 Distribution Accounts............ 60
15.7 PUT Option for ESOP Accounts
Only........................... 60
15.8 Distribution Limitations
Applicable to Before-Tax
Deposits....................... 61
15.9 Benefits Payable Pursuant To
a Qualified Domestic
Order.......................... 61
15.10 Direct Rollovers................. 62
SIXTEEN BENEFIT CLAIMS PROCEDURE.................. 63
16.1 Claims for Benefits.............. 63
16.2 Request for Review of Denial..... 64
16.3 Decision on Review of Denial..... 64
<PAGE>
SEVENTEEN MISCELLANEOUS PROVISIONS RESPECTING
PARTICIPANTS............................ 65
17.1 Participants to Furnish
Required Information........... 65
17.2 Participants' Rights in Trust
Fund........................... 66
17.3 Inalienability of Benefits....... 66
17.4 Address for Mailing of Benefits.. 69
17.5 Unclaimed Account Procedure...... 69
EIGHTEEN LOANS TO PARTICIPANTS, BENEFICIARIES
AND ALTERNATE PAYEES.................... 70
NINETEEN ADOPTION OF PLAN BY AFFILIATED COMPANY.... 73
TWENTY WITHDRAWAL FROM PLAN...................... 73
20.1 Notice of Withdrawal............. 73
20.2 Segregation of Trust Assets upon
Withdrawal..................... 73
20.3 Exclusive Benefit of
Participants................... 73
20.4 Applicability of Withdrawal
Provisions..................... 73
TWENTY-
ONE AMENDMENT OF THE PLAN..................... 74
TWENTY-
TWO PERMANENCY OF THE PLAN.................... 75
22.1 Right to Terminate Plan.......... 75
22.2 Merger or Consolidation of
Plan and Trust................. 75
22.3 Continuance by Successor Company. 76
TWENTY-
THREE DISCONTINUANCE OF DEPOSITS AND
TERMINATION............................. 76
23.1 Discontinuance of Deposits....... 76
23.2 Termination of Plan and Trust.... 76
23.3 Rights to Benefits upon
Termination of Plan or
Complete Discontinuance
of Deposits.................... 77
TWENTY-
FOUR STATUS OF EMPLOYMENT RELATIONS............ 77
TWENTY-
FIVE BENEFITS PAYABLE BY TRUST................. 78
<PAGE>
TWENTY-
SIX EXCLUSIVE BENEFIT OF TRUST FUND........... 78
26.1 Limitation on Reversions......... 78
26.2 Unallocated Amounts upon
Termination of Plan and Trust.. 78
26.3 Mistake of Fact or Disallowance
of Deduction.................. 78
26.4 Failure of Initial Qualification
of Plan and Trust.............. 79
TWENTY-
SEVEN APPLICABLE LAW............................ 79
TWENTY-
EIGHT INTERPRETATION OF THE PLAN AND TRUST...... 79
TWENTY-
NINE TOP HEAVY PLAN RULES...................... 80
29.1 Definitions...................... 80
29.2 Determination of Top Heaviness... 82
29.3 Minimum Requirements............. 85
29.4 Minimum Benefits for Employers
Maintaining Defined
Benefit Plans.................. 86
29.5 Super Top Heavy Plans............ 86
<PAGE>
ARKANSAS BEST CORPORATION
EMPLOYEES' INVESTMENT PLAN
SECTION ONE
PURPOSE AND RESTATEMENT OF THE PLAN
AND ESTABLISHMENT OF THE TRUST FUNDS
1.1 Restatement of the Plan. Subject to the terms
and conditions hereinafter set forth, Arkansas Best Corporation
(the "Sponsoring Company") hereby amends and restates effective
as of January 1, 1994 (except as otherwise provided herein),
the Arkansas Best Corporation Employees' Investment Plan, a
retirement plan for the exclusive benefit of its Employees and
their Beneficiaries, which was originally established effective
as of July 1, 1988, and was thereafter amended from time to
time.
Except as otherwise provided herein, the
provisions of the amended and restated Plan as contained herein
are applicable to Employees and Participants who have not died,
retired, become disabled or otherwise terminated employment
prior to January 1, 1994, or who are reemployed by a
Participating Company or Affiliated Company after January 1,
1994, and while they are still entitled to reinstatement of
rights under the Plan. Except as otherwise provided herein,
any Employee or Participant who died, retired, became disabled
or terminated employment prior to January 1, 1994, shall
receive any benefits to which he is entitled based upon the
provisions of the Plan as in effect prior to January 1, 1994.
1.2 Purposes. The purposes hereof are to reward
Employees for their long and faithful service, to help the
Employees accumulate funds for their later years, and to
provide funds for their Beneficiaries in case of death.
It is the intention of the Participating
Companies that this Plan shall meet all of the requirements
necessary or appropriate to qualify as a profit-sharing plan
under Sections 401(a) and 401(k) of the Code and that the Fund
made a part hereof shall be exempt from tax under Section
501(a) of the Code and all provisions hereof shall be
interpreted accordingly. Contributions may be made hereunder
without regard to whether the Sponsoring Company has profits.
1.3 Trust Agreement. In furtherance of this Plan,
the Sponsoring Company, effective as of April 1, 1994, has
entered into the Arkansas Best Corporation Employees'
Investment Trust ("Investment Trust"), which supersedes all
prior trust agreements relating to the Plan; such Trust
Agreement is made a part hereof, for the purpose of carrying
out the provisions of this Plan as hereinafter set forth.
<PAGE>
SECTION TWO
DEFINITIONS
As used in the Plan:
2.1 "Account" or "Accounts" shall mean the Basic
Before-Tax Deposit Account, if any; the Supplemental Before-Tax
Deposit Account, if any; the Choice Benefits Deposit Account,
if any; the Company Matching Deposit Account; the ESOP Account,
if any; and the Rollover Account, if any, collectively or
singly as the context requires, maintained for each Participant
under the Plan.
2.2 "Active Participant" shall mean a Participant who
has currently elected in accordance with the provisions of
Section 4.1 hereof to have Basic Before-Tax Deposits made on
his behalf, pursuant to the provisions of Section 6.2 hereof.
2.3 "Administrative Committee" shall mean the persons
or entity appointed to administer the Plan in accordance with
the provisions of Section Five of the Plan. The Administrative
Committee shall be the "Named Fiduciary" as referred to in
Section 402(a) of ERISA with respect to the management,
operation and administration of the Plan.
2.4 "Affiliated Company" shall mean any company which is a
component member of a controlled group of corporations within
the meaning of Section 1563(a) of the Code determined without
regard to Sections 1563(a)(4) and (e)(3)(C) thereof, which
controlled group of corporations includes as a component member
the Sponsoring Company or any Participating Company, except
that with respect to Section 7.4 hereof, "50 per cent" shall be
substituted for "80 per cent" where it appears in paragraph 1
of Section 1563(a) of the Code. The term "Affiliated Company"
shall also mean any trade or business under common control (as
defined in Sections 414(b) and 414(c) of the Code) with a
Participating Company and any member of an affiliated service
group (as defined in Section 414(m) of the Code) of which a
Participating Company is a member and any entity required to be
aggregated with a Participating Company pursuant to regulations
under Section 414(o) of the Code.
2.5 "Arkansas Best Stock" shall mean the common stock
of Arkansas Best Corporation, a Delaware corporation, or its
successor.
2.6 "Arkansas Best Stock Fund" shall mean the
Investment Fund invested primarily in Arkansas Best Stock as
provided in Section 9.5.
<PAGE>
2.7 "Basic Before-Tax Deposit Account" shall mean the
separate account maintained for each Participant reflecting the
Basic Before-Tax Deposits made on behalf of such Participant,
as adjusted in accordance with the provisions of Section Nine
of the Plan.
2.8 "Basic Before-Tax Deposits" shall mean the amount
each Active Participant has elected to have the Participating
Companies contribute on his behalf pursuant to the provisions
of Section 6.2 hereof which is subject to a Company Matching
Deposit. Such amounts shall qualify as elective contributions
under Section 401(k) of the Code and the regulations
thereunder.
2.9 "Before-Tax Deposits" shall mean, collectively or
singly as the context requires, a Participant's Basic Before-
Tax Deposits, if any, and his Supplemental Before-Tax Deposits,
if any.
2.10 "Beneficiary" shall mean any person entitled to
receive benefits which are payable upon or after a
Participant's death pursuant to Section 11 and Section 13.2 of
the Plan.
2.11 "Choice Benefits Deposit Account" shall mean the
separate account maintained for each Participant reflecting the
Choice Benefits Deposits made prior to January 1, 1990 on
behalf of such Participant, as adjusted in accordance with
Section Nine of the Plan.
2.12 "Choice Benefits Deposits" shall mean the amount
of the Participating Companies' contributions provided for in
the prior version of the Plan.
2.13 "Code" shall mean the Internal Revenue Code of
1986, as amended from time to time. References to any Section
of the Internal Revenue Code shall include any successor
provision thereto.
2.14 "Company Matching Deposit Account" shall mean the
separate account maintained for each Participant reflecting
such Participant's allocable share of the Company Matching
Deposits under Subsection 6.1(1) hereof, as adjusted in
accordance with the provisions of Section Nine of the Plan.
2.15 "Company Matching Deposits" shall mean the amount
of the Participating Companies' contributions provided for in
Subsection 6.1(1) hereof which match the Participant's Basic
Before-Tax Deposits.
2.16 "Compensation" shall mean, subject to the
provisions of Subsection 29.3(1) hereof, the amounts actually
<PAGE>
paid to an Employee by the Participating Company for services
rendered, inclusive of bonuses, commissions and overtime pay,
and amounts, if any, that would have been included in the
Employee's Compensation for such calendar year if they had not
received special tax treatment because they were deferred by
the Employee through a plan of deferred compensation under
Section 401(k) of the Code or under a salary reduction
agreement pursuant to Section 125 of the Code, but exclusive of
expense allowances and all other extraordinary compensation and
any Compensation paid for any period prior to the Entry Date on
which a Participant first becomes a Participant under the Plan.
Notwithstanding the foregoing, for Plan Years beginning after
December 31, 1988 and before December 31, 1993, "Compensation"
shall not include any Compensation in excess of Two Hundred
Thousand Dollars ($200,000) or such larger amount as results
from the adjustment provided in Section 401(a)(17) of the Code.
Notwithstanding the foregoing, for Plan Years beginning after
December 31, 1993, "Compensation" shall not include any
Compensation in excess of One Hundred Fifty Thousand Dollars
($150,000) or such larger amount as results from the adjustment
provided in Section 401(a)(17) of the Code.
2.17 "Eligible Employee" shall mean each Employee who
is employed by a Participating Company except the following
individuals:
2.17(1) any person who is a "casual employee" of
a Participating Company as defined by the Participating
Company's uniform and nondiscriminatory employment policy,
unless and until such "casual employee" completes a Vesting
Year of Service as defined in Section 2.45 hereof, in which
event such casual employee shall be treated as an Eligible
Employee as defined herein as of the date such casual employee
completes the Vesting Year of Service.
2.17(2) any person who is included in a
collective bargaining unit, if retirement benefits were the
subject of good faith bargaining, unless and until said
bargaining unit has bargained for coverage under the Plan, in
which event such person shall be treated as an Employee as
defined herein as of the date said bargaining unit commences
coverage under this plan.
2.17(3) any person who is not treated as an
employee on the payroll of a Participating Company, regardless
of whether such person is considered a leased employee within
the meaning of Code Sections 414(n) and 414(o).
<PAGE>
2.18 "Employee" shall mean any person who is employed
as a common-law employee by an Affiliated Company and receives
a compensation from an Affiliated Company that is subject to
FICA tax. Any leased employee shall be considered an
"Employee" under the Plan to the extent required by Sections
414(n) or 414(o) of the Code, but shall not be eligible to
participate in the Plan unless and until he actually becomes
employed on the payroll of a Participating Company and
otherwise meets the eligibility criteria of Article VI hereof.
2.19 "Employment Commencement Date" shall mean the
date an Employee first performs an Hour of Service with a
Participating Company or an Affiliated Company.
2.20 "Entry Date" shall mean the first day of each
calendar quarter.
2.21 "ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended from time to time. References
to any Section of ERISA shall include any successor provision
thereto.
2.22 "Hour of Service" shall mean each hour for which
an Employee is directly or indirectly paid, or entitled to
payment by a Participating Company or an Affiliated Company for
the performance of duties.
2.23 "Inactive Participant" shall mean any Participant
other than an Active Participant.
2.24 "Investment Manager" shall mean any party that
(i) is either (a) registered as an investment adviser under the
Investment Advisers Act of 1940, or (b) a bank (as defined in
the Investment Advisers Act of 1940), or (c) an insurance
company qualified to manage, acquire or dispose of Plan assets
under the laws of more than one State, (ii) acknowledges in
writing that it is a fiduciary with respect to the Plan, and
(iii) is granted the power to manage, acquire or dispose of any
asset of the Plan pursuant to Section 5.7 hereof and the Trust
Agreement.
2.25 "Leave of Absence" shall mean an absence with or
without pay from the active employment of a Participating
Company by reason of an approved absence granted by such
Participating Company in accordance with its leave and
personnel regulations, whether by reason of military service or
for any other reason on the basis of a uniform policy applied
by such Participating Company without discrimination (including
periods during which an Employee is receiving benefits under
any disability or sickness plan of a Participating Company or
an Affiliated Company). Such a Leave of Absence will not
<PAGE>
constitute a Termination of Employment provided the Employee
returns to the active employment of the Participating Company
at or prior to the expiration of his leave or, if not specified
therein, within the period of time which accords with such
Participating Company's policy with respect to permitted
absences. If the Employee does not return to the active
employment of such Participating Company at or prior to the
expiration of his Leave of Absence, his employment will be
considered terminated as of the earlier of (i) the date on
which his Leave of Absence expired, or (ii) the date which is
twelve (12) months after the date on which his Leave of Absence
began. Notwithstanding the foregoing provisions of this
Section, an Employee's absence from the active service of a
Participating Company because of military service will be
considered a Leave of Absence granted by a Participating
Company and will not terminate the employment of such Employee
if he returns to the active employment of the Participating
Company within the period of time during which he has
reemployment rights under any applicable federal law or within
sixty (60) days from and after discharge or separation from
such military service if no federal law is applicable.
However, no provision of this Section or of the remainder of
the Plan shall require reemployment of any Employee whose
active service with the Participating Company was terminated by
reason of military service.
2.26 "One-Year Period of Severance" shall mean a
twelve (12) consecutive month Period of Severance.
Notwithstanding the foregoing provisions hereof, or any other
provision of this Plan to the contrary, in the case of an
Employee who is absent from work for any period (i) by reason
of (a) the Employee's pregnancy, (b) the birth of the
Employee's child, (c) the placement of a child with the
Employee in connection with the adoption of such child by the
Employee, or (ii) for the purpose of caring for such child for
a period beginning immediately following such birth or
placement, the twelve (12) consecutive month period beginning
on the first anniversary of the first date of such absence
shall not constitute a One-Year Period of Severance and shall
not constitute a Period of Service.
2.27 "Participant" shall mean an Eligible Employee who
becomes a Participant in the Plan as provided in Section Three
of the Plan.
2.28 "Participating Company" shall mean the Sponsoring
Company or any Affiliated Company which adopts the Plan
pursuant to Section Nineteen of the Plan.
2.29 "Period of Service" shall mean the period of time
commencing on an Employee's Employment Commencement Date or
<PAGE>
Reemployment Commencement Date, as the case may be, and ending
on such Employee's Severance from Service Date. A Period of
Service shall also include a Period of Severance of less than
twelve (12) consecutive months. Notwithstanding the preceding
sentence:
2.29(1) If an Employee who is on Leave of
Absence or who is temporarily laid off, retires or suffers a
Termination of Employment during the first twelve (12) months
of such Leave of Absence or temporary layoff, as the case may
be, such Employee's Period of Service shall not include any
Period of Severance beginning on the date such Employee retired
or suffered a Termination of Employment and ending on such
Employee's Reemployment Commencement Date, if any, if such
Reemployment Commencement Date, if any, does not occur within
the twelve (12) month period commencing on the date such Leave
of Absence or temporary layoff began.
2.29(2) If an Employee works simultaneously for
more than one Participating Company and/or Affiliated Company,
the total Period of Service for such Employee shall not be
increased by reason of such simultaneous employment.
2.30 "Period of Severance" shall mean the period of
time commencing on an Employee's Severance from Service Date
and ending on such Employee's Reemployment Commencement Date,
if any.
2.31 "Plan" shall mean the Arkansas Best Corporation
Employees' Investment Plan as set forth in this document, and
as hereafter amended from time to time.
2.32 "Plan Year" shall mean the twelve (12)
consecutive month period ending on December 31 of each year.
2.33 "Reemployment Commencement Date" shall mean the
date on which an Employee first performs an Hour of Service
with a Participating Company or an Affiliated Company following
such Employee's Severance from Service Date.
2.34 "Retirement Date" of a Participant shall mean the
Participant's sixty-fifth (65th) birthday.
2.35 "Severance from Service Date" shall mean the
earlier of:
2.35(1) The date on which an Employee separates
from the active employment of a Participating Company or an
Affiliated Company on account of retirement, death, Total
<PAGE>
and Permanent Disability or Termination of Employment; or
2.35(2) In the case of an Employee on Leave of
Absence who does not return to the active employment of the
Participating Company or an Affiliated Company at or prior to
the expiration of such Leave of Absence, the earlier of (i) the
expiration date of such Leave of Absence, or (ii) the date
which is twelve (12) months after the date on which such Leave
of Absence began, or, in the case of an Employee who becomes
absent (whether the absence is with or without pay) from the
active employment of a Participating Company or an Affiliated
Company by reason of a temporary layoff, the date which is
twelve (12) months after the date on which such Employee first
becomes absent.
2.36 "Sponsoring Company" shall mean Arkansas Best
Corporation or its successor.
2.37 "Supplemental Before-Tax Deposit Account" shall
mean the separate account maintained for each Participant
reflecting the Supplemental Before-Tax Deposits made on behalf
of such Participant, as adjusted in accordance with the
provisions of Section Nine of the Plan.
2.38 "Supplemental Before-Tax Deposits" shall mean the
amount each Active Participant has elected to have the
Participating Companies contribute on his behalf pursuant to
the provisions of Section 6.2 hereof which is not subject to a
Company Matching Deposit. Such amounts shall qualify as
elective contributions under Section 401(k) of the Code and the
regulations thereunder.
2.39 "Termination of Employment" shall mean the
termination of active employment with any Participating
Company, whether voluntarily or involuntarily, other than by
reason of a Participant's retirement after attaining his
Retirement Date or after sustaining Total and Permanent
Disability, death or transfer to an Affiliated Company.
2.40 "Total and Permanent Disability" shall mean a
termination of employment due to a physical or mental condition
of a Participant resulting from bodily injury, disease, or
mental disorder which constitutes total disability under the
federal Social Security Act, and for which the Participant has
actually been approved for Social Security disability benefits.
2.41 "Trust" shall mean the legal entity resulting
from the Trust Agreement between the Sponsoring Company and the
Trustee which receives the Participating Companies' and
<PAGE>
Participants' contributions, and holds, invests, and disburses
funds to or for the benefit of Participants and their
Beneficiaries.
2.42 "Trust Fund" shall mean the total of
contributions made by the Participating Companies and
Participants to the Trust pursuant to the Plan, increased by
profits, gains, income and recoveries received, and decreased
by losses, depreciation, benefits paid and expenses incurred in
the administration of the Trust. The Trust Fund includes all
assets acquired by investment and reinvestment which are held
in the Trust by the Trustee.
2.43 "Trustee" shall mean Fidelity Management Trust
Company, trustee of the Investment Trust, and any additional or
successor Trustees. Except as otherwise provided in the Trust
Agreement and herein, the Trustee shall be the "Named
Fiduciary" referred to in Section 402(a) of ERISA with respect
to the control, management and disposition of the Trust Fund.
2.44 "Valuation Date" shall mean the close of each day
that the New York Stock Exchange is open for business.
2.45 "Vesting Year of Service" shall mean a Period of
Service of three hundred sixty-five (365) days, subject to the
provisions of Sections 3.2 and 14.3 hereof. Notwithstanding
the preceding sentence, if a Participant has a Reemployment
Commencement Date, such Participant's Periods of Service before
and after such Reemployment Commencement Date which are
required to be taken into account under this Plan shall be
determined on the basis of the actual number of days in such
aggregated Periods of Service.
2.46 Wherever appropriate, words used in the Plan in
the singular may mean the plural, the plural may mean the
singular, and the masculine may mean the feminine.
2.47 The expressions listed below shall have the
meanings stated in the Sections or Subsections hereof
respectively indicated:
"Actual Contribution
Percentage" ("ACP") Subsection 6.5(7)(a)
"Actual Deferral Percentage"
(or "ADP") Subsection 6.4(8)(a)
"Aggregated Family Group" Subsection 6.4(8)(f)
"Alternate Payee" Subsection 17.3(2)(e)
"Annual Additions" Section 7.4
<PAGE>
"Borrower" Section Eighteen
"Cash Transfers From
Another Qualified Plan" Subsection 4.2(3)
"Compensation" Section 2.17;
Subsection 29.3(1)
"Defined Benefit Plan" Subsection 7.7(3);
Subsection 29.1(1)
"Defined Benefit Plan
Fraction" Subsection 7.7(4)
"Defined Contribution Plan" Subsection 7.7(2);
Subsection 29.1(2)
"Defined Contribution
Plan Fraction" Subsection 7.7(5)
"Determination Date" Subsection 29.1(3)
"Direct Rollover" Subsection 15.10(1(3)
"Distributee" Subsection 15.10(1)(c)
"Eligible Employee" Subsection 2.17;
Subsection 6.4(8)(d)
"Employer" Subsection 29.1(4)
"Excess Aggregate
Contributions" Subsection 6.5(3)
"Excess Amounts" Subsection 7.4(4)
"Excess Contributions" Subsection 6.4(3)
"Excess Deferrals" Subsection 6.4(7)
"Family Member" Subsection 6.4(8)(f)
"Highly Compensated
Employee" Subsection 6.4(8)(b)
"Investment Funds" Subsection 9.4(1)
"Key Employee" Subsection 29.1(5)
"Key Employee Participant" Subsection 29.1(6)
"Limitation Year" Subsection 7.7(6)
<PAGE>
"Limitation Year
Compensation" Subsection 6.4(8)(b);
Subsection 7.7(7);
Subsection 29.1(7)
"Maximum Aggregate Amount" Subsection 7.7(5)
"Named Fiduciary" Section 2.3;
Section 2.43
"Non-Highly Compensated
Employee" Subsection 6.4(8)(c)
"Non-Vested Amount" Subsection 14.4(1)(a)
"Permissive Aggregation
Group" Subsection 29.1(8)
"Permitted Purpose" Subsection 6.7(1)(d)
"Plan Administrator" Section 5.14
"Qualified Domestic
Relations Order" Subsection 17.3(2)(d)
"Required Aggregation
Group" Subsection 29.1(9)
"Required Beginning Date" Section 15.3(1)
"Retirement Plan" Subsection 7.7(1)
"Rollover Account" Subsection 4.2(1)
"Super Top Heavy Plan" Subsection 29.2(2)
"Top Heavy Plan" Subsection 29.2(1)
"Top Heavy Ratio" Subsection 29.2(3)
"Total Compensation" Subsection 6.4(8)(e)
"Trust Agreement" Section 1.3
"Valuation Date" Subsection 29.1(10)
"Valuation Period" Section 9.3
"Vested Amount" Subsection 14.4(1)(a)
<PAGE>
SECTION THREE
REQUIREMENTS FOR ELIGIBILITY
3.1 Service. Each Eligible Employee who was eligible
to participate in the Plan as of December 31, 1993 shall
continue to be eligible to participate as of January 1, 1994.
Each Eligible Employee shall be eligible to become a
Participant in the Plan as of the Entry Date next following the
date upon which such Eligible Employee first performs an Hour
of Service with a Participating Company, or any subsequent
Entry Date provided that such Eligible Employee is so employed
on such Entry Date. In the event an Eligible Employee suffers
a Termination of Employment prior to the Entry Date upon which
such Eligible Employee would have become a Participant in the
Plan, as the case may be, and such Eligible Employee is
reemployed by a Participating Company prior to a One-Year
Period of Severance, such Eligible Employee shall be eligible
to become an Active Participant in the Plan as of the Entry
Date coincident with or next following his date of rehire,
provided such Eligible Employee is then still employed as such.
3.2 Service with a Predecessor Employer. If the Plan
had previously been maintained by a predecessor of a
Participating Company, whether a corporation, partnership, sole
proprietorship or other business entity, any period of service
with such predecessor shall be treated as a Period of Service
with a Participating Company. If the Plan had not been
maintained previously by a predecessor of a Participating
Company, service with such predecessor shall not be taken into
account, except to the extent required pursuant to regulations
prescribed by the Secretary of the Treasury or his delegate.
Notwithstanding the foregoing, service by a sole proprietor or
partner shall not be counted as a Period of Service with a
Participating Company.
3.3 Periods of Severance. For purposes of this
Section Three, the aggregate of all Periods of Service shall be
taken into account. In the event that a Participant has a
Severance from Service Date and such Participant is reemployed
by a Participating Company, he shall resume participation in
the Plan effective as of his Reemployment Commencement Date and
shall be eligible to become an Active Participant in the Plan
as of the Entry Date coincident with or next following his
Reemployment Commencement Date.
3.4 Change in Status of Employee.
3.4(1) In the event an individual who is
employed by a Participating Company or an Affiliated Company
but who is not defined as an Eligible Employee becomes so
<PAGE>
defined as an Eligible Employee, such individual shall be
eligible to become a Participant as of the date he becomes so
defined, provided he has met the other requirements for
eligibility set forth in Section 3.1 hereof and previously
would have become a Participant had he been defined as an
Eligible Employee.
3.4(2) A Participant who ceases to be an
Eligible Employee but who does not suffer a Termination of
Employment shall become a suspended Participant. During the
period of suspension, no amounts shall be credited to the
Participant's Accounts which are based on his Compensation from
and after the date of suspension. The suspended Participant
shall be entitled to benefits in accordance with the other
provisions of the Plan throughout the period during which he is
suspended.
3.4(3) In the event a Participant who ceased to
be defined as an Eligible Employee but who did not suffer a
Termination of Employment, subsequently becomes defined as an
Employee again, such Participant shall recommence participation
without regard to the limitations imposed by Subsection 3.4(2)
hereof, as of the date he became so redefined, but shall not be
eligible to become an Active Participant until the Entry Date
coinciding with or next following the date of becoming so
redefined as an Eligible Employee.
SECTION FOUR
ACTIVE PARTICIPATION IN THE PLAN
4.1 Active Participation. Any Employee eligible to
become a Participant in the Plan in accordance with Section
Three hereof, may become an Active Participant in the Plan by
electing no later than the date determined by the
Administrative Committee, pursuant to a uniform and
nondiscriminatory procedure established by the Administrative
Committee, to have made on his behalf Before-Tax Deposits in
accordance with the provisions of Section 6.2 of the Plan. Any
Participant in the Plan who does not elect to have made on his
behalf Before-Tax Deposits at the time he becomes a Participant
in the Plan shall be and remain an Inactive Participant unless
and until he elects to have made on his behalf Before-Tax
Deposits as provided in Section 6.2 of the Plan.
<PAGE>
4.2 Rollover Account.
4.2(1) With the consent of the Administrative
Committee, Cash Transfers From Another Qualified Plan may be
received by the Trustee on behalf of any Employee or
Participant. Such amounts shall be credited to a separate
Account herein referred to as a "Rollover Account." However,
the transfer of such an amount to the Trustee will not cause
such transferring Employee to be eligible to participate in the
Plan prior to the time specified in Section Three and Section
4.1. Prior to the time such Employee becomes eligible to
participate in the Plan, the Employee shall be treated as a
Participant solely with respect to the amount in his or her
Rollover Account.
4.2(2) Cash credited to a Rollover Account (i)
shall be held by the Trustee pursuant to the provisions of this
Plan, (ii) shall be fully vested at all times and shall not be
subject to forfeiture for any reason, and (iii) shall be
invested at the direction of the Employee in accordance with
the provisions of Section 9.4, and (iv) shall be distributed to
the Employee, Participant or Beneficiary at such time and in
the same manner as provided in Section 15 hereof for the
distribution of a Participant's Accounts under the Plan; and
may be withdrawn in accordance with Section 6.7.
4.2(3) For purposes of this Section, the term
"Cash Transfers From Another Qualified Plan" means amounts
which are properly characterized as a qualifying rollover
distribution received by a person who is now an Employee, from
another qualified plan, which amounts are eligible for tax free
rollover treatment and which are transferred in cash by the
Employee to the Trustee of this Plan within sixty (60) days
following receipt thereof or are transferred in cash directly
from such qualified plan to this Plan; amounts transferred in
cash to this Plan from an individual retirement account,
provided that the individual retirement account contains only
assets previously distributed from a qualified plan, which
amounts were eligible for tax-free rollover treatment, and
which amounts were deposited in such individual retirement
account within sixty (60) days of receipt thereof, and amounts
distributed to a person who is now an Employee from an
individual retirement account meeting the requirements of this
Subsection 4.2(3), and transferred in cash by the Employee to
this Plan within sixty (60) days of receipt thereof, from such
individual retirement account. Prior to accepting any cash
transfers to which this Section applies, the Administrative
Committee may require the Employee to establish that the
<PAGE>
amounts to be transferred in cash to this Plan meet the
requirements of this Section and may also require that the
Employee provide an opinion of counsel satisfactory to the
Administrative Committee that the amounts to be transferred
meet the requirements of this Section and will not jeopardize
the tax exempt status of this Plan or the Trust Fund for any
reason (including, but not limited to, the failure of the
amount to be excluded from the definition of annual addition in
Section 415(c)(2) of the Code; thereby causing the annual
addition to the Account to exceed the permissible limits of
Section 415 of the Code, or to create adverse tax consequences
to a Participating Company.
SECTION FIVE
ADMINISTRATION OF THE PLAN
5.1 Responsibility for Administration of the Plan.
The Administrative Committee shall be responsible for the
management, operation and administration of the Plan.
5.2 Appointment of Administrative Committee. The
Board of Directors of the Sponsoring Company shall appoint an
Administrative Committee consisting of at least three (3)
persons each of whom shall be employees of a Participating or
Affiliated Company. The President or an appropriate Vice
President of the Sponsoring Company shall certify to the
Trustee the names of the members of the Administrative
Committee. A member of the Administrative Committee shall
automatically cease to be a member upon termination of
employment with the Participating Company or Affiliated
Company. Any member of the Administrative Committee may resign
upon ten (10) days' prior written notice to the President of
the Sponsoring Company. The Board of Directors of the
Sponsoring Company shall be authorized to remove any member of
the Administrative Committee at any time and in its sole
discretion to appoint a successor whenever a vacancy on the
Administrative Committee occurs.
5.3 Responsibility for Administration of the Trust
Fund. Except as otherwise provided herein, the Trustee shall
be responsible for the management and investment of the Trust
Fund in accordance with the provisions of the Trust Agreement.
5.4 Delegation of Powers. The Administrative
Committee may appoint such assistants or representatives as it
deems necessary for the effective exercise of its duties in
administering the Plan and Trust. The Administrative Committee
may delegate to such assistants and representatives any powers
<PAGE>
and duties, both ministerial and discretionary, as it deems
expedient or appropriate.
5.5 Records. All acts and determinations with
respect to the administration of the Plan made by the
Administrative Committee and any assistants or representatives
appointed by it shall be duly recorded by the Administrative
Committee or by the assistant or representative appointed by it
to keep such records. All records, together with such other
documents as may be necessary for the administration of the
Plan, shall be preserved in the custody of the Administrative
Committee or the assistants or representatives appointed by it.
5.6 General Administrative Powers. The
Administrative Committee is authorized to take such actions as
may be necessary to carry out the provisions and purposes of
the Plan and shall have the authority to control and manage the
operation and administration of the Plan in accordance with its
terms. In order to effectuate the purposes of the Plan, the
Administrative Committee shall have the discretionary power to
construe and interpret the Plan, to supply any omissions
therein, to reconcile and correct any errors or
inconsistencies, to decide any questions in the administration
and application of the Plan, and to make equitable adjustments
for any mistakes or errors made in the administration of the
Plan. All such actions or determinations made by the
Administrative Committee, and the application of rules and
regulations to a particular case or issue by the Administrative
Committee, in good faith, shall not be subject to review by
anyone, but shall be final, binding and conclusive on all
persons ever interested hereunder. In construing the Plan and
in exercising its power under provisions requiring
Administrative Committee approval, the Administrative Committee
shall attempt to ascertain the purpose of the provisions in
question and when such purpose is known or reasonably
ascertainable, such purpose shall be given effect to the extent
feasible. Likewise, the Administrative Committee is authorized
to determine all questions with respect to the individual
rights of all Participants and their Beneficiaries and
Alternate Payees under this Plan, including, but not limited
to, all issues with respect to eligibility, Compensation,
service, valuation of Accounts, allocation of contributions and
Trust Fund earnings, retirement, Total and Permanent
Disability, or Termination of Employment, eligibility for loans
and hardship withdrawals, and shall direct the Trustee
concerning the allocation, payment and distribution of all
funds held in trust for purposes of the Plan. The
Administrative Committee shall establish investment objectives
and monitor, or cause to be monitored, the investment
performance of the Trustee or any Investment Manager which may
be appointed with respect to any assets of the Plan, and shall
<PAGE>
make such reports and give such recommendations to the Board as
it requests with respect thereto.
5.7 Appointment of Professional Assistants and
Investment Manager. The Administrative Committee may engage
accountants, attorneys, physicians and such other personnel as
it deems necessary or advisable, including in its sole
discretion, one or more Investment Managers to manage
(including the power to acquire or dispose of) all or any of
the assets of the Trust. The functions of any such persons
engaged by the Administrative Committee shall be limited to the
specific services and duties for which they are engaged, and
such persons shall have no other duties, obligations or
responsibilities under the Plan or Trust. Such persons shall
exercise no discretionary authority or discretionary control
respecting the management of the Plan, and, unless engaged
specifically as Investment Manager, shall exercise no authority
or control respecting management or disposition of the assets
of the Trust. The fees and costs of such services are an
administrative expense of the Plan to be paid out of the Trust
Fund, except to the extent that such fees and costs are paid by
any of the Participating Companies.
5.8 Actions of the Administrative Committee.
5.8(1) A majority of the members of the
Administrative Committee shall constitute a quorum for the
transaction of business, and shall have full power to act
hereunder. Action by the Administrative Committee shall be
official if approved by a vote of a majority of the members
present at any official meeting. The Administrative Committee
may, without a meeting, authorize or approve any action by
written instrument signed by a majority of all of the members.
Any written memorandum signed by the Chairman, or any other
member of the Administrative Committee, or by any other person
duly authorized by the Administrative Committee to act, in
respect of the subject matter of the memorandum, shall have the
same force and effect as a formal resolution adopted in open
meeting. The Administrative Committee shall give to the
Trustee any order, direction, consent, certificate or advice
required or permitted under the terms of the Trust Agreement,
and the Trustee shall be entitled to rely on, as evidencing the
action of the Administrative Committee, any instrument
delivered to the Trustee when: (i) if a resolution, it is
certified by the Chairman and Secretary, or (ii) if a
memorandum, it is signed by a majority of all of the members of
the Administrative Committee, or by a person who shall have
been authorized to act for the Administrative Committee in
respect of the subject matter thereof.
<PAGE>
5.8(2) A member of the Administrative Committee
may not vote or decide upon any matter relating solely to him
or vote in any case in which his individual right or claim to
any benefit under the Plan is specifically involved. If, in
any case in which an Administrative Committee member is so
disqualified to act, the remaining members then present cannot,
by majority vote, act or decide, the Board will appoint a
temporary substitute member to exercise all of the powers of
the disqualified member concerning the matter in which he is
disqualified.
5.8(3) The Administrative Committee shall
maintain minutes of its meetings and written records of its
actions, and as long as such minutes and written records are
maintained, members may participate and hold a meeting of the
Administrative Committee by means of conference telephone or
similar communications equipment which permits all persons
participating in the meeting to hear each other. Participation
in such a meeting constitutes presence in person at such
meeting.
5.9 Directives of the Administrative Committee.
Directives of the Administrative Committee to the Trustee shall
be delivered in writing, signed by an appropriate member of the
Administrative Committee.
5.10 Discretionary Acts. Any discretionary actions of
the Administrative Committee or any Participating Company with
respect to the administration of the Plan shall be made in a
manner which does not discriminate in favor of Highly
Compensated Employees. In the event the Administrative
Committee exercises any discretionary authority under the Plan
with respect to a Participant who is a member of the
Administrative Committee, such discretionary authority shall be
exercised solely and exclusively by those members of the
Administrative Committee other than such Participant, or, if
such Participant is the sole member of the Administrative
Committee, such discretionary authority shall be exercised
solely and exclusively by the Board of Directors of the
Sponsoring Company.
5.11 Responsibility of Fiduciaries. The members of
the Administrative Committee and their assistants and
representatives (other than any Investment Manager) shall be
free from all liability for their acts and conduct in the
administration of the Plan and Trust except for acts of willful
misconduct or gross negligence; provided, however, that the
foregoing shall not relieve any of them from any responsibility
or liability for any responsibility, obligation or duty that
they may have pursuant to ERISA.
<PAGE>
5.12 Indemnity by Participating Companies. In the
event and to the extent not insured against under any contract
of insurance with an insurance company, the Participating
Companies shall indemnify and hold harmless each "Indemnified
Person," as defined below, against any and all claims, demands,
suits, proceedings, losses, damages, interest, penalties,
expenses (specifically including, but not limited to counsel
fees to the extent approved by the Board of Directors of the
Sponsoring Company or otherwise provided by law, court costs
and other reasonable expenses of litigation), and liability of
every kind, including amounts paid in settlement, with the
approval of the Board of Directors of the Sponsoring Company,
arising from any action or cause of action related to the
Indemnified Person's act or acts or failure to act. Such
indemnity shall apply regardless of whether such claims,
demands, suits, proceedings, losses, damages, interest,
penalties, expenses, and liability arise in whole or in part
from (i) the negligence or other fault of the Indemnified
Person, except when the same is judicially determined to be due
to gross negligence, fraud, recklessness, a willful or
intentional misconduct of such Indemnified Person or (ii) from
the imposition on such Indemnified Person of any penalties
imposed by the Secretary of Labor, pursuant to Section 502(l)
of ERISA, relating to any breaches of fiduciary responsibility
under Part 4 of Title I of ERISA. "Indemnified Person" shall
mean each member of the Board of Directors of the Sponsoring
Company, and the Administrative Committee and each other
Employee who is allocated fiduciary responsibility hereunder.
5.13 Payment of Fees and Expenses. The Trustee, the
members of the Administrative Committee and their assistants
and representatives shall be entitled to payment or
reimbursement for all reasonable costs, charges and expenses
incurred in the administration of the Plan and Trust,
including, but not limited to, reasonable fees for accounting,
legal and other services rendered, to the extent incurred by
the Trustee, the members of the Administrative Committee or
their assistants and representatives in the course of
performance of their duties under the Plan and the Trust. All
costs, charges and expenses incurred in the administration of
the Plan and the Trust shall be paid from the Trust Fund except
to the extent paid by the Participating Companies or any
Affiliated Company. Notwithstanding any other provision of the
Plan or Trust, no person who is a "disqualified person," within
the meaning of Section 4975(e)(2) of the Code and who receives
full-time pay from any Participating Company shall receive
compensation from the Trust Fund, except for payment or
reimbursement of expenses properly and actually incurred.
<PAGE>
5.14 Plan Administrator. The Administrative Committee
shall be the "Plan Administrator" (as defined in Section
3(16)(A) of ERISA) of the Plan, and shall be responsible for
the performance of all reporting and disclosure obligations
under ERISA and all other obligations required or permitted to
be performed by the Plan Administrator under ERISA and not
otherwise delegated to other parties under the terms of the
Plan or the Trust Agreement. The Plan Administrator shall be
the designated agent for service of legal process.
5.15 Allocation and Delegation of Administrative
Committee Responsibilities. The Administrative Committee may
upon approval of a majority of the members of the
Administrative Committee, (i) allocate among any of the members
of the Administrative Committee any of the responsibilities of
the Administrative Committee under the Plan, or (ii) designate
any person, firm or corporation that is not a member of the
Administrative Committee to carry out any of the
responsibilities of the Administrative Committee under the
Plan. Any such allocation or designation shall be made
pursuant to a written instrument executed by a majority of the
members of the Administrative Committee.
SECTION SIX
DEPOSITS
6.1 Company Matching Deposits.
6.1(1) Each Participating Company shall make a
Company Matching Deposit to the Trust for each calendar month
in an amount equal to a specified percentage of the Basic
Before-Tax Deposits, if any, made by such Participating Company
during such calendar month on behalf of each Active Participant
employed by such Participating Company during such calendar
month. The specified percentage of the Basic Before-Tax
Deposits to be matched for each Plan Year shall, no later than
December 1 of the preceding Plan Year, be determined by the
Board of Directors of the Sponsoring Company and be
communicated to all Participants and all Employees who will be
eligible to become Participants in the Plan during such
succeeding Plan Year. In addition, such specified percentage
may be increased by the Board of Directors of the Sponsoring
Company at any time during the Plan Year.
6.1(2) In addition to its Company Matching
Deposits under Subsection 6.1(1) above, each Participating
Company shall make such additional Company Matching Deposits
<PAGE>
for each Plan Year as the Board of Directors of the Sponsoring
Company, in its discretion, shall determine. Such additional
deposits shall equal a specified percentage (which may be zero)
of the Basic Before-Tax Deposits for the Plan Year of each
Active Participant employed by such Participating Company as of
the last day of such Plan Year. The Board shall determine the
amount of any such additional Company Matching Deposits, and
direct the Participating Companies to deposit such amounts, no
later than the latest date prescribed by Section 6.3 below.
6.1(3) Notwithstanding the foregoing, in no
event shall any Company Matching Deposits, when added to any
Before-Tax Deposits, exceed the maximum permissible
contribution under Section 404(a) of the Code. All
contributions of the Participating Companies hereunder are
conditioned on their deductibility under Section 404(a) of the
Code. Company Matching Deposits shall be made in the form of
cash.
6.2 Basic and Supplemental Before-Tax Deposits.
6.2(1) Each Participant may have contributed on
his behalf to the Trust Fund each month by salary reduction an
amount (the "Basic Before-Tax Deposit") which shall be equal to
one percent (1%), two percent (2%), three percent (3%), or four
percent (4%) of such Participant's Compensation for such month,
as such Participant shall elect on the written authorization
form provided for herein. Any Active Participant who elects to
have made on his behalf Basic Before Tax Deposits of four
percent (4%) of his Compensation for each month may also elect
to have contributed on his behalf to the Trust Fund each month
by salary reduction an additional amount ("Supplemental Before
Tax Deposits") equal to from one percent (1%) to eleven percent
(11%) of his compensation; provided, however, such percentage
must be a whole percent. Any designated Before-Tax Deposits
(whether Basic or Supplemental Deposits or both) shall qualify
as elective contributions under Section 401(k) of the Code and
the regulations thereunder.
6.2(2) The percentage rate of Basic and
Supplemental Before-Tax Deposits, if any, which each Active
Participant elects and any changes thereto shall be made on a
written form provided by and filed with the Administrative
Committee. The Administrative Committee shall establish and
communicate to Employees uniform and nondiscriminatory
<PAGE>
procedures for the election of percentage rates of Basic
and Supplemental Before-Tax Deposits, including procedures
regarding the effective date of such election, and may change
said procedures at such times and in such manner as the
Administrative Committee may determine to be necessary or
desirable. Any such change in procedures shall be communicated
to Employees.
6.2(3) An Active Participant's Basic and
Supplemental Before-Tax Deposits shall be credited to his
appropriate Account under the Plan. Any amounts of Basic or
Supplemental Before-Tax Deposits properly credited to a
Participant's Accounts shall, for all purposes and in all
respects, be fully vested and nonforfeitable.
6.3 Date of Payment of Deposits. A Participating
Company shall make its Company Matching Deposits for a
particular period on or before the last date, including any
extensions thereof, for filing its federal income tax return
for its taxable year ending with or after the last day of the
Plan Year in which such period falls or at such earlier time
and in such amount as directed by the Administrative Committee
for the purpose of paying a Participant taking a final
distribution of the Company Match allocated to such
Participant. A Participating Company shall make all Basic and
Supplemental Before-Tax Deposits as provided for in Section 6.2
hereof to the Trust Fund as soon as administratively practical
following the deduction of such amounts from Active
Participants' pay.
6.4 Special Limitations on Before-Tax Deposits. This
Section 6.4 is effective July 1, 1988. The limitations
described in this Section 6.4 shall be determined in accordance
with Code Sections 401(k) and 402(g) and regulations
thereunder, which are incorporated by reference to the extent
not expressly stated below.
6.4(1) Notwithstanding any other provision of
this Plan, in no event shall a Participating Company make
Before-Tax Deposits in any Plan Year if such contribution would
cause the "Actual Deferral Percentage" (or "ADP") of Highly
Compensated Employees to exceed the greater of the limitations
indicated below:
(a) One hundred twenty-five
percent(125%) of the ADP for all Non-Highly Compensated
Employees; or
<PAGE>
(b) The lesser of (i) the sum of the
ADP for all Non-Highly Compensated Employees plus two percent
(2%), or (ii) two hundred percent (200%) of the ADP for all Non-
Highly Compensated Employees.
6.4(2) The Administrative Committee may, to the
extent necessary to conform the Before-Tax Deposits to the
above limitations, reduce prospectively, the percentage rates
or dollar amounts of Before-Tax Deposits to be made on behalf
of Highly Compensated Employees. Such prospective reductions
may thereafter be adjusted by the Administrative Committee,
upon due notice to the affected Participants, at any time
thereafter to increase the elected percentage rates for those
Highly Compensated Employees whose rates or amounts were
previously reduced in accordance with this Subsection 6.4(2) if
the Administrative Committee shall determine that such increase
will not cause the limits set forth in Subsection 6.4(1) to be
exceeded for the Plan Year. Any decrease of a Participant's
Before-Tax Deposits under this Subsection 6.4(2) shall be in
addition to and not otherwise affect such Participant's rights
to change or suspend contributions.
6.4(3) In the event that following the end of a
Plan Year, it is determined by the Administrative Committee
that the Before-Tax Deposits for Highly Compensated Employees
exceed the limitations of Subsection 6.4(1), then the amount in
excess of such limitation ("Excess Contributions") (and the
income thereon) shall be distributed to the Highly Compensated
Employees, notwithstanding any Plan provision to the contrary,
within the twelve (12) month period following the end of the
Plan Year in which such Excess Contributions occurred. In
distributing Excess Contributions, the following rules shall
apply. The Excess Contributions shall first be applied to
reduce the percentage rate elected by all those Highly
Compensated Employees who have elected the highest percentage
rate of Before-Tax Deposits, shall then be applied to reduce
the percentage rate elected by all those Highly Compensated
Employees (including those Employees whose percentage rate or
dollar amount was previously reduced) whose elected percentage
rate is at the next highest percentage rate of Before-Tax
Deposits and shall thereafter continue to be applied to the
extent necessary in like manner in descending order on the
basis of elected percentage rates until the reductions enable
the Before-Tax Deposits to conform to the limitations of
Subsection 6.4(1). The amount of Excess Contributions to be
distributed to each affected Highly Compensated Employee is
<PAGE>
equal to the Before-Tax Deposits on behalf of such Employee
(prior to reduction of the Excess Contributions) less the
product of such Employee's ADP (after reduction of the Excess
Contributions) times such Participant's Total Compensation,
rounded to the nearest one cent ($.01).
The amount of Excess Contributions that
may be distributed under this Subsection 6.4(3) with respect to
a Highly Compensated Employee for a Plan Year shall be reduced
by any Excess Deferrals (as defined in Section 6.4(7))
attributable to such Plan Year previously distributed to the
Employee. In the event a distribution of Before-Tax Deposits
constitutes a distribution of Excess Contributions and a
distribution of Excess Deferrals pursuant to Section 6.4(7),
the amounts distributed shall be treated as a simultaneous
distribution of both Excess Contributions and Excess Deferrals.
6.4(4) In determining the amount of income or
loss allocable to Excess Contributions which are being
distributed, the following rules shall apply:
(a) The income or loss allocable to
Excess Contributions for the Plan Year in which the
contributions are made is the income for the Plan Year
allocable to Before-Tax Deposits and amounts treated as Before-
Tax Deposits with respect to the Highly Compensated Employee,
multiplied by a fraction, the numerator of which is the amount
of Excess Contributions made on behalf of the Highly
Compensated Employee for the Plan Year and the denominator of
which is the combined balance of the aggregate of the
Participant's Basic Before-Tax Deposit Account and Supplemental
Before-Tax Deposit Account as of the end of the Plan Year.
(b) No income or loss shall be
allocable to the Excess Contributions for the period between
the end of the Plan Year and the date of the distribution.
For purposes of this Subsection
6.4(4), the income of the Plan shall mean all earnings, gains
and losses, computed in accordance with the provisions of
Section Eight.
6.4(5) Notwithstanding anything to the contrary
contained herein, in the case of a Highly Compensated Employee
who is part of an Aggregated Family Group, as defined in
<PAGE>
Subsection 6.4(8)(f), the following rules shall apply:
(a) The ADP for the Aggregated Family
Group (which shall be treated as a single Highly Compensated
Employee) shall be the ADP determined by aggregating the Before-
Tax Deposits and Total Compensation of all Family Members, as
defined in Subsection 6.4(8)(f), who are Eligible Employees.
Otherwise, the Before Tax Deposits and Total Compensation of
all Family Members are disregarded for purposes of determining
the ADP for the Highly-Compensated Employees, as a group, and
the Non-Highly Compensated Employees as a group.
(b) If the ADP of the Aggregated
Family Group as determined under Subsection 6.4(5)(a) above
exceeds the limitations of Subsection 6.4(1), the ADP shall be
reduced as provided in Subsection 6.4(3) in order to comply
with the limitations of Subsection 6.4(1), and Excess
Contributions shall be allocated among all of the Family
Members in proportion to each such Family Member's Before-Tax
Deposits.
6.4(6) In addition to or in lieu of the above
procedures to conform Before-Tax Deposits to the limitations of
Subsection 6.4(1), the Sponsoring Company may, in its sole
discretion, cause the Participating Companies to contribute on
behalf of any Non-highly Compensated Employee additional
contributions (which shall be treated as Supplemental Before-
Tax Deposits) to the extent necessary to insure that the
limitations of Subsection 6.4(1) are met. Such additional
contributions shall be immediately fully vested and subject to
the distribution restrictions of Section 15.8 hereof,
applicable to Before-Tax Deposits. Such additional
contributions shall be treated as Before-Tax Deposits only if
the requirements of Treasury Regulation Section 1.401(k)-
1(b)(5) (or any successor thereto) are met.
6.4(7) Notwithstanding anything herein to the
contrary, in no event shall the Participating Employer make
Before-Tax Deposits in any calendar year on behalf of any
Participant if such contribution would cause the Before-Tax
Deposits for such Participant for the calendar year to exceed
Seven Thousand Dollars ($7,000), or such amount as adjusted by
the Secretary of the Treasury or his delegate at the same time
and in the same manner as under Code Section 415(d). Should
<PAGE>
any Before-Tax Deposits made to the Plan by the Participating
Employer on behalf of a Participant exceed Seven Thousand
Dollars ($7,000), as adjusted by the Secretary of the Treasury
or his delegate at the same time and in the same manner as
under Code Section 415(d) ("Excess Deferrals"), the
Administrative Committee may distribute such Excess Deferrals
(and income thereon) to such Participant, notwithstanding any
Plan provision to the contrary, by the April 15 next following
the calendar year in which such Excess Deferral is made. The
Administrative Committee is authorized to establish such rules
as may be necessary to provide for distribution of Excess
Deferrals (and income thereon) caused by an individual's
participation in more than one cash or deferred arrangement
where the total deferrals exceed the amount referred to above
and the individual allocates part of the aggregate Excess
Deferral to this Plan as permitted by law.
In determining the amount of income or
loss allocable to Excess Deferrals, the following rules shall
apply:
(a) The income or loss allocable to
Excess Deferrals for the calendar year in which the deferrals
are made is the income or loss for the Plan Year allocable to
Before-Tax Deposits for the Participant multiplied by a
fraction, the numerator of which is the amount of Excess
Deferrals made on behalf of the Participant for the Plan Year
and the denominator of which is the aggregate balance of the
Participant's Basic Before-Tax Deposit Account and Supplemental
Before-Tax Deposit Account as of the end of the Plan Year.
(b) No income or loss shall be
allocable to the Excess Deferrals for the period between the
end of the Plan Year and the date of the distribution.
For purposes of this Subsection
6.4(7), the income or loss of the Plan shall mean all earnings,
gains and losses computed in accordance with the provisions of
Section Eight.
The amount of Excess Deferrals
that may be distributed under this Subsection 6.4(7) with
respect to a Highly Compensated Employee for a calendar year
shall be reduced by any Excess Contributions previously
distributed to the Employee during such Plan Year. In the
<PAGE>
event a distribution of Before-Tax Deposits constitutes a
distribution of Excess Contributions pursuant to Subsection
6.4(3) and a distribution of Excess Deferrals pursuant to this
Subsection 6.4(7), the amounts distributed shall be treated as
a simultaneous distribution of both Excess Contributions and
Excess Deferrals.
6.4(8) For purposes of this Section 6.4 and
Section 6.5, the following terms shall have the following
meanings:
(a) "Actual Deferral Percentage" (or
"ADP") shall mean for the Highly Compensated Employees, as a
group, and for the Non-Highly Compensated Employees, as a
group, the average of the ratios (calculated separately for
each Employee in such group) of the Before-Tax Deposits, if
any, made on behalf of each such Employee for each Plan Year,
to the Employee's Total Compensation, as defined in Subsection
6.4(8)(e), for such Plan Year. ADP for each group, and the
ratio of Before-Tax Contributions to Total Compensation for
each individual, shall be calculated to the nearest 100th of
one percent.
In calculating ADP, Before-Tax
Deposits shall be taken into account for a Plan Year only if
such Before-Tax Deposits: (i) relate to Total Compensation
that would have been received by the Employee during such Plan
Year (but for the salary reduction election) or is attributable
to services performed by the Employee during such Plan Year and
would have been received by the Employee within two and one-
half (2-1/2) months after the close of such Plan Year (but for
the salary reduction agreement); and (ii) are allocated to the
Employee during such Plan Year. Before-Tax Deposits are
treated as allocated as of a particular date during a Plan Year
if allocation of such contribution is not contingent on
participation in the Plan or the performance of services after
such date and such contribution is paid to the Trust not later
than twelve (12) months after the close of such Plan Year.
In calculating the ADP of a
Highly Compensated Employee who participates in more than one
plan maintained by an Affiliated Company, all elective
<PAGE>
deferrals (as defined in Section 401(m)(4) of the Code) of such
Employee shall be aggregated for purposes of determining such
percentage.
In calculating ADP, all elective
deferrals (as defined in Section 401(m)(4) of the Code) to any
plan required to be aggregated with the Plan for purposes of
Code Section 401(a)(4) or 410(b) shall be treated as if made
under the Plan. If the Plan is permissively aggregated with
another plan in order to comply with the limitations of
Subsection 6.4(1), such aggregated plans must also meet the
requirements of Code Sections 401(a)(4) and 410(b) as a single
plan.
(b) "Highly Compensated Employee"
shall mean any Eligible Employee who is a highly compensated
employee as defined in Code Section 414(q) and the regulations
thereunder. Generally, any Eligible Employee is considered a
Highly Compensated Employee if such Eligible Employee:
(i) Was at any time during the
current Plan Year or the prior Plan Year, a "five percent
owner" as defined in Section 416(i)(1)(B)(i) of the Code, with
respect to a Participating Company;
(ii) received Limitation Year
Compensation from a Participating Company in excess of Seventy-
Five Thousand Dollars ($75,000) as adjusted by the Secretary of
Treasury pursuant to Section 414(q)(1) of the Code during the
prior Plan Year;
(iii) received Limitation Year
Compensation from a Participating Company in excess of Fifty
Thousand Dollars ($50,000) as adjusted by the Secretary of
Treasury pursuant to Section 414(q)(1) of the Code, and was in
the top-paid group of Employees during the prior Plan Year. An
Employee is in the top-paid group of Employees for any Plan
Year if such Employee is in the group consisting of the top
twenty percent (20%) of the Employees when ranked on the basis
<PAGE>
of Limitation Year Compensation paid during the Plan Year. For
purposes of determining the number of Employees in the top-paid
group, Employees who have not completed six (6) months of
service, normally work less than seventeen and one-half (17-
1/2) hours per week, normally work during six (6) or less
months per year, have not attained the age of twenty-one (21),
are nonresident aliens with no earned income from sources
within the United States (within the meaning of Section
861(a)(3) of the Code), or are included in a unit of employees
covered by a collective bargaining agreement (except to the
extent provided in regulations), shall not be included;
(iv) is an officer of a
Participating Company who received Limitation Year Compensation
for a Plan Year in excess of fifty percent (50%) of the amount
in effect under Code Section 415(b)(1)(A) for such Plan Year
(if no officer of a Participating Company has Limitation Year
Compensation in excess of such amount, the officer having the
highest Limitation Year Compensation for such Plan Year shall
be treated as an officer). For purposes of this Subsection,
not more than fifty (50) Employees (or, if less, the greater of
three (3) Employees or ten percent (10%) of Employees) shall be
treated as officers.
(v) An Eligible Employee who
is not described in (ii), (iii) or (iv) above for the
immediately preceding Plan Year shall only be considered a
Highly Compensated Employee if he is among the 100 highest paid
Employees during the current Plan Year.
For purposes of this Section 6.4
and Section 6.5: (i) the determination of "Limitation Year
Compensation" shall include amounts deferred pursuant to Code
Sections 125, 401(k) and 403(b), (ii) Limitation Year
<PAGE>
Compensation shall include compensation paid by any employer
required to be aggregated with a Participating Company under
Section 414(b), (c), (m) or (o) of the Code, and (iii) a Former
Employee who is an Eligible Employee shall be treated as a
Highly Compensated Employee if such Former Employee was a
Highly Compensated Employee when he separated from service with
the Participating Company or was a Highly Compensated Employee
at any time after attaining age fifty-five (55). "Former
Employee" shall mean a person who has been an Employee, but who
ceased to be an Employee for any reason and later returned to
employment with the Participating Company.
(c) "Non-Highly Compensated
Employee" shall mean each Eligible Employee who
is not a Highly Compensated Employee.
(d) "Eligible Employee" shall mean
each Eligible Employee who has completed the service
requirements of Section 3.01 and is eligible to become a
Participant and each other Employee who is an Active
Participant.
(e) "Total Compensation" shall mean
compensation received by an Eligible Employee for the Plan Year
in question from an Affiliated Company which is required to be
reported as wages for income tax purposes on the Eligible
Employee's Form W-2 plus, if elected by the Administrative
Committee in accordance with Treasury Regulations, any amount
that is not currently includable in the Eligible Employee's
gross income by reason of a deferral pursuant to Sections 125
and 401(k) of the Code. In the event an Employee begins,
resumes or ceases to be an Eligible Employee during a Plan
Year, the amount of the Employee's Total Compensation for only
the portion of the Plan Year in which he was an Eligible
Employee shall be taken into account for purposes of Sections
6.4 and 6.5. Effective January 1, 1989, Total Compensation
shall be limited to Two Hundred Thousand Dollars ($200,000) or
such higher amount to which such amount shall be adjusted by
the Secretary of the Treasury or his delegate pursuant to
Section 401(a)(17) of the Code. Effective January 1, 1994,
Total Compensation shall be limited to One Hundred Fifty
Thousand Dollars ($150,000) or such higher amount to which such
<PAGE>
amount shall be adjusted by the Secretary of the Treasury or
his delegate pursuant to Section 401(a)(17) of the Code.
(f) "Aggregated Family Group" shall
mean a family group required to be aggregated under Code
Section 414(q)(6) and regulations thereunder and shall include
any member of the family, as defined in Code Section 414(q)(6)
and regulations thereunder, of either (i) a five percent (5%)
owner, or (ii) one of the ten (10) Highly Compensated Employees
paid the greatest Limitation Year Compensation for the current
Plan Year. Any spouse, lineal ascendant, lineal descendent,
spouse of a lineal ascendant, or spouse of a lineal descendent
of such a Highly Compensated Employee (a "Family Member") shall
be included in the "Aggregated Family Group."
6.4(9) Notwithstanding anything to the contrary
in the Plan, to the extent a Participant's Before-Tax Deposits
for a Plan Year are reduced and refunded to him pursuant to
Subsection 6.4(3) or Subsection 7.4(4), such refunded amounts
shall be disregarded in determining the amount of Company
Matching Deposits to which a Participant is entitled for the
Plan Year.
6.5 Special Limitation on Company Matching Deposits.
This Section 6.5 is effective July 1, 1988. The limitations
described in this Section 6.5 shall be determined in accordance
with the applicable sections of the Code and regulations
thereunder. Notwithstanding anything to the contrary in this
Section 6.5 or in Section 6.4, the limitations of Subsection
6.4 or 6.5 shall be reduced to the extent required by Treasury
Regulation Section 1.401(m)-2 (or any successor thereto).
6.5(1) Notwithstanding any other provision of
this Plan, the "Actual Contribution Percentage" (or "ACP") of
Company Matching Deposits made to this Plan for Highly
Compensated Employees during any Plan Year shall not exceed the
greater of the limitations indicated below:
(a) One hundred twenty-five percent
(125%) of the ACP for all Non-Highly Compensated Employees; or
(b) The lesser of (i) the sum of the
ACP for all Non-Highly Compensated Employees plus two percent
(2%), or (ii) two hundred percent (200%) of the ACP for all Non-
Highly Compensated Employees.
<PAGE>
6.5(2) The Administrative Committee shall, to
the extent necessary to conform to the limitations of
Subsection 6.5(1), reduce prospectively, the percentage rates
or dollar amounts of Company Matching Deposits to be made on
behalf of Highly Compensated Employees. Such prospective
reductions may thereafter be adjusted by the Administrative
Committee, upon due notice to the affected Participants, at any
time thereafter to increase the elected percentage rates for
those Highly Compensated Employees whose rates were previously
reduced in accordance with this subsection if the
Administrative Committee shall determine that such increase
will not cause the limits set forth in this subsection to be
exceeded for the Plan Year.
6.5(3) In the event that following the end of
the Plan Year, it is determined by the Administrative Committee
that the Company Matching Deposits for Highly Compensated
Employees exceed the limitations of Subsection 6.5(1), then the
amount in excess of such limitation ("Excess Aggregate
Contributions") (and income thereon) shall be distributed to
the Highly Compensated Employees who are one hundred percent
(100%) vested in such amounts, notwithstanding any Plan
provision to the contrary, within the twelve months following
the end of the Plan Year in which such Excess Aggregate
Contributions occurred. In the case of any Highly Compensated
Employee who is not one hundred percent (100%) vested in his
Company Matching Deposit Account, such excess amount shall be
treated as a forfeiture under Section 14.4. The Excess
Aggregate Contributions shall first be applied to reduce the
percentage rate elected by all those Highly Compensated
Employees who have elected the highest percentage rate of
Company Matching Deposits, shall then be applied to reduce the
percentage rate elected by all those Highly Compensated
Employees (including those Employees whose percentage rate was
previously reduced) whose elected percentage rate is at the
next highest percentage rate of Company Matching Deposits, and
shall thereafter continue to be applied to the extent necessary
in like manner in descending order on the basis of elected
percentage rates until the reductions enable the Company
Matching Deposits to conform to the limitations of Subsection
6.5(1). The amount of Excess Aggregate Contributions to be
distributed to each affected Highly Compensated Employee is
equal to the Company Matching Deposits on behalf of such
Employee (prior to reduction of the Excess Aggregate
<PAGE>
Contributions), less the product of such Employee's ACP (after
reduction of the Excess Aggregate Contributions) times such
Participant's Total Compensation, rounded to the nearest one
cent ($.01).
6.5(4) In determining the amount of income or
loss allocable to Excess Aggregate Contributions which are
being distributed, the following rules shall apply:
(a) The income or loss allocable to
Excess Aggregate Contributions for the Plan Year in which the
contributions are made is the income or loss for the Plan Year
allocable to Company Matching Deposits with respect to the
Highly Compensated Employee multiplied by a fraction, the
numerator of which is the amount of Excess Aggregate
Contributions made on behalf of the Highly Compensated Employee
for the Plan Year and the denominator of which is the balance
of the Company Matching Deposits Account attributable to
Company Matching Deposits as of the end of the Plan Year.
(b) No income or loss shall be
allocable to the Excess Aggregate Contributions for the period
between the end of the Plan Year and the date of the
distribution.
For purposes of this Subsection 6.5(4), the income or
loss of the Plan shall mean all earnings, gains and losses
computed in accordance with the provisions of Section Eight.
6.5(5) Notwithstanding anything to the contrary
contained herein, in the case of a Highly Compensated Employee
who is part of an Aggregated Family Group, the following rules
shall apply:
(a) The ACP for the Aggregated Family
Group (which shall be treated as a Single Highly Compensated
Employee), as defined in Subsection 6.4(8)(e), shall be the ACP
determined by aggregating the Company Matching Deposits and
Total Compensation of all Family Members, as defined in
Subsection 6.4(8)(e), who are Eligible Employees. Otherwise,
the Company Matching Deposits and Total Compensation of all
Family Members are disregarded for purposes of determining the
ACP for the Highly Compensated Employees, as a group, and the
Non-Highly Compensated Employees, as a group.
<PAGE>
(b) If the ACP of the Aggregated
Family Group is determined under Subsection 6.5(5)(a) above and
the limitations of Subsection 6.5(1) are exceeded, the ACP
shall be reduced as provided in Subsection 6.5(3) in order to
comply with the limitations of Subsection 6.5(1), and Excess
Aggregate Contributions shall be allocated among all of the
Family Members in proportion to each such Family Member's
Company Matching Deposits.
6.5(6) In addition to or in lieu of the above
procedures to conform Company Matching Deposits to the
limitations of Subsection 6.5(1), the Sponsoring Company may,
in its sole discretion, cause the Participating Companies to
contribute on behalf of any Non-highly Compensated Employee
additional contributions (which shall be treated as
Supplemental Before-Tax Deposits) to the extent necessary to
insure that the limitations of Subsection 6.5(1) are met. Such
additional contributions shall be immediately fully vested and
subject to the distribution restrictions of Section 15.8
hereof, applicable to Before-Tax Deposits. Such additional
contributions included in the calculations under Subsection
6.5(1) only if the requirements of Treasury Regulation Section
1.401(m)-1(b)(5) (or any successor thereto) are met. In
addition, the Administrative Committee may designate that all
or part of the Before-Tax Deposits shall be included in the
calculations under Subsection 6.5(1) (any such amounts shall
not be included in the calculations under Subsection 6.4(1))
provided such use complies with the requirements of Treasury
Regulation Section 1.401(m)-1(b)(2) (or any successor thereto).
6.5(7) For purposes of this Section 6.5, the
following terms shall have the following meaning:
(a) "Actual Contribution Percentage"
(or "ACP") shall mean for the Highly Compensated Employees, as
a group, and for the Non-Highly Compensated Employees, as a
group, the average of the ratios (calculated separately for
each Employee in such group) of the amount of Company Matching
Deposits paid to the Trust for each such Employee for each Plan
Year to the Employee's Total Compensation, as defined in
Subsection 6.4(8)(d), for such Plan Year.
In calculating ACP, a Company
Matching Deposit shall be taken into account for a Plan Year
only if such Contribution: (i) is made on account of the
<PAGE>
Employee's Before-Tax Deposits for the Plan Year, (ii) is
allocated to the Employee during such Plan Year, and (iii) is
paid to the Trust not later than the last day of the twelfth
(12th) month following the close of such Plan Year.
In calculating ACP, all employee
contributions and employer matching contributions (as defined
in Section 401(m)(4) of the Code) of any Highly Compensated
Employee who participates in more than one plan maintained by
an Affiliated Company shall be aggregated for purposes of
determining such percentage.
In calculating ACP, all employee
contributions and employer matching contributions (as defined
in Section 401(m)(4) of the Code) to any plan required to be
aggregated with the Plan for purposes of Code Section 401(a)(4)
or 410(b) shall be treated as if made under the Plan. If the
Plan is permissively aggregated with another plan in order to
comply with the limitations of Subsection 6.5(1), such
aggregated plans must also meet the requirements of Code
Sections 401(a)(4) and 410(b) as a single plan.
(b) "Highly Compensated Employee,"
"Eligible Employee," "Non-Highly Compensated Employee," "Total
Compensation," "Aggregated Family Group," and "Family Member"
shall all have the meanings set forth in Subsection 6.4(8).
6.6 Right to Change Rate of, Resume or Discontinue
Before-Tax Deposits.
6.6(1) An Active Participant may voluntarily
suspend his Before-Tax Deposits at any time by delivering to
the Administrative Committee written notification of his
election to suspend said contributions on the form prescribed
for that purpose by the Administrative Committee. No
suspension of Basic Before-Tax Deposits shall be effective
unless the Participant has already suspended or is
simultaneously suspending his Supplemental Before-Tax Deposits.
Any such suspension shall be effective as of the first day of
the payroll period next following the date which is seven (7)
days after the date the Administrative Committee receives such
written notification.
<PAGE>
6.6(2) A Participant may, in accordance with
this Section, change the rate of the Before-Tax Deposits made
to the Trust on his behalf to another rate permitted under
Section 6.2, or to resume having made Before-Tax Deposits in
any amount permitted under Section 6.2, to the Trust on his
behalf provided that (i) any such change of rate shall be
effective on the first day of the calendar month next following
the date written notice of such change is received by the
Administrative Committee, and (ii) any such change shall be in
whole percentages of the Participant's Compensation. A
Participant who desires to change the rate of or to resume such
contributions must notify the Administrative Committee thereof
in writing on forms specified by the Administrative Committee.
6.7 Withdrawals from Participant Accounts.
6.7(1) Subject to the provisions of Subsections
6.7(2) and 6.7(3), a Participant, upon or after attaining age
fifty-nine and one-half (59-1/2) or upon meeting the conditions
of hardship, may withdraw the following amounts (determined as
of the Valuation Date coincident with or next following the
date a written request for such withdrawal is received by the
Administrative Committee) from the following Accounts in the
following order: (i) all or any portion of the Participant's
previously unwithdrawn Cash Transfers From Another Qualified
Plan credited to his Rollover Account, (ii) all or any portion
of the current value of previously unwithdrawn earnings in the
Participant's Rollover Account, (iii) all or any portion of the
Participant's previously unwithdrawn Supplemental Before-Tax
Deposits, and (iv) all or any portion of the Participant's
previously unwithdrawn Basic Before-Tax Deposits. No amount
shall be withdrawn under a succeeding clause until all amounts
which may be withdrawn under a preceding clause have been
withdrawn (which withdrawal may be simultaneous with the
withdrawal under a succeeding clause). Notwithstanding the
foregoing, in no event shall a hardship withdrawal of any
amount allocated to a Participant's Accounts pursuant to
Subsection 6.4(6) or 6.5(6) or of any earnings or gains
credited to a Participant's Before-Tax Deposits be permitted.
The following provisions shall apply
with respect to hardship withdrawals:
(a) Application for withdrawal must
be made in writing on a form approved by the Administrative
Committee, and must set out in detail the circumstances
<PAGE>
establishing that the proposed withdrawal is for a Permitted
Purpose.
(b) The Administrative Committee's
determination of whether the application meets the requirements
of this section and the Code and regulations thereunder shall
be final and conclusive, and in making such determination, the
Administrative Committee shall follow uniform and
nondiscriminatory rules.
(c) If the Administrative Committee
is satisfied that the application meets the requirements of
this section and the Code and regulations thereunder, the
application shall be granted.
(d) The expression "Permitted
Purpose," as used in this Subsection 6.7(1), means a withdrawal
which is necessary in light of immediate and heavy financial
need of the Participant which is (i) due to medical expenses
described in Code Section 213 incurred by the Participant, the
Participant's spouse or dependents (as defined in Code Section
152) or necessary for such persons to obtain medical care, (ii)
for purchase of a principal residence of the Participant, (iii)
for payment of tuition for the next twelve (12) months of post-
secondary education for the Participant or such Participant's
immediate family, (iv) needed to prevent eviction of the
Participant from his principal residence or foreclosure on the
mortgage of the Participant's principal residence, or (v) such
other purposes as permitted by the Commissioner of the Internal
Revenue Service. Such payment shall not be made unless the
Committee determines the Participant has obtained all
distributions (other than hardship distributions) and all
nontaxable loans currently available under all plans maintained
by the Participating Company or any Affiliated Company, and in
no event will such payment exceed the amount required to meet
such financial need.
(e) A distribution will not be deemed
necessary in light of immediate and heavy financial need of a
Participant to the extent the amount of the distribution is in
excess of the amount required to relieve the financial need or
to the extent such need can be satisfied from other resources
<PAGE>
reasonably available to the Participant, as determined by the
Administrative Committee on the basis of all relevant facts and
circumstances. In making such determination, the
Administrative Committee may rely on a certification by the
Participant that the financial need cannot be relieved: (i)
through reimbursement or compensation by insurance or
otherwise, (ii) by reasonable liquidation of the Participant's
(or the Participant's spouse's or minor children's) assets, to
the extent such liquidation would not itself cause a hardship,
(iii) by ceasing Before-Tax Deposits to the Plan or
contributions to other plans, or (iv) by other distributions or
loans from the Plan or any other plan, or by borrowing from
commercial sources on reasonable commercial terms, in an amount
sufficient to satisfy the need.
6.7(2) If, at any time, a Participant withdraws
less than the entire amount which is available for his
withdrawal at such time from all Accounts, then such
Participant must withdraw a minimum amount equal to Five
Hundred Dollars ($500.00).
6.7(3) Notwithstanding the foregoing provisions
of this Section 6.7, the Administrative Committee shall,
subject to any terms and conditions imposed by the Trustee,
establish additional uniform policies and procedures, including
procedures regarding the manner in which the amount of any
withdrawal shall be obtained from the Investment Funds referred
to in Section 9.4 hereof to which such Participant has directed
the investment of the amounts credited to his Accounts.
SECTION SEVEN
ALLOCATION TO PARTICIPANTS' ACCOUNTS
7.1 Methods of Allocating Deposits.
7.1(1) Subject to the limitations of Section
7.4 hereof and subject to the provisions of Subsection 29.3(1)
hereof, the Company Matching Deposit of each Participating
Company for each calendar month pursuant to Subsection 6.1(1)
above shall be allocated to the Company Matching Deposit
Account of the Participant on whose behalf said Company Match
Deposit was made, as of the last day of such month.
<PAGE>
7.1(2) Subject to the limitations of Section
7.4 hereof and subject to the provisions of Subsection 29.3(1)
hereof, any additional Company Matching Deposits for a Plan
Year made pursuant to Subsection 6.1(2) above shall be
allocated as of the last day of such Plan Year to the Company
Matching Deposit Account of each Participant who is employed by
a Participating Company as of the last day of such Plan Year,
in an amount equal to a percentage of his Basic Before-Tax
Deposits for the Plan Year, as prescribed by the Board of
Directors of the Sponsoring Company.
7.1(3) Subject to the limitations of Section
7.4 hereof, each Participant's Basic and Supplemental Before-
Tax Deposits for each month shall be allocated to the
appropriate Account as of the last day of such month.
7.2 Allocation to a Participant Transferred to a
Participating Company. If, during a Plan Year, an Active
Participant is transferred from one Participating Company to
another Participating Company, such Participant's share of the
Company Matching Deposits of each Participating Company shall
be determined on the basis of the Basic Before-Tax Deposits
made on behalf of such Active Participant for the portion of
the Plan Year that such Active Participant was employed by such
Participating Company.
7.3 Allocation to a Participant Transferred to an
Affiliated Company Which Has Not Adopted the Plan.
Notwithstanding any other provision of the Plan, if a
Participant is transferred from a Participating Company to an
Affiliated Company which has not adopted the Plan, he shall
continue to participate in the Plan as an Inactive Participant
who has elected a voluntary suspension of Basic and
Supplemental Before-Tax Deposits. If such Participant is
subsequently reemployed by a Participating Company, he shall be
eligible to elect to have made on his behalf Basic and
Supplemental Before-Tax Deposits as of the Entry Date
coincident with or next following the Participant's
reemployment, provided he complies with the provisions of
Section 6.2 of the Plan.
7.4 Limitations on Annual Additions. This Section
7.4 is effective July 1, 1988.
7.4(1) Notwithstanding any other provision of
the Plan, the sum of the Annual Additions to a Participant's
Accounts for any Limitation Year shall not exceed the lesser of
(i) Thirty Thousand Dollars ($30,000) or, if greater, one-
fourth (1/4) of the defined benefit dollar limitation set forth
<PAGE>
in Section 415(b)(1)(A) of the Code as in effect for the
Limitation Year, or (ii) twenty-five percent (25%) of such
Participant's Limitation Year Compensation for the entire
Limitation Year (even though such Participant may not have been
a Participant for the entire Limitation Year). The term
"Annual Additions" to a Participant's Accounts for any
Limitation Year shall mean the sum of:
(a) Such Participant's allocable
share of the contributions of the Participating Company,
including Before-Tax Deposits and Company Matching Deposits,
credited to such Participant within such Limitation Year;
(b) Any amount allocated to an
"individual medical account," as defined in Section 415(l)(2)
of the Code, which is part of a pension or annuity plan
maintained by a Participating Company;
(c) Any amounts derived from
contributions paid or accrued after December 31, 1985, in
taxable years ending after such date, which are attributable to
post-retirement medical benefits allocated to the separate
account of a key employee (as defined in Section 419A(d)(3) of
the Code) under a welfare benefit fund (as defined in Section
419(e) of the Code) maintained by a Participating Company;
(d) Such Participant's allocable
share of forfeitures, if any, credited to such Participant
within such Plan Year; and
(e) Any Participant contributions;
provided, however, that the twenty-five percent
(25%) limitation set forth in Subsection 7.4(1)(ii) above shall
not apply to amounts described in Subsection (b) or (c) above.
Solely for purposes of this Section 7.4, the
determination of a Participant's allocable share of
Participating Company contributions and forfeitures, if any,
for a Limitation Year shall exclude any Participating Company
contributions and forfeitures allocated to such Participant for
any of the reasons set forth in Sections 1.415-6(b)(2)(ii)-(vi)
of the Income Tax Regulations (except as otherwise provided in
such Sections).
<PAGE>
7.4(2) In the event that as a result of (i) the
allocation of forfeitures, (ii) a reasonable error in
estimating a Participant's Limitation Year Compensation, (iii)
a reasonable error in determining the amount of Before Tax
Deposits that may be made under this Section, or (iv) other
facts and circumstances which the Commissioner of Internal
Revenue or his delegate finds justify the availability of the
provisions of this Subsection 7.4(2) and Subsections 7.4(3) and
7.4(4), it is determined that, but for the limitations
contained in Subsection 7.4(1), the Annual Additions to a
Participant's Accounts for any Limitation Year would be in
excess of the limitations contained herein, such Annual
Additions shall be reduced to the extent necessary to bring
such Annual Additions within the limitations contained in
Subsection 7.4(1) in the following order:
(a) Such Participant's Supplemental
Before-Tax Deposits for the Plan Year ending within such
Limitation Year shall be reduced.
(b) Such Participant's allocable
share of Basic Before-Tax Deposits and Company Matching
Deposits for the Plan Year ending within such Limitation Year
shall be simultaneously reduced on a pro-rata basis.
7.4(3) If the amount of any Participant's
allocable share of forfeitures, if any, or Company Matching
Deposits is reduced in accordance with Subsection 7.4(2) above,
the amount of such reduction shall be maintained in a separate
suspense account under the Trust to be used solely to reduce
forfeitures or Company Matching Deposits, respectively, for
that Participant for the next succeeding Limitation Year (and
succeeding Limitation Years, as necessary), if that Participant
is employed as of the end of such Limitation Year. If such
Participant is no longer employed as of the end of such next
succeeding Limitation Year (or succeeding Limitation Years, if
applicable), then the amount in the suspense account shall
reduce forfeitures or Company Matching Deposits, respectively,
for such next succeeding Limitation Year (and succeeding
Limitation Years, if applicable) and shall, subject to the
provisions of Subsection 7.4(1), be allocated and reallocated
in such next succeeding Limitation Year (and succeeding
Limitation Years, if applicable), among the remaining
Participants in the Plan as if such amount were a forfeiture or
Company Matching Deposit, respectively, for the appropriate
Limitation Year. Any suspense account established pursuant to
<PAGE>
this Subsection shall not be adjusted to reflect net income,
loss, appreciation or depreciation in the value of the Trust
Fund as provided for a Participant's regular Accounts pursuant
to Section 9 hereof.
7.4(4) Ifthe amount of any Participant's Basic
or Supplemental Before-Tax Deposits are reduced in accordance
with the provisions of Subsection 7.4(2) above, the amount of
such reduction (the "Excess Amounts"), adjusted for earnings or
losses in a manner similar to Section 6.4(4) above, shall be
distributed to such Participant, and shall be disregarded for
purposes of Section 6.4 above.
7.4(5) In the event of termination of the Plan,
the suspense account established pursuant to this Section 7.4
shall revert to the Participating Company to the extent it may
not then be allocated to any Participant's Account.
7.5 Limitations on Annual Additions for Participating
Companies or Affiliated Companies Maintaining Other Defined
Contribution Plans. In the event that any Participant in this
Plan is a participant under any other Defined Contribution Plan
maintained by a Participating Company or an Affiliated Company
(whether or not terminated), the total amount of annual
additions, as defined in Section 415(c) of the Code and
regulations thereunder, to such Participant's accounts from all
such Defined Contribution Plans shall not exceed the
limitations set forth in Subsection 7.4(1) hereof. If such
total amount of annual additions to each Participant's accounts
from all such Defined Contribution Plans does exceed the
limitations set forth in Subsection 7.4(1) hereof, then the
Annual Additions to a Participant's Accounts in this Plan shall
be reduced, and such reduction shall be accomplished in
accordance with the provisions of Section 7.4 hereof.
7.6 Limitations on Benefits and Annual Additions for
Participating Companies or Affiliated Companies Maintaining
Defined Benefit Plans. In the event that any Participant in
this Plan is a participant under one or more Defined Benefit
Plans maintained by a Participating Company or an Affiliated
Company (whether or not terminated), then the sum of the
Defined Benefit Plan Fraction for such Limitation Year and the
Defined Contribution Plan Fraction for such Limitation Year
shall not exceed one (1.0). If the sum of the Defined Benefit
Plan Fraction for any Limitation Year and the Defined
Contribution Plan Fraction for such Limitation Year does exceed
one (1.0), then the annual additions to a Participant's
Accounts under this Plan shall be reduced subsequent to
reductions under any Defined Benefit Plan.
<PAGE>
7.7 Definitions Relating to Annual Addition
Limitations. For purposes of Sections 7.4, 7.5 and 7.6 hereof
and this Section 7.7, the following definitions shall apply:
7.7(1) "Retirement Plan" shall mean (a) any
profit sharing, pension or stock bonus plan described in
Sections 401(a) and 501(a) of the Code, (b) any annuity plan or
annuity contract described in Section 403(a) or 403(b) of the
Code, (c) any simplified employee pension plan described in
Section 408(k) of the Code and (d) any individual retirement
account or individual retirement annuity described in Section
408(a) or 408(b) of the Code.
7.7(2) "Defined Contribution Plan" shall mean a
Retirement Plan which provides for an individual account for
each participant and for benefits based solely on the amount
contributed to the participant's accounts, and any income,
expenses, gains or losses, and any forfeitures of accounts of
other participants which may be allocated to such participant's
account.
7.7(3) "Defined Benefit Plan" shall mean any
Retirement Plan which does not meet the definition of a Defined
Contribution Plan.
7.7(4) "Defined Benefit Plan Fraction" shall
mean a fraction calculated in accordance with Code Section
415(e)(2).
7.7(5) "Defined Contribution Plan Fraction"
shall mean a fraction, the numerator of which is the sum of the
Annual Additions to the Participant's account under all the
Defined Contribution Plans (whether or not terminated)
maintained by the Participating Companies or any Affiliated
Company for the current and all prior Limitation Years,
(including the Annual Additions attributable to the
Participant's nondeductible employee contributions to this and
all other Defined Contribution Plans, whether or not
terminated, maintained by the Participating Companies or any
Affiliated Company), and the denominator of which is the sum of
the Maximum Aggregate Amounts for the current and all prior
Limitation Years of service with the Participating Companies or
any Affiliated Company (regardless of whether a Defined
Contribution Plan was maintained by the Participating Companies
or any Affiliated Company). The "Maximum Aggregate Amount" in
any Limitation Year is the lesser of one hundred twenty-five
percent (125%) of the dollar limitation in effect under Section
415(c)(1)(A) of the Code or one hundred forty percent (140%) of
<PAGE>
the amount which may be taken into account under Section
415(c)(1)(B) of the Code.
7.7(6) "Limitation Year" shall mean the twelve
(12) consecutive month period ending on December 31.
7.7(7) "Limitation Year Compensation" shall
mean the aggregate of (i) all wages, salaries and other amounts
received for personal services actually rendered in the course
of employment with all Participating Companies and Affiliated
Companies (including, but not limited to, commissions paid
salesmen, compensation for services on the basis of a
percentage of profits, commissions on insurance premiums, tips,
fringe benefits, expense accounts and bonuses) which are
actually paid or made available to a Participant within a
Limitation Year; (ii) in the case of a Participant who is an
employee within the meaning of Code Section 401(c)(1), the
Participant's earned income (as described in Code Section
401(c)(2)); (iii) amounts described in Code Sections 104(a)(3),
105(a) and 105(h), but only to the extent that these amounts
are includable in the gross income of the Participant; (iv)
amounts paid or reimbursed for moving expenses incurred by a
Participant, but only to the extent that these amounts are not
deductible by the Participant under Code Section 217; (v) the
value of a non-qualified stock option granted to a Participant
but only to the extent that the value of the option is
includable in the gross income of the Participant for the
taxable year in which granted; (vi) the amount includable in
the gross income of a Participant upon making the election
described in Code Section 83(b); which are actually paid or
made available (or, for Limitation Years beginning prior to
December 31, 1991, accrued, if the Company properly so elected)
to a Participant within a Limitation Year. Paragraphs (i) and
(ii) of this section include foreign earned income (as defined
in Code Section 911(b)), whether or not excludable from gross
income under Code Section 911. . Limitation Year Compensation
shall not include the following:
(a) Contributions made by any
Participating Company or Affiliated Company to a plan of
deferred compensation to the extent that, before the
application of the Section 415 limitations to the Plan, the
contributions are not included in the gross income of the
Participant for the taxable year in which contributed, or
contributions made by any Participating Company or Affiliated
<PAGE>
Company under a simplified employee pension plan to the extent
the contributions are deductible by the Participant, and any
distributions from a plan of deferred compensation;
(b) Amounts realized from the
exercise of a non-qualified stock option, or when restricted
stock (or property) held by a Participant become freely
transferable or is no longer subject to a substantial risk of
forfeiture;
(c) Amount realized from the sale,
exchange or other disposition of stock acquired under a
qualified stock option; and
(d) Other amounts that receive
special tax benefits, such as premiums for group term life
insurance (but only to the extent that premiums are includable
in the gross income of the Participant), or contributions made
by any Participating Company or Affiliated Company (whether or
not under a salary reduction agreement) towards the purchase of
an annuity contract as described in Section 403(b) of the Code
(whether or not the contributions are excludable from the gross
income of the Participant).
SECTION EIGHT
VALUATION OF TRUST FUND
The Trustee shall evaluate the Trust Fund (separately
itemized with respect to each Investment Fund under Section 9.4
hereof) at fair market value as of the close of business on
each Valuation Date. In making such valuations, except as
otherwise provided for herein or in a Trust Agreement, the
Trustee shall use the modified cash basis method of accounting
and shall deduct all charges, expenses and other liabilities,
if any, then chargeable against the Trust Fund, in order to
give effect to income realized and expenses paid, losses
sustained and unrealized gains or losses constituting
appreciation or depreciation in the value of Trust investments
since the last previous valuation. At the request of the
Administrative Committee, as soon as practicable after such
valuation, the Trustee shall deliver in writing to the
Administrative Committee a valuation of the Trust Fund together
with a statement of the amount of net income or loss (including
appreciation or depreciation in the value of Trust investments)
since the last previous valuation.
<PAGE>
SECTION NINE
PARTICIPANTS' ACCOUNTS
9.1 Separate Accounts. Subject to the provisions of
Section 17.2 hereof, the Administrative Committee shall
maintain for each Participant a separate Company Matching
Deposit Account, a separate Basic Before-Tax Deposit Account, a
separate Supplemental Before-Tax Deposit Account, a separate
Choice Benefits Deposit Account as necessary, an ESOP Account
as necessary, and a separate Rollover Account as necessary.
The ESOP Account will consist of those assets transferred from
the Arkansas Best Employee Stock Ownership Plan. The amount
contributed by or on behalf of a Participant or allocated to
such Participant shall be credited to the appropriate Account
in the manner set forth in Sections Six and Seven hereof. All
payments to a Participant or his Beneficiaries shall be charged
against the respective Accounts of such Participant.
9.2 Accounts of Participants Transferred to an
Affiliated Company. If a Participant is transferred to an
Affiliated Company which has not adopted the Plan, the amount
in the Trust which is credited to his Accounts shall continue
to share in the earnings or losses of the Trust and such
Participant's rights and obligations with respect to such
Accounts shall be governed by the provisions of the Plan and
Trust.
9.3 Adjustment of Participant's Accounts. Except as
otherwise provided herein, the Administrative Committee shall
adjust the Accounts of each Participant so that the amount of
net income, loss, appreciation or depreciation in the value of
the Trust Fund (as appropriately itemized with respect to each
Investment Fund under Section 9.4 hereof) for the period
(herein referred to as the "Valuation Period") from the last
previous valuation to the date of such valuation shall be
credited to or charged against the balance in the Participants'
Accounts as adjusted by the transactions occurring with respect
to each such Account during such Valuation Period. Any Plan
earnings or losses attributable to the investment of a
Participant's Account under the Plan in a loan to the
Participant under Section Eighteen shall be allocated solely to
that Participant's Account in accordance with the procedures of
Section Eighteen.
9.4 Account Investment Direction.
9.4(1) Notwithstanding any other provision of
the Plan or the Trust Agreement with respect to control over
and direction of the investment of assets in the Trust Fund,
each Participant may, at such time and in such manner as the
<PAGE>
Administrative Committee shall determine pursuant to a uniform
policy established by it, direct that all or any part (subject
to such percentage increment limitations as the Administrative
Committee shall determine from time to time) of the amounts
constituting such Participant's existing Account and his future
Basic and Supplemental Before-Tax Deposits and Matching Deposit
be invested among such investment funds as the Administrative
Committee shall offer from time to time ("Investment Funds")
for direction by Participants. This Section 9.4 is intended to
meet the requirements of Section 404(c) of ERISA by allowing
each Participant to direct the investment of his individual
Accounts.
9.4(2) The Administrative Committee shall from
time to time designate the Investment Funds available
hereunder, provided that at all times there shall be at least
three diversified Investment Funds having materially different
risk and reward characteristics in addition to the Arkansas
Best Stock Fund. The assets of each such Investment Fund may
be invested in shares of a registered investment company,
provided that such shares constitute securities described in
Section 401(b)(1) of ERISA. Moneys in any such Fund in amounts
estimated by the Trustee to be needed for cash withdrawals,
inter-Fund transfers or other purposes, or in amounts too small
to be reasonably invested, may be retained by the Trustee in
cash or invested in a manner consistent with such purposes.
9.4(3) At such times as the Administrative
Committee shall permit, and in such manner as the
Administrative Committee shall determine, pursuant to uniform
policies established by it, each Participant may (i) direct
that all, or any part (subject to such percentage increment
limitations as the Administrative Committee shall determine
from time to time) of the amounts in the Participant's Accounts
which are invested on his behalf in any of the Investment
Funds, be liquidated and the proceeds thereof reinvested in the
other Investment Funds and (ii) redirect the investment of
future Before-Tax Deposits and Matching Contributions (and
future earnings on all such amounts) in accordance with the
provisions of Subsection 9.4(1) hereof. In the event at any
time a Participant does not elect to redirect any Account
balances or future contributions as provided for in this
Subsection 9.4(3), then such Participant's prior directions
shall remain in effect.
<PAGE>
9.4(4) The Trustee shall carry out
Participant's directions or redirections permitted by this
Section 9.4 (or in the absence of directions, shall invest as
provided in Subsection 9.4(5) hereof) as soon as
administratively practicable. Notwithstanding the foregoing,
in the event a Participant has directed that only part of his
interest in any of the Investment Funds be liquidated and
reinvested in one or more of the other Investment Funds only
the nearest value of whole units will be liquidated and
reinvested.
9.4(5) If a Participant fails or refuses to
exercise any of his investment direction rights as provided for
in this Section 9.4, the Trustee shall invest all amounts (not
otherwise directed) in the lowest risk Investment Fund
available, as determined by the Administrative Committee.
9.4(6) The Administrative Committee shall
establish and maintain, or cause the appropriate Trustee to
establish and maintain procedures and records which will
adequately reflect the state of each Investment Fund and the
proportionate interest of each Participant in each Investment
Fund, including the amount of each Participant's various
Accounts allocated to each such Investment Fund.
9.4(7) Proxy Voting. Shares of stock held in
the Arkansas Best Stock Fund shall be voted in accordance with
Subsection 9.5(3) below. Any shares of a registered investment
company allocated to a Participant's Account shall be voted in
accordance with directions of the Participant (or Beneficiary
or Alternate Payee), with any fractional shares being voted on
a combined basis to the extent possible to reflect the
directions of voting Participants. The Trustee or a duly
appointed Investment Manager shall be responsible for the
voting of any other securities within an Investment Fund and
the exercise of any tender offer or redemption rights with
respect to any such securities.
9.5 Arkansas Best Stock Fund.
9.5(1) The Arkansas Best Stock Fund shall be
one of the Investment Funds available for the investment of any
portion of a Participant's Account in accordance with Section
9.4. The Arkansas Best Stock Fund may be partially invested in
cash, cash-equivalents, or short-term investments as needed to
meet liquidity requirements, or in amounts that are too small
to reasonably invest in Arkansas Best Stock.
<PAGE>
9.5(2) Except as provided in Subsection 9.5(1),
all assets of the Arkansas Best Stock Fund, shall be invested
and reinvested exclusively in Arkansas Best Stock.
9.5(3) All shares of Arkansas Best Stock in the
Arkansas Best Stock Fund shall be voted by the Trustee in such
manner as may be directed by the respective Participants,
Beneficiaries and Alternate Payees, with fractional shares
being voted on a combined basis to the extent possible to
reflect the direction of the voting Participants. In the event
that there is a tender offer or exchange offer for outstanding
shares of Arkansas Best Stock, each Participant, Beneficiary
and Alternate Payee shall be permitted to elect whether shares
of Company Stock held in his Account should be tendered or
exchanged. Rights to tender or exchange with respect to shares
allocated to a Participant's Account with respect to which
direction has not been received by the Trustee shall not be
tendered or exchanged but shall continue to be held by the
Trust.
9.5(4) Subject to the provisions of the Plan
and Trust, the Arkansas Best Stock Fund may sell shares of
Arkansas Best Stock to any person (including the issuer of such
shares), provided that any sale to a party in interest must be
made for not less than adequate consideration. No commission
shall be paid with respect to sales or purchases of Arkansas
Best Stock from parties-in-interest. The sale price for each
such share of Arkansas Best Stock sold to a party-in-interest
shall not be less than the price of Arkansas Best Stock,
prevailing at the time of sale, on a national securities
exchange which is registered under section 6 of the Securities
Exchange Act of 1934, or, if Arkansas Best Stock is not, at the
time of such purchase, traded on such national securities
exchange, shall be not more than the offering price for the
Arkansas Best Stock as established by the current bid and asked
prices quoted by persons independent of the Sponsoring Company
and of any party-in-interest. In the event that either (i) the
sale price per share from the Sponsoring Company as determined
pursuant to the foregoing is less than the then par value of
such Arkansas Best Stock, or (ii) Trustee is of the opinion
that the sale of such shares directly to the Sponsoring Company
or a party-in-interest might involve a possible violation of
any federal or state securities law, or any rule or regulation
thereunder, Trustee shall not sell such shares directly to the
Sponsoring Company, but shall sell such shares in the open
market in exchange transactions or in any other lawful manner.
<PAGE>
9.5(5) Securities Law Restriction.
Notwithstanding anything to the contrary contained in the Plan,
the Administrative Committee may, in its sole discretion,
restrict any Plan transactions involving Arkansas Best Stock to
insure that the operation of the Plan complies with Rule
16(b)(3), promulgated under the Securities Exchange Act of
1934, as amended.
SECTION TEN
COMMON TRUST FUND
Except as otherwise provided in accordance with
procedures adopted under Subsection 9.4(6) hereof, the fact
that for administrative purposes the Administrative Committee
maintains separate accounts for each Participant shall not be
deemed to segregate for such Participant, or to give such
Participant any direct interest in, any specific assets in the
Trust Fund held by the Trustee. Except as provided herein, all
such assets may be held and administered by the Trustee as a
commingled fund, subject to the provisions of Section 9.4
hereof.
SECTION ELEVEN
DESIGNATION OF BENEFICIARIES
11.1 Participant's Designation.
11.1(1) Subject to the provisions of Sections
11.2 and 13.2 hereof and of Subsection 17.3(2) below, each
Participant may designate a Beneficiary or Beneficiaries, and
contingent Beneficiary or Beneficiaries, if desired, including
the executor or administrator of his estate, to receive his
interest in the Trust Fund in the event of his death, but the
designation of a Beneficiary shall not be effective for any
purpose unless and until it has been filed with the
Administrative Committee on the form provided therefor. If the
Participant has a surviving spouse and the deceased Participant
failed to name a Beneficiary in the manner herein prescribed,
or the Beneficiary or Beneficiaries so named predecease the
Participant, the amount, if any, which is payable hereunder
with respect to such deceased Participant shall be paid to the
surviving spouse. If the Participant does not have a surviving
spouse and the deceased Participant failed to name a
Beneficiary in the manner herein prescribed, or the Beneficiary
<PAGE>
or Beneficiaries so named predecease the Participant, the
amount, if any, which is payable hereunder in respect of such
deceased Participant may be paid, in the discretion of the
Administrative Committee, either to (a) all or any one (1) or
more of the persons comprising the group consisting of such
Participant's descendants, parents, or heirs at law, and the
Administrative Committee may pay the entire benefit to any
member of such group or apportion such benefit among any two
(2) or more of them in such shares as the Administrative
Committee, in its sole discretion, shall determine, or (b) the
executor or administrator of the estate of such deceased
Participant, provided that in any of such cases payment shall
be made in the form of an immediate lump sum as provided in
Subsection 15.2(1). If the Administrative Committee does not
so direct any of such payments, the Administrative Committee
may elect to have a court of applicable jurisdiction determine
to whom a payment or payments should be made. Any payment made
to any person pursuant to the power and discretion conferred
upon the Administrative Committee by the preceding sentence
shall operate as a complete discharge of all obligations under
the Plan in respect of such deceased Participant and shall not
be subject to review by anyone, but shall be final, binding and
conclusive on all persons ever interested hereunder.
11.1(2) Subject to the provisions of Subsection
11.2 below, a Participant may from time to time change any
Beneficiary designated by him without notice to such
Beneficiary, under such rules and regulations as the
Administrative Committee may from time to time promulgate, but
the last Beneficiary designation filed with the Administrative
Committee shall control.
11.2 Qualified Consent. With respect to a Participant
who on the date of such Participant's death, is survived by and
has been married to the same spouse continuously for a period
of at least one (1) year, such Participant's Accounts shall, on
his death, be paid to such surviving spouse to whom he was
married at the date of his death unless the surviving spouse
has made a Qualified Consent to the payment of any or all of
said Accounts to a designated Beneficiary other than the
surviving spouse. "Qualified Consent" means an irrevocable
written consent executed by the Participant's spouse which
acknowledges the effect of the consent and is witnessed by a
Plan representative or a notary public. A Participant may,
after obtaining a Qualified Consent, change his Beneficiary
designation as permitted by Subsection 11.1(2) above, but any
such change is subject to the requirements of this Section 11.2
<PAGE>
and will require another Qualified Consent should such a
spouse, if surviving, not be the sole Beneficiary of all
amounts in said Account, unless a Qualified Consent previously
executed by such spouse expressly authorizes changes in the
Beneficiary without further consent of the spouse. A Qualified
Consent is effective only with respect to the spouse who
executes it. If the Plan Administrator is satisfied that there
is no spouse, or that the spouse cannot reasonably be located,
or in such other circumstances as permitted by governmental
regulations, no Qualified Consent shall be required as a
condition to payment to a Beneficiary who is not the surviving
spouse.
SECTION TWELVE
DISABILITY BENEFITS
12.1 Disability Retirement Benefits. If a Participant
retires by reason of Total and Permanent Disability while in a
Participating Company's or an Affiliated Company's employ or on
Leave of Absence, his Company Matching Deposit Account shall
fully vest and, subject to the provisions of Section 17.3
hereof, he shall be entitled to receive benefits equal to the
total amount in all of his Accounts under the Plan, as
determined in accordance with the provisions of Section 15.2
hereof. Such benefits shall be paid as provided in Subsection
15.2(1) and Section 15.5 hereof.
12.2 Determination of Disability. The Administrative
Committee shall determine whether a Participant has suffered
Total and Permanent Disability and its determination in that
respect is binding upon the Participant, provided that the
Administrative Committee shall rely upon professional medical
advice in making such determination. In making its
determination, the Administrative Committee may require the
Participant to submit to medical examinations by doctors
selected by the Administrative Committee. The provisions of
this Section Twelve shall be uniformly and consistently applied
to all Participants.
SECTION THIRTEEN
RETIREMENT AND DEATH BENEFITS
13.1 Retirement Benefits. A Participant's Company
Matching Deposit Account shall fully vest and be nonforfeitable
on his Retirement Date, provided such Participant is employed
by a Participating Company or an Affiliated Company on such
date. A Participant who continues in the Participating
Company's employ after his Retirement Date shall continue to be
a Participant in the Plan until his actual retirement. Subject
<PAGE>
to the provisions of Section [17.3] hereof, any Participant who
retires under this Section 13.1 shall be entitled to receive
benefits equal to the total amounts in all of his Accounts
under the Plan as determined in accordance with the provisions
of Section 15.1 hereof. Such benefit shall be paid as provided
in Subsection 15.2(1) and Section 15.5 hereof.
13.2 Death Benefits. Upon the death of a Participant
while in the employ of a Participating Company, an Affiliated
Company or on Leave of Absence, his Company Matching Deposit
Account shall fully vest and, subject to the provisions of
Section 17.3 hereof, the following person or persons shall be
entitled to receive benefits equal to the total amounts in the
deceased Participant's Accounts under the Plan as determined in
accordance with the provisions of Subsection 15.2(1) and
Section 15.5 hereof:
(i) In the case of a Participant who is
married as of the date of his death, except as provided in
Subsection (ii) below, his surviving spouse.
(ii) In the case of a Participant who is
married on the date of his death but who has designated a
Beneficiary other than his surviving spouse pursuant to Section
Eleven hereof and (i) whose surviving spouse has executed a
Qualified Consent as provided for in Section 11.2 hereof or
(ii) who has not been married to the same spouse continuously
for at least one (1) year as of the date of his death, his
designated Beneficiary pursuant to Section Eleven hereof.
(iii) In the case of a Participant who is not
married on the date of his death, his designated Beneficiary
pursuant to Section Eleven hereof.
Upon the death of a Participant who is no longer employed by a
Participating Company or an Affiliated Company prior to the
receipt by such Participant of all amounts to which such
Participant is entitled under the provisions of the Plan, the
person or persons entitled to receive death benefits as
hereinabove provided shall be entitled to receive the balance
of any amounts owing to such deceased Participant, as
determined and to be paid in accordance with the provisions of
Subsection 15.2(1) and Section 15.5 hereof.
SECTION FOURTEEN
EMPLOYMENT TERMINATION BENEFITS
14.1 Vesting upon Termination of Employment. Subject
to the provisions of Sections 15 and 17 hereof, in the event of
<PAGE>
the Termination of Employment of a Participant, such
Participant shall be entitled to receive (i) one hundred
percent (100%) of the amounts in all of his Accounts other than
his Company Matching Deposit Account and ESOP Account, and (ii)
the following percentage of the amount in his Company Matching
Deposit Account and ESOP Account, based upon such Participant's
number of Vesting Years of Service prior to such Termination of
Employment:
Number of Vesting
Years of Service Vested Percentage
Less than 5 years None
5 years or more 100%
Such benefits shall be paid as provided in
Section 15 hereof.
14.2 Determination of Vesting Years of Service. All
Vesting Years of Service (whether or not continuous) shall be
taken into account, except Vesting Years of Service not taken
into account in accordance with Section 14.3 hereof.
14.3 Periods of Severance. Subject to the provisions
of Section 14.5 hereof, Vesting Years of Service shall be
disregarded as follows:
14.3(1) In the case of any Participant who
suffers a Termination of Employment and who has a One-Year
Period of Severance, Vesting Years of Service before such
severance shall not be taken into account until such
Participant has completed a Vesting Year of Service after such
severance.
14.3(2) In the case of any Participant who
suffers a Termination of Employment and who has no vested
amount in his Basic or Supplemental Before-Tax Deposit
Accounts, or his Choice Benefits Deposit Account, or his
Company Matching Deposit Account in accordance with the
provisions of Section 14.1 hereof, Vesting Years of Service
before any period of One-Year Periods of Severance shall not be
taken into account if such Participant's latest Period of
Severance equals or exceeds the greater of (i) five (5)
consecutive One-Year Periods of Severance, or (ii) his
aggregate Periods of Service before the commencement of such
latest Period of Severance. Such aggregate Periods of Service
before the commencement of such latest Period of Severance
shall be deemed not to include any Period of Service not
required to be taken into account under this Section 14.3 by
reason of any prior Period of Severance. Such aggregate
Periods of Service shall be deemed not to include any Vesting
<PAGE>
Year of Service which precedes a One-Year Period of Severance
if as of or prior to December 31, 1984, the duration of the
consecutive One-Year Periods of Severance measured in years
equals or exceeds the Participant's Vesting Years of Service
prior to the One-Year Periods of Severance.
14.3(3) In the case of any Participant who has
five (5) consecutive One-Year Periods of Severance, Vesting
Years of Service after such five (5) year period shall not be
taken into account for purposes of determining the vested
amount in his Company Matching Deposit Account which accrued
prior to such five (5) year period.
14.4 Forfeiture of Non-Vested Amount.
14.4(1) (a) In the case of any Participant
who has suffered a Termination of Employment and who has
received a distribution of the vested amount in his Company
Matching Deposit Account and his Basic and Supplemental Before-
Tax Deposit Accounts and his Choice Benefits Deposit Account
(the "Vested Amount") on or prior to the last day of the second
(2nd) Plan Year following the Plan Year in which such
Termination of Employment occurs, the excess, if any, of the
amount in his Company Matching Deposit Account over the vested
amount in such Account (the "Non-Vested Amount") shall be
forfeited as of the last day of the second (2nd) Plan Year
following the Plan Year during which such Participant suffers
such Termination of Employment.
(b) In the case of any Participant
who has suffered a Termination of Employment and who has no
Vested Amount at the time of such Termination of Employment,
the amount in his Company Matching Deposit Account shall be
forfeited as of the last day of the second (2nd) Plan Year
following the Plan Year during which such Participant suffers
such Termination of Employment.
(c) In the case of any Participant
who has suffered a Termination of Employment and who has not
received a distribution of the Vested Amount on or prior to the
last day of the second (2nd) Plan Year following the Plan Year
in which such Termination of Employment occurs, the Non-Vested
Amount shall be forfeited as of the last day of the second
<PAGE>
(2nd) Plan Year following the Plan Year during which such
Participant suffers such Termination of Employment.
14.4(2) Subject to the provisions of Subsection
14.5(2) hereof, forfeited, Non-Vested Amounts shall reduce the
Company Matching Deposits of each Participating Company under
Subsection 6.1(1). If the amount of the forfeited, Non-Vested
Amounts for a Plan Year exceeds the amount of the Company
Matching Deposits for that Plan Year, the excess shall be
treated as an increase in the specified percentage determined
in accordance with Subsection 6.1(1) for the Plan Year.
14.5 Restoration of Forfeited Non-Vested Amount.
14.5(1) In the event a Participant who has
forfeited any amount in his Company Matching Deposit Account in
accordance with Section 14.4 hereof, returns to employment with
a Participating Company as an Employee prior to the date on
which such Participant has incurred five (5) consecutive One-
Year Periods of Severance, the amount in such Participant's
Company Matching Deposit Account which was forfeited pursuant
to Section 14.4 hereof (without adjustment for any gains or
losses in the Trust Fund subsequent to such forfeiture) shall
be restored to such Participant's Company Matching Deposit
Account. Upon the restoration of a Participant's Company
Matching Deposit Account as provided for hereinabove, the
vested amount in such Participant's Company Matching Deposit
Account (whether attributable to amounts restored, amounts, if
any, repaid by the Participant or additional amounts added to
such Account after such reemployment) shall thereafter be
determined in accordance with the provisions of this Section
Fourteen without regard to such Participant's original
Termination of Employment.
14.5(2) The restoration of a Participant's Non-
Vested Amount in his Company Matching Deposit Account as
provided for in Subsection 14.5(1) above, shall be made from
the Non-Vested Amounts forfeited pursuant to Section 14.4
hereof during the Plan Year of such restoration before any use
of such forfeitures as provided in Subsection 14.4(2) hereof.
In the event there are not sufficient forfeitures to restore
the entire amount owing to Participants under Subsection
14.5(1) above, the additional amount necessary for restoration
shall be contributed by the Participating Company employing
such Participant as a special contribution to be allocated to
<PAGE>
the Company Matching Deposit Account of the affected
Participant.
14.6 Vesting of ESOP Accounts. Notwithstanding
anything to the contrary elsewhere in the Plan, the following
provisions shall govern the nonforfeitability of all balances
in a Participant's ESOP Account. Effective for any Termination
of Employment on or after January 1, 1994, a Participant's ESOP
Account shall vest in accordance with Section 14.1 above, and,
in addition, a Participant's interest in his Accounts shall
become 100% vested and nonforfeitable if he is employed by the
Company or an Affiliated Company on or after his 55th birthday,
provided he was employed prior to January 1, 1991.
SECTION FIFTEEN
PAYMENT OF BENEFITS
15.1 Amount of Payment. Upon a Participant's
retirement, Total and Permanent Disability, death or
Termination of Employment, he or his Beneficiary shall be
entitled to an amount computed in accordance with the
provisions of Sections Twelve, Thirteen or Fourteen, as
applicable.
15.2 Method of and Time for Distribution of Benefits.
15.2(1) Upon a Participant's Termination of
Employment, retirement, Total and Permanent Disability or
death, the Participant or, if applicable, the Beneficiary, may
elect distribution in the form of a lump sum payment of the
vested amounts in the Participant's Accounts valued as of the
most recent available Valuation Date preceding the date of
distribution, paid as soon as administratively practicable
following the Participant's request for distribution.
15.2(2) Notwithstanding any other provision of
this Section Fifteen to the contrary, if the vested amounts in
the Participant's Accounts (other than his Rollover Account) do
not exceed Three Thousand Five Hundred Dollars ($3,500),
distribution shall be made as provided in Subsection
15.2(1)(a), as if the Participant had requested distribution
within sixty (60) days after the date the Participant
terminated employment.
15.2(3) Subject to the provisions of this
Section 15.2, if a Participant or his Beneficiary is entitled
<PAGE>
to a distribution pursuant to Section Twelve, Thirteen or
Fourteen hereof, such amounts shall be distributed not later
than the sixtieth (60th) day after the close of the Plan Year
in which occurs the latest of:
(a) The date on which the Participant
attains or would have attained sixty-five (65) years of age;
(b) The tenth (10th) anniversary of
the year in which the Participant commenced participation in
the Plan; or
(c) The Participant's termination of
employment or death.
15.2(4) Notwithstanding any other provision of
this Section Fifteen to the contrary, no distribution shall be
made before the earlier of the Participant's Retirement Date or
death without the Participant's written consent to the
commencement of such distribution obtained not more than ninety
(90) days prior to such commencement of distribution, if the
combined vested value of such Participant's Company Matching
Deposit Account, Basic and Supplemental Before-Tax Deposit
Accounts and Choice Benefits Deposit Account as of such date
exceeds Three Thousand Five Hundred Dollars ($3,500).
15.2(5) Explanation to Participants: no less
than 30 days and no more than 90 days prior to commencement of
distribution, the Participant must be furnished with a general
description of the material features, and an explanation of the
relative values of any optional forms of distribution available
to him under this Section, and, if applicable, of his right to
defer distribution.
A distribution may commence less than 30 days
after the notice required under section 1.411(a)-11(c) of the
Income Tax Regulations is given, provided that:
(a) the Plan Administrator clearly informs the
Participant that the Participant has a right to a period of at
least 30 days after receiving the notice to consider the
decision of whether or not to elect a distribution (and, if
applicable, a particular distribution option), and
(b) the Participant, after receiving the notice,
affirmatively elects a distribution.
<PAGE>
15.2(6) If, upon the date that payments are to
commence under this Section Fifteen, the amount of such payment
cannot be ascertained, a payment retroactive to such date may
be made no later than sixty (60) days after the end of the Plan
Year during which such date occurs.
15.3 Limitations on Timing. Notwithstanding any other
provision of the Plan to the contrary, distributions must occur
at least as rapidly as required under this Section 15.3.
15.3(1) A Participant's entire interest in the
Plan shall be distributed to him no later than the Required
Beginning Date. "Required Beginning Date" shall mean April 1
of the calendar year following the calendar year in which the
Participant attains age seventy and one-half (70-1/2).
15.3(2) In the event of the death of a
Participant prior to distribution of his benefits under the
Plan, distribution of such benefits to a Beneficiary shall be
made within five (5) years after the death of such Participant.
15.4 Payments on Personal Receipt Except in Case of
Legal Disability. All payments to any Participant or his
Beneficiary, from the Trust Fund, shall be made to the
recipient entitled thereto in person or upon his personal
receipt, in a form satisfactory to the Administrative
Committee, except when the recipient entitled thereto shall be
under a legal disability, or, in the sole judgment of the
Administrative Committee, shall otherwise be unable to apply
such payments in furtherance of his own interests and
advantage. The Administrative Committee may, in such event, in
its sole discretion, direct all or any portion of such payments
to be made in any one or more of the following ways: (i)
directly to such person; (ii) to the guardian of his person or
of his estate, appointed by any court of competent
jurisdiction; (iii) to his spouse or to any other person, to be
expended for his benefit; (iv) to a custodian under any
applicable Uniform Gifts to Minors Act; or (v) by the
Administrative Committee itself directing the expenditure of
any payments so made. The decision of the Administrative
Committee, in each case, will be final, binding and conclusive
upon all persons ever interested hereunder, and, except in the
case of (v) above, the Administrative Committee shall not be
obliged to see to the proper application or expenditure of any
payments so made. Any payment made pursuant to the power
herein conferred upon the Administrative Committee shall
operate as a complete discharge of all obligations of the
Trustee and the Administrative Committee, to the extent of the
amounts so paid.
<PAGE>
15.5 Benefits Payable in Cash. All disbursements from
the Trust Fund shall be made in cash, and no Participant may
elect to receive an in kind distribution except as specifically
provided below. The Participant shall have the right to demand
that distribution of his ESOP Account and the portion of his
Company Matching Deposit Account that is invested in Arkansas
Best Stock at the time of distribution, be made in whole shares
of Arkansas Best Stock (with the value of any fractional shares
paid in cash). The number of shares of stock to be distributed
shall be calculated by dividing the aggregate fair market value
of the Participants' units in the Arkansas Best Stock Fund by
the fair market value of a share of Arkansas Best Stock.
15.6 Distribution Accounts. If the payment of a
Participant's Accounts is to be deferred pursuant to Section
15.2 hereof, the balance in the Participant's Accounts shall
remain invested in accordance with the Participant's previous
directions under Section 9.4 or in accordance with Section 9.5,
whichever is applicable, and such Participant may continue to
direct the investment of his Accounts in the manner and to the
extent permitted in Section 9.4 as if the Participant were
still employed by the Participating Company or an Affiliated
Company.
15.7 Put Option for ESOP Accounts Only. The Company
shall provide a "put option" to any Participant (or
Beneficiary) who receives a distribution of Arkansas Best Stock
from his ESOP Account at a time when such Arkansas Best Stock
is not readily tradable on an established market. The put
option shall permit the Participant (or Beneficiary) to sell
such Arkansas Best Stock to the Company at any time during two
option periods, at the then Fair Market Value. "Fair Market
Value" shall mean the fair market value of Arkansas Best Stock
as determined in good faith by the Administrative Committee.
The first put option period shall be for at least 60 days
beginning on the date of distribution. The second put option
period shall be for at least 60 days beginning after the new
determination of Fair Market Value (and notice to the
Participant thereof) in the following Plan Year. The Company
may allow the Administrative Committee to direct the Trustee to
purchase shares of Arkansas Best Stock tendered to the Company
under a put option. The payment for any Arkansas Best Stock
sold under a put option shall be made within 30 days if the
shares were distributed as part of an installment distribution.
If the shares were distributed in a lump sum distribution,
payment shall commence within 30 days and may be made in a lump
sum or in substantially equal, annual installments over a
period not exceeding five years, with adequate security
provided and interest payable at a reasonable rate on any
unpaid installment balance (as determined by the Company or the
Administrative Committee).
<PAGE>
Shares of Arkansas Best Stock held or distributed by the
Trustee may include such legend restrictions on transferability
as the Company may reasonably require in order to assure
compliance with applicable Federal and state securities law.
Except as otherwise provided in this Section 15.7, no shares of
Arkansas Best Stock held or distributed by the Trustee may be
subject to a put, call or other option, or buy-sell or similar
arrangement.
15.8 Distribution Limitations Applicable to Before-Tax
Deposits. Notwithstanding any provisions to the contrary
herein, no distribution shall be made of any Before-Tax
Deposits or the earnings thereon prior to the earliest of:
15.8(1) Separation from service, death, or
Disability, as provided in Sections 12, 13 and 14 above.
15.8(2) Termination of the Plan without
establishment of or maintenance of another defined contribution
plan (other than an employee stock ownership plan as defined in
Code Section 4975(e)(7)), as provided in Treasury Regulations.
15.8(3) The disposition by a Participating
Company of substantially all of the assets used by such
Participating Company in a trade or business of such
Participating Company, as provided in Treasury Regulations.
15.8(4) The disposition by a Participating
Company of its interest in a subsidiary, as provided in
Treasury Regulations.
15.8(5) The attainment of age fifty-nine and one-
half (59 1/2) as provided in Section 6.7 above or the Required
Beginning Date, as provided in Section 15.3(1) above.
15.8(6) Financial hardship pursuant to the
provisions of Section 6.7 above.
15.9 Benefits Payable Pursuant to a Qualified Domestic
Relations Order. Notwithstanding any other provision of the
Plan to the contrary, immediate distribution of benefits
payable to an Alternate Payee pursuant to a Qualified Domestic
Relations Order shall be permitted even though the Participant
whose benefits have been assigned to the Alternate Payee would
not be entitled to receive a distribution at such time, if all
of the following requirements are met: (i) the Participant's
Account is one hundred percent (100%) vested and nonforfeitable
at such time pursuant to Section 14.1 hereof, (ii) the entire
<PAGE>
amount payable to the Alternate Payee does not exceed Three
Thousand Five Hundred Dollars ($3,500), or the Alternate Payee
has requested immediate distribution in writing, (iii)
allocation pursuant to Section 8.1 hereof of all amounts
required to be paid to the Alternate Payee has been completed,
and (iv) the Qualified Domestic Relations Order requires or
permits immediate distribution.
In the event an Alternate Payee dies prior to
distribution of the amounts payable to the Alternate Payee
pursuant to the Qualified Domestic Relations Order, the amount
payable shall be distributed as provided in the Qualified
Domestic Relations Order. If the Qualified Domestic Relations
Order does not specify how such amounts are to be distributed
in the event of the Alternate Payee's death, the Administrative
Committee shall cause such amounts to be distributed in
accordance with applicable law; without limitation, the
Administrative Committee may ascertain the requirements of
applicable law by filing an interpleader or declaratory
judgment action in a court of competent jurisdiction.
15.10 Direct Rollovers. This Article applies to
distributions made on or after January 1, 1993.
Notwithstanding any provision of the Plan to the contrary that
would otherwise limit a distributee's election under this
Section, a distributee may elect, at the time and in the manner
prescribed by the Administrative 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. Such procedures may limit direct rollovers to
eligible rollover distributions of at least $200 (or those
reasonably expected to total at least $200 when aggregated with
other distributions during the Plan Year from this Plan). The
procedures prescribed by the Administrative Committee may
include a deadline for making such an election and may require
the distributee to furnish adequate information regarding the
transferee plan. Such procedures may also require the direct
rollover of at least $500 as a condition of permitting direct
rollover of less than the total distribution and may limit
Participants to a single direct rollover.
15.10(1) Definitions.
(a) Eligible Rollover Distribution.
An eligible rollover distribution is any distribution of all or
any portion of the balance to the credit of the distributee,
except that an eligible rollover distribution does not include:
any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) made for
<PAGE>
the life (or life expectancy) of the distributee or the joint
lives (or joint life expectancies) of the distributee and the
distributee's designated beneficiary, or for a specified period
of ten years or more; any distribution to the extent such
distribution is required under Section 401(a)(9) of the Code;
and the portion of any distribution that is not includible in
gross income (determined without regard to the exclusion for
net unrealized appreciation with respect to employer
securities).
(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 is
a defined contribution plan that accepts the distributee's
eligible rollover distribution. However, in the case of an
eligible rollover distribution to a surviving spouse, an
eligible retirement plan is an individual retirement account or
individual retirement annuity.
(c) Distributee. A distributee
includes an employee or former employee. In addition, the
employee's or former employee's surviving spouse and the
employee's or former employee's spouse or former spouse who is
the alternate payee under a Qualified Domestic Relations Order,
as defined in Section 414(p) of the Code, are distributees with
regard to the interest of the spouse of former spouse.
(d) Direct Rollover. A direct
rollover is a payment by the Plan to the eligible retirement
plan specified by the distributee.
SECTION SIXTEEN
BENEFIT CLAIMS PROCEDURE
16.1 Claims for Benefits. Any claim for benefits
under the Plan shall be made in writing to the Administrative
Committee. If such claim for benefits is wholly or partially
denied, the Administrative Committee shall, within ninety (90)
days after receipt of the claim, notify the Participant or
<PAGE>
Beneficiary of the denial of the claim. Such notice of denial
(i) shall be in writing, (ii) shall be written in a manner
calculated to be understood by the Participant or Beneficiary,
and (iii) shall contain (a) the specific reason or reasons for
denial of the claim, (b) a specific reference to the pertinent
Plan provisions upon which the denial is based, (c) a
description of any additional material or information necessary
to perfect the claim, along with an explanation of why such
material or information is necessary, and (d) an explanation of
the claim review procedure, in accordance with the provisions
of this Section Sixteen.
16.2 Request for Review of Denial. Within sixty (60)
days after the receipt by the Participant or Beneficiary of a
written notice of denial of the claim, or such later time as
shall be deemed reasonable taking into account the nature of
the benefit subject to the claim and any other attendant
circumstances, if the Participant or Beneficiary does not agree
with the denial of the claim, such Participant or Beneficiary
or his authorized representative shall file a written request
with the Administrative Committee that it conduct a full and
fair review of the denial of the claim for benefits. In
connection with any request for a review of the denial of a
claim for benefits, the Participant or Beneficiary, or his
authorized representative, may review pertinent documents
relating thereto and may submit issues and comments in writing
to the Administrative Committee.
16.3 Decision on Review of Denial. The Administrative
Committee shall deliver to the Participant or Beneficiary a
written decision on the claim within sixty (60) days after the
receipt of the aforesaid request for review, except that if
there are special circumstances (such as the need to hold a
hearing, if necessary) which require an extension of time for
processing, the aforesaid sixty (60) day period shall be
extended to one hundred twenty (120) days. Written notice of
any such extension shall be furnished to the Participant or
Beneficiary prior to the commencement of such extension. A
decision on a review of a denial of a claim for benefits shall
(i) be written in a manner calculated to be understood by the
Participant or Beneficiary, (ii) include the specific reason or
reasons for the decision, and (iii) contain a specific
reference to the pertinent Plan provisions upon which the
decision is based.
<PAGE>
SECTION SEVENTEEN
MISCELLANEOUS PROVISIONS
RESPECTING PARTICIPANTS
17.1 Participants to Furnish Required Information.
17.1(1) Each Participant shall furnish to the
Administrative Committee such information as the Administrative
Committee considers necessary or desirable for purposes of
administering the Plan, and the provisions of the Plan
respecting any payments hereunder are conditional upon the
Participant's furnishing promptly such true, full and complete
information as the Administrative Committee may reasonably
request.
17.1(2) Each Participant shall submit proof of
such Participant's age to the Administrative Committee. The
Administrative Committee shall, if such proof of age is not
submitted as required, use as conclusive evidence thereof, such
information as is deemed by it to be reliable, regardless of
the source of such information. Any adjustment required by
reason of lack of proof or the misstatement of the age of
persons entitled to benefits hereunder, by the Participant or
otherwise, shall be in such manner as the Administrative
Committee deems equitable.
17.1(3) Any notice or information which
according to the terms of the Plan or the rules of the
Administrative Committee must be filed with the Administrative
Committee, shall be deemed so filed if addressed and either
delivered in person or mailed, postage fully prepaid, to the
Administrative Committee. Whenever a provision herein requires
that a Participant (or the Participant's Beneficiary) give
notice to the Administrative Committee within a specified
number of days or by a certain date, and the last day of such
period, or such date, falls on a Saturday, Sunday, or company
holiday, the Participant (or the Participant's Beneficiary)
will be deemed in compliance with such provision if notice is
delivered in person to the Administrative Committee or is
mailed, properly addressed, postage prepaid, and postmarked on
or before the business day next following such Saturday, Sunday
or company holiday. The Administrative Committee may, in its
sole discretion, modify or waive any required notice; provided,
however, that such modification or waiver must be
administratively feasible, must be in the best interest of the
Participant, and must be made on the basis of rules of the
<PAGE>
Administrative Committee which are applied uniformly to all
Participants.
17.2 Participants' Rights in Trust Fund. No
Participant or other person shall have any right, title or
interest in, to or under the Trust Fund, or any part of the
assets thereof, except and to the extent expressly provided in
the Plan.
17.3 Inalienability of Benefits.
17.3(1) Restrictions on Assignment. The
benefits provided hereunder are intended for the personal
security of persons entitled to payment under the Plan, and are
not subject in any manner to the debts or other obligations of
the persons to whom they are payable. The interest of a
Participant or such Participant's Beneficiary or Beneficiaries
may not be sold, transferred, assigned or encumbered in any
manner, either voluntarily or involuntarily, and any attempt so
to anticipate, alienate, sell, transfer, assign, pledge,
encumber, or charge the same shall be null and void; neither
shall the Trust Fund nor any benefits thereunder or hereunder
be liable for or subject to the debts, contracts, liabilities,
engagements or torts of any person to whom such benefits or
funds are payable, nor shall they be subject to garnishment,
attachment, or other legal or equitable process nor shall they
be an asset in bankruptcy. All of the provisions of this
Section 17.3, however, are subject to Section 15.4.
17.3(2) Exception for Qualified Domestic
Relations Order.
(a) The prohibitions contained in
Subsection 17.3(1) hereof shall not apply to the creation,
assignment or recognition of a right to any benefit payable
with respect to a Participant pursuant to a Qualified Domestic
Relations Order.
(b) The Plan Administrator shall
establish written procedures for the determination of the
qualified status of a domestic relations order.
(c) Upon receiving a domestic
relations order, the Plan Administrator shall notify the
Participant and Alternate Payee named in the order, in writing,
of the receipt of the order and the Plan's procedures for
<PAGE>
determining the qualified status of the order. Within a
reasonable period of time after receiving the domestic
relations order, the Plan Administrator shall determine the
qualified status of the order and shall notify the Participant
and the Alternate Payee, in writing, of its determination. The
Plan Administrator shall provide notice under this paragraph by
mailing such notice to the individual's address specified in
the domestic relations order, or in a manner consistent with
Department of Labor regulations.
If any portion of the
Participant's Account is payable during the period the Plan
Administrator is making its determination of the qualified
status of the domestic relations order, the Administrative
Committee shall direct the Trustee to segregate the amounts
payable in a separate account and to invest the segregated
account solely in fixed income investments. If the Plan
Administrator determines the order is a Qualified Domestic
Relations Order within eighteen (18) months of the time for
commencement of distribution under the order, the
Administrative Committee shall direct the Trustee to distribute
the segregated account in accordance with the order. If the
Plan Administrator does not make its determination of the
qualified status of the order within eighteen (18) months after
the time for commencement of distribution under the order, the
Administrative Committee shall direct the Trustee to distribute
the segregated account in the manner the Plan would distribute
if the order did not exist and shall apply the order
prospectively if the Plan Administrator later determines the
order is a Qualified Domestic Relations Order.
To the extent it is not
inconsistent with the provisions of the Qualified Domestic
Relations Order, the Trustee shall segregate the amount subject
to the Qualified Domestic Relations Order in a separate account
and invest the account in federally insured, interest-bearing
savings account(s) or time deposit(s) (or a combination of
both), direct obligations of the United States, or any other
investment providing for guarantee of principal and a fixed
rate of return. Any segregated account shall remain a part of
<PAGE>
the Trust, but it alone shall share in any income it earns, and
it alone shall bear any expense or loss it incurs.
The Trustee shall make any
payments or distributions required under this Subsection
17.3(2) by separate benefit checks or other separate
distribution to the Alternate Payee(s).
(d) "Qualified Domestic Relations
Order" shall mean an order which:
(i) Relates to the provision
of child support, alimony payments, or marital property rights
to a spouse, child, or other dependent of a Participant;
(ii) Is made pursuant to a
state domestic relations law (including a community property
law);
(iii) Creates or recognizes the
existence of an Alternate Payee's right to, or assigns to an
Alternate Payee the right to, receive all or a portion of the
benefits payable with respect to a Participant under the Plan;
and
(iv) Is determined by the Plan
Administrator to meet all applicable requirements pursuant to
the procedure established by the Committee for determining
whether an order is a Qualified Domestic Relations Order.
A Qualified Domestic Relations
Order includes a domestic relations order issued before January
1, 1985 that is treated by the Plan Administrator as a
Qualified Domestic Relations Order pursuant to the Retirement
Equity Act of 1984.
(e) "Alternative Payee" shall mean an
individual entitled to benefits under the Plan pursuant to a
Qualified Domestic Relations Order.
<PAGE>
17.4 Address for Mailing of Benefits.
17.4(1) Each Participant and each other person
entitled to benefits hereunder shall file with the
Administrative Committee from time to time in writing such
Participant's post office address and each change of address.
Any check representing payment hereunder and any communication
addressed to a Participant, an Employee or Beneficiary, at such
person's last address filed with the Administrative Committee,
or if no such address has been filed, then at such person's
last address as indicated on the records of a Participating
Company, shall be deemed to have been delivered to such person
on the date on which such check or communication is deposited,
postage prepaid, in the United States mail.
17.4(2) If the Administrative Committee is in
doubt as to whether payments are being received by the person
entitled thereto, it shall, by registered mail addressed to the
person concerned, at his address last known to the
Administrative Committee, notify such person that all unmailed
and future payments shall be withheld until he provides the
Administrative Committee with evidence of his continued life
and his proper mailing address.
17.5 Unclaimed Account Procedure. Neither the Trustee
nor the Administrative Committee shall be obliged to search
for, or ascertain the whereabouts of any Participant,
Beneficiary or Alternate Payee. The Administrative Committee,
by certified or registered mail addressed to such
Participant's, Beneficiary's or Alternate Payee's last known
address, shall notify the Participant, Beneficiary or Alternate
Payee that such Participant, Beneficiary or Alternate Payee is
entitled to a distribution under this Plan, and the notice
shall quote the provisions of this Section 17.5. If any
distribution or payment which is not claimed by the person
entitled thereto or before the termination or discontinuance of
the Plan, whichever occurs first, the Administrative Committee
shall treat the Participant's, Beneficiary's or Alternate
Payee's unclaimed benefit as forfeited. Such forfeited amounts
shall be added to forfeitures and used as herein provided.
If a Participant, Beneficiary or Alternate Payee
who has incurred a forfeiture of his benefits under the
provisions of the first paragraph of this Section 17.5 makes a
claim for such forfeited benefit, at any time prior to
termination or discontinuance of the Plan, the Administrative
Committee shall restore the Participant's, Beneficiary's or
Alternate Payee's forfeited benefit to the same dollar amount
<PAGE>
as the dollar amount of the benefit forfeited, unadjusted for
any gains or losses occurring subsequent to the date of the
forfeiture. The Administrative Committee shall make the
restoration, during the Plan Year in which the Participant,
Beneficiary or Alternate Payee makes the claim, first from the
amount, if any, of Participant forfeitures the Administrative
Committee otherwise would use for the Plan Year, and then from
the amount, or additional amount, the Participating Company for
whom such Participant was employed shall contribute to the Plan
to enable the Administrative Committee to make the required
restoration. The Administrative Committee shall direct the
Trustee to distribute the Participant's, Beneficiary's or
Alternate Payee's restored benefit to him in a lump sum not
later than sixty (60) days after the close of the Plan Year in
which the Administrative Committee restores the forfeited
benefit.
SECTION EIGHTEEN
LOANS TO PARTICIPANTS,
BENEFICIARIES AND ALTERNATE PAYEES
Upon the written application of any Participant (and any
Former Participant or Beneficiary who is a party-in-interest
with respect to the Plan and who has an undistributed Account
under the Plan) made to the Administrative Committee on such
form and accompanied by such additional documentation and
information as the Administrative Committee shall require, the
Administrative Committee shall, if the Administrative Committee
determines the loan would comply with all of the loan
requirements, make a loan to such individual (the "Borrower");
provided, however, that the amount of any such loan to a
Borrower when added to the outstanding balance of all other
such loans, if any, made to such Borrower hereunder, shall not
exceed the lesser of (a) Fifty Thousand Dollars ($50,000)
reduced by the excess, if any, of the highest outstanding
balance of loans from the Plan during the one-year period
ending on the day before the date on which the loan is made,
over the outstanding balance of loans from the Plan on the date
on which the loan is made; or (b) fifty percent (50%) of the
vested amounts in all of the Borrower's Accounts valued as of
the Valuation Date coincident with or next preceding the date
the loan is approved. The Administrative Committee may
establish uniform and nondiscriminatory rules which further
limit the amount and the Accounts from which Participants,
Beneficiaries and Alternate Payees may borrow from the Trust so
long as such rules are in writing and are distributed to
Participants, Beneficiaries and Alternate Payees. Loans shall
be available to all Participants, Beneficiaries and Alternate
Payees on a reasonably equivalent basis, and shall not be made
<PAGE>
available to Highly Compensated Employees, as a percentage of
their Accounts greater than the percentage of the Accounts made
available to other Participants, Beneficiaries or Alternate
Payees. All such loans shall be subject to the following terms
and conditions:
(a) Interest will be based on a reasonable
rate of interest which shall be commensurate with the interest
rates charged by persons in the business of lending money for
loans of a similar nature. This reasonable rate of interest
shall be determined by the Administrative Committee, in its
sole discretion, through reasonable investigation of the
interest rates charged by lenders in Fort Smith, Arkansas for
loans of a similar nature at or near the time that the Plan
loan is granted. Administrative fees related to a loan may be
charged against the loan proceeds and/or the Borrower's Account
in accordance with rules prescribed by the Administrative
Committee.
(b) Any loan made to a Borrower shall be
considered a directed investment of such Borrower. The
Administrative Committee shall, subject to any terms and
conditions imposed by the Trustee, establish uniform policies
and procedures regarding the manner in which the amount of any
loan shall be obtained from the Investment Funds referred to in
Section 9.4 hereof to which the Borrower has directed the
investment of the amounts credited to his Accounts. Repayments
of principal amounts and interest paid on such loan shall be
credited to the Borrower's Account from which the loan was made
on the basis of the amount of the loan from each such account.
Repayments of principal amounts and interest payments on any
loan shall be invested among the Investment Funds in accordance
with the Borrower's current investment direction for his
Accounts pursuant to Section 9.4.
(c) Loans shall be evidenced by promissory
notes in the form approved by the Administrative Committee,
which shall specify the time and manner of repayment as
determined by the Administrative Committee in accordance with
uniform and nondiscriminatory rules. Notwithstanding the
foregoing provisions, it is generally intended that repayment
of a loan by an Employee will be made by payroll deduction.
All loans shall be amortized in level payments made no less
frequently than quarterly over the term of the loan. In no
event shall any loan be repayable over a period in excess of
five (5) years from the date such loan is made, unless such
loan is used to acquire any dwelling unit which within a
<PAGE>
reasonable time is to be used (determined at the time the loan
is made) as the principal residence of the Borrower, in which
case, the loan shall be repayable over a reasonable period as
determined in accordance with uniform rules established by the
Administrative Committee.
(d) Every loan shall be secured by fifty
percent (50%) of the amount in the Borrower's Accounts under
the Plan, and such other security, if any, as the
Administrative Committee shall deem necessary to ensure that
the loan is adequately secured.
(e) Loan funds shall be disbursed as soon as
practicable following receipt by the Administrative Committee
of the loan application.
(f) An "Event of Default" shall be deemed to
have occurred if two (2) consecutive loan repayments are not
made on or before the due date of the second (2nd) of such
payments. When an Event of Default occurs, the Administrative
Committee shall offset, to the extent legally permissible, the
unpaid amount (including interest) against the Borrower's
Accounts to the extent such Accounts are security for the loan.
To the extent not so offset, the unpaid balance will bear
interest at the maximum legal rate until offset.
(g) No loans shall be made for less than One
Thousand Dollars ($1,000).
(h) No Borrower shall have more than one
loan outstanding at any time. If a Plan loan is prepaid, the
Borrower may not take another loan until after the end of the
calendar quarter in which the prepayment occurred.
(i) The Administrative Committee shall
establish such additional loan policies and procedures as are
necessary to provide uniform and nondiscriminatory rules
governing the making of loans to Participants, Beneficiaries
and Alternate Payees.
(j) Loans shall not be made to the extent
they would violate Section 4975 of the Code or Section 406 of
ERISA and the regulations thereunder, to the extent they would
be taxed as distributions to Participants under Section 72(p)
of the Code, or to the extent they would violate any applicable
law, and all provisions hereof shall be interpreted
accordingly.
<PAGE>
SECTION NINETEEN
ADOPTION OF PLAN BY AFFILIATED COMPANY
Any Affiliated Company, whether or not presently
existing, may, with the approval of the Board of Directors of
the Sponsoring Company, adopt this Plan pursuant to appropriate
written resolutions of the Board of Directors of such
Affiliated Company and, if appropriate, by executing such
documents, if any, with the Trustee as may be necessary to make
such Affiliated Company a party to the Trust Agreement as a
Participating Company. Any Affiliated Company which adopts the
Plan is thereafter a Participating Company with respect to its
Employees for purposes of the Plan.
SECTION TWENTY
WITHDRAWAL FROM PLAN
20.1 Notice of Withdrawal. Any Participating Company
may, with the approval of the Board of Directors of the
Sponsoring Company, as of any Valuation Date, withdraw from the
Plan upon giving the Administrative Committee and the Trustee
at least thirty (30) days' notice in writing of its intention
to withdraw.
20.2 Segregation of Trust Assets upon Withdrawal.
Upon the withdrawal of a Participating Company pursuant to
Section 20.1, the Trustee shall segregate the share of the
assets in the Trust Fund, the value of which shall equal the
total credited to the Accounts of Participants of the
withdrawing Participating Company. The determination of which
assets are to be so segregated shall be made by the Trustee, in
its sole discretion, after taking into account the investment
selections provided for in Section 9.4 hereof.
20.3 Exclusive Benefit of Participants. Neither the
segregation and any transfer of the Trust assets upon the
withdrawal of a Participating Company nor the execution of a
new agreement and/or declaration of trust by such withdrawing
Participating Company shall operate to permit any part of the
Trust Fund to be used for or diverted to purposes other than
for the exclusive benefit of the Participants.
20.4 Applicability of Withdrawal Provisions. The
withdrawal provisions contained in this Section Twenty shall be
applicable only if the withdrawing Participating Company
continues to cover its Participants and eligible Employees in
another profit-sharing plan and trust qualified under Sections
401 and 501 of the Code. Otherwise, the termination provisions
of the Plan and Trust shall apply.
<PAGE>
SECTION TWENTY-ONE
AMENDMENT OF THE PLAN
The Board of Directors of the Sponsoring Company
reserves the right to amend the Plan with respect to all
Participating Companies at any time and from time to time. In
addition, the Board of Directors of each Participating Company
may amend the Plan with respect to such Participating Company
at any time, and from time to time, pursuant to written
resolutions adopted by such Board of Directors, provided the
Sponsoring Company approves such amendment. Unless otherwise
permitted by law, no amendment shall permit any part of the
Trust Fund to revert to or be recoverable by an Participating
Company or be used for or diverted to purposes other than the
exclusive benefit of the Participants or their Beneficiaries,
or deprive any Participant of any interest he might have in the
Trust Fund at the time of the amendment to the extent that such
interest would be available to the Participant under Section
Fifteen hereof were he to voluntarily resign as of the
effective date of the amendment.
(a) Under no condition, shall such amendment,
amendments, or restatements increase the duties or
responsibilities, or decrease the compensation, privileges, and
immunities of the Trustee without the Trustee's written
consent.
(b) Under no condition, shall such amendment change
the vesting schedule to one which would result in the
nonforfeitable percentage of the accrued benefit derived from
Company Matching Deposits (determined as of the later of the
date of the adoption of the amendment or of the effective date
of the amendment) of any Participant being less than such
nonforfeitable percentage computed under the Plan without
regard to such amendment; no amendment shall change the vesting
schedule unless each Participant with three (3) or more Vesting
Years of Service, is permitted to elect, within the election
period described below, to have his nonforfeitable percentage
computed under the Plan without regard to the amendment. The
election period described herein shall begin no later than the
date upon which the amendment is adopted and shall end no later
than the latest of the following dates: (i) the date which is
sixty (60) days after the day the amendment is adopted, (ii)
the date which is sixty (60) days after the day the amendment
becomes effective, or (iii) the date which is sixty (60) days
after the day the Participant is issued a written notice of the
amendment by the Sponsoring Company.
(c) Subject to the above stated limitations and the
requirement that no amendment shall eliminate, except with
<PAGE>
respect to any future contributions or future accrual of
benefits and except as otherwise permitted by Treasury
regulations or rulings, any nondiscretionary optional form of
payment (as provided in Treasury Regulation Section 1.411(d)-4
and Code Section 411(d)(6)) with respect to any Participant who
is a Participant immediately prior to the amendment, the
Sponsoring Company shall have the power to amend the Plan and
Trust Agreement, retroactively or otherwise, in any manner in
which it deems desirable, including, but not by way of
limitation, the power to change any provisions relating to the
administration of the Plan and Trust Fund, and to change any
provisions relating to the benefits or payment of any of the
assets of the Trust Fund. Each such amendment shall become
effective when executed by the Sponsoring Company unless a
different effective date is specified in the amendment.
(d) Notwithstanding anything herein to the contrary,
this Plan may be amended at any time by the Sponsoring Company
if necessary or desirable in order to have it conform to the
provisions and requirements of the Code or any other law with
respect to qualified employees' plans and trusts, and no such
amendment shall be considered prejudicial to the rights of any
Participant hereunder or of any Beneficiary, Alternate Payee or
Employee. Further, it is understood that any provisions of
this Plan as herein contained which are contrary to the
requirements of the Code for a qualified tax exempt employees'
plan and trust shall be deemed void and of no effect, without
affecting the validity of other provisions hereof.
SECTION TWENTY-TWO
PERMANENCY OF THE PLAN
22.1 Right to Terminate Plan. Each Participating
Company contemplates that the Plan shall be permanent and that
it shall be able to make contributions to the Plan.
Nevertheless, in recognition of the fact that future conditions
and circumstances cannot now be entirely foreseen, each
Participating Company reserves the right to terminate (as to
such Participating Company) either the Plan or both the Plan
and the Trust, and the Sponsoring Company reserves the right to
terminate the Plan and the Trust in its entirety.
22.2 Merger or Consolidation of Plan and Trust.
Neither the Plan nor the Trust may be merged or consolidated
with, nor may its assets or liabilities be transferred to, any
other plan or trust, unless each Participant would (if the Plan
then terminated) receive a benefit immediately after the
merger, consolidation, or transfer which is equal to or greater
than the benefit he would have been entitled to receive
immediately before the merger, consolidation, or transfer (if
the Plan had then terminated).
<PAGE>
22.3 Continuance by Successor Company. In the event
of the liquidation, dissolution, merger, consolidation or
reorganization of a Participating Company, the successor
company may adopt the Plan and Trust for the benefit of the
employees of such Participating Company. If such successor
company does adopt the Plan and Trust, it shall, in all
respects, be substituted for such Participating Company under
the Plan and Trust. Any such substitution of such successor
company shall constitute an assumption of Plan liabilities by
such successor company, and such successor company shall have
all of the powers, duties and responsibilities of such
Participating Company under the Plan and Trust. If such
successor company does not adopt the Plan and Trust, the Plan
and Trust shall be terminated with respect to such
Participating Company in accordance with the provisions of the
Plan and Trust Agreement.
SECTION TWENTY-THREE
DISCONTINUANCE OF DEPOSITS AND TERMINATION
23.1 Discontinuance of Deposits. Whenever a
Participating Company determines that it is impossible or
inadvisable for it to make further contributions as provided in
the Plan, the Board of Directors of such Participating Company
may, without terminating the Trust, adopt an appropriate
resolution permanently discontinuing all further contributions
by such Participating Company. A certified copy of such
resolution shall be delivered to the Administrative Committee
and the Trustee. Thereafter, the Administrative Committee and
the Trustee shall continue to administer all the provisions of
the Plan which are necessary and remain in force, other than
the provisions relating to contributions by such Participating
Company. However, the Trust shall remain in existence with
respect to such Participating Company and all of the provisions
of the Trust Agreement shall remain in force.
23.2 Termination of Plan and Trust. If the Board of
Directors of a Participating Company determines to terminate
(as to such Participating Company) the Plan and Trust
completely, they shall be terminated insofar as they are
applicable to such Participating Company as of the date
specified in certified copies of resolutions of such Board of
Directors delivered to the Administrative Committee and the
Trustee. Upon such termination of the Plan and Trust, after
payment of all expenses and proportional adjustment of Accounts
of Participants employed by such Participating Company to
reflect such expenses, Trust Fund profits or losses, and
subject to the limitations contained in Section 7.4 hereof,
allocations of any previously unallocated funds to the date of
<PAGE>
termination, such Participating Company's Participants shall be
entitled to receive the amount then credited to their
respective Accounts in the Trust Fund, subject to Section 15.8
above. The Administrative Committee shall make payment to such
Participants of such amount in cash or in the form of Arkansas
Best Stock, in accordance with the distribution options set
forth in Section 15 of the Plan; provided, however, that if the
Administrative Committee determines that certain assets are not
readily saleable at their fair market value or cannot be sold
due to legal restrictions, the Administrative Committee shall
distribute such assets in kind.
23.3 Rights to Benefits upon Termination of Plan or
Complete Discontinuance of Deposits. Upon the termination or
partial termination of the Plan or the complete discontinuance
of contributions by a Participating Company, the rights of each
of such Participating Company's Employees who are then
Participants (or, in the case of a partial termination, who are
then Participants affected by the termination) and the rights
of each other person, other than a person who has forfeited his
non-vested amounts pursuant to Section 14.4 hereof prior to the
effective date of such termination (or partial termination) or
complete discontinuance, to the amounts credited to his
Accounts at such time, shall be nonforfeitable without
reference to any formal action on the part of such
Participating Company, the Administrative Committee or the
Trustee.
SECTION TWENTY-FOUR
STATUS OF EMPLOYMENT RELATIONS
The adoption and maintenance of the Plan and Trust shall
not be deemed to constitute a contract between a Participating
Company and its Employees or to be consideration for, or an
inducement or condition of, the employment of any person.
Nothing herein contained shall be deemed (i) to give to any
Employee the right to be retained in the employ of a
Participating Company; (ii) to affect the right of a
Participating Company to discipline or discharge any Employee
at any time; (iii) to give a Participating Company the right to
require any Employee to remain in its employ; or (iv) to affect
any Employee's right to terminate his employment at any time.
<PAGE>
SECTION TWENTY-FIVE
BENEFITS PAYABLE BY TRUST
All benefits payable under the Plan shall be paid or
provided for solely from the Trust. The Participating Company
assumes no liability or responsibility therefor.
SECTION TWENTY-SIX
EXCLUSIVE BENEFIT OF TRUST FUND
26.1 Limitation on Reversions. Except as otherwise
provided in Section 6.4 hereof or in this Section Twenty-Six,
the assets of the Trust Fund shall be held for the exclusive
purposes of providing benefits to Participants and their
Beneficiaries and defraying reasonable expenses of
administering the Plan and shall not inure to the benefit of
any Participating Company.
26.2 Unallocated Amounts upon Termination of Plan and
Trust. In the event the Plan and Trust are terminated, any
previously unallocated amounts maintained in a suspense account
in accordance with the provisions of Section 7.4 hereof which
cannot be allocated to Participants upon the termination of the
Plan and Trust pursuant to Section 23.2 hereof because of the
limitations contained in Sections 7.4 through 7.7 hereof, shall
revert to the Participating Company or Participating Companies
employing the Participant at the time of such termination.
26.3 Mistake of Fact or Disallowance of Deduction. If
the Administrative Committee in good faith determines that (a)
a contribution was made by reason of a mistake of fact, or (b)
a contribution is conditioned on its being deductible under
Code Section 404, but the Internal Revenue Service disallows
such deduction, the amount of the excess contribution less
losses attributable thereto may, upon direction of the
Administrative Committee, be returned to the contributing
Participating Company. All payments of returned contributions
under this Section shall be made within one (1) year from the
date of the payment of such mistaken contribution or the
disallowance by the Internal Revenue Service of the deduction,
whichever is applicable. The amount of the excess contribution
shall be the excess of (1) the amount contributed over (2) the
amount that would have been contributed had there not occurred
a mistake of fact or had the deduction not been disallowed.
Earnings attributable to the excess contribution shall not be
returned to the contributing Participating Company, but losses
attributable thereto shall reduce the amount of such
<PAGE>
contribution to be so returned. Furthermore, if the withdrawal
of the amount attributable to the mistaken contribution would
cause the balance of a Participant's Account to be reduced to
an amount which is less than the balance which would have been
in said Account had the mistaken amount not been contributed,
then the amount to be returned to the Participating Company
under this Section will be reduced so as to avoid any such
reduction.
26.4 Failure of Initial Qualification of Plan and
Trust. The initial establishment of the Plan and Trust by any
Participating Company is contingent upon obtaining the approval
of the Internal Revenue Service. In the event that the
Internal Revenue Service fails initially to approve the Plan
and Trust as to any Participating Company, the Trustee shall,
after paying any expenses attributable to such initial
establishment, return to such Participating Company any
remaining contribution made by such Participating Company.
Such remaining contribution shall be returned as promptly as
practicable, but in no event later than one (1) year after the
date of the final denial of qualification of the Plan as to
such Participating Company, including the final resolution of
any appeals before the Internal Revenue Service or the courts.
SECTION TWENTY-SEVEN
APPLICABLE LAW
To the extent not preempted by ERISA, the Plan and Trust
which is a part thereof shall be construed, regulated,
interpreted and administered under and in accordance with the
laws of the State of Arkansas.
SECTION TWENTY-EIGHT
INTERPRETATION OF THE PLAN AND TRUST
It is the intention of the Participating Companies that
the Plan, and the Trust established by the Participating
Companies to implement the Plan, shall qualify as a profit-
sharing plan and shall comply with the provisions of Section
401(a), Section 401(k), and Section 501(a) of the Code and the
requirements of ERISA, and the corresponding provisions of any
subsequent laws, and the provisions of the Plan and Trust
Agreement shall be construed to effectuate such intention.
<PAGE>
SECTION TWENTY-NINE
TOP HEAVY PLAN RULES
29.1 Definitions. As used in this Section Twenty-
Nine:
29.1(1) "Defined Benefit Plan" shall have the
meaning set forth in Subsection 7.7(3) hereof.
29.1(2) "Defined Contribution Plan" shall have
the meaning set forth in Subsection 7.7(2) hereof.
29.1(3) "Determination Date" shall mean with
respect to any plan year, the last day of the preceding plan
year, except that in the case of the first plan year of any
plan, the last day of such first plan year.
29.1(4) "Employer" shall mean the Participating
Company and any Affiliated Companies.
29.1(5) "Key Employee" shall mean any person
employed or formerly employed by any Employer (and the
beneficiaries of any such person) who is, at any time during
the plan year, or who was, during any one or more of the four
preceding plan years, any one or more of the following:
(a) An officer of an Employer having
Limitation Year Compensation for the applicable Plan Year
greater than fifty percent (50%) of the maximum dollar
limitation under Code Section 415(b)(1)(A) (as in effect for
the calendar year in which the Determination Date for such Plan
Year falls).
(b) One of the ten persons employed
by an Employer having Limitation Year Compensation for the
applicable plan year greater than the maximum dollar limitation
under Section 415(c)(1)(A) of the Code as in effect for the
calendar year in which the Determination Date for such plan
year falls, and owning (or considered as owning within the
meaning of Section 318 of the Code) both more than one-half of
one percent (1/2 of 1%) interest and the largest interests in
the Employer. For purposes of this Subsection (b), (i) a
person who has some ownership interest is considered to be one
of the top ten owners unless at least ten other persons own a
larger interest than that person, and (ii) if two or more have
<PAGE>
the same ownership interest in the Employer, the person having
greater annual Limitation Year Compensation from all Employers
shall be treated as having the larger interest.
(c) Any person owning (or considered
as owning within the meaning of Section 318 of the Code) more
than five percent (5%) of the outstanding stock of an Employer
or stock possessing more than five percent (5%) of the total
combined voting power of such stock or more than five percent
(5%) of the capital or profits interest of an Employer which is
not a corporation.
(d) A person who would be described
in Subsection (c) above if "one percent (1%)" were substituted
for "five percent (5%)" each place it appears in said
Subsection (c), and whose aggregate annual Limitation Year
Compensation from all Employers is more than One Hundred Fifty
Thousand Dollars ($150,000).
(e) Notwithstanding any other
provision in this Plan to the contrary, for purposes of
determining ownership under this Subsection 29.1(5), the rules
of Sections 414(b), (c) and (m) of the Code shall not apply in
defining who is an Employer.
The determination of who is a Key
Employee hereunder shall be made in accordance with the
provisions of Section 416(i)(1) of the Code and the regulations
thereunder.
29.1(6) "Key Employee Participant" shall mean a
Participant in this Plan who is a Key Employee.
29.1(7) "Limitation Year Compensation" shall
have the meaning set forth in Subsection 7.7(7) hereof, except
that if the Limitation Year and the plan year under the
applicable plan are not the same, then for purposes of this
Section Twenty-Nine, "plan year" shall be substituted for
"Limitation Year" every place it occurs in said Subsection
7.7(7).
29.1(8) "Permissive Aggregation Group" shall
mean the Required Aggregation Group, plus any other plan or
plans of any Employer selected by the Sponsoring Company,
provided that such selected plans, when considered as a group
with the Required Aggregation Group, would continue to satisfy
the requirements of Sections 401(a)(4) and 410 of the Code.
<PAGE>
29.1(9) "Required Aggregation Group" shall mean
the group of plans consisting of (i) all tax qualified plans
maintained by the Employers in which at least one Key Employee
participates, and (ii) any other tax qualified plan maintained
by the Employers which enables a plan described in clause (i)
above to meet the requirements of Sections 401(a)(4) or 410 of
the Code.
29.1(10) "Valuation Date" shall mean (i) in the
case of a Defined Contribution Plan, the last day of the plan
year for the appropriate plan, and (ii) in the case of a
Defined Benefit Plan, the date used for computing plan costs
for minimum funding, regardless of whether a valuation is
performed that year.
29.1(11) All of the definitions set forth in
Section Two hereof and not set forth herein shall have the same
meaning in this Section.
29.2 Determination of Top Heaviness.
29.2(1) This Plan shall be a "Top Heavy Plan"
with respect to any Plan Year if, as of the Determination Date
for said Plan Year, any of the following conditions exists:
(a) The Top Heavy Ratio for this Plan
exceeds sixty percent (60%) and this Plan is not part of a
Required Aggregation Group or a Permissive Aggregation Group.
(b) This Plan is part of a Required
Aggregation Group, but not part of a Permissive Aggregation
Group, and the Top Heavy Ratio for the Required Aggregation
Group exceeds sixty percent (60%).
(c) This Plan is part of a Required
Aggregation Group and part of a Permissive Aggregation Group,
and the Top Heavy Ratio for the Permissive Aggregation Group
exceeds sixty percent (60%).
29.2(2) This Plan shall be a "Super Top Heavy
Plan" if it would be a Top Heavy Plan under the provisions of
Subsection 29.2(1) above if "ninety percent (90%)" were
substituted for "sixty percent (60%)" everywhere sixty percent
(60%) appears in said Subsection 29.2(1).
<PAGE>
29.2(3) The "Top Heavy Ratio" referred to in
Subsection 29.2(1) above shall be determined as follows:
(a) If the Employers maintain or have
maintained one or more Defined Contribution Plans but have
never maintained a Defined Benefit Plan which has covered or
could cover a Participant in this Plan, the Top Heavy Ratio is
a fraction, the numerator of which is the sum of the account
balances under the Defined Contribution Plans for all Key
Employees as of the Determination Date (including any part of
any such account balance distributed in the five (5) year
period ending on the Determination Date), and the denominator
of which is the sum of all account balances under the Defined
Contribution Plans for all participants as of the Determination
Date (including any part of any such account balance
distributed in the five (5) year period ending on the
Determination Date). Both the numerator and the denominator of
the Top Heavy Ratio shall be adjusted to reflect any
contribution which is due but unpaid as of the appropriate
Determination Date. In determining the account balances which
have been distributed in the five (5) year period ending on the
Determination Date, distributions under a terminated plan shall
be included, provided such terminated plan, if it had not been
terminated, would have been included in a Required Aggregation
Group.
(b) If the Employers maintain one or
more Defined Contribution Plans and maintain or have maintained
one or more Defined Benefit Plans which have covered or could
cover a Participant in this Plan, the Top Heavy Ratio is a
fraction, the numerator of which is the sum of account balances
under the Defined Contribution Plans for all Key Employees and
the present value of accrued benefits under the Defined Benefit
Plans for all Key Employees, both calculated as of the
Determination Date, and the denominator of which is the sum of
the account balances under the Defined Contribution Plans for
all participants and the present value of accrued benefits
under the Defined Benefit Plans for all participants, both
calculated as of the Determination Date. Both the numerator
and denominator of the Top Heavy Ratio are adjusted for any
distribution of an account balance or an accrued benefit made
<PAGE>
in the five (5) year period ending on the appropriate
Determination Date and any contribution due but unpaid as of
the appropriate Determination Date. In determining the account
balances or accrued benefits which have been distributed in the
five (5) year period ending on the Determination Date,
distributions under a terminated plan shall be included,
provided such terminated plan, if it had not been terminated,
would have been included in a Required Aggregation Group.
(c) For purposes of Subsections (a)
and (b) above, the value of account balances and the present
value of accrued benefits shall be determined as of the most
recent Valuation Date that falls within or ends with the twelve
(12) month period ending on the Determination Date. The
present value of accrued benefits under Defined Benefit Plans
shall be determined under the actuarial assumptions set forth
in each such plan as of said Valuation Date as if the person
voluntarily terminated service as of such Valuation Date. If
any Participant was a Key Employee as set forth in Subsection
29.1(5) above for any prior plan year, but such Participant
ceases to be a Key Employee for any plan year, such
Participant's account balances and accrued benefits shall not
be taken into account for purposes of determining whether this
Plan is a Top Heavy Plan or a Super Top Heavy Plan as of the
Determination Date of said plan year. Accounts and accrued
benefits shall be calculated to include all amounts
attributable to both Employer contributions and contributions
by persons employed by the Employer, but shall exclude amounts
attributable to voluntary deductible contributions by said
persons. The calculation of the Top Heavy Ratios, and the
extent to which distributions, rollovers and transfers are
taken into account shall be made in accordance with Section 416
of the Code and the regulations thereunder. When aggregating
plans for purposes of an Aggregation Group, the value of
account balances and accrued benefits will be calculated with
reference to the Determination Dates that fall within the same
calendar year. Notwithstanding the provisions of Subsections
(a) and (b) above, in determining the fractions referred to
therein, there shall not be taken into account the accrued
benefits or account balances of any person who has not received
any Limitation Year Compensation from any Employer maintaining
<PAGE>
any Defined Contribution Plan or Defined Benefit Plan referred
to in such Subsections at any time during the five (5) year
period ending on the Determination Date.
29.3 Minimum Requirements. Notwithstanding any other
provision of this Plan to the contrary, if the Plan is a Top
Heavy Plan for any Plan Year, then the following provisions
shall apply:
29.3(1) Minimum Allocation of Participating
Company Deposits. Except as otherwise provided in this Section
Twenty-Nine, for any Plan Year in which the Plan is a Top Heavy
Plan, the Company Matching Deposits allocated on behalf of each
Participant who is not a Key Employee Participant shall not be
less than the lesser of (i) three percent (3%) of such
Participant's Limitation Year Compensation, or (ii) the largest
percentage of the sum of (a) the Company Matching Deposits
allocated on behalf of any Key Employee Participant for that
Plan Year, and (b) such Key Employee Participant's Basic and
Supplemental Before-Tax Deposits for that Plan Year; provided,
however, that the provisions of clause (ii) hereof shall not
apply to any plan included in a Required Aggregation Group if
such plan enables a Defined Benefit Plan included in such
Required Aggregation Group to meet the requirements of Section
401(a)(4) or Section 410 of the Code. The minimum allocation
provided for herein shall be determined without taking into
account contributions or benefits under Chapter 21 of the Code
(relating to the Federal Insurance Contributions Act), Title II
of the Social Security Act, or any other federal or state law,
and shall be made without regard to any contrary provisions of
the Plan regarding the allocation of Participating Company
Deposits to affected Participants which might otherwise result
in any such Participant being entitled to no allocation or a
lesser allocation due to the Participant's failure to complete
one thousand (1,000) Hours of Service (or the equivalent), the
Participant's failure to make mandatory employee contributions,
or, in the case of a cash or deferred arrangement, elective
contributions, or the Participant's failure to earn a stated
amount of Compensation; provided however, that such minimum
allocation shall not be required to be made on behalf of any
Participant who is not actively employed by a Participating
Company on the last day of the applicable Plan Year. For
purposes of this Subsection 29.3(1), all Defined Contribution
Plans required to be included in an Aggregation Group shall be
treated as one plan.
<PAGE>
29.3(2) Vesting. Any Participant who is
credited with an Hour of Service in the first Plan Year in
which the Plan is a Top Heavy Plan, or in any subsequent Plan
Year after such first Plan Year (whether or not the Plan is a
Top Heavy Plan in such subsequent Plan Year) shall have his
percentage of vested benefits owing upon a Termination of
Employment determined pursuant to the following schedule, in
lieu of the Schedule set forth in Section 14.1 hereof:
Vesting Years of Service Percentage
Less than 2 years 0%
2 years 20%
3 years 40%
4 years 60%
5 years or more 100%
29.4 Minimum Benefits for Employers Maintaining
Defined Benefit Plans. If any Participant other than a Key
Employee Participant is also a participant under a Defined
Benefit Plan maintained by an Employer which is also a Top
Heavy Plan, then Subsection 29.3(1) shall not apply, and such
Participant shall receive an allocation of Company Matching
Deposits in an amount which, when added to such Participant's
Basic and Supplemental Before-Tax Deposits, is no less than
five percent (5%) of such Participant's Compensation under the
Plan for the applicable Plan Year. Such allocation shall be
made without regard to the amount allocated under the Plan on
behalf of any Key Employee Participant for such Plan Year. For
purposes of this Section 29.4, all Defined Contribution Plans
required to be included in an Aggregation Group shall be
treated as one plan.
29.5 Super Top Heavy Plans. If in any Plan Year in
which the Plan is a Top Heavy Plan, (i) it is also a Super Top
Heavy Plan, or (ii) it does not provide minimum benefits under
Subsection 29.3(1) hereof after substituting "four percent
(4%)" for "three percent (3%)" contained in clause (i) of the
first sentence of said Subsection, or (iii) if Section 29.4
hereof applies, it does not provide minimum benefits under said
Section 29.4 after substituting "seven and one-half percent (7-
1/2%)" for "five percent (5%)" contained in the first sentence
of said Section, then, in any such event, for purposes of the
definitions set forth in Subsections 7.7(4) and 7.7(5) hereof,
the dollar limitations contained in Sections 415(e)(2)(B) and
415(e)(3)(B) of the Code shall be multiplied by 1.0 rather than
1.25. Notwithstanding the foregoing provisions of this Section
29.5, if the application of said provisions would cause any
individual to exceed the combined limits of Section 7.6 hereof,
if applicable, then the requirements of this Section 29.5 shall
<PAGE>
be suspended as to such individual until such time as he no
longer exceeds the limitations of said Section 7.6 as modified
by this Section 29.5, and during the period of such suspension,
said individual shall receive no allocation of contributions
which would be included in such individual's Annual Additions
(as defined in Code Section 415(c)) under this Plan or any
other Defined Contribution Plan maintained by an Employer, and
there shall be no accruals of benefits for such individual
under any Defined Benefit Plan maintained by an Employer.
IN WITNESS WHEREOF, Arkansas Best Corporation has caused
this Plan to be executed and attested by the officers hereunto
duly authorized, this 28th day of March, 1994, effective as of
January 1, 1994.
ARKANSAS BEST CORPORATION
By: Edward G. Myers
Title: Vice President - Human Resources
ATTEST:
By:
Title:
Consent of Ernst & Young, Independent Auditors
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to the Arkansas Best Corporation Employees' Investment
Plan of our report dated January 28, 1994, with respect to the consolidated
financial statements and schedules of Arkansas Best Corporation included in
its Annual Report (Form 10-K) for the year ended December 31, 1993, filed
with the Securities and Exchange Commission.
ERNST & YOUNG
Little Rock, Arkansas
March 29, 1994
