As filed with the Securities and Exchange Commission on December 4, 1998
Registration No.
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
BLC FINANCIAL SERVICES, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 75-1430406
(State or Other Jurisdiction (I.R.S. Employer Identification No.)
of Incorporation or Organization
645 Madison Avenue
New York, New York 10022
(212) 751-5626
(Address, Including Zip Code, and Telephone Number,
including Area Code, of Registrant's Principal Executive Offices)
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
(Full Title of Plan)
Robert F. Tannenhauser
President
BLC Financial Services, Inc.
645 Madison Avenue
New York, New York 10022
(212) 751-5626
(Name and Address, Including Zip Code,
and Telephone Number, Including Area Code, of Agent For Service)
Copies to:
Simeon Gold, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
(212) 310-8000
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===================================================================================================================================
Title of Each Class of Securities to be Amount to be Proposed Maximum Proposed Maximum Amount of
Registered Registered(1) Offering Price Per Aggregate Offering Registration Fee
Share(2) Price(2)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $0.01 per share 100,000 $2.22 $222,000 $61.72
===================================================================================================================================
</TABLE>
(1) Pursuant to Rule 416(c) under the Securities Act of 1933, this registration
statement covers an indeterminate amount of interests to be offered or sold
pursuant to the employee benefit plan described therein. (2) Computed solely for
the purpose of calculating the registration fee pursuant to Rule 457(h) under
the Securities Act of 1933 based upon a good faith estimate of the aggregate
number of shares of Common Stock of the Registrant to be purchased by the
Trustee pursuant to the Plan at the average of the high and low prices of the
Registrant's Common Stock as reported on the American Stock Exchange on November
27, 1998.
================================================================================
NYFS12...:\99\26799\0004\2097\FRMN178M.32B
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1.
The documents containing the information specified in Part I of this
Registration Statement will be sent or given to employees as specified by Rule
428(b)(1). Such documents are not required to be and are not filed with the
Securities and Exchange Commission (the "Commission") either as part of this
Registration Statement or as prospectuses or prospectus supplements pursuant to
Rule 424. These documents and the documents incorporated by reference in this
Registration Statement pursuant to Item 3 of Part II of this Form S-8, taken
together, constitute a prospectus that meets the requirements of Section 10(a)
of the Securities Act of 1933, as amended (the "Securities Act").
Item 2.
Upon written or oral request, any of the documents incorporated by
reference in Item 3 of Part II of this Registration Statement (which documents
are incorporated by reference in this Section 10(a) Prospectus), other documents
required to be delivered to eligible employees pursuant to Rule 428(b) or
additional information about the 401(k) Plan of the Registrant and the
Registrant and the administrators of such plan are available without charge by
contacting:
BLC Financial Services, Inc.
645 Madison Avenue
New York, New York 10022
(212) 751-5626
Attention: Corporate Secretary
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed with the Commission by BLC Financial
Services, Inc. (the "Corporation") are incorporated herein by reference:
(a) The Corporation's Annual Report on Form 10-K for the fiscal year
ended June 30, 1998.
(b) The Corporation's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1998.
(c) The description of the Corporation's Common Stock, par value
$0.01 per share (the "Common Stock"), contained in the Corporation's
registration statement on Form 8-A/A, dated December 4, 1998, filed with the
Commission pursuant to Section 12 of the Exchange Act, including any amendment
or report filed for the purpose of updating such description.
All documents subsequently filed by the Corporation with the
Commission 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 securities offered have been sold or which deregisters
all securities then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be a part hereof from the date
of filing of such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Section 145 of the General Corporation Law of the State of Delaware
(the "Delaware Code") empowers a Delaware corporation 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, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the
corporation) by reason of the fact that such person is or was a director,
officer, employee or agent of such corporation or is or was serving at the
request of such corporation as a director, officer, employee or agent of another
corporation, partnership, joint, venture, trust or other enterprise. The
indemnity may include expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by such person in
connection with such action, suit or proceeding, provided that such person acted
in good faith and in a manner such person reasonably believed to be in or not
opposed to the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reasonable cause to believe such person's
conduct was unlawful. A Delaware corporation may indemnify directors, officers,
employees and other agents of such corporation in an action by or in the right
of the corporation under the same conditions, except that no indemnification is
permitted without judicial approval if the person to be indemnified has been
adjudged to be liable to the corporation. Where a director, officer, employee or
agent of the corporation is successful on the merits or otherwise in the defense
of any
II-1
<PAGE>
action, suit or proceeding referred to above or in defense of any claim, issue
or matter therein, the corporation must indemnify such person against the
expenses (including attorneys' fees) which he or she actually and reasonably
incurred in connection therewith.
The Corporation's Amended and Restated Certificate of Incorporation
contains a provision that indemnifies officers and directors to the fullest
extent permitted by, and in the manner permissible under, the Delaware Code.
As permitted by Section 102(b)(7) of the Delaware Code, the
Corporation's Amended and Restated Certificate of Incorporation contains a
provision eliminating the personal liability of a director to the Corporation or
its stockholders for monetary damages for breach of fiduciary duty as a
director, subject to certain exceptions.
The Registrant maintains policies insuring its officers and
directors against certain civil liabilities, including liabilities under the
Securities Act.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers or persons controlling
the Corporation as disclosed above, the Corporation has been informed that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
4.1 - Amended and Restated Certificate of Incorporation of
the Corporation (incorporated by reference to
Exhibit 1.3 of the Company's Annual Report on Form
10-K for the year ended June 30, 1997).
4.2 - Amended and Restated By-Laws of the Corporation
(incorporated by reference to Exhibit 1.4 of the
Company's Annual Report on Form 10-K for the year
ended June 30, 1997).
4.3 - BLC Financial Services, Inc. 401(k) Plan.
23.2 - Consent of Richard A. Eisner & Company, LLP.
24 - Power of Attorney (included as part of the signature
page to this Registration Statement and incorporated
herein by reference).
Item 9. Undertakings.
(a) The 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 1933;
II-2
<PAGE>
(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. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would
not exceed that which was registered) and any deviation
from the low or high and of the estimated maximum
offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the change in volume and
price represent no more than 20 percent change in the
maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
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)(ii) do not apply if
the registration statement is on Form S-3, Form S-8 or Form
F-3, and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by
the registrant pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes to submit the Plan and
any amendments thereto to the Internal Revenue Service (the "IRS")
in a timely manner and to make all changes required by the IRS to
qualify the Plan under Section 401(k) of the Internal revenue Code,
as amended to date.
(c) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of the Registrant's annual report pursuant to Section 13(a)
or Section 15(d) of the 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.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing
provisions, or otherwise, the Registrant has been advised that in
the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the
event that a claim for
II-3
<PAGE>
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 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 of whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and
will be governed by the final adjudication of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of New York, State of New York, on this 25th day of
November, 1998.
BLC FINANCIAL SERVICES, INC.
By: /s/ Robert S. Tannenhauser
-------------------------------------
Robert F. Tannenhauser
President, Chairman of the Board,
Chief Executive Officer and Director
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints each of Robert F. Tannenhauser and
Jennifer Goldstein acting individually, his or her true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him or her and in his or her name, place and stead, in any and all
capacities, to sign any and all 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, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he or she might or could do in
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his or her substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
--------- ----- ----
/s/ Robert F. Tannehauser President, Chairman of the November 25, 1998
- ---------------------------- Board, Chief Executive
Robert F. Tannenhauser Officer and Director
/s/ Jennifer M. Goldstein Treasurer (Principal November 25, 1998
- ---------------------------- Financial and Accounting
Jennifer M. Goldstein Officer)
/s/ Peter Blanck Director November 25, 1998
- ----------------------------
Peter D. Blanck
/s/ Robert D'Loren Director November 25, 1998
- ----------------------------
Robert W. D'Loren
/s/ Irwin Redlener Director November 25, 1998
- ----------------------------
Irwin E. Redlener, M.D.
II-5
<PAGE>
Director
- ----------------------------
Kenneth S. Schwartz, M.D.
/s/ Robert Wien Director November 24, 1998
- ----------------------------
Robert W. Wien
Director
- ----------------------------
Jerome Alenick
Pursuant to the requirements of the Securities Act of 1933, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto authorized, in the City of New York, State of New York,
on November 25, 1998.
BLC FINANCIAL SERVICES, INC.
401(K) PLAN
By: /s/ Louis Hafkin
---------------------------------
Name: Louis Hafkin
Title: Controller
II-6
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
4.1 - Amended and Restated Certificate of Incorporation of the
Corporation (incorporated by reference to Exhibit 1.3 of the
Company's Annual Report on Form 10-K for the year ended June
30, 1997).
4.2 - Amended and Restated By-Laws of the Corporation (incorporated
by reference to Exhibit 1.4 of the Company's Annual Report on
Form 10-K for the year ended June 30, 1997).
4.3 - BLC Financial Services, Inc. 401(k) Plan.
23.2 - Consent of Richard A. Eisner & Company, LLP.
24 - Power of Attorney (included as part of the signature page to
this Registration Statement and incorporated herein by
reference).
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
AND ALL SUPPORTING FORMS HAVE BEEN PRODUCED FOR
BLC FINANCIAL SERVICES, INC.
Copyright 1997 Corbel
All Rights Reserved
<PAGE>
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
<PAGE>
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
ARTICLE II
ADMINISTRATION
2.1 POWERS AND RESPONSIBILITIES OF THE EMPLOYER.................. 17
2.2 DESIGNATION OF ADMINISTRATIVE AUTHORITY...................... 18
2.3 POWERS AND DUTIES OF THE ADMINISTRATOR....................... 18
2.4 RECORDS AND REPORTS.......................................... 20
2.5 APPOINTMENT OF ADVISERS...................................... 20
2.6 PAYMENT OF EXPENSES.......................................... 20
2.7 CLAIMS PROCEDURE............................................. 20
2.8 CLAIMS REVIEW PROCEDURE...................................... 21
ARTICLE III
ELIGIBILITY
3.1 CONDITIONS OF ELIGIBILITY.................................... 22
3.2 EFFECTIVE DATE OF PARTICIPATION.............................. 22
3.3 DETERMINATION OF ELIGIBILITY................................. 22
3.4 TERMINATION OF ELIGIBILITY................................... 22
3.5 OMISSION OF ELIGIBLE EMPLOYEE................................ 23
3.6 INCLUSION OF INELIGIBLE EMPLOYEE............................. 23
3.7 ELECTION NOT TO PARTICIPATE.................................. 23
ARTICLE IV
CONTRIBUTION AND ALLOCATION
4.1 FORMULA FOR DETERMINING EMPLOYER CONTRIBUTION................ 23
<PAGE>
4.2 PARTICIPANT'S SALARY REDUCTION ELECTION...................... 24
4.3 TIME OF PAYMENT OF EMPLOYER CONTRIBUTION..................... 28
4.4 ALLOCATION OF CONTRIBUTION AND EARNINGS...................... 28
4.5 ACTUAL DEFERRAL PERCENTAGE TESTS............................. 31
4.6 ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS............... 33
4.7 MAXIMUM ANNUAL ADDITIONS..................................... 35
4.8 ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS.................... 39
4.9 TRANSFERS FROM QUALIFIED PLANS............................... 40
4.10 DIRECTED INVESTMENT ACCOUNT.................................. 42
ARTICLE V
VALUATIONS
5.1 VALUATION OF THE TRUST FUND.................................. 44
5.2 METHOD OF VALUATION.......................................... 45
ARTICLE VI
DETERMINATION AND DISTRIBUTION OF BENEFITS
6.1 DETERMINATION OF BENEFITS UPON RETIREMENT.................... 45
6.2 DETERMINATION OF BENEFITS UPON DEATH......................... 45
6.3 DETERMINATION OF BENEFITS IN EVENT OF DISABILITY............. 47
6.4 DETERMINATION OF BENEFITS UPON TERMINATION................... 47
6.5 DISTRIBUTION OF BENEFITS..................................... 50
6.6 DISTRIBUTION OF BENEFITS UPON DEATH.......................... 53
6.7 TIME OF SEGREGATION OR DISTRIBUTION.......................... 55
6.8 DISTRIBUTION FOR MINOR BENEFICIARY........................... 56
6.9 LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN............... 56
6.10 PRE-RETIREMENT DISTRIBUTION.................................. 56
6.11 ADVANCE DISTRIBUTION FOR HARDSHIP............................ 56
<PAGE>
6.12 QUALIFIED DOMESTIC RELATIONS ORDER DISTRIBUTION.............. 58
ARTICLE VII
TRUSTEE
7.1 BASIC RESPONSIBILITIES OF THE TRUSTEE........................ 59
7.2 INVESTMENT POWERS AND DUTIES OF THE TRUSTEE.................. 60
7.3 OTHER POWERS OF THE TRUSTEE.................................. 61
7.4 LOANS TO PARTICIPANTS........................................ 64
7.5 DUTIES OF THE TRUSTEE REGARDING PAYMENTS..................... 65
7.6 TRUSTEE'S COMPENSATION AND EXPENSES AND TAXES................ 65
7.7 ANNUAL REPORT OF THE TRUSTEE................................. 66
7.8 AUDIT........................................................ 66
7.9 RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE............... 67
7.10 TRANSFER OF INTEREST......................................... 68
7.11 DIRECT ROLLOVER.............................................. 68
7.12 EMPLOYER SECURITIES AND REAL PROPERTY........................ 70
ARTICLE VIII
AMENDMENT, TERMINATION AND MERGERS
8.1 AMENDMENT.................................................... 70
8.2 TERMINATION.................................................. 71
8.3 MERGER OR CONSOLIDATION...................................... 71
ARTICLE IX
TOP HEAVY
9.1 TOP HEAVY PLAN REQUIREMENTS.................................. 71
9.2 DETERMINATION OF TOP HEAVY STATUS............................ 72
<PAGE>
ARTICLE X
MISCELLANEOUS
10.1 PARTICIPANT'S RIGHTS......................................... 75
10.2 ALIENATION................................................... 76
10.3 CONSTRUCTION OF PLAN......................................... 77
10.4 GENDER AND NUMBER............................................ 77
10.5 LEGAL ACTION................................................. 77
10.6 PROHIBITION AGAINST DIVERSION OF FUNDS....................... 77
10.7 BONDING...................................................... 78
10.8 EMPLOYER'S AND TRUSTEE'S PROTECTIVE CLAUSE................... 78
10.9 INSURER'S PROTECTIVE CLAUSE.................................. 78
10.10 RECEIPT AND RELEASE FOR PAYMENTS............................. 78
10.11 ACTION BY THE EMPLOYER....................................... 79
10.12 NAMED FIDUCIARIES AND ALLOCATION OF
RESPONSIBILITY............................................... 79
10.13 HEADINGS..................................................... 80
10.14 APPROVAL BY INTERNAL REVENUE SERVICE......................... 80
10.15 UNIFORMITY................................................... 80
ARTICLE XI
PARTICIPATING EMPLOYERS
11.1 ADOPTION BY OTHER EMPLOYERS.................................. 81
11.2 REQUIREMENTS OF PARTICIPATING EMPLOYERS...................... 81
11.3 DESIGNATION OF AGENT......................................... 82
11.4 EMPLOYEE TRANSFERS........................................... 82
11.5 PARTICIPATING EMPLOYER CONTRIBUTION.......................... 82
11.6 AMENDMENT.................................................... 83
11.7 DISCONTINUANCE OF PARTICIPATION.............................. 83
11.8 ADMINISTRATOR'S AUTHORITY.................................... 83
<PAGE>
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
THIS AGREEMENT, hereby made and entered into this __________ day
of _________________________, 19____, by and between BLC Financial Services,
Inc. (herein referred to as the "Employer") and Louis Hafkin, Tracy Connors,
Jennifer Goldstein and Leonard Rudolph (herein referred to as the "Trustee").
W I T N E S S E T H:
WHEREAS, the Employer heretofore established a Profit Sharing Plan
and Trust effective January 1, 1994, (hereinafter called the "Effective Date")
known as BLC Financial Services, Inc. 401(k) Plan (herein referred to as the
"Plan") in recognition of the contribution made to its successful operation by
its employees and for the exclusive benefit of its eligible employees; and
WHEREAS, under the terms of the Plan, the Employer has the ability
to amend the Plan, provided the Trustee joins in such amendment if the
provisions of the Plan affecting the Trustee are amended;
NOW, THEREFORE, effective November 1, 1998, except as otherwise
provided, the Employer and the Trustee in accordance with the provisions of the
Plan pertaining to amendments thereof, hereby amend the Plan in its entirety and
restate the Plan to provide as follows:
ARTICLE I
DEFINITIONS
1.1 "Act" means the Employee Retirement Income Security Act of 1974, as it
may be amended from time to time.
1.2 "Administrator" means the Employer unless another person or entity has
been designated by the Employer pursuant to Section 2.2 to administer the Plan
on behalf of the Employer.
1.3 "Affiliated Employer" means any corporation which is a member of a
controlled group of corporations (as defined in Code Section 414(b)) which
includes the Employer; any trade or business (whether or not incorporated) which
is under common control (as defined in Code Section 414(c)) with the Employer;
any organization (whether or not incorporated) which is a member of an
affiliated service group (as defined in Code Section 414(m)) which includes the
Employer; and any other entity required to be aggregated with the Employer
pursuant to Regulations under Code Section 414(o).
1.4 "Aggregate Account" means, with respect to each Participant, the value
of all accounts maintained on behalf of a Participant, whether attributable to
Employer or Employee contributions, subject to the provisions of Section 9.2.
1
<PAGE>
1.5 "Anniversary Date" means December 31.
1.6 "Beneficiary" means the person to whom the share of a deceased
Participant's total account is payable, subject to the restrictions of Sections
6.2 and 6.6.
1.7 "Code" means the Internal Revenue Code of 1986, as amended or replaced
from time to time.
1.8 "Compensation" with respect to any Participant means such
Participant's wages as defined in Code Section 3401(a) and all other payments of
compensation by the Employer (in the course of the Employer's trade or business)
for a Plan Year for which the Employer is required to furnish the Participant a
written statement under Code Sections 6041(d), 6051(a)(3) and 6052. Compensation
must be determined without regard to any rules under Code Section 3401(a) that
limit the remuneration included in wages based on the nature or location of the
employment or the services performed (such as the exception for agricultural
labor in Code Section 3401(a)(2)).
For purposes of this Section, the determination of Compensation
shall be made by:
(a) including amounts which are contributed by the Employer
pursuant to a salary reduction agreement and which are not
includible in the gross income of the Participant under Code
Sections 125, 402(e)(3), 402(h)(1)(B), 403(b) or 457(b), and
Employee contributions described in Code Section 414(h)(2) that are
treated as Employer contributions.
For a Participant's initial year of participation, Compensation
shall be recognized as of such Employee's effective date of participation
pursuant to Section 3.2.
Compensation in excess of $150,000 shall be disregarded. Such amount
shall be adjusted for increases in the cost of living in accordance with Code
Section 401(a)(17), except that the dollar increase in effect on January 1 of
any calendar year shall be effective for the Plan Year beginning with or within
such calendar year. For any short Plan Year the Compensation limit shall be an
amount equal to the Compensation limit for the calendar year in which the Plan
Year begins multiplied by the ratio obtained by dividing the number of full
months in the short Plan Year by twelve (12). In applying this limitation, the
family group of a Highly Compensated Participant who is subject to the Family
Member aggregation rules of Code Section 414(q)(6) because such Participant is
either a "five percent owner" of the Employer or one of the ten (10) Highly
Compensated Employees paid the greatest "415 Compensation" during the year,
shall be treated as a single Participant, except that for this purpose Family
Members shall include only the affected Participant's spouse and any lineal
descendants who have not
2
<PAGE>
attained age nineteen (19) before the close of the year. If, as a result of the
application of such rules the adjusted limitation is exceeded, then the
limitation shall be prorated among the affected Family Members in proportion to
each such Family Member's Compensation prior to the application of this
limitation, or the limitation shall be adjusted in accordance with any other
method permitted by Regulation.
If, as a result of such rules, the maximum "annual addition" limit
of Section 4.7(a) would be exceeded for one or more of the affected Family
Members, the prorated Compensation of all affected Family Members shall be
adjusted to avoid or reduce any excess. The prorated Compensation of any
affected Family Member whose allocation would exceed the limit shall be adjusted
downward to the level needed to provide an allocation equal to such limit. The
prorated Compensation of affected Family Members not affected by such limit
shall then be adjusted upward on a pro rata basis not to exceed each such
affected Family Member's Compensation as determined prior to application of the
Family Member rule. The resulting allocation shall not exceed such individual's
maximum "annual addition" limit. If, after these adjustments, an "excess amount"
still results, such "excess amount" shall be disposed of in the manner described
in Section 4.8(a) pro rata among all affected Family Members.
For purposes of this Section, if the Plan is a plan described in
Code Section 413(c) or 414(f) (a plan maintained by more than one Employer), the
limitation applies separately with respect to the Compensation of any
Participant from each Employer maintaining the Plan.
If, in connection with the adoption of this amendment and
restatement, the definition of Compensation has been modified, then, for Plan
Years prior to the Plan Year which includes the adoption date of this amendment
and restatement, Compensation means compensation determined pursuant to the Plan
then in effect.
1.9 "Contract" or "Policy" means any life insurance policy, retirement
income or annuity policy, or annuity contract (group or individual) issued
pursuant to the terms of the Plan.
1.10 "Deferred Compensation" with respect to any Participant means the
amount of the Participant's total Compensation which has been contributed to the
Plan in accordance with the Participant's deferral election pursuant to Section
4.2 excluding any such amounts distributed as excess "annual additions" pursuant
to Section 4.8(a).
1.11 "Designated Investment Alternative" means a specific investment
identified by name by a Fiduciary as an available investment under the Plan
which may be acquired or disposed of by the Trustee pursuant to the investment
direction by a Participant.
3
<PAGE>
1.12 "Directed Investment Option" means one or more of the following:
(a) a Designated Investment Alternative.
(b) any other investment permitted by the Plan and the
Participant Direction Procedures and acquired or disposed of by the
Trustee pursuant to the investment direction of a Participant.
1.13 "Early Retirement Date." This Plan does not provide for a retirement
date prior to Normal Retirement Date.
1.14 "Elective Contribution" means the Employer contributions to the Plan
of Deferred Compensation excluding any such amounts distributed as excess
"annual additions" pursuant to Section 4.8(a). In addition, any Employer
Qualified Non-Elective Contribution made pursuant to Section 4.1(b) and Section
4.6(b) which is used to satisfy the "Actual Deferral Percentage" tests shall be
considered an Elective Contribution for purposes of the Plan. Any contributions
deemed to be Elective Contributions (whether or not used to satisfy the "Actual
Deferral Percentage" tests) shall be subject to the requirements of Sections
4.2(b) and 4.2(c) and shall further be required to satisfy the nondiscrimination
requirements of Regulation 1.401(k)-1(b)(5), the provisions of which are
specifically incorporated herein by reference.
1.15 "Eligible Employee" means any Employee.
Employees of Affiliated Employers shall not be eligible to
participate in this Plan unless such Affiliated Employers have specifically
adopted this Plan in writing.
1.16 "Employee" means any person who is employed by the Employer or
Affiliated Employer, but excludes any person who is an independent contractor.
Employee shall include Leased Employees within the meaning of Code Sections
414(n)(2) and 414(o)(2) unless such Leased Employees are covered by a plan
described in Code Section 414(n)(5) and such Leased Employees do not constitute
more than 20% of the recipient's non-highly compensated work force.
1.17 "Employer" means BLC Financial Services, Inc. and any successor which
shall maintain this Plan; and any predecessor which has maintained this Plan.
The Employer is a corporation, with principal offices in the State of Delaware.
In addition, where appropriate, the term Employer shall include any
Participating Employer (as defined in Section 11.1) which shall adopt this Plan.
1.18 "Excess Contributions" means, with respect to a Plan Year, the excess
of Elective Contributions used to satisfy the "Actual Deferral Percentage" tests
made on behalf of Highly
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Compensated Participants for the Plan Year over the maximum amount of such
contributions permitted under Section 4.5(a). Excess Contributions shall be
treated as an "annual addition" pursuant to Section 4.7(b).
1.19 "Excess Deferred Compensation" means, with respect to any taxable
year of a Participant, the excess of the aggregate amount of such Participant's
Deferred Compensation and the elective deferrals pursuant to Section 4.2(f)
actually made on behalf of such Participant for such taxable year, over the
dollar limitation provided for in Code Section 402(g), which is incorporated
herein by reference. Excess Deferred Compensation shall be treated as an "annual
addition" pursuant to Section 4.7(b) when contributed to the Plan unless
distributed to the affected Participant not later than the first April 15th
following the close of the Participant's taxable year. Additionally, for
purposes of Sections 9.2 and 4.4(f), Excess Deferred Compensation shall continue
to be treated as Employer contributions even if distributed pursuant to Section
4.2(f). However, Excess Deferred Compensation of Non-Highly Compensated
Participants is not taken into account for purposes of Section 4.5(a) to the
extent such Excess Deferred Compensation occurs pursuant to Section 4.2(d).
1.20 "Family Member" means, with respect to an affected Participant, such
Participant's spouse and such Participant's lineal descendants and ascendants
and their spouses, all as described in Code Section 414(q)(6)(B).
1.21 "Fiduciary" means any person who (a) exercises any discretionary
authority or discretionary control respecting management of the Plan or
exercises any authority or control respecting management or disposition of its
assets, (b) renders investment advice for a fee or other compensation, direct or
indirect, with respect to any monies or other property of the Plan or has any
authority or responsibility to do so, or (c) has any discretionary authority or
discretionary responsibility in the administration of the Plan, including, but
not limited to, the Trustee, the Employer and its representative body, and the
Administrator.
1.22 "Fiscal Year" means the Employer's accounting year of 12 months
commencing on July 1st of each year and ending the following June 30th.
1.23 "Forfeiture" means that portion of a Participant's Account that is
not Vested, and occurs on the earlier of:
(a) the distribution of the entire Vested portion
of a Terminated Participant's Account, or
(b) the last day of the Plan Year in which the Participant
incurs five (5) consecutive 1-Year Breaks
in Service.
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Furthermore, for purposes of paragraph (a) above, in the case of a
Terminated Participant whose Vested benefit is zero, such Terminated Participant
shall be deemed to have received a distribution of his Vested benefit upon his
termination of employment. Restoration of such amounts shall occur pursuant to
Section 6.4(f)(2). In addition, the term Forfeiture shall also include amounts
deemed to be Forfeitures pursuant to any other provision of this Plan.
1.24 "Former Participant" means a person who has been a Participant, but
who has ceased to be a Participant for any reason.
1.25 "415 Compensation" with respect to any Participant means such
Participant's wages as defined in Code Section 3401(a) and all other payments of
compensation by the Employer (in the course of the Employer's trade or business)
for a Plan Year for which the Employer is required to furnish the Participant a
written statement under Code Sections 6041(d), 6051(a)(3) and 6052. "415
Compensation" must be determined without regard to any rules under Code Section
3401(a) that limit the remuneration included in wages based on the nature or
location of the employment or the services performed (such as the exception for
agricultural labor in Code Section 3401(a)(2)).
If, in connection with the adoption of this amendment and
restatement, the definition of "415 Compensation" has been modified, then, for
Plan Years prior to the Plan Year which includes the adoption date of this
amendment and restatement, "415 Compensation" means compensation determined
pursuant to the Plan then in effect.
1.26 "414(s) Compensation" with respect to any Participant means such
Participant's "415 Compensation" paid during a Plan Year. The amount of "414(s)
Compensation" with respect to any Participant shall include "414(s)
Compensation" for the entire twelve (12) month period ending on the last day of
such Plan Year, except that "414(s) Compensation" shall only be recognized for
that portion of the Plan Year during which an Employee was a Participant in the
Plan.
For purposes of this Section, the determination of "414(s)
Compensation" shall be made by including amounts which are contributed by the
Employer pursuant to a salary reduction agreement and which are not includible
in the gross income of the Participant under Code Sections 125, 402(e)(3),
402(h)(1)(B), 403(b) or 457(b), and Employee contributions described in Code
Section 414(h)(2) that are treated as Employer contributions.
"414(s) Compensation" in excess of $150,000 shall be disregarded.
Such amount shall be adjusted for increases in the cost of living in accordance
with Code Section 401(a)(17), except that the dollar increase in effect on
January 1 of any calendar year shall be effective for the Plan Year beginning
with or
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within such calendar year. For any short Plan Year the "414(s) Compensation"
limit shall be an amount equal to the "414(s) Compensation" limit for the
calendar year in which the Plan Year begins multiplied by the ratio obtained by
dividing the number of full months in the short Plan Year by twelve (12). In
applying this limitation, the family group of a Highly Compensated Participant
who is subject to the Family Member aggregation rules of Code Section 414(q)(6)
because such Participant is either a "five percent owner" of the Employer or one
of the ten (10) Highly Compensated Employees paid the greatest "415
Compensation" during the year, shall be treated as a single Participant, except
that for this purpose Family Members shall include only the affected
Participant's spouse and any lineal descendants who have not attained age
nineteen (19) before the close of the year.
If, in connection with the adoption of this amendment and
restatement, the definition of "414(s) Compensation" has been modified, then,
for Plan Years prior to the Plan Year which includes the adoption date of this
amendment and restatement, "414(s) Compensation" means compensation determined
pursuant to the Plan then in effect.
1.27 "Highly Compensated Employee" means an Employee described in Code
Section 414(q) and the Regulations thereunder, and generally means an Employee
who performed services for the Employer during the "determination year" and is
in one or more of the following groups:
(a) Employees who at any time during the "determination year"
or "look-back year" were "five percent owners" as defined in Section
1.34(c).
(b) Employees who received "415 Compensation" during the
"look-back year" from the Employer in excess of $75,000.
(c) Employees who received "415 Compensation" during the
"look-back year" from the Employer in excess of $50,000 and were in
the Top Paid Group of Employees for the Plan Year.
(d) Employees who during the "look-back year" were officers of
the Employer (as that term is defined within the meaning of the
Regulations under Code Section 416) and received "415 Compensation"
during the "look-back year" from the Employer greater than 50
percent of the limit in effect under Code Section 415(b)(1)(A) for
any such Plan Year. The number of officers shall be limited to the
lesser of (i) 50 employees; or (ii) the greater of 3 employees or 10
percent of all employees. For the purpose of determining the number
of officers, Employees described in Section 1.59(a), (b), (c) and
(d) shall be excluded, but such Employees shall still be considered
for the
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<PAGE>
purpose of identifying the particular Employees who are officers. If
the Employer does not have at least one officer whose annual "415
Compensation" is in excess of 50 percent of the Code Section
415(b)(1)(A) limit, then the highest paid officer of the Employer
will be treated as a Highly Compensated Employee.
(e) Employees who are in the group consisting of the 100
Employees paid the greatest "415 Compensation" during the
"determination year" and are also described in (b), (c) or (d) above
when these paragraphs are modified to substitute "determination
year" for "look-back year."
The "look-back year" shall be the calendar year ending with or
within the Plan Year for which testing is being performed, and the
"determination year" (if applicable) shall be the period of time, if any, which
extends beyond the "look-back year" and ends on the last day of the Plan Year
for which testing is being performed (the "lag period"). If the "lag period" is
less than twelve months long, the dollar threshold amounts specified in (b), (c)
and (d) above shall be prorated based upon the number of months in the "lag
period."
If an Employee is, during a "determination year" or "look-back
year", a Family Member of either a "five percent owner" (whether active or
former) or a Highly Compensated Employee who is one of the 10 most Highly
Compensated Employees ranked on the basis of "415 Compensation" paid by the
Employer during such year, then the Family Member and the "five percent owner"
or top-ten Highly Compensated Employee shall be aggregated. In such case, the
Family Member and "five percent owner" or top-ten Highly Compensated Employee
shall be treated as a single Employee receiving "415 Compensation" and Plan
contributions or benefits equal to the sum of such "415 Compensation" and
contributions or benefits of the Family Member and "five percent owner" or
top-ten Highly Compensated Employee.
For purposes of this Section, the determination of "415
Compensation" shall be made by including amounts which are contributed by the
Employer pursuant to a salary reduction agreement and which are not includible
in the gross income of the Participant under Code Sections 125, 402(e)(3),
402(h)(1)(B), 403(b) or 457(b), and Employee contributions described in Code
Section 414(h)(2) that are treated as Employer contributions. Additionally, the
dollar threshold amounts specified in (b) and (c) above shall be adjusted at
such time and in such manner as is provided in Regulations. In the case of such
an adjustment, the dollar limits which shall be applied are those for the
calendar year in which the "determination year" or "look-back year" begins.
In determining who is a Highly Compensated Employee, Employees who
are non-resident aliens and who received no earned
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<PAGE>
income (within the meaning of Code Section 911(d)(2)) from the Employer
constituting United States source income within the meaning of Code Section
861(a)(3) shall not be treated as Employees. Additionally, all Affiliated
Employers shall be taken into account as a single employer and Leased Employees
within the meaning of Code Sections 414(n)(2) and 414(o)(2) shall be considered
Employees unless such Leased Employees are covered by a plan described in Code
Section 414(n)(5) and are not covered in any qualified plan maintained by the
Employer. The exclusion of Leased Employees for this purpose shall be applied on
a uniform and consistent basis for all of the Employer's retirement plans.
Highly Compensated Former Employees shall be treated as Highly Compensated
Employees without regard to whether they performed services during the
"determination year."
1.28 "Highly Compensated Former Employee" means a former Employee who had
a separation year prior to the "determination year" and was a Highly Compensated
Employee in the year of separation from service or in any "determination year"
after attaining age 55. Notwithstanding the foregoing, an Employee who separated
from service prior to 1987 will be treated as a Highly Compensated Former
Employee only if during the separation year (or year preceding the separation
year) or any year after the Employee attains age 55 (or the last year ending
before the Employee's 55th birthday), the Employee either received "415
Compensation" in excess of $50,000 or was a "five percent owner." For purposes
of this Section, "determination year," "415 Compensation" and "five percent
owner" shall be determined in accordance with Section 1.27. Highly Compensated
Former Employees shall be treated as Highly Compensated Employees. The method
set forth in this Section for determining who is a "Highly Compensated Former
Employee" shall be applied on a uniform and consistent basis for all purposes
for which the Code Section 414(q) definition is applicable.
1.29 "Highly Compensated Participant" means any Highly Compensated
Employee who is eligible to participate in the Plan.
1.30 "Hour of Service" means, for purposes of eligibility for
participation, each hour for which an Employee is paid or entitled to payment
for the performance of duties for the Employer.
1.31 "Hour of Service" means, for purposes of vesting, (1) each hour for
which an Employee is directly or indirectly compensated or entitled to
compensation by the Employer for the performance of duties (these hours will be
credited to the Employee for the computation period in which the duties are
performed); (2) each hour for which an Employee is directly or indirectly
compensated or entitled to compensation by the Employer (irrespective of whether
the employment relationship has terminated) for reasons other than performance
of duties (such as vacation, holidays, sickness, jury duty, disability, lay-off,
military duty or leave of absence) during the applicable
9
<PAGE>
computation period (these hours will be calculated and credited pursuant to
Department of Labor regulation 2530.200b-2 which is incorporated herein by
reference); (3) each hour for which back pay is awarded or agreed to by the
Employer without regard to mitigation of damages (these hours will be credited
to the Employee for the computation period or periods to which the award or
agreement pertains rather than the computation period in which the award,
agreement or payment is made). The same Hours of Service shall not be credited
both under (1) or (2), as the case may be, and under (3).
Notwithstanding the above, (i) no more than 501 Hours of Service are
required to be credited to an Employee on account of any single continuous
period during which the Employee performs no duties (whether or not such period
occurs in a single computation period); (ii) an hour for which an Employee is
directly or indirectly paid, or entitled to payment, on account of a period
during which no duties are performed is not required to be credited to the
Employee if such payment is made or due under a plan maintained solely for the
purpose of complying with applicable worker's compensation, or unemployment
compensation or disability insurance laws; and (iii) Hours of Service are not
required to be credited for a payment which solely reimburses an Employee for
medical or medically related expenses incurred by the Employee.
For purposes of this Section, a payment shall be deemed to be made
by or due from the Employer regardless of whether such payment is made by or due
from the Employer directly, or indirectly through, among others, a trust fund,
or insurer, to which the Employer contributes or pays premiums and regardless of
whether contributions made or due to the trust fund, insurer, or other entity
are for the benefit of particular Employees or are on behalf of a group of
Employees in the aggregate.
For purposes of this Section, Hours of Service will be credited for
employment with other Affiliated Employers. The provisions of Department of
Labor regulations 2530.200b-2(b) and (c) are incorporated herein by reference.
1.32 "Income" means the income or losses allocable to Excess Deferred
Compensation or Excess Contributions which amount shall be allocated in the same
manner as income or losses are allocated pursuant to Section 4.4(e).
1.33 "Investment Manager" means an entity that (a) has the power to
manage, acquire, or dispose of Plan assets and (b) acknowledges fiduciary
responsibility to the Plan in writing. Such entity must be a person, firm, or
corporation registered as an investment adviser under the Investment Advisers
Act of 1940, a bank, or an insurance company.
1.34 "Key Employee" means an Employee as defined in Code
Section 416(i) and the Regulations thereunder. Generally, any
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<PAGE>
Employee or former Employee (as well as each of his Beneficiaries) is considered
a Key Employee if he, at any time during the Plan Year that contains the
"Determination Date" or any of the preceding four (4) Plan Years, has been
included in one of the following categories:
(a) an officer of the Employer (as that term is defined within
the meaning of the Regulations under Code Section 416) having annual
"415 Compensation" greater than 50 percent of the amount in effect
under Code Section 415(b)(1)(A) for any such Plan Year.
(b) one of the ten employees having annual "415 Compensation"
from the Employer for a Plan Year greater than the dollar limitation
in effect under Code Section 415(c)(1)(A) for the calendar year in
which such Plan Year ends and owning (or considered as owning within
the meaning of Code Section 318) both more than one-half percent
interest and the largest interests in the Employer.
(c) a "five percent owner" of the Employer. "Five percent
owner" means any person who owns (or is considered as owning within
the meaning of Code Section 318) more than five percent (5%) of the
outstanding stock of the Employer or stock possessing more than five
percent (5%) of the total combined voting power of all stock of the
Employer or, in the case of an unincorporated business, any person
who owns more than five percent (5%) of the capital or profits
interest in the Employer. In determining percentage ownership
hereunder, employers that would otherwise be aggregated under Code
Sections 414(b), (c), (m) and (o) shall be treated as separate
employers.
(d) a "one percent owner" of the Employer having an annual
"415 Compensation" from the Employer of more than $150,000. "One
percent owner" means any person who owns (or is considered as owning
within the meaning of Code Section 318) more than one percent (1%)
of the outstanding stock of the Employer or stock possessing more
than one percent (1%) of the total combined voting power of all
stock of the Employer or, in the case of an unincorporated business,
any person who owns more than one percent (1%) of the capital or
profits interest in the Employer. In determining percentage
ownership hereunder, employers that would otherwise be aggregated
under Code Sections 414(b), (c), (m) and (o) shall be treated as
separate employers. However, in determining whether an individual
has "415 Compensation" of more than $150,000, "415 Compensation"
from each employer required to be aggregated under Code Sections
414(b), (c), (m) and (o) shall be taken into account.
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For purposes of this Section, the determination of "415
Compensation" shall be made by including amounts which are contributed by the
Employer pursuant to a salary reduction agreement and which are not includible
in the gross income of the Participant under Code Sections 125, 402(e)(3),
402(h)(1)(B), 403(b) or 457(b), and Employee contributions described in Code
Section 414(h)(2) that are treated as Employer contributions.
1.35 "Late Retirement Date" means the first day of the month coinciding
with or next following a Participant's actual Retirement Date after having
reached his Normal Retirement Date.
1.36 "Leased Employee" means any person (other than an Employee of the
recipient) who pursuant to an agreement between the recipient and any other
person ("leasing organization") has performed services for the recipient (or for
the recipient and related persons determined in accordance with Code Section
414(n)(6)) on a substantially full time basis for a period of at least one year,
and such services are of a type historically performed by employees in the
business field of the recipient employer. Contributions or benefits provided a
Leased Employee by the leasing organization which are attributable to services
performed for the recipient employer shall be treated as provided by the
recipient employer. A Leased Employee shall not be considered an Employee of the
recipient:
(a) if such employee is covered by a money purchase pension
plan providing:
(1) a non-integrated employer contribution rate of at least
10% of compensation, as defined in Code Section 415(c)(3), but
including amounts which are contributed by the Employer
pursuant to a salary reduction agreement and which are not
includible in the gross income of the Participant under Code
Sections 125, 402(e)(3), 402(h)(1)(B), 403(b) or 457(b), and
Employee contributions described in Code Section 414(h)(2)
that are treated as Employer contributions.
(2) immediate participation; and
(3) full and immediate vesting; and
(b) if Leased Employees do not constitute more than 20% of the
recipient's non-highly compensated work force.
1.37 "Non-Highly Compensated Participant" means any Participant who is
neither a Highly Compensated Employee nor a Family Member.
1.38 "Non-Key Employee" means any Employee or former Employee (and his
Beneficiaries) who is not a Key Employee.
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1.39 "Normal Retirement Age" means the Participant's 65th birthday. A
Participant shall become fully Vested in his Participant's Account upon
attaining his Normal Retirement Age.
1.40 "Normal Retirement Date" means the first day of the month coinciding
with or next following the Participant's Normal Retirement Age.
1.41 "1-Year Break in Service" means, for purposes of eligibility for
participation, a Period of Severance of at least 12 consecutive months.
1.42 "1-Year Break in Service" means, for purposes of vesting, the
applicable computation period during which an Employee has not completed more
than 500 Hours of Service with the Employer. Further, solely for the purpose of
determining whether a Participant has incurred a 1-Year Break in Service, Hours
of Service shall be recognized for "authorized leaves of absence" and "maternity
and paternity leaves of absence." Years of Service and 1-Year Breaks in Service
shall be measured on the same computation period.
"Authorized leave of absence" means an unpaid, temporary cessation
from active employment with the Employer pursuant to an established
nondiscriminatory policy, whether occasioned by illness, military service, or
any other reason.
A "maternity or paternity leave of absence" means, for Plan Years
beginning after December 31, 1984, an absence from work for any period by reason
of the Employee's pregnancy, birth of the Employee's child, placement of a child
with the Employee in connection with the adoption of such child, or any absence
for the purpose of caring for such child for a period immediately following such
birth or placement. For this purpose, Hours of Service shall be credited for the
computation period in which the absence from work begins, only if credit
therefore is necessary to prevent the Employee from incurring a 1-Year Break in
Service, or, in any other case, in the immediately following computation period.
The Hours of Service credited for a "maternity or paternity leave of absence"
shall be those which would normally have been credited but for such absence, or,
in any case in which the Administrator is unable to determine such hours
normally credited, eight (8) Hours of Service per day. The total Hours of
Service required to be credited for a "maternity or paternity leave of absence"
shall not exceed 501.
1.43 "Participant" means any Eligible Employee who participates in the
Plan and has not for any reason become ineligible to participate further in the
Plan.
1.44 "Participant Direction Procedures" means such instructions,
guidelines or policies, the terms of which are incorporated herein, as shall be
established pursuant to Section
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4.10 and observed by the Administrator and applied and provided to Participants
who have Participant Directed Accounts.
1.45 "Participant's Directed Account" means that portion of a
Participant's interest in the Plan with respect to which the Participant has
directed the investment in accordance with the Participant Direction Procedure.
1.46 "Participant's Elective Account" means the account established and
maintained by the Administrator for each Participant with respect to his total
interest in the Plan and Trust resulting from the Employer Elective
Contributions used to satisfy the "Actual Deferral Percentage" tests. A separate
accounting shall be maintained with respect to that portion of the Participant's
Elective Account attributable to such Elective Contributions pursuant to Section
4.2 and any Employer Qualified Non-Elective Contributions.
1.47 "Period of Service" means the aggregate of all periods commencing
with the Employee's first day of employment or reemployment with the Employer or
Affiliated Employer and ending on the date a 1-Year Break in Service begins. The
first day of employment or reemployment is the first day the Employee performs
an Hour of Service. An Employee will also receive partial credit for any Period
of Severance of less than 12 consecutive months. Fractional periods of a year
will be expressed in terms of days.
1.48 "Period of Severance" means a continuous period of time during which
the Employee is not employed by the Employer. Such period begins on the date the
Employee retires, quits or is discharged, or if earlier, the 12 month
anniversary of the date on which the Employee was otherwise first absent from
service.
In the case of an individual who is absent from work for maternity
or paternity reasons, the 12-consecutive month period beginning on the first
anniversary of the first day of such absence shall not constitute a 1-Year Break
in Service. For purposes of this paragraph, an absence from work for maternity
or paternity reasons means an absence (a) by reason of the pregnancy of the
individual, (b) by reason of the birth of a child of the individual, (c) by
reason of the placement of a child with the individual in connection with the
adoption of such child by such individual, or (d) for purposes of caring for
such child for a period beginning immediately following such birth or placement.
1.49 "Plan" means this instrument, including all amendments thereto.
1.50 "Plan Year" means the Plan's accounting year of twelve (12) months
commencing on January 1st of each year and ending the following December 31st.
1.51 "Qualified Non-Elective Contribution" means any Employer
contributions made pursuant to Section 4.1(b) and
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Section 4.6(b). Such contributions shall be considered an Elective Contribution
for the purposes of the Plan and may be used to satisfy the "Actual Deferral
Percentage" tests.
1.52 "Regulation" means the Income Tax Regulations as promulgated by the
Secretary of the Treasury or his delegate, and as amended from time to time.
1.53 "Retired Participant" means a person who has been a Participant, but
who has become entitled to retirement benefits under the Plan.
1.54 "Retirement Date" means the date as of which a Participant retires
for reasons other than Total and Permanent Disability, whether such retirement
occurs on a Participant's Normal Retirement Date or Late Retirement Date (see
Section 6.1).
1.55 "Super Top Heavy Plan" means a plan described in Section 9.2(b).
1.56 "Terminated Participant" means a person who has been a Participant,
but whose employment has been terminated other than by death, Total and
Permanent Disability or retirement.
1.57 "Top Heavy Plan" means a plan described in Section 9.2(a).
1.58 "Top Heavy Plan Year" means a Plan Year during which the Plan is a
Top Heavy Plan.
1.59 "Top Paid Group" means the top 20 percent of Employees who performed
services for the Employer during the applicable year, ranked according to the
amount of "415 Compensation" (determined for this purpose in accordance with
Section 1.27) received from the Employer during such year. All Affiliated
Employers shall be taken into account as a single employer, and Leased Employees
within the meaning of Code Sections 414(n)(2) and 414(o)(2) shall be considered
Employees unless such Leased Employees are covered by a plan described in Code
Section 414(n)(5) and are not covered in any qualified plan maintained by the
Employer. Employees who are non-resident aliens and who received no earned
income (within the meaning of Code Section 911(d)(2)) from the Employer
constituting United States source income within the meaning of Code Section
861(a)(3) shall not be treated as Employees. Additionally, for the purpose of
determining the number of active Employees in any year, the following additional
Employees shall also be excluded; however, such Employees shall still be
considered for the purpose of identifying the particular Employees in the Top
Paid Group:
(a) Employees with less than six (6) months of
service;
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<PAGE>
(b) Employees who normally work less than 17 1/2 hours per
week;
(c) Employees who normally work less than six (6) months
during a year; and
(d) Employees who have not yet attained age 21.
In addition, if 90 percent or more of the Employees of the Employer
are covered under agreements the Secretary of Labor finds to be collective
bargaining agreements between Employee representatives and the Employer, and the
Plan covers only Employees who are not covered under such agreements, then
Employees covered by such agreements shall be excluded from both the total
number of active Employees as well as from the identification of particular
Employees in the Top Paid Group.
The foregoing exclusions set forth in this Section shall be applied
on a uniform and consistent basis for all purposes for which the Code Section
414(q) definition is applicable.
1.60 "Total and Permanent Disability" means a physical or mental condition
of a Participant resulting from bodily injury, disease, or mental disorder which
renders him incapable of continuing any gainful occupation and which condition
constitutes total disability under the federal Social Security Acts.
1.61 "Trustee" means the person or entity named as trustee herein or in
any separate trust forming a part of this Plan, and any successors.
1.62 "Trust Fund" means the assets of the Plan and Trust as the same shall
exist from time to time.
1.63 "USERRA" means the Uniformed Services Employment and Reemployment
Rights Act of 1994. Notwithstanding any provision of this Plan to the contrary,
contributions, benefits and service credit with respect to qualified military
service will be provided in accordance with Code Section 414(u).
1.64 "Valuation Date" means the Anniversary Date and such other date or
dates deemed necessary by the Administrator. The Valuation Date may include any
day during the Plan Year that the Trustee, any transfer agent appointed by the
Trustee or the Employer and any stock exchange used by such agent are open for
business.
1.65 "Vested" means the nonforfeitable portion of any account maintained
on behalf of a Participant.
1.66 "Year of Service" means the computation period of twelve (12)
consecutive months, herein set forth, during which an Employee has at least 1000
Hours of Service.
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For vesting purposes, the computation periods shall be the Plan
Year, including periods prior to the Effective Date of the Plan.
The computation period shall be the Plan Year if not otherwise set
forth herein.
Notwithstanding the foregoing, for any short Plan Year, the
determination of whether an Employee has completed a Year of Service shall be
made in accordance with Department of Labor regulation 2530.203-2(c).
Years of Service with any Affiliated Employer shall be recognized.
ARTICLE II
ADMINISTRATION
2.1 POWERS AND RESPONSIBILITIES OF THE EMPLOYER
(a) In addition to the general powers and responsibilities
otherwise provided for in this Plan, the Employer shall be
empowered to appoint and remove the Trustee and the Administrator
from time to time as it deems necessary for the proper
administration of the Plan to ensure that the Plan is being
operated for the exclusive benefit of the Participants and their
Beneficiaries in accordance with the terms of the Plan, the Code,
and the Act. The Employer may appoint counsel, specialists,
advisers, agents (including any nonfiduciary agent) and other
persons as the Employer deems necessary or desirable in connection
with the exercise of its fiduciary duties under this Plan. The
Employer may compensate such agents or advisers from the assets of
the Plan as fiduciary expenses (but not including any business
(settlor) expenses of the Employer), to the extent not paid by the
Employer.
(b) The Employer may, by written agreement or designation,
appoint at its option an Investment Manager (qualified under the
Investment Company Act of 1940 as amended), investment adviser, or
other agent to provide direction to the Trustee with respect to
any or all of the Plan assets. Such appointment shall be given by
the Employer in writing in a form acceptable to the Trustee and
shall specifically identify the Plan assets with respect to which
the Investment Manager or other agent shall have authority to
direct the investment.
(c) The Employer shall establish a "funding policy and
method," i.e., it shall determine whether the Plan has a short run
need for liquidity (e.g., to pay benefits) or whether liquidity is
a long run goal
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and investment growth (and stability of same) is a more current
need, or shall appoint a qualified person to do so. The Employer
or its delegate shall communicate such needs and goals to the
Trustee, who shall coordinate such Plan needs with its investment
policy. The communication of such a "funding policy and method"
shall not, however, constitute a directive to the Trustee as to
investment of the Trust Funds. Such "funding policy and method"
shall be consistent with the objectives of this Plan and with the
requirements of Title I of the Act.
(d) The Employer shall periodically review the performance
of any Fiduciary or other person to whom duties have been
delegated or allocated by it under the provisions of this Plan or
pursuant to procedures established hereunder. This requirement may
be satisfied by formal periodic review by the Employer or by a
qualified person specifically designated by the Employer, through
day-to-day conduct and evaluation, or through other appropriate
ways.
2.2 DESIGNATION OF ADMINISTRATIVE AUTHORITY
The Employer shall be the Administrator. The Employer may appoint
any person, including, but not limited to, the Employees of the Employer, to
perform the duties of the Administrator. Any person so appointed shall signify
his acceptance by filing written acceptance with the Employer. Upon the
resignation or removal of any individual performing the duties of the
Administrator, the Employer may designate a successor.
2.3 POWERS AND DUTIES OF THE ADMINISTRATOR
The primary responsibility of the Administrator is to administer
the Plan for the exclusive benefit of the Participants and their Beneficiaries,
subject to the specific terms of the Plan. The Administrator shall administer
the Plan in accordance with its terms and shall have the power and discretion to
construe the terms of the Plan and to determine all questions arising in
connection with the administration, interpretation, and application of the Plan.
Any such determination by the Administrator shall be conclusive and binding upon
all persons. The Administrator may establish procedures, correct any defect,
supply any information, or reconcile any inconsistency in such manner and to
such extent as shall be deemed necessary or advisable to carry out the purpose
of the Plan; provided, however, that any procedure, discretionary act,
interpretation or construction shall be done in a nondiscriminatory manner based
upon uniform principles consistently applied and shall be consistent with the
intent that the Plan shall continue to be deemed a qualified plan under the
terms of Code Section 401(a), and shall comply with the terms of the Act and all
regulations
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issued pursuant thereto. The Administrator shall have all powers necessary or
appropriate to accomplish his duties under this Plan.
The Administrator shall be charged with the duties of the general
administration of the Plan, including, but not limited to, the following:
(a) the discretion to determine all questions relating to
the eligibility of Employees to participate or remain a
Participant hereunder and to receive benefits under the Plan;
(b) to compute, certify, and direct the Trustee with respect
to the amount and the kind of benefits to which any Participant
shall be entitled hereunder;
(c) to authorize and direct the Trustee with respect to all
nondiscretionary or otherwise directed disbursements from the
Trust;
(d) to maintain all necessary records for the
administration of the Plan;
(e) to interpret the provisions of the Plan and to make and
publish such rules for regulation of the Plan as are consistent
with the terms hereof;
(f) to determine the size and type of any Contract to be
purchased from any insurer, and to designate the insurer from
which such Contract shall be purchased;
(g) to compute and certify to the Employer and to the
Trustee from time to time the sums of money necessary or desirable
to be contributed to the Plan;
(h) to consult with the Employer and the Trustee regarding
the short and long-term liquidity needs of the Plan in order that
the Trustee can exercise any investment discretion in a manner
designed to accomplish specific objectives;
(i) to prepare and implement a procedure to notify Eligible
Employees that they may elect to have a portion of their
Compensation deferred or paid to them in cash;
(j) to act as the named Fiduciary responsible for
communications with Participants as needed to maintain Plan
compliance with ERISA Section 404(c), including but not limited to
the receipt and transmitting of Participant's directions as to the
investment of their account(s) under the Plan and the
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formulation of policies, rules, and procedures pursuant to which
Participants may give investment instructions with respect to the
investment of their accounts;
(k) to assist any Participant regarding his rights,
benefits, or elections available under the Plan.
2.4 RECORDS AND REPORTS
The Administrator shall keep a record of all actions taken and
shall keep all other books of account, records, policies, and other data that
may be necessary for proper administration of the Plan and shall be responsible
for supplying all information and reports to the Internal Revenue Service,
Department of Labor, Participants, Beneficiaries and others as required by law.
2.5 APPOINTMENT OF ADVISERS
The Administrator, or the Trustee with the consent of the
Administrator, may appoint counsel, specialists, advisers, agents (including
nonfiduciary agents) and other persons as the Administrator or the Trustee deems
necessary or desirable in connection with the administration of this Plan,
including but not limited to agents and advisers to assist with the
administration and management of the Plan, and thereby to provide, among such
other duties as the Administrator may appoint, assistance with maintaining Plan
records and the providing of investment information to the Plan's investment
fiduciaries and to Plan Participants.
2.6 PAYMENT OF EXPENSES
All expenses of administration may be paid out of the Trust Fund
unless paid by the Employer. Such expenses shall include any expenses incident
to the functioning of the Administrator, or any person or persons retained or
appointed by any Named Fiduciary incident to the exercise of their duties under
the Plan, including, but not limited to, fees of accountants, counsel,
Investment Managers, agents (including nonfiduciary agents) appointed for the
purpose of assisting the Administrator or the Trustee in carrying out the
instructions of Participants as to the directed investment of their accounts and
other specialists and their agents, and other costs of administering the Plan.
Until paid, the expenses shall constitute a liability of the Trust Fund.
2.7 CLAIMS PROCEDURE
Claims for benefits under the Plan may be filed in writing with
the Administrator. Written notice of the disposition of a claim shall be
furnished to the claimant within 90 days
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after the application is filed. In the event the claim is denied, the reasons
for the denial shall be specifically set forth in the notice in language
calculated to be understood by the claimant, pertinent provisions of the Plan
shall be cited, and, where appropriate, an explanation as to how the claimant
can perfect the claim will be provided. In addition, the claimant shall be
furnished with an explanation of the Plan's claims review procedure.
2.8 CLAIMS REVIEW PROCEDURE
Any Employee, former Employee, or Beneficiary of either, who has
been denied a benefit by a decision of the Administrator pursuant to Section 2.7
shall be entitled to request the Administrator to give further consideration to
his claim by filing with the Administrator (on a form which may be obtained from
the Administrator) a request for a hearing. Such request, together with a
written statement of the reasons why the claimant believes his claim should be
allowed, shall be filed with the Administrator no later than 60 days after
receipt of the written notification provided for in Section 2.7. The
Administrator shall then conduct a hearing within the next 60 days, at which the
claimant may be represented by an attorney or any other representative of his
choosing and at which the claimant shall have an opportunity to submit written
and oral evidence and arguments in support of his claim. At the hearing (or
prior thereto upon 5 business days written notice to the Administrator) the
claimant or his representative shall have an opportunity to review all documents
in the possession of the Administrator which are pertinent to the claim at issue
and its disallowance. Either the claimant or the Administrator may cause a court
reporter to attend the hearing and record the proceedings. In such event, a
complete written transcript of the proceedings shall be furnished to both
parties by the court reporter. The full expense of any such court reporter and
such transcripts shall be borne by the party causing the court reporter to
attend the hearing. A final decision as to the allowance of the claim shall be
made by the Administrator within 60 days of receipt of the appeal (unless there
has been an extension of 60 days due to special circumstances, provided the
delay and the special circumstances occasioning it are communicated to the
claimant within the 60 day period). Such communication shall be written in a
manner calculated to be understood by the claimant and shall include specific
reasons for the decision and specific references to the pertinent Plan
provisions on which the decision is based.
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ARTICLE III
ELIGIBILITY
3.1 CONDITIONS OF ELIGIBILITY
Any Eligible Employee who was employed on October 31, 1998 shall
be eligible to participate and shall enter the Plan as of the first day of such
Plan Year. Any other Eligible Employee who has completed a six (6) month Period
of Service and has attained age 21 shall be eligible to participate hereunder as
of the date he has satisfied such requirements. However, any Employee who was a
Participant in the Plan prior to the effective date of this amendment and
restatement shall continue to participate in the Plan.
3.2 EFFECTIVE DATE OF PARTICIPATION
An Eligible Employee shall become a Participant effective as of
the first day of the month coinciding with or next following the date on which
such Employee met the eligibility requirements of Section 3.1, provided said
Employee was still employed as of such date (or if not employed on such date, as
of the date of rehire if a 1-Year Break in Service has not occurred).
3.3 DETERMINATION OF ELIGIBILITY
The Administrator shall determine the eligibility of each Employee
for participation in the Plan based upon information furnished by the Employer.
Such determination shall be conclusive and binding upon all persons, as long as
the same is made pursuant to the Plan and the Act. Such determination shall be
subject to review per Section 2.8.
3.4 TERMINATION OF ELIGIBILITY
(a) In the event a Participant shall go from a
classification of an Eligible Employee to an ineligible Employee,
such Former Participant shall continue to vest in his interest in
the Plan for each Year of Service completed while a noneligible
Employee, until such time as his Participant's Account shall be
forfeited or distributed pursuant to the terms of the Plan.
Additionally, his interest in the Plan shall continue to share in
the earnings of the Trust Fund.
(b) In the event a Participant is no longer a member of an
eligible class of Employees and becomes ineligible to participate,
such Employee will participate immediately upon returning to an
eligible class of Employees.
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3.5 OMISSION OF ELIGIBLE EMPLOYEE
If, in any Plan Year, any Employee who should be included as a
Participant in the Plan is erroneously omitted and discovery of such omission is
not made until after a contribution by his Employer for the year has been made,
the Employer shall make a subsequent contribution with respect to the omitted
Employee in the amount which the said Employer would have contributed with
respect to him had he not been omitted. Such contribution shall be made
regardless of whether or not it is deductible in whole or in part in any taxable
year under applicable provisions of the Code.
3.6 INCLUSION OF INELIGIBLE EMPLOYEE
If, in any Plan Year, any person who should not have been included
as a Participant in the Plan is erroneously included and discovery of such
incorrect inclusion is not made until after a contribution for the year has been
made, the Employer shall not be entitled to recover the contribution made with
respect to the ineligible person regardless of whether or not a deduction is
allowable with respect to such contribution. In such event, the amount
contributed with respect to the ineligible person shall constitute a Forfeiture
(except for Deferred Compensation which shall be distributed to the ineligible
person) for the Plan Year in which the discovery is made.
3.7 ELECTION NOT TO PARTICIPATE
An Employee may, subject to the approval of the Employer, elect
voluntarily not to participate in the Plan. The election not to participate must
be communicated to the Employer, in writing, at least thirty (30) days before
the beginning of a Plan Year.
ARTICLE IV
CONTRIBUTION AND ALLOCATION
4.1 FORMULA FOR DETERMINING EMPLOYER CONTRIBUTION
For each Plan Year, the Employer shall contribute to the Plan:
(a) The amount of the total salary reduction elections of
all Participants made pursuant to Section 4.2(a), which amount
shall be deemed an Employer Elective Contribution.
(b) On behalf of each Non-Highly Compensated Participant who
is eligible to share in the Qualified Non-Elective Contribution
for the Plan Year, a discretionary Qualified Non-Elective
Contribution equal to a uniform percentage of each eligible
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<PAGE>
individual's Compensation, the exact percentage, if
any, to be determined each year by the Employer. Any
Employer Qualified Non-Elective Contribution shall be
deemed an Employer Elective Contribution.
(c) Additionally, to the extent necessary, the Employer
shall contribute to the Plan the amount necessary to provide the
top heavy minimum contribution. All contributions by the Employer
shall be made in cash.
4.2 PARTICIPANT'S SALARY REDUCTION ELECTION
(a) Each Participant may elect to defer from 1% to 25% of
his Compensation which would have been received in the Plan Year,
but for the deferral election. A deferral election (or
modification of an earlier election) may not be made with respect
to Compensation which is currently available on or before the date
the Participant executed such election. For purposes of this
Section, Compensation shall be determined prior to any reductions
made pursuant to Code Sections 125, 402(e)(3), 402(h)(1)(B),
403(b) or 457(b), and Employee contributions described in Code
Section 414(h)(2) that are treated as Employer contributions.
The amount by which Compensation is reduced shall be
that Participant's Deferred Compensation and be treated as an
Employer Elective Contribution and allocated to that Participant's
Elective Account.
(b) The balance in each Participant's Elective Account shall
be fully Vested at all times and shall not be subject to
Forfeiture for any reason.
(c) Notwithstanding anything in the Plan to the contrary,
amounts held in the Participant's Elective Account may not be
distributable (including any offset of loans) earlier than:
(1) a Participant's separation from service,
Total and Permanent Disability, or death;
(2) a Participant's attainment of age 59 1/2;
(3) the termination of the Plan without the establishment or
existence of a "successor plan," as that term is described
in Regulation 1.401(k)-1(d)(3);
(4) the date of disposition by the Employer to an entity
that is not an Affiliated Employer of substantially all of
the assets (within the
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meaning of Code Section 409(d)(2)) used in a trade or
business of such corporation if such corporation continues
to maintain this Plan after the disposition with respect to
a Participant who continues employment with the corporation
acquiring such assets;
(5) the date of disposition by the Employer or an Affiliated
Employer who maintains the Plan of its interest in a
subsidiary (within the meaning of Code Section 409(d)(3)) to
an entity which is not an Affiliated Employer but only with
respect to a Participant who continues employment with such
subsidiary; or
(6) the proven financial hardship of a Participant, subject
to the limitations of Section 6.11.
(d) For each Plan Year, a Participant's Deferred
Compensation made under this Plan and all other plans, contracts
or arrangements of the Employer maintaining this Plan shall not
exceed, during any taxable year of the Participant, the limitation
imposed by Code Section 402(g), as in effect at the beginning of
such taxable year. If such dollar limitation is exceeded, a
Participant will be deemed to have notified the Administrator of
such excess amount which shall be distributed in a manner
consistent with Section 4.2(f). The dollar limitation shall be
adjusted annually pursuant to the method provided in Code Section
415(d) in accordance with Regulations.
(e) In the event a Participant has received a hardship
distribution from his Participant's Elective Account pursuant to
Section 6.11(b) or pursuant to Regulation 1.401(k)-1(d)(2)(iv)(B)
from any other plan maintained by the Employer, then such
Participant shall not be permitted to elect to have Deferred
Compensation contributed to the Plan on his behalf for a period of
twelve (12) months following the receipt of the distribution.
Furthermore, the dollar limitation under Code Section 402(g) shall
be reduced, with respect to the Participant's taxable year
following the taxable year in which the hardship distribution was
made, by the amount of such Participant's Deferred Compensation,
if any, pursuant to this Plan (and any other plan maintained by
the Employer) for the taxable year of the hardship distribution.
(f) If a Participant's Deferred Compensation under this Plan
together with any elective deferrals (as defined in Regulation
1.402(g)-1(b)) under another
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qualified cash or deferred arrangement (as defined in Code Section
401(k)), a simplified employee pension (as defined in Code Section
408(k)), a salary reduction arrangement (within the meaning of
Code Section 3121(a)(5)(D)), a deferred compensation plan under
Code Section 457(b), or a trust described in Code Section
501(c)(18) cumulatively exceed the limitation imposed by Code
Section 402(g) (as adjusted annually in accordance with the method
provided in Code Section 415(d) pursuant to Regulations) for such
Participant's taxable year, the Participant may, not later than
March 1 following the close of the Participant's taxable year,
notify the Administrator in writing of such excess and request
that his Deferred Compensation under this Plan be reduced by an
amount specified by the Participant. In such event, the
Administrator may direct the Trustee to distribute such excess
amount (and any Income allocable to such excess amount) to the
Participant not later than the first April 15th following the
close of the Participant's taxable year. Any distribution of less
than the entire amount of Excess Deferred Compensation and Income
shall be treated as a pro rata distribution of Excess Deferred
Compensation and Income. The amount distributed shall not exceed
the Participant's Deferred Compensation under the Plan for the
taxable year (and any Income allocable to such excess amount). Any
distribution on or before the last day of the Participant's
taxable year must satisfy each of the following conditions:
(1) the distribution must be made after the date on which
the Plan received the Excess Deferred Compensation;
(2) the Participant shall designate the distribution as
Excess Deferred Compensation; and
(3) the Plan must designate the distribution as a
distribution of Excess Deferred Compensation.
(g) Notwithstanding Section 4.2(f) above, a Participant's
Excess Deferred Compensation shall be reduced, but not below zero,
by any distribution of Excess Contributions pursuant to Section
4.6(a) for the Plan Year beginning with or within the taxable
year of the Participant.
(h) At Normal Retirement Date, or such other date when the
Participant shall be entitled to receive benefits, the fair market
value of the Participant's Elective Account shall be used to
provide additional benefits to the Participant or his Beneficiary.
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(i) Employer Elective Contributions made pursuant to this
Section may be segregated into a separate account for each
Participant in a federally insured savings account, certificate of
deposit in a bank or savings and loan association, money market
certificate, or other short-term debt security acceptable to the
Trustee until such time as the allocations pursuant to Section 4.4
have been made.
(j) The Employer and the Administrator shall implement the
salary reduction elections provided for herein in accordance with
the following:
(1) A Participant must make his initial salary deferral
election within a reasonable time, not to exceed thirty (30)
days, after entering the Plan pursuant to Section 3.2. If
the Participant fails to make an initial salary deferral
election within such time, then such Participant may
thereafter make an election in accordance with the rules
governing modifications. The Participant shall make such an
election by entering into a written salary reduction
agreement with the Employer and filing such agreement with
the Administrator. Such election shall initially be
effective beginning with the pay period following the
acceptance of the salary reduction agreement by the
Administrator, shall not have retroactive effect and shall
remain in force until revoked.
(2) A Participant may modify a prior election during the
Plan Year and concurrently make a new election by filing a
written notice with the Administrator within a reasonable
time before the pay period for which such modification is to
be effective. However, modifications to a salary deferral
election shall only be permitted quarterly, during election
periods established by the Administrator prior to the first
day of each Plan Year quarter. Any modification shall not
have retroactive effect and shall remain in force until
revoked.
(3) A Participant may elect to prospectively revoke his
salary reduction agreement in its entirety at any time
during the Plan Year by providing the Administrator with
thirty (30) days written notice of such revocation (or upon
such shorter notice period as may be acceptable to the
Administrator). Such revocation shall become effective as of
the beginning of the first pay period coincident with or
next following the expiration of the notice period.
Furthermore, the
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termination of the Participant's employment, or the
cessation of participation for any reason, shall be deemed
to revoke any salary reduction agreement then in effect,
effective immediately following the close of the pay period
within which such termination or cessation occurs.
4.3 TIME OF PAYMENT OF EMPLOYER CONTRIBUTION
The Employer shall generally pay to the Trustee its contribution
to the Plan for each Plan Year within the time prescribed by law, including
extensions of time, for the filing of the Employer federal income tax return for
the Fiscal Year.
However, Employer Elective Contributions accumulated through
payroll deductions shall be paid to the Trustee as of the earliest date on which
such contributions can reasonably be segregated from the Employer general
assets, but in any event within ninety (90) days from the date on which such
amounts would otherwise have been payable to the Participant in cash. The
provisions of Department of Labor regulations 2510.3-102 are incorporated herein
by reference. Furthermore, any additional Employer contributions which are
allocable to the Participant's Elective Account for a Plan Year shall be paid to
the Plan no later than the twelve-month period immediately following the close
of such Plan Year.
4.4 ALLOCATION OF CONTRIBUTION AND EARNINGS
(a) The Administrator shall establish and maintain an
account in the name of each Participant to which the Administrator
shall credit as of each Anniversary Date all amounts allocated to
each such Participant as set forth herein.
(b) The Employer shall provide the Administrator with all
information required by the Administrator to make a proper
allocation of the Employer contributions for each Plan Year.
Within a reasonable period of time after the date of receipt by
the Administrator of such information, the Administrator shall
allocate such contribution as follows:
(1) With respect to the Employer Elective Contribution made
pursuant to Section 4.1(a), to each Participant's Elective
Account in an amount equal to each such Participant's
Deferred Compensation for the year.
(2) With respect to the Employer Qualified Non-Elective
Contribution made pursuant to Section 4.1(b), to each
Participant's Elective Account in accordance with Section
4.1(b).
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Only Non-Highly Compensated Participants who have completed
a of Service during the Plan Year and are actively employed
on the last day of the Plan Year shall be eligible to share
in the Qualified Non-Elective Contribution for the year.
(c) For any Top Heavy Plan Year, Non-Key Employees not
otherwise eligible to share in the allocation of contributions as
provided above, shall receive the minimum allocation provided for
in Section 4.4(f) if eligible pursuant to the provisions of
Section 4.4(h).
(d) Notwithstanding the foregoing, Participants who are not
actively employed on the last day of the Plan Year due to
Retirement (Normal or Late), Total and Permanent Disability or
death shall share in the allocation of contributions for that Plan
Year.
(e) As of each Valuation Date, any earnings or losses (net
appreciation or net depreciation) of the Trust Fund shall be
allocated in the same proportion that each Participant's and
Former Participant's time weighted average (based on end of year
base) nonsegregated accounts bear to the total of all
Participants' and Former Participants' time weighted average
(based on end of year base) nonsegregated accounts as of such
date. Earnings or losses with respect to a Participant's Directed
Account shall be allocated in accordance with Section 4.10.
Participants' transfers from other qualified plans
deposited in the general Trust Fund shall share in any earnings
and losses (net appreciation or net depreciation) of the Trust
Fund in the same manner provided above. Each segregated account
maintained on behalf of a Participant shall be credited or charged
with its separate earnings and losses.
(f) Minimum Allocations Required for Top Heavy Plan Years:
Notwithstanding the foregoing, for any Top Heavy Plan Year, the
sum of the Employer contributions allocated to the Participant's
Elective Account of each Non-Key Employee shall be equal to at
least three percent (3%) of such Non-Key Employee's "415
Compensation" (reduced by contributions and forfeitures, if any,
allocated to each Non-Key Employee in any defined contribution
plan included with this plan in a Required Aggregation Group).
However, if (1) the sum of the Employer contributions allocated to
the Participant's Elective Account of each Key Employee for such
Top Heavy Plan Year is less than three percent (3%) of each Key
Employee's "415 Compensation" and (2) this Plan is not required to
be
29
<PAGE>
included in an Aggregation Group to enable a defined benefit plan
to meet the requirements of Code Section 401(a)(4) or 410, the sum
of the Employer contributions allocated to the Participant's
Elective Account of each Non-Key Employee shall be equal to the
largest percentage allocated to the Participant's Elective Account
of any Key Employee. However, in determining whether a Non-Key
Employee has received the required minimum allocation, such
Non-Key Employee's Deferred Compensation shall not be taken into
account.
However, no such minimum allocation shall be required
in this Plan for any Non-Key Employee who participates in another
defined contribution plan subject to Code Section 412 included
with this Plan in a Required Aggregation Group.
(g) For purposes of the minimum allocations set forth above,
the percentage allocated to the Participant's Elective Account of
any Key Employee shall be equal to the ratio of the sum of the
Employer contributions allocated on behalf of such Key Employee
divided by the "415 Compensation" for such Key Employee.
(h) For any Top Heavy Plan Year, the minimum allocations set
forth above shall be allocated to the Participant's Elective
Account of all Non-Key Employees who are Participants and who are
employed by the Employer on the last day of the Plan Year,
including Non-Key Employees who have (1) failed to complete a Year
of Service; and (2) declined to make mandatory contributions (if
required) or, in the case of a cash or deferred arrangement,
elective contributions to the Plan.
(i) For the purposes of this Section, "415 Compensation"
shall be limited to $150,000. Such amount shall be adjusted for
increases in the cost of living in accordance with Code Section
401(a)(17), except that the dollar increase in effect on January 1
of any calendar year shall be effective for the Plan Year
beginning with or within such calendar year. For any short Plan
Year the "415 Compensation" limit shall be an amount equal to the
"415 Compensation" limit for the calendar year in which the Plan
Year begins multiplied by the ratio obtained by dividing the
number of full months in the short Plan Year by twelve (12).
(j) Notwithstanding anything herein to the contrary,
Participants who terminated employment for any reason during the
Plan Year shall share in the
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salary reduction contributions made by the Employer for the year
of termination without regard to the Hours of Service credited.
(k) If a Former Participant is reemployed after five (5)
consecutive 1-Year Breaks in Service, then separate accounts shall
be maintained as follows:
(1) one account for nonforfeitable benefits
attributable to pre-break service; and
(2) one account representing his status in the Plan
attributable to post-break service.
4.5 ACTUAL DEFERRAL PERCENTAGE TESTS
(a) Maximum Annual Allocation: For each Plan Year, the
annual allocation derived from Employer Elective Contributions to
a Participant's Elective Account shall satisfy one of the
following tests:
(1) The "Actual Deferral Percentage" for the Highly
Compensated Participant group shall not be more than the
"Actual Deferral Percentage" of the Non-Highly Compensated
Participant group multiplied by 1.25, or
(2) The excess of the "Actual Deferral Percentage" for the
Highly Compensated Participant group over the "Actual
Deferral Percentage" for the Non-Highly Compensated
Participant group shall not be more than two percentage
points. Additionally, the "Actual Deferral Percentage" for
the Highly Compensated Participant group shall not exceed
the "Actual Deferral Percentage" for the Non-Highly
Compensated Participant group multiplied by 2. The
provisions of Code Section 401(k)(3) and Regulation
1.401(k)-1(b) are incorporated herein by reference.
However, in order to prevent the multiple use of the
alternative method described in (2) above and in Code
Section 401(m)(9)(A), any Highly Compensated Participant
eligible to make elective deferrals pursuant to Section 4.2
and to make Employee contributions or to receive matching
contributions under any other plan maintained by the
Employer or an Affiliated Employer shall have a combination
of his actual deferral ratio and his actual contribution
ratio reduced pursuant to Section 4.6(a) and Regulation
1.401(m)-2, the provisions of which are incorporated herein
by reference.
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(b) For the purposes of this Section "Actual Deferral
Percentage" means, with respect to the Highly Compensated
Participant group and Non-Highly Compensated Participant group for
a Plan Year, the average of the ratios, calculated separately for
each Participant in such group, of the amount of Employer Elective
Contributions allocated to each Participant's Elective Account for
such Plan Year, to such Participant's "414(s) Compensation" for
such Plan Year. The actual deferral ratio for each Participant and
the "Actual Deferral Percentage" for each group shall be
calculated to the nearest one-hundredth of one percent. Employer
Elective Contributions allocated to each Non-Highly Compensated
Participant's Elective Account shall be reduced by Excess Deferred
Compensation to the extent such excess amounts are made under this
Plan or any other plan maintained by the Employer.
(c) For the purpose of determining the actual deferral ratio
of a Highly Compensated Employee who is subject to the Family
Member aggregation rules of Code Section 414(q)(6) because such
Participant is either a "five percent owner" of the Employer or
one of the ten (10) Highly Compensated Employees paid the greatest
"415 Compensation" during the year, the following shall apply:
(1) The combined actual deferral ratio for the family group
(which shall be treated as one Highly Compensated
Participant) shall be determined by aggregating Employer
Elective Contributions and "414(s) Compensation" of all
eligible Family Members (including Highly Compensated
Participants). However, in applying the $150,000 limit to
"414(s) Compensation," Family Members shall include only the
affected Employee's spouse and any lineal descendants who
have not attained age 19 before the close of the Plan Year.
(2) The Employer Elective Contributions and "414(s)
Compensation" of all Family Members shall be disregarded for
purposes of determining the "Actual Deferral Percentage" of
the Non-Highly Compensated Participant group except to the
extent taken into account in paragraph (1) above.
(3) If a Participant is required to be aggregated as a
member of more than one family group in a plan, all
Participants who are members of those family groups that
include the Participant are aggregated as one family group
in accordance with paragraphs (1) and (2) above.
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(d) For the purposes of Sections 4.5(a) and 4.6, a Highly
Compensated Participant and a Non-Highly Compensated Participant
shall include any Employee eligible to make a deferral election
pursuant to Section 4.2, whether or not such deferral election was
made or suspended pursuant to Section 4.2.
(e) For the purposes of this Section and Code Sections
401(a)(4), 410(b) and 401(k), if two or more plans which include
cash or deferred arrangements are considered one plan for the
purposes of Code Section 401(a)(4) or 410(b) (other than Code
Section 410(b)(2)(A)(ii)), the cash or deferred arrangements
included in such plans shall be treated as one arrangement. In
addition, two or more cash or deferred arrangements may be
considered as a single arrangement for purposes of determining
whether or not such arrangements satisfy Code Sections 401(a)(4),
410(b) and 401(k). In such a case, the cash or deferred
arrangements included in such plans and the plans including such
arrangements shall be treated as one arrangement and as one plan
for purposes of this Section and Code Sections 401(a)(4), 410(b)
and 401(k). Plans may be aggregated under this paragraph (e) only
if they have the same plan year.
Notwithstanding the above, an employee stock ownership
plan described in Code Section 4975(e)(7) or 409 may not be
combined with this Plan for purposes of determining whether the
employee stock ownership plan or this Plan satisfies this Section
and Code Sections 401(a)(4), 410(b) and 401(k).
(f) For the purposes of this Section, if a Highly
Compensated Participant is a Participant under two or more cash or
deferred arrangements (other than a cash or deferred arrangement
which is part of an employee stock ownership plan as defined in
Code Section 4975(e)(7) or 409) of the Employer or an Affiliated
Employer, all such cash or deferred arrangements shall be treated
as one cash or deferred arrangement for the purpose of determining
the actual deferral ratio with respect to such Highly Compensated
Participant. However, if the cash or deferred arrangements have
different plan years, this paragraph shall be applied by treating
all cash or deferred arrangements ending with or within the same
calendar year as a single arrangement.
4.6 ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS
In the event that the initial allocations of the Employer Elective
Contributions made pursuant to Section 4.4 do not satisfy one of the tests set
forth in Section 4.5(a), the
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Administrator shall adjust Excess Contributions pursuant to the options set
forth below:
(a) On or before the fifteenth day of the third month
following the end of each Plan Year, the Highly Compensated
Participant having the highest actual deferral ratio shall have
his portion of Excess Contributions distributed to him until one
of the tests set forth in Section 4.5(a) is satisfied, or until
his actual deferral ratio equals the actual deferral ratio of the
Highly Compensated Participant having the second highest actual
deferral ratio. This process shall continue until one of the tests
set forth in Section 4.5(a) is satisfied. For each Highly
Compensated Participant, the amount of Excess Contributions is
equal to the Elective Contributions used to satisfy the "Actual
Deferral Percentage" tests on behalf of such Highly Compensated
Participant (determined prior to the application of this
paragraph) minus the amount determined by multiplying the Highly
Compensated Participant's actual deferral ratio (determined after
application of this paragraph) by his "414(s) Compensation."
However, in determining the amount of Excess Contributions to be
distributed with respect to an affected Highly Compensated
Participant as determined herein, such amount shall be reduced
pursuant to Section 4.2(f) by any Excess Deferred Compensation
previously distributed to such affected Highly Compensated
Participant for his taxable year ending with or within such Plan
Year.
(1) With respect to the distribution of Excess Contributions
pursuant to (a) above, such distribution:
(i) may be postponed but not later than the close of
the Plan Year following the Plan Year to which they
are allocable;
(ii) shall be adjusted for Income; and
(iii) shall be designated by the Employer as a
distribution of Excess Contributions (and Income).
(2) Any distribution of less than the entire amount of
Excess Contributions shall be treated as a pro rata
distribution of Excess
Contributions and Income.
(3) The determination and correction of Excess Contributions
of a Highly Compensated Participant whose actual deferral
ratio is determined under the family aggregation rules shall
be
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accomplished by reducing the actual deferral ratio as
required herein, and the Excess Contributions for the family
unit shall then be allocated among the Family Members in
proportion to the Elective Contributions of each Family
Member that were combined to determine the group actual
deferral ratio.
(b) Within twelve (12) months after the end of the Plan
Year, the Employer may make a special Qualified Non-Elective
Contribution on behalf of Non-Highly Compensated Participants
electing salary reductions pursuant to Section 4.2 in an amount
sufficient to satisfy one of the tests set forth in Section
4.5(a). Such contribution shall be allocated to the Participant's
Elective Account of each Non-Highly Compensated Participant
electing salary reductions pursuant to Section 4.2 in the same
proportion that each such Non-Highly Compensated Participant's
Deferred Compensation for the year bears to the total Deferred
Compensation of all such Non-Highly Compensated Participants.
(c) If during a Plan Year the projected aggregate amount of
Elective Contributions to be allocated to all Highly Compensated
Participants under this Plan would, by virtue of the tests set
forth in Section 4.5(a), cause the Plan to fail such tests, then
the Administrator may automatically reduce proportionately or in
the order provided in Section 4.6(a) each affected Highly
Compensated Participant's deferral election made pursuant to
Section 4.2 by an amount necessary to satisfy one of the tests set
forth in Section 4.5(a).
4.7 MAXIMUM ANNUAL ADDITIONS
(a) Notwithstanding the foregoing, the maximum "annual
additions" credited to a Participant's accounts for any
"limitation year" shall equal the lesser of: (1) $30,000 adjusted
annually as provided in Code Section 415(d) pursuant to the
Regulations, or (2) twenty-five percent (25%) of the Participant's
"415 Compensation" for such "limitation year." For any short
"limitation year," the dollar limitation in (1) above shall be
reduced by a fraction, the numerator of which is the number of
full months in the short "limitation year" and the denominator of
which is twelve (12).
(b) For purposes of applying the limitations of Code Section
415, "annual additions" means the sum credited to a Participant's
accounts for any "limitation year" of (1) Employer contributions,
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(2) Employee contributions, (3) forfeitures, (4) amounts
allocated, after March 31, 1984, to an individual medical account,
as defined in Code Section 415(l)(2) which is part of a pension or
annuity plan maintained by the Employer and (5) 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 Code Section 419A(d)(3)) under a
welfare benefit plan (as defined in Code Section 419(e))
maintained by the Employer. Except, however, the "415
Compensation" percentage limitation referred to in paragraph
(a)(2) above shall not apply to: (1) any contribution for medical
benefits (within the meaning of Code Section 419A(f)(2)) after
separation from service which is otherwise treated as an "annual
addition," or (2) any amount otherwise treated as an "annual
addition" under Code Section 415(l)(1).
(c) For purposes of applying the limitations of Code Section
415, the transfer of funds from one qualified plan to another is
not an "annual addition." In addition, the following are not
Employee contributions for the purposes of Section 4.7(b)(2): (1)
rollover contributions (as defined in Code Sections 402(e)(6),
403(a)(4), 403(b)(8) and 408(d)(3)); (2) repayments of loans made
to a Participant from the Plan; (3) repayments of distributions
received by an Employee pursuant to Code Section 411(a)(7)(B)
(cash-outs); (4) repayments of distributions received by an
Employee pursuant to Code Section 411(a)(3)(D) (mandatory
contributions); and (5) Employee contributions to a simplified
employee pension excludable from gross income under Code Section
408(k)(6).
(d) For purposes of applying the limitations of Code Section
415, the "limitation year" shall be the Plan Year.
(e) For the purpose of this Section, all qualified defined
benefit plans (whether terminated or not) ever maintained by the
Employer shall be treated as one defined benefit plan, and all
qualified defined contribution plans (whether terminated or not)
ever maintained by the Employer shall be treated as one defined
contribution plan.
(f) For the purpose of this Section, if the Employer is a
member of a controlled group of corporations, trades or businesses
under common control (as defined by Code Section 1563(a) or Code
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Section 414(b) and (c) as modified by Code Section 415(h)), is a
member of an affiliated service group (as defined by Code Section
414(m)), or is a member of a group of entities required to be
aggregated pursuant to Regulations under Code Section 414(o), all
Employees of such Employers shall be considered to be employed by
a single Employer.
(g) For the purpose of this Section, if this Plan is a Code
Section 413(c) plan, each Employer who maintains this Plan will be
considered to be a separate Employer.
(h)(1) If a Participant participates in more than one
defined contribution plan maintained by the Employer which have
different Anniversary Dates, the maximum "annual additions" under
this Plan shall equal the maximum "annual additions" for the
"limitation year" minus any "annual additions" previously credited
to such Participant's accounts during the "limitation year."
(2) If a Participant participates in both a defined
contribution plan subject to Code Section 412 and a defined
contribution plan not subject to Code Section 412 maintained
by the Employer which have the same Anniversary Date,
"annual additions" will be credited to the Participant's
accounts under the defined contribution plan subject to Code
Section 412 prior to crediting "annual additions" to the
Participant's accounts under the defined contribution plan
not subject to Code Section 412.
(3) If a Participant participates in more than one defined
contribution plan not subject to Code Section 412 maintained
by the Employer which have the same Anniversary Date, the
maximum "annual additions" under this Plan shall equal the
product of (A) the maximum "annual additions" for the
"limitation year" minus any "annual additions" previously
credited under subparagraphs (1) or (2) above, multiplied by
(B) a fraction (i) the numerator of which is the "annual
additions" which would be credited to such Participant's
accounts under this Plan without regard to the limitations
of Code Section 415 and (ii) the denominator of which is
such "annual additions" for all plans described in this
subparagraph.
(i) If an Employee is (or has been) a
Participant in one or more defined benefit plans and
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one or more defined contribution plans maintained by the Employer,
the sum of the defined benefit plan fraction and the defined
contribution plan fraction for any "limitation year" may not
exceed 1.0.
(j) The defined benefit plan fraction for any "limitation
year" is a fraction, the numerator of which is the sum of the
Participant's projected annual benefits under all the defined
benefit plans (whether or not terminated) maintained by the
Employer, and the denominator of which is the lesser of 125
percent of the dollar limitation determined for the "limitation
year" under Code Sections 415(b) and (d) or 140 percent of the
highest average compensation, including any adjustments under Code
Section 415(b).
Notwithstanding the above, if the Participant was a
Participant as of the first day of the first "limitation year"
beginning after December 31, 1986, in one or more defined benefit
plans maintained by the Employer which were in existence on May 6,
1986, the denominator of this fraction will not be less than 125
percent of the sum of the annual benefits under such plans which
the Participant had accrued as of the close of the last
"limitation year" beginning before January 1, 1987, disregarding
any changes in the terms and conditions of the plan after May 5,
1986. The preceding sentence applies only if the defined benefit
plans individually and in the aggregate satisfied the requirements
of Code Section 415 for all "limitation years" beginning before
January 1, 1987.
(k) The defined contribution plan fraction for any
"limitation year" is a fraction, the numerator of which is the sum
of the annual additions to the Participant's Account under all the
defined contribution plans (whether or not terminated) maintained
by the Employer for the current and all prior "limitation years"
(including the annual additions attributable to the Participant's
nondeductible Employee contributions to all defined benefit plans,
whether or not terminated, maintained by the Employer, and the
annual additions attributable to all welfare benefit funds, as
defined in Code Section 419(e), and individual medical accounts,
as defined in Code Section 415(l)(2), maintained by the Employer),
and the denominator of which is the sum of the maximum aggregate
amounts for the current and all prior "limitation years" of
service with the Employer (regardless of whether a defined
contribution plan was maintained by the Employer). The maximum
aggregate amount in any "limitation year" is the lesser of 125
percent of the dollar limitation determined under Code
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Sections 415(b) and (d) in effect under Code Section 415(c)(1)(A)
or 35 percent of the Participant's Compensation for such year.
If the Employee was a Participant as of the end of the
first day of the first "limitation year" beginning after December
31, 1986, in one or more defined contribution plans maintained by
the Employer which were in existence on May 6, 1986, the numerator
of this fraction will be adjusted if the sum of this fraction and
the defined benefit fraction would otherwise exceed 1.0 under the
terms of this Plan. Under the adjustment, an amount equal to the
product of (1) the excess of the sum of the fractions over 1.0
times (2) the denominator of this fraction, will be permanently
subtracted from the numerator of this fraction. The adjustment is
calculated using the fractions as they would be computed as of the
end of the last "limitation year" beginning before January 1,
1987, and disregarding any changes in the terms and conditions of
the Plan made after May 5, 1986, but using the Code Section 415
limitation applicable to the first "limitation year" beginning on
or after January 1, 1987. The annual addition for any "limitation
year" beginning before January 1, 1987 shall not be recomputed to
treat all Employee contributions as annual additions.
(l) Notwithstanding anything contained in this Section to
the contrary, the limitations, adjustments and other requirements
prescribed in this Section shall at all times comply with the
provisions of Code Section 415 and the Regulations thereunder, the
terms of which are specifically incorporated herein by reference.
4.8 ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS
(a) If, as a result of a reasonable error in estimating a
Participant's Compensation, a reasonable error in determining the
amount of elective deferrals (within the meaning of Code Section
402(g)(3)) that may be made with respect to any Participant under
the limits of Section 4.7 or other facts and circumstances to
which Regulation 1.415-6(b)(6) shall be applicable, the "annual
additions" under this Plan would cause the maximum "annual
additions" to be exceeded for any Participant, the Administrator
shall (1) distribute any elective deferrals (within the meaning of
Code Section 402(g)(3)) or return any Employee contributions
(whether voluntary or mandatory), and for the distribution of
gains attributable to those elective deferrals and Employee
contributions, to the extent that the distribution or return would
reduce
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the "excess amount" in the Participant's accounts (2) hold any
"excess amount" remaining after the return of any elective
deferrals or voluntary Employee contributions in a "Section 415
suspense account" (3) use the "Section 415 suspense account" in
the next "limitation year" (and succeeding "limitation years" if
necessary) to reduce Employer contributions for that Participant
if that Participant is covered by the Plan as of the end of the
"limitation year," or if the Participant is not so covered,
allocate and reallocate the "Section 415 suspense account" in the
next "limitation year" (and succeeding "limitation years" if
necessary) to all Participants in the Plan before any Employer or
Employee contributions which would constitute "annual additions"
are made to the Plan for such "limitation year" (4) reduce
Employer contributions to the Plan for such "limitation year" by
the amount of the "Section 415 suspense account" allocated and
reallocated during such "limitation year."
(b) For purposes of this Article, "excess amount" for any
Participant for a "limitation year" shall mean the excess, if any,
of (1) the "annual additions" which would be credited to his
account under the terms of the Plan without regard to the
limitations of Code Section 415 over (2) the maximum "annual
additions" determined pursuant to Section 4.7.
(c) For purposes of this Section, "Section 415 suspense
account" shall mean an unallocated account equal to the sum of
"excess amounts" for all Participants in the Plan during the
"limitation year." The "Section 415 suspense account" shall not
share in any earnings or losses of the Trust Fund.
4.9 TRANSFERS FROM QUALIFIED PLANS
(a) With the consent of the Administrator, amounts may be
transferred from other qualified plans by Participants, provided
that the trust from which such funds are transferred permits the
transfer to be made and the transfer will not jeopardize the tax
exempt status of the Plan or Trust or create adverse tax
consequences for the Employer. The amounts transferred shall be
set up in a separate account herein referred to as a
"Participant's Rollover Account." Such account shall be fully
Vested at all times and shall not be subject to Forfeiture for any
reason.
(b) Amounts in a Participant's Rollover Account shall be
held by the Trustee pursuant to the provisions of this Plan and
may not be withdrawn by,
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or distributed to the Participant, in whole or in part, except as
provided in Section 6.10 and paragraphs (c) and (d) of this
Section.
(c) Except as permitted by Regulations (including Regulation
1.411(d)-4), amounts attributable to elective contributions (as
defined in Regulation 1.401(k)-1(g)(3)), including amounts treated
as elective contributions, which are transferred from another
qualified plan in a plan-to-plan transfer shall be subject to the
distribution limitations provided for in Regulation 1.401(k)-1(d).
(d) At Normal Retirement Date, or such other date when the
Participant or his Beneficiary shall be entitled to receive
benefits, the fair market value of the Participant's Rollover
Account shall be used to provide additional benefits to the
Participant or his Beneficiary. Any distributions of amounts held
in a Participant's Rollover Account shall be made in a manner
which is consistent with and satisfies the provisions of Section
6.5, including, but not limited to, all notice and consent
requirements of Code Section 411(a)(11) and the Regulations
thereunder. Furthermore, such amounts shall be considered as part
of a Participant's benefit in determining whether an involuntary
cash-out of benefits without Participant consent may be made.
(e) The Administrator may direct that employee transfers
made after a valuation date be segregated into a separate account
for each Participant in a federally insured savings account,
certificate of deposit in a bank or savings and loan association,
money market certificate, or other short term debt security
acceptable to the Trustee until such time as the allocations
pursuant to this Plan have been made, at which time they may
remain segregated or be invested as part of the general Trust
Fund, to be determined by the Administrator.
(f) For purposes of this Section, the term "qualified plan"
shall mean any tax qualified plan under Code Section 401(a). The
term "amounts transferred from other qualified plans" shall mean:
(i) amounts transferred to this Plan directly from another
qualified plan; (ii) distributions from another qualified plan
which are eligible rollover distributions and which are either
transferred by the Employee to this Plan within sixty (60) days
following his receipt thereof or are transferred pursuant to a
direct rollover; (iii) amounts transferred to this Plan from a
conduit individual retirement account
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provided that the conduit individual retirement account has no
assets other than assets which (A) were previously distributed to
the Employee by another qualified plan as a lump-sum distribution
(B) were eligible for tax-free rollover to a qualified plan and
(C) were deposited in such conduit individual retirement account
within sixty (60) days of receipt thereof and other than earnings
on said assets; and (iv) amounts distributed to the Employee from
a conduit individual retirement account meeting the requirements
of clause (iii) above, and transferred by the Employee to this
Plan within sixty (60) days of his receipt thereof from such
conduit individual retirement account.
(g) Prior to accepting any transfers to which this Section
applies, the Administrator may require the Employee to establish
that the amounts to be transferred to this Plan meet the
requirements of this Section and may also require the Employee to
provide an opinion of counsel satisfactory to the Employer that
the amounts to be transferred meet the requirements of this
Section.
(h) This Plan shall not accept any direct or indirect
transfers (as that term is defined and interpreted under Code
Section 401(a)(11) and the Regulations thereunder) from a defined
benefit plan, money purchase plan (including a target benefit
plan), stock bonus or profit sharing plan which would otherwise
have provided for a life annuity form of payment to the
Participant.
(i) Notwithstanding anything herein to the contrary, a
transfer directly to this Plan from another qualified plan (or a
transaction having the effect of such a transfer) shall only be
permitted if it will not result in the elimination or reduction of
any "Section 411(d)(6) protected benefit" as described in Section
8.1.
4.10 DIRECTED INVESTMENT ACCOUNT
(a) Participants may, subject to a procedure established by
the Administrator (the Participant Direction Procedures) and
applied in a uniform nondiscriminatory manner, direct the Trustee
to invest all of their accounts in specific assets, specific funds
or other investments permitted under the Plan and the Participant
Direction Procedures. That portion of the interest of any
Participant so directing will thereupon be considered a
Participant's Directed Account.
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(b) As of each Valuation Date, all Participant Directed
Accounts shall be charged or credited with the net earnings,
gains, losses and expenses as well as any appreciation or
depreciation in the market value using publicly listed fair market
values when available or appropriate.
(1) To the extent that the assets in a Participant's
Directed Account are accounted for as pooled assets or
investments, the allocation of earnings, gains and losses of
each Participant's Directed Account shall be based upon the
total amount of funds so invested, in a manner proportionate
to the Participant's share of such pooled investment.
(2) To the extent that the assets in the Participant's
Directed Account are accounted for as segregated assets, the
allocation of earnings, gains and losses from such assets
shall be made on a separate and distinct basis.
(c) The Participant Direction Procedures shall provide an
explanation of the circumstances under which Participants and
their Beneficiaries may give investment instructions, including,
but need not be limited to, the following:
(1) the conveyance of instructions by the Participants and
their Beneficiaries to invest Participant Directed Accounts
in Directed
Investments;
(2) the name, address and phone number of the Fiduciary
(and, if applicable, the person or persons designated by the
Fiduciary to act on its behalf) responsible for providing
information to the Participant or a Beneficiary upon request
relating to the investments in Directed Investments;
(3) applicable restrictions on transfers to and from any
Designated Investment Alternative;
(4) any restrictions on the exercise of voting, tender and
similar rights related to a Directed Investment by the
Participants or their Beneficiaries;
(5) a description of any transaction fees and expenses which
affect the balances in Participant Directed Accounts in
connection with the purchase or sale of Directed
Investments; and
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(6) general procedures for the dissemination of investment
and other information relating to the Designated Investment
Alternatives as deemed necessary or appropriate, including
but not limited to a description of the following:
(i) the investment vehicles available under the Plan,
including specific information regarding any
Designated Investment
Alternative;
(ii) any designated Investment Managers; and
(iii) a description of the additional information
which may be obtained upon request from the Fiduciary
designated to provide such information.
(d) Any information regarding investments available under
the Plan, to the extent not required to be described in the
Participant Direction Procedures, may be provided to the
Participant in one or more written documents which are separate
from the Participant Direction Procedures and are not thereby
incorporated by reference into this Plan.
(e) The Administrator may, at its discretion, include in or
exclude by amendment or other action from the Participant
Direction Procedures such instructions, guidelines or policies as
it deems necessary or appropriate to ensure proper administration
of the Plan, and may interpret the same accordingly.
ARTICLE V
VALUATIONS
5.1 VALUATION OF THE TRUST FUND
The Administrator shall direct the Trustee, as of each Valuation
Date, to determine the net worth of the assets comprising the Trust Fund as it
exists on the Valuation Date. In determining such net worth, the Trustee shall
value the assets comprising the Trust Fund at their fair market value as of the
Valuation Date and shall deduct all expenses for which the Trustee has not yet
obtained reimbursement from the Employer or the Trust Fund. The Trustee may
update the value of any shares held in the Participant Directed Account by
reference to the number of shares held by that Participant, priced at the market
value as of the Valuation Date.
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5.2 METHOD OF VALUATION
In determining the fair market value of securities held in the
Trust Fund which are listed on a registered stock exchange, the Administrator
shall direct the Trustee to value the same at the prices they were last traded
on such exchange preceding the close of business on the Valuation Date. If such
securities were not traded on the Valuation Date, or if the exchange on which
they are traded was not open for business on the Valuation Date, then the
securities shall be valued at the prices at which they were last traded prior to
the Valuation Date. Any unlisted security held in the Trust Fund shall be valued
at its bid price next preceding the close of business on the Valuation Date,
which bid price shall be obtained from a registered broker or an investment
banker. In determining the fair market value of assets other than securities for
which trading or bid prices can be obtained, the Trustee may appraise such
assets itself, or in its discretion, employ one or more appraisers for that
purpose and rely on the values established by such appraiser or appraisers.
ARTICLE VI
DETERMINATION AND DISTRIBUTION OF BENEFITS
6.1 DETERMINATION OF BENEFITS UPON RETIREMENT
Every Participant may terminate his employment with the Employer
and retire for the purposes hereof on his Normal Retirement Date. However, a
Participant may postpone the termination of his employment with the Employer to
a later date, in which event the participation of such Participant in the Plan,
including the right to receive allocations pursuant to Section 4.4, shall
continue until his Late Retirement Date. Upon a Participant's Retirement Date or
attainment of his Normal Retirement Date without termination of employment with
the Employer, or as soon thereafter as is practicable, the Trustee shall
distribute, at the election of the Participant, all amounts credited to such
Participant's Elective Account in accordance with Section 6.5.
6.2 DETERMINATION OF BENEFITS UPON DEATH
(a) Upon the death of a Participant before his Retirement
Date or other termination of his employment, all amounts credited
to such Participant's Elective Account shall become fully Vested.
The Administrator shall direct the Trustee, in accordance with the
provisions of Sections 6.6 and 6.7, to distribute the value of the
deceased Participant's accounts to the Participant's Beneficiary.
(b) Upon the death of a Former Participant, the
Administrator shall direct the Trustee, in accordance with the
provisions of Sections 6.6 and 6.7, to
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distribute any remaining Vested amounts credited to the accounts
of a deceased Former Participant to such Former Participant's
Beneficiary.
(c) Any security interest held by the Plan by reason of an
outstanding loan to the Participant or Former Participant shall be
taken into account in determining the amount of the death benefit.
(d) The Administrator may require such proper proof of death
and such evidence of the right of any person to receive payment of
the value of the account of a deceased Participant or Former
Participant as the Administrator may deem desirable. The
Administrator's determination of death and of the right of any
person to receive payment shall be conclusive.
(e) The Beneficiary of the death benefit payable pursuant to
this Section shall be the Participant's spouse. Except, however,
the Participant may designate a Beneficiary other than his spouse
if:
(1) the spouse has waived the right to be the
Participant's Beneficiary, or
(2) the Participant is legally separated or has been
abandoned (within the meaning of local law) and the
Participant has a court order to such effect (and there is
no "qualified domestic relations order" as defined in Code
Section 414(p) which provides otherwise), or
(3) the Participant has no spouse, or
(4) the spouse cannot be located.
In such event, the designation of a Beneficiary shall
be made on a form satisfactory to the Administrator. A Participant
may at any time revoke his designation of a Beneficiary or change
his Beneficiary by filing written notice of such revocation or
change with the Administrator. However, the Participant's spouse
must again consent in writing to any change in Beneficiary unless
the original consent acknowledged that the spouse had the right to
limit consent only to a specific Beneficiary and that the spouse
voluntarily elected to relinquish such right. In the event no
valid designation of Beneficiary exists at the time of the
Participant's death, the death benefit shall be payable to his
estate.
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(f) Any consent by the Participant's spouse to waive any
rights to the death benefit must be in writing, must acknowledge
the effect of such waiver, and be witnessed by a Plan
representative or a notary public. Further, the spouse's consent
must be irrevocable and must acknowledge the specific nonspouse
Beneficiary.
6.3 DETERMINATION OF BENEFITS IN EVENT OF DISABILITY
In the event of a Participant's Total and Permanent Disability
prior to his Retirement Date or other termination of his employment, all amounts
credited to such Participant's Elective Account shall become fully Vested. In
the event of a Participant's Total and Permanent Disability, the Trustee, in
accordance with the provisions of Sections 6.5 and 6.7, shall distribute to such
Participant all amounts credited to such Participant's Elective Account as
though he had retired.
6.4 DETERMINATION OF BENEFITS UPON TERMINATION
(a) If a Participant's employment with the Employer is
terminated for any reason other than death, Total and Permanent
Disability or retirement, such Participant shall be entitled to
such benefits as are provided hereinafter pursuant to this Section
6.4.
Distribution of the funds due to a Terminated
Participant shall be made on the occurrence of an event which
would result in the distribution had the Terminated Participant
remained in the employ of the Employer (upon the Participant's
death, Total and Permanent Disability or Normal Retirement).
However, at the election of the Participant, the Administrator
shall direct the Trustee to cause the entire Vested portion of the
Terminated Participant's Elective Account to be payable to such
Terminated Participant. Any distribution under this paragraph
shall be made in a manner which is consistent with and satisfies
the provisions of Section 6.5, including, but not limited to, all
notice and consent requirements of Code Section 411(a)(11) and the
Regulations thereunder.
If the value of a Terminated Participant's Vested
benefit derived from Employer and Employee contributions does not
exceed $3,500 and has never exceeded $3,500 at the time of any
prior distribution, the Administrator shall direct the Trustee to
cause the entire Vested benefit to be paid to such Participant in
a single lump sum.
For purposes of this Section 6.4, if the
value of a Terminated Participant's Vested benefit is
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zero, the Terminated Participant shall be deemed to have received
a distribution of such Vested benefit.
(b) The Vested portion of any Participant's Account shall be
a percentage of the total amount credited to his Participant's
Account determined on the basis of the Participant's number of
Years of Service according to the following schedule:
Vesting Schedule
Years of Service Percentage
Less than 2
2 20 %
3 40 %
4 60 %
5 80 %
6 100 %
(c) Notwithstanding the vesting schedule above, the Vested
percentage of a Participant's Account shall not be less than the
Vested percentage attained as of the later of the effective date
or adoption date of this amendment and restatement.
(d) Notwithstanding the vesting schedule above, upon the
complete discontinuance of the Employer contributions to the Plan
or upon any full or partial termination of the Plan, all amounts
credited to the account of any affected Participant shall become
100% Vested and shall not thereafter be subject to Forfeiture.
(e) The computation of a Participant's nonforfeitable
percentage of his interest in the Plan shall not be reduced as the
result of any direct or indirect amendment to this Plan. For this
purpose, the Plan shall be treated as having been amended if the
Plan provides for an automatic change in vesting due to a change
in top heavy status. In the event that the Plan is amended to
change or modify any vesting schedule, a Participant with at least
three (3) Years of Service as of the expiration date of the
election period may elect to have his nonforfeitable percentage
computed under the Plan without regard to such amendment. If a
Participant fails to make such election, then such Participant
shall be subject to the new vesting schedule. The Participant's
election period shall commence on the adoption date of the
amendment and shall end 60 days after the latest of:
(1) the adoption date of the amendment,
(2) the effective date of the amendment, or
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(3) the date the Participant receives written notice of the
amendment from the Employer or Administrator.
(f)(1) If any Former Participant shall be reemployed by the
Employer before a 1-Year Break in Service occurs, he shall
continue to participate in the Plan in the same manner as if such
termination had not occurred.
(2) If any Former Participant shall be reemployed by the
Employer before five (5) consecutive 1-Year Breaks in
Service, and such Former Participant had received, or was
deemed to have received, a distribution of his entire Vested
interest prior to his reemployment, his forfeited account
shall be reinstated only if he repays the full amount
distributed to him before the earlier of five (5) years
after the first date on which the Participant is
subsequently reemployed by the Employer or the close of the
first period of five (5) consecutive 1-Year Breaks in
Service commencing after the distribution, or in the event
of a deemed distribution, upon the reemployment of such
Former Participant. In the event the Former Participant does
repay the full amount distributed to him, or in the event of
a deemed distribution, the undistributed portion of the
Participant's Account must be restored in full, unadjusted
by any gains or losses occurring subsequent to the Valuation
Date coinciding with or preceding his termination. The
source for such reinstatement shall first be any Forfeitures
occurring during the year. If such source is insufficient,
then the Employer shall contribute an amount which is
sufficient to restore any such forfeited Accounts.
(3) If any Former Participant is reemployed after a 1-Year
Break in Service has occurred, Years and Periods of Service
shall include Years and Periods of Service prior to his
1-Year Break in Service subject to the following rules:
(i) If a Former Participant has a 1-Year Break in
Service, his pre-break and post-break service shall be
used for computing Years and Periods of Service for
eligibility and for vesting purposes only after he has
been employed for one (1) Year or Period of Service,
whichever is applicable, following the date of his
reemployment with the Employer;
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(ii) Any Former Participant who under the Plan does
not have a nonforfeitable right to any interest in the
Plan resulting from Employer contributions shall lose
credits otherwise allowable under (i) above if his
consecutive 1-Year Breaks in Service equal or exceed
the greater of (A) five (5) or (B) the aggregate
number of his pre-break Years or Periods of Service,
whichever is applicable;
(iii) After five (5) consecutive 1-Year Breaks in
Service, a Former Participant's Vested Account balance
attributable to pre-break service shall not be
increased as a result of post-break service;
(iv) If a Former Participant is reemployed by the
Employer, he shall participate in the Plan immediately
on his date of reemployment;
(v) If a Former Participant (a 1-Year Break in Service
previously occurred, but employment had not
terminated) is credited with an Hour of Service after
the first eligibility computation period in which he
incurs a 1-Year Break in Service, he shall participate
in the Plan immediately.
(g) In determining Years of Service for purposes of vesting
under the Plan, Years of Service prior to the vesting computation
period in which an Employee attained his eighteenth birthday shall
be excluded.
6.5 DISTRIBUTION OF BENEFITS
(a) The Administrator, pursuant to the election of the
Participant, shall direct the Trustee to distribute to a
Participant or his Beneficiary any amount to which he is entitled
under the Plan in one or more of the following methods:
(1) One lump-sum payment in cash.
(2) Payments over a period certain in monthly, quarterly,
semiannual, or annual cash installments. In order to provide
such installment payments, the Administrator may (A)
segregate the aggregate amount thereof in a separate,
federally insured savings account, certificate of deposit in
a bank or savings and loan association, money market
certificate or other liquid short-term security or (B)
purchase
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a nontransferable annuity contract for a term certain (with
no life contingencies) providing for such payment. The
period over which such payment is to be made shall not
extend beyond the Participant's life expectancy (or the life
expectancy of the Participant and his designated
Beneficiary).
(b) Any distribution to a Participant who has a benefit
which exceeds, or has ever exceeded, $3,500 at the time of any
prior distribution shall require such Participant's consent if
such distribution commences prior to the later of his Normal
Retirement Age or age 62. With regard to this required consent:
(1) The Participant must be informed of his right to defer
receipt of the distribution. If a Participant fails to
consent, it shall be deemed an election to defer the
commencement of payment of any benefit. However, any
election to defer the receipt of benefits shall not apply
with respect to distributions which are required under
Section 6.5(c).
(2) Notice of the rights specified under this paragraph
shall be provided no less than 30 days and no more than 90
days before the date the distribution commences.
(3) Written consent of the Participant to the distribution
must not be made before the Participant receives the notice
and must not be made more than 90 days before the date the
distribution commences.
(4) No consent shall be valid if a significant detriment is
imposed under the Plan on any Participant who does not
consent to the distribution.
Any such distribution may commence less than 30 days after
the notice required under Regulation 1.411(a)-11(c) is given,
provided that: (1) the Administrator clearly informs the
Participant that the Participant has a right to a period of at
least 30 days after receiving the notice to consider the decision
of whether or not to elect a distribution (and, if applicable, a
particular distribution option), and (2) the Participant, after
receiving the notice, affirmatively elects a distribution.
(c) Notwithstanding any provision in the Plan to the
contrary, the distribution of a Participant's benefits shall be
made in accordance with the
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following requirements and shall otherwise comply with Code
Section 401(a)(9) and the Regulations thereunder (including
Regulation 1.401(a)(9)-2), the provisions of which are
incorporated herein by reference:
(1) A Participant's benefits shall be distributed or must
begin to be distributed to him not later than April 1st of
the calendar year following the later of (i) the calendar
year in which the Participant attains age 70 1/2 or (ii) the
calendar year in which the Participant retires, provided,
however, that this clause (ii) shall not apply in the case
of a Participant who is a "five (5) percent owner" at any
time during the five (5) Plan Year period ending in the
calendar year in which he attains age 70 1/2 or, in the case
of a Participant who becomes a "five (5) percent owner"
during any subsequent Plan Year, clause (ii) shall no longer
apply and the required beginning date shall be the April 1st
of the calendar year following the calendar year in which
such subsequent Plan Year ends. Such distributions shall be
equal to or greater than any required distribution.
Notwithstanding the foregoing, clause (ii) above shall not
apply to any Participant unless the Participant had attained
age 70 1/2 before January 1, 1988 and was not a "five (5)
percent owner" at any time during the Plan Year ending with
or within the calendar year in which the Participant
attained age 66 1/2 or any subsequent Plan Year.
Alternatively, distributions to a Participant must begin no
later than the applicable April 1st as determined under the
preceding paragraph and must be made over a period certain
measured by the life expectancy of the Participant (or the
life expectancies of the Participant and his designated
Beneficiary) in accordance with Regulations.
(2) Distributions to a Participant and his Beneficiaries
shall only be made in accordance with the incidental death
benefit requirements of Code Section 401(a)(9)(G) and the
Regulations
thereunder.
(d) For purposes of this Section, the life expectancy of a
Participant and a Participant's spouse shall not be redetermined
in accordance with Code Section 401(a)(9)(D). Life expectancy and
joint and last survivor expectancy shall be computed using the
return multiples in Tables V and VI of Regulation 1.72-9.
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(e) All annuity Contracts under this Plan shall be
non-transferable when distributed. Furthermore, the terms of any
annuity Contract purchased and distributed to a Participant or
spouse shall comply with all of the requirements of the Plan.
(f) If a distribution is made at a time when a Participant
is not fully Vested in his Participant's Account and the
Participant may increase the Vested percentage in such account:
(1) a separate account shall be established for the
Participant's interest in the Plan as of the time of the
distribution; and
(2) at any relevant time, the Participant's Vested portion
of the separate account shall be equal to an amount ("X")
determined by the formula:
X equals P(AB plus (R x D)) - (R x D)
For purposes of applying the formula: P is the Vested
percentage at the relevant time, AB is the account balance
at the relevant time, D is the amount of distribution, and R
is the ratio of the account balance at the relevant time to
the account balance after distribution.
6.6 DISTRIBUTION OF BENEFITS UPON DEATH
(a)(1) The death benefit payable pursuant to Section 6.2
shall be paid to the Participant's Beneficiary within a reasonable
time after the Participant's death by either of the following
methods, as elected by the Participant (or if no election has been
made prior to the Participant's death, by his Beneficiary)
subject, however, to the rules specified in Section 6.6(b):
(i) One lump-sum payment in cash.
(ii) Payment in monthly, quarterly, semi-annual, or
annual cash installments over a period to be
determined by the Participant or his Beneficiary.
After periodic installments commence, the Beneficiary
shall have the right to direct the Trustee to reduce
the period over which such periodic installments shall
be made, and the Trustee shall adjust the cash amount
of such periodic installments accordingly.
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(2) In the event the death benefit payable pursuant to
Section 6.2 is payable in installments, then, upon the death
of the Participant, the Administrator may direct the Trustee
to segregate the death benefit into a separate account, and
the Trustee shall invest such segregated account separately,
and the funds accumulated in such account shall be used for
the payment of the installments.
(b) Notwithstanding any provision in the Plan to the
contrary, distributions upon the death of a Participant shall be
made in accordance with the following requirements and shall
otherwise comply with Code Section 401(a)(9) and the Regulations
thereunder. If it is determined pursuant to Regulations that the
distribution of a Participant's interest has begun and the
Participant dies before his entire interest has been distributed
to him, the remaining portion of such interest shall be
distributed at least as rapidly as under the method of
distribution selected pursuant to Section 6.5 as of his date of
death. If a Participant dies before he has begun to receive any
distributions of his interest under the Plan or before
distributions are deemed to have begun pursuant to Regulations,
then his death benefit shall be distributed to his Beneficiaries
by December 31st of the calendar year in which the fifth
anniversary of his date of death occurs.
However, the 5-year distribution requirement of the
preceding paragraph shall not apply to any portion of the deceased
Participant's interest which is payable to or for the benefit of a
designated Beneficiary. In such event, such portion may, at the
election of the Participant (or the Participant's designated
Beneficiary), be distributed over a period not extending beyond
the life expectancy of such designated Beneficiary provided such
distribution begins not later than December 31st of the calendar
year immediately following the calendar year in which the
Participant died. However, in the event the Participant's spouse
(determined as of the date of the Participant's death) is his
Beneficiary, the requirement that distributions commence within
one year of a Participant's death shall not apply. In lieu
thereof, distributions must commence on or before the later of:
(1) December 31st of the calendar year immediately following the
calendar year in which the Participant died; or (2) December 31st
of the calendar year in which the Participant would have attained
age 70 1/2. If the surviving spouse dies before distributions to
such spouse begin, then the 5-year
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distribution requirement of this Section shall apply
as if the spouse was the Participant.
(c) For purposes of Section 6.6(b), the election by a
designated Beneficiary to be excepted from the 5-year distribution
requirement must be made no later than December 31st of the
calendar year following the calendar year of the Participant's
death. Except, however, with respect to a designated Beneficiary
who is the Participant's surviving spouse, the election must be
made by the earlier of: (1) December 31st of the calendar year
immediately following the calendar year in which the Participant
died or, if later, the calendar year in which the Participant
would have attained age 70 1/2; or (2) December 31st of the
calendar year which contains the fifth anniversary of the date of
the Participant's death. An election by a designated Beneficiary
must be in writing and shall be irrevocable as of the last day of
the election period stated herein. In the absence of an election
by the Participant or a designated Beneficiary, the 5-year
distribution requirement shall apply.
(d) For purposes of this Section, the life expectancy of a
Participant and a Participant's spouse shall not be redetermined
in accordance with Code Section 401(a)(9)(D). Life expectancy and
joint and last survivor expectancy shall be computed using the
return multiples in Tables V and VI of Regulation 1.72-9.
6.7 TIME OF SEGREGATION OR DISTRIBUTION
Except as limited by Sections 6.5 and 6.6, whenever the Trustee is
to make a distribution or to commence a series of payments the distribution or
series of payments may be made or begun as soon as is practicable. However,
unless a Former Participant elects in writing to defer the receipt of benefits
(such election may not result in a death benefit that is more than incidental),
the payment of benefits shall begin not later than the 60th day after the close
of the Plan Year in which the latest of the following events occurs: (a) the
date on which the Participant attains the earlier of age 65 or the Normal
Retirement Age specified herein; (b) the 10th anniversary of the year in which
the Participant commenced participation in the Plan; or (c) the date the
Participant terminates his service with the Employer.
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6.8 DISTRIBUTION FOR MINOR BENEFICIARY
In the event a distribution is to be made to a minor, then the
Administrator may direct that such distribution be paid to the legal guardian,
or if none, to a parent of such Beneficiary or a responsible adult with whom the
Beneficiary maintains his residence, or to the custodian for such Beneficiary
under the Uniform Gift to Minors Act or Gift to Minors Act, if such is permitted
by the laws of the state in which said Beneficiary resides. Such a payment to
the legal guardian, custodian or parent of a minor Beneficiary shall fully
discharge the Trustee, Employer, and Plan from further liability on account
thereof.
6.9 LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN
In the event that all, or any portion, of the distribution payable
to a Participant or his Beneficiary hereunder shall, at the later of the
Participant's attainment of age 62 or his Normal Retirement Age, remain unpaid
solely by reason of the inability of the Administrator, after sending a
registered letter, return receipt requested, to the last known address, and
after further diligent effort, to ascertain the whereabouts of such Participant
or his Beneficiary, the amount so distributable shall be treated as a Forfeiture
pursuant to the Plan. In the event a Participant or Beneficiary is located
subsequent to his benefit being reallocated, such benefit shall be restored
unadjusted for earnings or losses.
6.10 PRE-RETIREMENT DISTRIBUTION
At such time as a Participant shall have attained the age of 59
1/2 years, the Administrator, at the election of the Participant, shall direct
the Trustee to distribute all or a portion of the Vested amount then credited to
the accounts maintained on behalf of the Participant. In the event that the
Administrator makes such a distribution, the Participant shall continue to be
eligible to participate in the Plan on the same basis as any other Employee. Any
distribution made pursuant to this Section shall be made in a manner consistent
with Section 6.5, including, but not limited to, all notice and consent
requirements of Code Section 411(a)(11) and the Regulations thereunder.
Notwithstanding the above, pre-retirement distributions from a
Participant's Elective Account shall not be permitted prior to the Participant
attaining age 59 1/2 except as otherwise permitted under the terms of the Plan.
6.11 ADVANCE DISTRIBUTION FOR HARDSHIP
(a) The Administrator, at the election of the Participant,
shall direct the Trustee to distribute to any Participant in any
one Plan Year up to the lesser
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of 100% of his Participant's Elective Account and Participant's
Rollover Account valued as of the last Valuation Date or the
amount necessary to satisfy the immediate and heavy financial need
of the Participant. Such distribution may not be less than $500.
Any distribution made pursuant to this Section shall be deemed to
be made as of the first day of the Plan Year or, if later, the
Valuation Date immediately preceding the date of distribution, and
the Participant's Elective Account and Participant's Rollover
Account shall be reduced accordingly. Withdrawal under this
Section shall be authorized only if the distribution is on account
of:
(1) Expenses for medical care described in Code Section
213(d) previously incurred by the Participant, his spouse,
or any of his dependents (as defined in Code Section 152) or
necessary for these persons to obtain medical care;
(2) The costs directly related to the purchase of a
principal residence for the Participant (excluding mortgage
payments);
(3) Payment of tuition, related educational fees, and room
and board expenses for the next twelve (12) months of
post-secondary education for the Participant, his spouse,
children, or dependents; or
(4) Payments necessary to prevent the eviction of the
Participant from his principal residence or foreclosure on
the mortgage of the Participant's principal residence.
(b) No distribution shall be made pursuant to this Section
unless the Administrator, based upon the Participant's
representation and such other facts as are known to the
Administrator, determines that all of the following conditions are
satisfied:
(1) The distribution is not in excess of the amount of the
immediate and heavy financial need of the Participant. The
amount of the immediate and heavy financial need may include
any amounts necessary to pay any federal, state, or local
income taxes or penalties reasonably anticipated to result
from the distribution;
(2) The Participant has obtained all distributions, other
than hardship distributions, and all nontaxable (at the time
of the loan) loans currently available under all plans
maintained by the Employer;
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(3) The Plan, and all other plans maintained by the
Employer, provide that the Participant's elective deferrals
and voluntary Employee contributions will be suspended for
at least twelve (12) months after receipt of the hardship
distribution or, the Participant, pursuant to a legally
enforceable agreement, will suspend his elective deferrals
and voluntary Employee contributions to the Plan and all
other plans maintained by the Employer for at least twelve
(12) months after receipt of the hardship distribution; and
(4) The Plan, and all other plans maintained by the
Employer, provide that the Participant may not make elective
deferrals for the Participant's taxable year immediately
following the taxable year of the hardship distribution in
excess of the applicable limit under Code Section 402(g) for
such next taxable year less the amount of such Participant's
elective deferrals for the taxable year of the hardship
distribution.
(c) Notwithstanding the above, distributions from the
Participant's Elective Account pursuant to this Section shall be
limited, as of the date of distribution, to the Participant's
Elective Account as of the end of the last Plan Year ending before
July 1, 1989, plus the total Participant's Deferred Compensation
after such date, reduced by the amount of any previous
distributions pursuant to this Section and Section 6.10.
(d) Any distribution made pursuant to this Section shall be
made in a manner which is consistent with and satisfies the
provisions of Section 6.5, including, but not limited to, all
notice and consent requirements of Code Section 411(a)(11) and the
Regulations thereunder.
6.12 QUALIFIED DOMESTIC RELATIONS ORDER DISTRIBUTION
All rights and benefits, including elections, provided to a
Participant in this Plan shall be subject to the rights afforded to any
"alternate payee" under a "qualified domestic relations order." Furthermore, a
distribution to an "alternate payee" shall be permitted if such distribution is
authorized by a "qualified domestic relations order," even if the affected
Participant has not separated from service and has not reached the "earliest
retirement age" under the Plan. For the purposes of this Section, "alternate
payee," "qualified domestic relations order" and "earliest retirement age" shall
have the meaning set forth under Code Section 414(p).
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ARTICLE VII
TRUSTEE
7.1 BASIC RESPONSIBILITIES OF THE TRUSTEE
(a) The Trustee shall have the following categories of
responsibilities:
(1) Consistent with the "funding policy and method"
determined by the Employer, to invest, manage, and control
the Plan assets subject, however, to the direction of a
Participant with respect to his Participant Directed
Accounts, the Employer or an Investment Manager appointed by
the Employer or any agent of the Employer;
(2) At the direction of the Administrator, to pay benefits
required under the Plan to be paid to Participants, or, in
the event of their death, to their Beneficiaries; and
(3) To maintain records of receipts and disbursements and
furnish to the Employer and/or Administrator for each Plan
Year a written annual report per Section 7.7.
(b) In the event that the Trustee shall be directed by a
Participant (pursuant to the Participant Direction Procedures), or
the Employer, or an Investment Manager or other agent appointed by
the Employer with respect to the investment of any or all Plan
assets, the Trustee shall have no liability with respect to the
investment of such assets, but shall be responsible only to
execute such investment instructions as so directed.
(1) The Trustee shall be entitled to rely fully on the
written instructions of a Participant (pursuant to the
Participant Direction Procedures), or the Employer, or any
Fiduciary or nonfiduciary agent of the Employer, in the
discharge of such duties, and shall not be liable for any
loss or other liability, resulting from such direction (or
lack of direction) of the investment of any part of the Plan
assets.
(2) The Trustee may delegate the duty to execute such
instructions to any nonfiduciary agent, which may be an
affiliate of the Trustee or any Plan representative.
(3) The Trustee may refuse to comply with any direction from
the Participant in the event the Trustee, in its sole and
absolute discretion,
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deems such directions improper by virtue of applicable law.
The Trustee shall not be responsible or liable for any loss
or expense which may result from the Trustee's refusal or
failure to comply with any directions from the Participant.
(4) Any costs and expenses related to compliance with the
Participant's directions shall be borne by the Participant's
Directed Account, unless
paid by the Employer.
(c) If there shall be more than one Trustee, they shall act
by a majority of their number, but may authorize one or more of
them to sign papers on their behalf.
7.2 INVESTMENT POWERS AND DUTIES OF THE TRUSTEE
(a) The Trustee shall invest and reinvest the Trust Fund to
keep the Trust Fund invested without distinction between principal
and income and in such securities or property, real or personal,
wherever situated, as the Trustee shall deem advisable, including,
but not limited to, stocks, common or preferred, bonds and other
evidences of indebtedness or ownership, and real estate or any
interest therein. The Trustee shall at all times in making
investments of the Trust Fund consider, among other factors, the
short and long-term financial needs of the Plan on the basis of
information furnished by the Employer. In making such investments,
the Trustee shall not be restricted to securities or other
property of the character expressly authorized by the applicable
law for trust investments; however, the Trustee shall give due
regard to any limitations imposed by the Code or the Act so that
at all times the Plan may qualify as a qualified Profit Sharing
Plan and Trust.
(b) The Trustee may employ a bank or trust company pursuant
to the terms of its usual and customary bank agency agreement,
under which the duties of such bank or trust company shall be of a
custodial, clerical and record-keeping nature.
(c) With respect to any Employer stock which is allocated to
a Participant's Directed Investment Account, the Participant or
Beneficiary shall direct the Trustee with regard to any voting,
tender and similar rights associated with the ownership of
Employer stock, (i.e., the "Stock Right(s)") as follows:
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(1) Each Participant or Beneficiary shall direct the Trustee
to vote or otherwise exercise such Stock Rights in
accordance with the provisions, conditions and terms of any
such Stock Right(s).
(2) Such directions shall be provided to the Trustee by the
Participant or Beneficiary in accordance with the procedure
as established by the Administrator. The Trustee shall vote
or otherwise exercise such Stock Right(s) with respect to
which it has received directions to do so under this
Section.
(3) To the extent to which a Participant or Beneficiary does
not instruct the Trustee or does not issue valid directions
to the Trustee to vote or otherwise exercise such Stock
Right(s), such Participants or Beneficiaries shall be deemed
to have directed the Trustee that such Stock Rights remain
nonvoted and unexercised.
7.3 OTHER POWERS OF THE TRUSTEE
The Trustee, in addition to all powers and authorities under
common law, statutory authority, including the Act, and other provisions of the
Plan, shall have the following powers and authorities, to be exercised in the
Trustee's sole discretion:
(a) To purchase, or subscribe for, any securities or other
property and to retain the same. In conjunction with the purchase
of securities, margin accounts may be opened and maintained;
(b) To sell, exchange, convey, transfer, grant options to
purchase, or otherwise dispose of any securities or other property
held by the Trustee, by private contract or at public auction. No
person dealing with the Trustee shall be bound to see to the
application of the purchase money or to inquire into the validity,
expediency, or propriety of any such sale or other disposition,
with or without advertisement;
(c) To vote upon any stocks, bonds, or other securities; to
give general or special proxies or powers of attorney with or
without power of substitution; to exercise any conversion
privileges, subscription rights or other options, and to make any
payments incidental thereto; to oppose, or to consent to, or
otherwise participate in, corporate reorganizations or other
changes affecting corporate securities, and to delegate
discretionary powers, and to pay any assessments or charges in
connection therewith; and generally to exercise any of the powers
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of an owner with respect to stocks, bonds, securities, or other
property. However, the Trustee shall not vote proxies relating to
securities for which it has not been assigned full investment
management responsibilities. In those cases where another party
has such investment authority or discretion, the Trustee will
deliver all proxies to said party who will then have full
responsibility for voting those proxies;
(d) To cause any securities or other property to be
registered in the Trustee's own name or in the name of one or more
of the Trustee's nominees, and to hold any investments in bearer
form, but the books and records of the Trustee shall at all times
show that all such investments are part of the Trust Fund;
(e) To borrow or raise money for the purposes of the Plan in
such amount, and upon such terms and conditions, as the Trustee
shall deem advisable; and for any sum so borrowed, to issue a
promissory note as Trustee, and to secure the repayment thereof by
pledging all, or any part, of the Trust Fund; and no person
lending money to the Trustee shall be bound to see to the
application of the money lent or to inquire into the validity,
expediency, or propriety of any borrowing;
(f) To keep such portion of the Trust Fund in cash or cash
balances as the Trustee may, from time to time, deem to be in the
best interests of the Plan, without liability for interest
thereon;
(g) To accept and retain for such time as the Trustee may
deem advisable any securities or other property received or
acquired as Trustee hereunder, whether or not such securities or
other property would normally be purchased as investments
hereunder;
(h) To make, execute, acknowledge, and deliver any and all
documents of transfer and conveyance and any and all other
instruments that may be necessary or appropriate to carry out the
powers herein granted;
(i) To settle, compromise, or submit to arbitration any
claims, debts, or damages due or owing to or from the Plan, to
commence or defend suits or legal or administrative proceedings,
and to represent the Plan in all suits and legal and
administrative proceedings;
(j) To employ suitable agents and counsel and to pay their
reasonable expenses and compensation, and
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such agent or counsel may or may not be agent or
counsel for the Employer;
(k) To apply for and procure from responsible insurance
companies, to be selected by the Administrator, as an investment
of the Trust Fund such annuity, or other Contracts (on the life of
any Participant) as the Administrator shall deem proper; to
exercise, at any time or from time to time, whatever rights and
privileges may be granted under such annuity, or other Contracts;
to collect, receive, and settle for the proceeds of all such
annuity or other Contracts as and when entitled to do so under the
provisions thereof;
(l) To invest funds of the Trust in time deposits or savings
accounts bearing a reasonable rate of interest in the Trustee's
bank;
(m) To invest in Treasury Bills and other forms of United
States government obligations;
(n) To invest in shares of investment companies registered
under the Investment Company Act of 1940;
(o) To sell, purchase and acquire put or call options if the
options are traded on and purchased through a national securities
exchange registered under the Securities Exchange Act of 1934, as
amended, or, if the options are not traded on a national
securities exchange, are guaranteed by a member firm of the New
York Stock Exchange;
(p) To deposit monies in federally insured savings accounts
or certificates of deposit in banks or savings and loan
associations;
(q) To pool all or any of the Trust Fund, from time to time,
with assets belonging to any other qualified employee pension
benefit trust created by the Employer or an affiliated company of
the Employer, and to commingle such assets and make joint or
common investments and carry joint accounts on behalf of this Plan
and such other trust or trusts, allocating undivided shares or
interests in such investments or accounts or any pooled assets of
the two or more trusts in accordance with their respective
interests;
(r) To appoint a nonfiduciary agent or agents to assist the
Trustee in carrying out any investment instructions of
Participants and of any Investment Manager or Fiduciary, and to
compensate such agent(s) from the assets of the Plan, to the
extent not paid by the Employer;
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(s) To do all such acts and exercise all such rights and
privileges, although not specifically mentioned herein, as the
Trustee may deem necessary to carry out the purposes of the Plan.
7.4 LOANS TO PARTICIPANTS
(a) The Trustee may, in the Trustee's discretion, make loans
to Participants and Beneficiaries under the following
circumstances: (1) loans shall be made available to all
Participants and Beneficiaries on a reasonably equivalent basis;
(2) loans shall not be made available to Highly Compensated
Employees in an amount greater than the amount made available to
other Participants and Beneficiaries; (3) loans shall bear a
reasonable rate of interest; (4) loans shall be adequately
secured; and (5) shall provide for repayment over a reasonable
period of time.
(b) Loans made pursuant to this Section (when added to the
outstanding balance of all other loans made by the Plan to the
Participant) shall be limited to the lesser of:
(1) $50,000 reduced by the excess (if any) of the highest
outstanding balance of loans from the Plan to the
Participant during the one year period ending on the day
before the date on which such loan is made, over the
outstanding balance of loans from the Plan to the
Participant on the date on which such loan was made, or
(2) one-half (1/2) of the present value of the
non-forfeitable accrued benefit of the
Participant under the Plan.
For purposes of this limit, all plans of the Employer
shall be considered one plan.
(c) Loans shall provide for level amortization with payments
to be made not less frequently than quarterly over a period not to
exceed five (5) years. However, loans used to acquire any dwelling
unit which, within a reasonable time, is to be used (determined at
the time the loan is made) as a principal residence of the
Participant shall provide for periodic repayment over a reasonable
period of time that may exceed five (5) years. For this purpose, a
principal residence has the same meaning as a principal residence
under Code Section 1034. Loan repayments will be suspended under
this Plan as permitted under Code Section 414(u)(4).
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(d) Any loans granted or renewed shall be made pursuant to a
Participant loan program. Such loan program shall be established
in writing and must include, but need not be limited to, the
following:
(1) the identity of the person or positions
authorized to administer the Participant loan
program;
(2) a procedure for applying for loans;
(3) the basis on which loans will be approved or denied;
(4) limitations, if any, on the types and amounts of loans
offered;
(5) the procedure under the program for determining a
reasonable rate of interest;
(6) the types of collateral which may secure a Participant
loan; and
(7) the events constituting default and the steps that will
be taken to preserve Plan assets.
Such Participant loan program shall be contained in a
separate written document which, when properly executed, is hereby
incorporated by reference and made a part of the Plan.
Furthermore, such Participant loan program may be modified or
amended in writing from time to time without the necessity of
amending this Section.
7.5 DUTIES OF THE TRUSTEE REGARDING PAYMENTS
At the direction of the Administrator, the Trustee shall, from
time to time, in accordance with the terms of the Plan, make payments out of the
Trust Fund. The Trustee shall not be responsible in any way for the application
of such payments.
7.6 TRUSTEE'S COMPENSATION AND EXPENSES AND TAXES
The Trustee shall be paid such reasonable compensation as shall
from time to time be agreed upon in writing by the Employer and the Trustee. An
individual serving as Trustee who already receives full-time pay from the
Employer shall not receive compensation from the Plan. In addition, the Trustee
shall be reimbursed for any reasonable expenses, including reasonable counsel
fees incurred by it as Trustee. Such compensation and expenses shall be paid
from the Trust Fund unless paid or advanced by the Employer. All taxes of any
kind and all kinds whatsoever that may be levied or assessed under
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existing or future laws upon, or in respect of, the Trust Fund or the income
thereof, shall be paid from the Trust Fund.
7.7 ANNUAL REPORT OF THE TRUSTEE
Within a reasonable period of time after the later of the
Anniversary Date or receipt of the Employer contribution for each Plan Year, the
Trustee shall furnish to the Employer and Administrator a written statement of
account with respect to the Plan Year for which such contribution was made
setting forth:
(a) the net income, or loss, of the Trust Fund;
(b) the gains, or losses, realized by the Trust Fund upon
sales or other disposition of the assets;
(c) the increase, or decrease, in the value of
the Trust Fund;
(d) all payments and distributions made from the Trust Fund;
and
(e) such further information as the Trustee and/or
Administrator deems appropriate. The Employer, forthwith upon its
receipt of each such statement of account, shall acknowledge
receipt thereof in writing and advise the Trustee and/or
Administrator of its approval or disapproval thereof. Failure by
the Employer to disapprove any such statement of account within
thirty (30) days after its receipt thereof shall be deemed an
approval thereof. The approval by the Employer of any statement of
account shall be binding as to all matters embraced therein as
between the Employer and the Trustee to the same extent as if the
account of the Trustee had been settled by judgment or decree in
an action for a judicial settlement of its account in a court of
competent jurisdiction in which the Trustee, the Employer and all
persons having or claiming an interest in the Plan were parties;
provided, however, that nothing herein contained shall deprive the
Trustee of its right to have its accounts judicially settled if
the Trustee so desires.
7.8 AUDIT
(a) If an audit of the Plan's records shall be required by
the Act and the regulations thereunder for any Plan Year, the
Administrator shall direct the Trustee to engage on behalf of all
Participants an independent qualified public accountant for that
purpose. Such accountant shall, after an audit of the books and
records of the Plan in accordance with generally accepted auditing
standards, within a
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reasonable period after the close of the Plan Year, furnish to the
Administrator and the Trustee a report of his audit setting forth
his opinion as to whether any statements, schedules or lists that
are required by Act Section 103 or the Secretary of Labor to be
filed with the Plan's annual report, are presented fairly in
conformity with generally accepted accounting principles applied
consistently. All auditing and accounting fees shall be an expense
of and may, at the election of the Administrator, be paid from the
Trust Fund.
(b) If some or all of the information necessary to enable
the Administrator to comply with Act Section 103 is maintained by
a bank, insurance company, or similar institution, regulated and
supervised and subject to periodic examination by a state or
federal agency, it shall transmit and certify the accuracy of that
information to the Administrator as provided in Act Section 103(b)
within one hundred twenty (120) days after the end of the Plan
Year or by such other date as may be prescribed under regulations
of the Secretary of Labor.
7.9 RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE
(a) The Trustee may resign at any time by delivering to the
Employer, at least thirty (30) days before its effective date, a
written notice of his resignation.
(b) The Employer may remove the Trustee by mailing by
registered or certified mail, addressed to such Trustee at his
last known address, at least thirty (30) days before its effective
date, a written notice of his removal.
(c) Upon the death, resignation, incapacity, or removal of
any Trustee, a successor may be appointed by the Employer; and
such successor, upon accepting such appointment in writing and
delivering same to the Employer, shall, without further act,
become vested with all the estate, rights, powers, discretions,
and duties of his predecessor with like respect as if he were
originally named as a Trustee herein. Until such a successor is
appointed, the remaining Trustee or Trustees shall have full
authority to act under the terms of the Plan.
(d) The Employer may designate one or more successors prior
to the death, resignation, incapacity, or removal of a Trustee. In
the event a successor is so designated by the Employer and accepts
such designation, the successor shall, without further
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act, become vested with all the estate, rights, powers,
discretions, and duties of his predecessor with the like effect as
if he were originally named as Trustee herein immediately upon the
death, resignation, incapacity, or removal of his predecessor.
(e) Whenever any Trustee hereunder ceases to serve as such,
he shall furnish to the Employer and Administrator a written
statement of account with respect to the portion of the Plan Year
during which he served as Trustee. This statement shall be either
(i) included as part of the annual statement of account for the
Plan Year required under Section 7.7 or (ii) set forth in a
special statement. Any such special statement of account should be
rendered to the Employer no later than the due date of the annual
statement of account for the Plan Year. The procedures set forth
in Section 7.7 for the approval by the Employer of annual
statements of account shall apply to any special statement of
account rendered hereunder and approval by the Employer of any
such special statement in the manner provided in Section 7.7 shall
have the same effect upon the statement as the Employer's approval
of an annual statement of account. No successor to the Trustee
shall have any duty or responsibility to investigate the acts or
transactions of any predecessor who has rendered all statements of
account required by Section 7.7 and this subparagraph.
7.10 TRANSFER OF INTEREST
Notwithstanding any other provision contained in this Plan, the
Trustee at the direction of the Administrator shall transfer the Vested
interest, if any, of such Participant in his account to another trust forming
part of a pension, profit sharing or stock bonus plan maintained by such
Participant's new employer and represented by said employer in writing as
meeting the requirements of Code Section 401(a), provided that the trust to
which such transfers are made permits the transfer to be made.
7.11 DIRECT ROLLOVER
(a) 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 Administrator, to have any portion of an
eligible rollover distribution that is equal to at least $500 paid
directly to an eligible retirement plan specified by the
distributee in a direct rollover.
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(b) For purposes of this Section the following definitions
shall apply:
(1) An eligible rollover distribution is any distribution of
all or any portion of the balance to the credit of the
distributee, except that an eligible rollover distribution
does not include: any distribution that is one of a series
of substantially equal periodic payments (not less
frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or joint
life expectancies) of the distributee and the distributee's
designated beneficiary, or for a specified period of ten
years or more; any distribution to the extent such
distribution is required under Code Section 401(a)(9); the
portion of any other distribution that is not includible in
gross income (determined without regard to the exclusion for
net unrealized appreciation with respect to employer
securities); and any other distribution that is reasonably
expected to total less than $200 during a year.
(2) An eligible retirement plan is an individual retirement
account described in Code Section 408(a), an individual
retirement annuity described in Code Section 408(b), an
annuity plan described in Code Section 403(a), or a
qualified trust described in Code Section 401(a), that
accepts the distributee's eligible rollover distribution.
However, in the case of an eligible rollover distribution to
the surviving spouse, an eligible retirement plan is an
individual retirement account or individual retirement
annuity.
(3) A distributee includes an Employee or former Employee.
In addition, the Employee's or former Employee's surviving
spouse and the Employee's or former Employee's spouse or
former spouse who is the alternate payee under a qualified
domestic relations order, as defined in Code Section 414(p),
are distributees with regard to the interest of the spouse
or former spouse.
(4) A direct rollover is a payment by the Plan to the
eligible retirement plan specified by the distributee.
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7.12 EMPLOYER SECURITIES AND REAL PROPERTY
The Trustee shall be empowered to acquire and hold "qualifying
Employer securities" and "qualifying Employer real property," as those terms are
defined in the Act, provided, however, that the Trustee shall not be permitted
to acquire any qualifying Employer securities or qualifying Employer real
property if, immediately after the acquisition of such securities or property,
the fair market value of all qualifying Employer securities and qualifying
Employer real property held by the Trustee hereunder should amount to more than
100% of the fair market value of all the assets in the Trust Fund.
ARTICLE VIII
AMENDMENT, TERMINATION AND MERGERS
8.1 AMENDMENT
(a) The Employer shall have the right at any time to amend
the Plan, subject to the limitations of this Section. However, any
amendment which affects the rights, duties or responsibilities of
the Trustee and Administrator, other than an amendment to remove
the Trustee or Administrator, may only be made with the Trustee's
and Administrator's written consent. Any such amendment shall
become effective as provided therein upon its execution. The
Trustee shall not be required to execute any such amendment unless
the Trust provisions contained herein are a part of the Plan and
the amendment affects the duties of the Trustee hereunder.
(b) No amendment to the Plan shall be effective if it
authorizes or permits any part of the Trust Fund (other than such
part as is required to pay taxes and administration expenses) to
be used for or diverted to any purpose other than for the
exclusive benefit of the Participants or their Beneficiaries or
estates; or causes any reduction in the amount credited to the
account of any Participant; or causes or permits any portion of
the Trust Fund to revert to or become property of the Employer.
(c) Except as permitted by Regulations, no Plan amendment or
transaction having the effect of a Plan amendment (such as a
merger, plan transfer or similar transaction) shall be effective
to the extent it eliminates or reduces any "Section 411(d)(6)
protected benefit" or adds or modifies conditions relating to
"Section 411(d)(6) protected benefits" the result of which is a
further restriction on such benefit unless such protected benefits
are preserved with respect to benefits accrued as of the later of
the adoption date or effective date of the amendment. "Section
411(d)(6)
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protected benefits" are benefits described in Code Section
411(d)(6)(A), early retirement benefits and retirement-type
subsidies, and optional forms of benefit.
8.2 TERMINATION
(a) The Employer shall have the right at any time to
terminate the Plan by delivering to the Trustee and Administrator
written notice of such termination. Upon any full or partial
termination, all amounts credited to the affected Participants'
Elective Accounts shall become 100% Vested as provided in Section
6.4 and shall not thereafter be subject to forfeiture, and all
unallocated amounts shall be allocated to the accounts of all
Participants in accordance with the provisions hereof.
(b) Upon the full termination of the Plan, the Employer
shall direct the distribution of the assets of the Trust Fund to
Participants in a manner which is consistent with and satisfies
the provisions of Section 6.5. Distributions to a Participant
shall be made in cash or through the purchase of irrevocable
nontransferable deferred commitments from an insurer. Except as
permitted by Regulations, the termination of the Plan shall not
result in the reduction of "Section 411(d)(6) protected benefits"
in accordance with Section 8.1(c).
8.3 MERGER OR CONSOLIDATION
This Plan and Trust may be merged or consolidated with, or its
assets and/or liabilities may be transferred to any other plan and trust only if
the benefits which would be received by a Participant of this Plan, in the event
of a termination of the plan immediately after such transfer, merger or
consolidation, are at least equal to the benefits the Participant would have
received if the Plan had terminated immediately before the transfer, merger or
consolidation, and such transfer, merger or consolidation does not otherwise
result in the elimination or reduction of any "Section 411(d)(6) protected
benefits" in accordance with Section 8.1(c).
ARTICLE IX
TOP HEAVY
9.1 TOP HEAVY PLAN REQUIREMENTS
For any Top Heavy Plan Year, the Plan shall provide the special
vesting requirements of Code Section 416(b) pursuant to Section 6.4 of the Plan
and the special minimum allocation requirements of Code Section 416(c) pursuant
to Section 4.4 of the Plan.
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9.2 DETERMINATION OF TOP HEAVY STATUS
(a) This Plan shall be a Top Heavy Plan for any Plan Year in
which, as of the Determination Date, (1) the Present Value of
Accrued Benefits of Key Employees and (2) the sum of the Aggregate
Accounts of Key Employees under this Plan and all plans of an
Aggregation Group, exceeds sixty percent (60%) of the Present
Value of Accrued Benefits and the Aggregate Accounts of all Key
and Non-Key Employees under this Plan and all plans of an
Aggregation Group.
If any Participant is a Non-Key Employee for any Plan
Year, but such Participant was a Key Employee for any prior Plan
Year, such Participant's Present Value of Accrued Benefit and/or
Aggregate Account balance shall not be taken into account for
purposes of determining whether this Plan is a Top Heavy or Super
Top Heavy Plan (or whether any Aggregation Group which includes
this Plan is a Top Heavy Group). In addition, if a Participant or
Former Participant has not performed any services for any Employer
maintaining the Plan at any time during the five year period
ending on the Determination Date, any accrued benefit for such
Participant or Former Participant shall not be taken into account
for the purposes of determining whether this Plan is a Top Heavy
or Super Top Heavy Plan.
(b) This Plan shall be a Super Top Heavy Plan for any Plan
Year in which, as of the Determination Date, (1) the Present Value
of Accrued Benefits of Key Employees and (2) the sum of the
Aggregate Accounts of Key Employees under this Plan and all plans
of an Aggregation Group, exceeds ninety percent (90%) of the
Present Value of Accrued Benefits and the Aggregate Accounts of
all Key and Non-Key Employees under this Plan and all plans of an
Aggregation Group.
(c) Aggregate Account: A Participant's Aggregate Account as
of the Determination Date is the sum of:
(1) his Participant's Elective Account balance as of the
most recent valuation occurring within a twelve (12) month
period ending on the Determination Date;
(2) an adjustment for any contributions due as of the
Determination Date. Such adjustment shall be the amount of
any contributions actually made after the Valuation Date but
due on or before the Determination Date, except for the
first Plan Year when such adjustment shall also reflect the
amount of any contributions made after the
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Determination Date that are allocated as of a date in that
first Plan Year.
(3) any Plan distributions made within the Plan Year that
includes the Determination Date or within the four (4)
preceding Plan Years. However, in the case of distributions
made after the Valuation Date and prior to the Determination
Date, such distributions are not included as distributions
for top heavy purposes to the extent that such distributions
are already included in the Participant's Aggregate Account
balance as of the Valuation Date. Notwithstanding anything
herein to the contrary, all distributions, including
distributions under a terminated plan which if it had not
been terminated would have been required to be included in
an Aggregation Group, will be counted. Further,
distributions from the Plan (including the cash value of
life insurance policies) of a Participant's account balance
because of death shall be treated as a distribution for the
purposes of this paragraph.
(4) any Employee contributions, whether voluntary or
mandatory. However, amounts attributable to tax deductible
qualified voluntary employee contributions shall not be
considered to be a part of the Participant's Aggregate
Account balance.
(5) with respect to unrelated rollovers and plan-to-plan
transfers (ones which are both initiated by the Employee and
made from a plan maintained by one employer to a plan
maintained by another employer), if this Plan provides the
rollovers or plan-to-plan transfers, it shall always
consider such rollovers or plan-to-plan transfers as a
distribution for the purposes of this Section. If this Plan
is the plan accepting such rollovers or plan-to-plan
transfers, it shall not consider such rollovers or
plan-to-plan transfers as part of the Participant's
Aggregate Account balance.
(6) with respect to related rollovers and plan-to-plan
transfers (ones either not initiated by the Employee or made
to a plan maintained by the same employer), if this Plan
provides the rollover or plan-to-plan transfer, it shall not
be counted as a distribution for purposes of this Section.
If this Plan is the plan accepting such rollover or
plan-to-plan transfer, it shall consider such rollover or
plan-to-plan transfer
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as part of the Participant's Aggregate Account balance,
irrespective of the date on which such rollover or
plan-to-plan transfer is accepted.
(7) For the purposes of determining whether two employers
are to be treated as the same employer in (5) and (6) above,
all employers aggregated under Code Section 414(b), (c), (m)
and (o) are treated as the same employer.
(d) "Aggregation Group" means either a Required
Aggregation Group or a Permissive Aggregation Group as
hereinafter determined.
(1) Required Aggregation Group: In determining a Required
Aggregation Group hereunder, each plan of the Employer in
which a Key Employee is a participant in the Plan Year
containing the Determination Date or any of the four
preceding Plan Years, and each other plan of the Employer
which enables any plan in which a Key Employee participates
to meet the requirements of Code Sections 401(a)(4) or 410,
will be required to be aggregated. Such group shall be known
as a Required Aggregation Group.
In the case of a Required Aggregation Group, each plan in
the group will be considered a Top Heavy Plan if the
Required Aggregation Group is a Top Heavy Group. No plan in
the Required Aggregation Group will be considered a Top
Heavy Plan if the Required Aggregation Group is not a Top
Heavy Group.
(2) Permissive Aggregation Group: The Employer may also
include any other plan not required to be included in the
Required Aggregation Group, provided the resulting group,
taken as a whole, would continue to satisfy the provisions
of Code Sections 401(a)(4) and 410. Such group shall be
known as a Permissive Aggregation Group.
In the case of a Permissive Aggregation Group, only a plan
that is part of the Required Aggregation Group will be
considered a Top Heavy Plan if the Permissive Aggregation
Group is a Top Heavy Group. No plan in the Permissive
Aggregation Group will be considered a Top Heavy Plan if the
Permissive Aggregation Group is not a Top Heavy Group.
(3) Only those plans of the Employer in which the
Determination Dates fall within the same
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calendar year shall be aggregated in order to determine
whether such plans are Top Heavy Plans.
(4) An Aggregation Group shall include any terminated plan
of the Employer if it was maintained within the last five
(5) years ending on the Determination Date.
(e) "Determination Date" means (a) the last day of the
preceding Plan Year, or (b) in the case of the first Plan Year,
the last day of such Plan Year.
(f) Present Value of Accrued Benefit: In the case of a
defined benefit plan, the Present Value of Accrued Benefit for a
Participant other than a Key Employee, shall be as determined
using the single accrual method used for all plans of the Employer
and Affiliated Employers, or if no such single method exists,
using a method which results in benefits accruing not more rapidly
than the slowest accrual rate permitted under Code Section
411(b)(1)(C). The determination of the Present Value of Accrued
Benefit shall be determined as of the most recent Valuation Date
that falls within or ends with the 12-month period ending on the
Determination Date except as provided in Code Section 416 and the
Regulations thereunder for the first and second plan years of a
defined benefit plan.
(g) "Top Heavy Group" means an Aggregation Group in which,
as of the Determination Date, the sum of:
(1) the Present Value of Accrued Benefits of Key Employees
under all defined benefit plans included in the group, and
(2) the Aggregate Accounts of Key Employees under all
defined contribution plans included in the group,
exceeds sixty percent (60%) of a similar sum
determined for all Participants.
ARTICLE X
MISCELLANEOUS
10.1 PARTICIPANT'S RIGHTS
This Plan shall not be deemed to constitute a contract between the
Employer and any Participant or to be a consideration or an inducement for the
employment of any Participant or Employee. Nothing contained in this Plan shall
be deemed to give any Participant or Employee the right to be retained in the
service of the Employer or to interfere with the right of the
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Employer to discharge any Participant or Employee at any time regardless of the
effect which such discharge shall have upon him as a Participant of this Plan.
10.2 ALIENATION
(a) Subject to the exceptions provided below, no benefit
which shall be payable out of the Trust Fund to any person
(including a Participant or his Beneficiary) shall be subject in
any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, or charge, and any attempt to
anticipate, alienate, sell, transfer, assign, pledge, encumber, or
charge the same shall be void; and no such benefit shall in any
manner be liable for, or subject to, the debts, contracts,
liabilities, engagements, or torts of any such person, nor shall
it be subject to attachment or legal process for or against such
person, and the same shall not be recognized by the Trustee,
except to such extent as may be required by law.
(b) This provision shall not apply to the extent a
Participant or Beneficiary is indebted to the Plan, as a result of
a loan from the Plan. At the time a distribution is to be made to
or for a Participant's or Beneficiary's benefit, such proportion
of the amount distributed as shall equal such loan indebtedness
shall be paid by the Trustee to the Trustee or the Administrator,
at the direction of the Administrator, to apply against or
discharge such loan indebtedness. Prior to making a payment,
however, the Participant or Beneficiary must be given written
notice by the Administrator that such loan indebtedness is to be
so paid in whole or part from his Participant's Elective Account.
If the Participant or Beneficiary does not agree that the loan
indebtedness is a valid claim against his Vested Participant's
Elective Account, he shall be entitled to a review of the validity
of the claim in accordance with procedures provided in Sections
2.7 and 2.8.
(c) This provision shall not apply to a "qualified domestic
relations order" defined in Code Section 414(p), and those other
domestic relations orders permitted to be so treated by the
Administrator under the provisions of the Retirement Equity Act of
1984. The Administrator shall establish a written procedure to
determine the qualified status of domestic relations orders and to
administer distributions under such qualified orders. Further, to
the extent provided under a "qualified domestic relations order,"
a former spouse of a Participant
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shall be treated as the spouse or surviving spouse for
all purposes under the Plan.
10.3 CONSTRUCTION OF PLAN
This Plan and Trust shall be construed and enforced according to
the Act and the laws of the State of Delaware, other than its laws respecting
choice of law, to the extent not preempted by the Act.
10.4 GENDER AND NUMBER
Wherever any words are used herein in the masculine, feminine or
neuter gender, they shall be construed as though they were also used in another
gender in all cases where they would so apply, and whenever any words are used
herein in the singular or plural form, they shall be construed as though they
were also used in the other form in all cases where they would so apply.
10.5 LEGAL ACTION
In the event any claim, suit, or proceeding is brought regarding
the Trust and/or Plan established hereunder to which the Trustee, the Employer
or the Administrator may be a party, and such claim, suit, or proceeding is
resolved in favor of the Trustee, the Employer or the Administrator, they shall
be entitled to be reimbursed from the Trust Fund for any and all costs,
attorney's fees, and other expenses pertaining thereto incurred by them for
which they shall have become liable.
10.6 PROHIBITION AGAINST DIVERSION OF FUNDS
(a) Except as provided below and otherwise specifically
permitted by law, it shall be impossible by operation of the Plan
or of the Trust, by termination of either, by power of revocation
or amendment, by the happening of any contingency, by collateral
arrangement or by any other means, for any part of the corpus or
income of any trust fund maintained pursuant to the Plan or any
funds contributed thereto to be used for, or diverted to, purposes
other than the exclusive benefit of Participants, Retired
Participants, or their Beneficiaries.
(b) In the event the Employer shall make an excessive
contribution under a mistake of fact pursuant to Act Section
403(c)(2)(A), the Employer may demand repayment of such excessive
contribution at any time within one (1) year following the time of
payment and the Trustees shall return such amount to the Employer
within the one (1) year period. Earnings of the Plan attributable
to the excess contributions may not be returned to the Employer
but any losses
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attributable thereto must reduce the amount so
returned.
10.7 BONDING
Every Fiduciary, except a bank or an insurance company, unless
exempted by the Act and regulations thereunder, shall be bonded in an amount not
less than 10% of the amount of the funds such Fiduciary handles; provided,
however, that the minimum bond shall be $1,000 and the maximum bond, $500,000.
The amount of funds handled shall be determined at the beginning of each Plan
Year by the amount of funds handled by such person, group, or class to be
covered and their predecessors, if any, during the preceding Plan Year, or if
there is no preceding Plan Year, then by the amount of the funds to be handled
during the then current year. The bond shall provide protection to the Plan
against any loss by reason of acts of fraud or dishonesty by the Fiduciary alone
or in connivance with others. The surety shall be a corporate surety company (as
such term is used in Act Section 412(a)(2)), and the bond shall be in a form
approved by the Secretary of Labor. Notwithstanding anything in the Plan to the
contrary, the cost of such bonds shall be an expense of and may, at the election
of the Administrator, be paid from the Trust Fund or by the Employer.
10.8 EMPLOYER'S AND TRUSTEE'S PROTECTIVE CLAUSE
Neither the Employer, the Administrator, nor the Trustee, nor
their successors shall be responsible for the validity of any Contract issued
hereunder or for the failure on the part of the insurer to make payments
provided by any such Contract, or for the action of any person which may delay
payment or render a Contract null and void or unenforceable in whole or in part.
10.9 INSURER'S PROTECTIVE CLAUSE
Any insurer who shall issue Contracts hereunder shall not have any
responsibility for the validity of this Plan or for the tax or legal aspects of
this Plan. The insurer shall be protected and held harmless in acting in
accordance with any written direction of the Trustee, and shall have no duty to
see to the application of any funds paid to the Trustee, nor be required to
question any actions directed by the Trustee. Regardless of any provision of
this Plan, the insurer shall not be required to take or permit any action or
allow any benefit or privilege contrary to the terms of any Contract which it
issues hereunder, or the rules of the insurer.
10.10 RECEIPT AND RELEASE FOR PAYMENTS
Any payment to any Participant, his legal representative,
Beneficiary, or to any guardian or committee appointed for such Participant or
Beneficiary in accordance with
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the provisions of the Plan, shall, to the extent thereof, be in full
satisfaction of all claims hereunder against the Trustee and the Employer,
either of whom may require such Participant, legal representative, Beneficiary,
guardian or committee, as a condition precedent to such payment, to execute a
receipt and release thereof in such form as shall be determined by the Trustee
or Employer.
10.11 ACTION BY THE EMPLOYER
Whenever the Employer under the terms of the Plan is permitted or
required to do or perform any act or matter or thing, it shall be done and
performed by a person duly authorized by its legally constituted authority.
10.12 NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY
The "named Fiduciaries" of this Plan are (1) the Employer, (2) the
Administrator and (3) the Trustee. The named Fiduciaries shall have only those
specific powers, duties, responsibilities, and obligations as are specifically
given them under the Plan or as accepted by or assigned to them pursuant to any
procedure provided under the Plan, including but not limited to any agreement
allocating or delegating their responsibilities, the terms of which are
incorporated herein by reference. In general, unless otherwise indicated herein
or pursuant to such agreements, the Employer shall have the duties specified in
Article II hereof, as the same may be allocated or delegated thereunder,
including but not limited to the responsibility for making the contributions
provided for under Section 4.1; and shall have the authority to appoint and
remove the Trustee and the Administrator; to formulate the Plan's "funding
policy and method"; and to amend or terminate, in whole or in part, the Plan.
The Administrator shall have the responsibility for the administration of the
Plan, including but not limited to the items specified in Article II of the
Plan, as the same may be allocated or delegated thereunder. The Administrator
shall act as the named Fiduciary responsible for communicating with the
Participant according to the Participant Direction Procedures. The Trustee shall
have the responsibility of management and control of the assets held under the
Trust, except to the extent directed pursuant to Article II or with respect to
those assets, the management of which has been assigned to an Investment
Manager, who shall be solely responsible for the management of the assets
assigned to it, all as specifically provided in the Plan and any agreement with
the Trustee. Each named Fiduciary warrants that any directions given,
information furnished, or action taken by it shall be in accordance with the
provisions of the Plan, authorizing or providing for such direction, information
or action. Furthermore, each named Fiduciary may rely upon any such direction,
information or action of another named Fiduciary as being proper under the Plan,
and is not required under the Plan to inquire into the propriety of any such
direction, information or action. It is intended under the Plan
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<PAGE>
that each named Fiduciary shall be responsible for the proper exercise of its
own powers, duties, responsibilities and obligations under the Plan as specified
or allocated herein. No named Fiduciary shall guarantee the Trust Fund in any
manner against investment loss or depreciation in asset value. Any person or
group may serve in more than one Fiduciary capacity. In the furtherance of their
responsibilities hereunder, the "named Fiduciaries" shall be empowered to
interpret the Plan and Trust and to resolve ambiguities, inconsistencies and
omissions, which findings shall be binding, final and conclusive.
10.13 HEADINGS
The headings and subheadings of this Plan have been inserted for
convenience of reference and are to be ignored in any construction of the
provisions hereof.
10.14 APPROVAL BY INTERNAL REVENUE SERVICE
(a) Notwithstanding anything herein to the contrary,
contributions to this Plan are conditioned upon the initial
qualification of the Plan under Code Section 401. If the Plan
receives an adverse determination with respect to its initial
qualification, then the Plan may return such contributions to the
Employer within one year after such determination, provided the
application for the determination is made by the time prescribed
by law for filing the Employer's return for the taxable year in
which the Plan was adopted, or such later date as the Secretary of
the Treasury may prescribe.
(b) Notwithstanding any provisions to the contrary, except
Sections 3.5, 3.6, and 4.1(c), any contribution by the Employer to
the Trust Fund is conditioned upon the deductibility of the
contribution by the Employer under the Code and, to the extent any
such deduction is disallowed, the Employer may, within one (1)
year following the disallowance of the deduction, demand repayment
of such disallowed contribution and the Trustee shall return such
contribution within one (1) year following the disallowance.
Earnings of the Plan attributable to the excess contribution may
not be returned to the Employer, but any losses attributable
thereto must reduce the amount so returned.
10.15 UNIFORMITY
All provisions of this Plan shall be interpreted and applied in a
uniform, nondiscriminatory manner. In the event of any conflict between the
terms of this Plan and any Contract purchased hereunder, the Plan provisions
shall control.
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ARTICLE XI
PARTICIPATING EMPLOYERS
11.1 ADOPTION BY OTHER EMPLOYERS
Notwithstanding anything herein to the contrary, with the consent
of the Employer and Trustee, any other corporation or entity, whether an
affiliate or subsidiary or not, may adopt this Plan and all of the provisions
hereof, and participate herein and be known as a Participating Employer, by a
properly executed document evidencing said intent and will of such Participating
Employer.
11.2 REQUIREMENTS OF PARTICIPATING EMPLOYERS
(a) Each such Participating Employer shall be required to
use the same Trustee as provided in this Plan.
(b) The Trustee may, but shall not be required to,
commingle, hold and invest as one Trust Fund all contributions
made by Participating Employers, as well as all increments
thereof. However, the assets of the Plan shall, on an ongoing
basis, be available to pay benefits to all Participants and
Beneficiaries under the Plan without regard to the Employer or
Participating Employer who contributed such assets.
(c) The transfer of any Participant from or to an Employer
participating in this Plan, whether he be an Employee of the
Employer or a Participating Employer, shall not affect such
Participant's rights under the Plan, and all amounts credited to
such Participant's Elective Account as well as his accumulated
service time with the transferor or predecessor, and his length of
participation in the Plan, shall continue to his credit.
(d) All rights and values forfeited by termination of
employment shall inure only to the benefit of the Participants of
the Employer or Participating Employer by which the forfeiting
Participant was employed, except if the Forfeiture is for an
Employee whose Employer is an Affiliated Employer, then said
Forfeiture shall inure to the benefit of the Participants of those
Employers who are Affiliated Employers. Should an Employee of one
("First") Employer be transferred to an associated ("Second")
Employer which is an Affiliated Employer, such transfer shall not
cause his account balance (generated while an Employee of "First"
Employer) in any manner, or by any amount to be forfeited. Such
Employee's Participant Elective Account balance for all purposes
of the Plan, including length of service,
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shall be considered as though he had always been employed by the
"Second" Employer and as such had received contributions,
forfeitures, earnings or losses, and appreciation or depreciation
in value of assets totaling the amount so transferred.
(e) Any expenses of the Trust which are to be paid by the
Employer or borne by the Trust Fund shall be paid by each
Participating Employer in the same proportion that the total
amount standing to the credit of all Participants employed by such
Employer bears to the total standing to the credit of all
Participants.
11.3 DESIGNATION OF AGENT
Each Participating Employer shall be deemed to be a party to this
Plan; provided, however, that with respect to all of its relations with the
Trustee and Administrator for the purpose of this Plan, each Participating
Employer shall be deemed to have designated irrevocably the Employer as its
agent. Unless the context of the Plan clearly indicates the contrary, the word
"Employer" shall be deemed to include each Participating Employer as related to
its adoption of the Plan.
11.4 EMPLOYEE TRANSFERS
It is anticipated that an Employee may be transferred between
Participating Employers, and in the event of any such transfer, the Employee
involved shall carry with him his accumulated service and eligibility. No such
transfer shall effect a termination of employment hereunder, and the
Participating Employer to which the Employee is transferred shall thereupon
become obligated hereunder with respect to such Employee in the same manner as
was the Participating Employer from whom the Employee was transferred.
11.5 PARTICIPATING EMPLOYER CONTRIBUTION
Any contribution subject to allocation during each Plan Year shall
be allocated only among those Participants of the Employer or Participating
Employer making the contribution, except if the contribution is made by an
Affiliated Employer, in which event such contribution shall be allocated among
all Participants of all Participating Employers who are Affiliated Employers in
accordance with the provisions of this Plan. On the basis of the information
furnished by the Administrator, the Trustee shall keep separate books and
records concerning the affairs of each Participating Employer hereunder and as
to the accounts and credits of the Employees of each Participating Employer. The
Trustee may, but need not, register Contracts so as to evidence that a
particular Participating Employer is the interested Employer hereunder, but in
the event of an Employee
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transfer from one Participating Employer to another, the employing Employer
shall immediately notify the Trustee thereof.
11.6 AMENDMENT
Amendment of this Plan by the Employer at any time when there
shall be a Participating Employer hereunder shall only be by the written action
of each and every Participating Employer and with the consent of the Trustee
where such consent is necessary in accordance with the terms of this Plan.
11.7 DISCONTINUANCE OF PARTICIPATION
Any Participating Employer shall be permitted to discontinue or
revoke its participation in the Plan. At the time of any such discontinuance or
revocation, satisfactory evidence thereof and of any applicable conditions
imposed shall be delivered to the Trustee. The Trustee shall thereafter
transfer, deliver and assign Contracts and other Trust Fund assets allocable to
the Participants of such Participating Employer to such new Trustee as shall
have been designated by such Participating Employer, in the event that it has
established a separate pension plan for its Employees, provided however, that no
such transfer shall be made if the result is the elimination or reduction of any
"Section 411(d)(6) protected benefits" in accordance with Section 8.1(c). If no
successor is designated, the Trustee shall retain such assets for the Employees
of said Participating Employer pursuant to the provisions of Article VII hereof.
In no such event shall any part of the corpus or income of the Trust as it
relates to such Participating Employer be used for or diverted to purposes other
than for the exclusive benefit of the Employees of such Participating Employer.
11.8 ADMINISTRATOR'S AUTHORITY
The Administrator shall have authority to make any and all
necessary rules or regulations, binding upon all Participating Employers and all
Participants, to effectuate the purpose of this Article.
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IN WITNESS WHEREOF, this Plan has been executed the day and year
first above written.
Signed, sealed, and delivered in the presence of:
BLC Financial Services, Inc.
______________________________ By __________________________
EMPLOYER
- ------------------------------
WITNESSES AS TO EMPLOYER
ATTEST______________________
______________________________ _______________________(SEAL)
TRUSTEE
- ------------------------------
WITNESSES AS TO TRUSTEE
______________________________ _______________________(SEAL)
TRUSTEE
- ------------------------------
WITNESSES AS TO TRUSTEE
______________________________ _______________________(SEAL)
TRUSTEE
- ------------------------------
WITNESSES AS TO TRUSTEE
______________________________ _______________________(SEAL)
TRUSTEE
- ------------------------------
WITNESSES AS TO TRUSTEE
<PAGE>
DEAR CORBEL CLIENT:
Enclosed is the package you ordered. This package includes IRS Forms 5307 (Rev
3/96) and 5300 (Rev 1/96). Although we are providing both tax submission forms,
only one form (the 5307 OR the 5300) must be submitted.
Form 5307 will be used for most plan submissions under Corbel's Volume Submitter
Program. This will entitle you to pay a reduced User Fee. However, the 5300 is
being made available to you for submission if the plan will NOT qualify under
the Volume Submitter Program. Generally, this will occur if special language
changes are so substantial that the IRS will not accept the plan under the
Volume Submitter Program.
There are two sheets enclosed entitled "Form 5307 Submission Instructions" and
"Form 5300 Submission Instructions" which you should review and follow
carefully. It's especially important to pay close attention to the 5307/5300 and
other tax forms since there is information not available in our files which you
or the
employer must complete.
Finally, you may only submit Form 5307 or Form 5300 if the employer or the
employer's representative includes IRS Schedule Q, Nondiscrimination
Requirements (Schedule Q enclosed). In addition to Schedule Q, you must also
include various demonstrations pursuant to Schedule Q. Corbel has provided
demonstrations 4 and 9.
Remember, submit either Form 5307 or Form 5300, but not both.
Thanks for the opportunity to serve you.
CORBEL
<PAGE>
CERTIFICATE OF CORPORATE RESOLUTION
The undersigned Secretary of BLC Financial Services, Inc. (the
Corporation) hereby certifies that the following resolutions were duly adopted
by the board of directors of the Corporation on ______________________, and that
such resolutions have not been modified or rescinded as of the date hereof:
RESOLVED, that the form of amended Profit Sharing Plan and Trust
effective November 1, 1998, presented to this meeting is hereby approved and
adopted and that the proper officers of the Corporation are hereby authorized
and directed to execute and deliver to the Trustee of the Plan one or more
counterparts of the Plan.
RESOLVED, that for purposes of the limitations on contributions
and benefits under the Plan, prescribed by Section 415 of the Internal Revenue
Code, the "limitation year" shall be the Plan Year.
RESOLVED, that not later than the due date (including extensions
hereof) of the Corporation's federal income tax return for each of its fiscal
years hereafter, the Corporation shall contribute to the Plan for each such
fiscal year such amount as shall be determined by the board of directors of the
Corporation and that the Treasurer of the Corporation is authorized and directed
to pay such contribution to the Trustee of the Plan in cash or property and to
designate to the Trustee the year for which such contribution is made.
RESOLVED, that the proper officers of the Corporation shall act as
soon as possible to notify the employees of the Corporation of the adoption of
the Profit Sharing Plan by delivering to each employee a copy of the summary
description of the Plan in the form of the Summary Plan Description presented to
this meeting, which form is hereby approved.
<PAGE>
The undersigned further certifies that attached hereto as Exhibits
A, B and C, respectively, are true copies of BLC Financial Services, Inc. 401(k)
Plan as amended and restated, Summary Plan Description and Funding Policy and
Method approved and adopted in the foregoing resolutions.
----------------------------------
Secretary
Date:____________________________
<PAGE>
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
FUNDING POLICY AND METHOD
A pension benefit plan (as defined in the Employee Retirement
Income Security Act of 1974) has been adopted by the company for the purpose of
rewarding long and loyal service to the company by providing to employees
additional financial security at retirement. Incidental benefits are provided in
the case of disability, death or other termination of employment.
Since the principal purpose of the plan is to provide benefits at
normal retirement age, the principal goal of the investment of the funds in the
plan should be both security and long-term stability with moderate growth
commensurate with the anticipated retirement dates of participants. Investments,
other than "fixed dollar" investments, should be included among the plan's
investments to prevent erosion by inflation. However, investments should be
sufficiently liquid to enable the plan, on short notice, to make some
distributions in the event of the death or disability of a participant.
<PAGE>
SUPPLEMENTAL PARTICIPATION AGREEMENT
A Participation Agreement made and entered into this ____ day of
__________________, 19____, between BLC Financial Services, Inc. (hereinafter
referred to as the "Participating Employer"), BLC Financial Services, Inc.
(hereinafter referred to as the "Employer"), and Louis Hafkin, Tracy Connors,
Jennifer Goldstein and Leonard Rudolph (hereinafter referred to as the
"Trustees").
WHEREAS, the Participating Employer desires to reward its
employees for faithful service, to establish a bond between employer and
employee, to provide an incentive for efficient and conscientious work, to
provide a fund for retirement, disability, or death, and to retain high-calibre
fellow employees; and
WHEREAS, there exists a Profit Sharing Plan entered into on the
____ day of __________________, 19____ namely the BLC Financial Services, Inc.
401(k) Plan, called the "Plan," between the Employer and the Trustees (a copy
being attached hereto as Exhibit "A" and made a part hereof by reference); and
WHEREAS, Plan Section 11.1 provides that any other Participating
Employer may, with the consent of the Employer, adopt the Plan and participate
therein by a properly executed document evidencing said intent of said
Participating Employer;
NOW, THEREFORE, the Participating Employer hereby becomes a party
to the Plan, effective the _____ day of _________________ , 19____, and the
Employer and the Trustees hereby consent to such adoption and participation upon
the following terms:
(1) Wherever a right or obligation is imposed upon the
Employer by the terms of the Plan, the same shall extend to
the Participating Employer as the "Employer" under the Plan
and shall be separate and distinct from that imposed upon
the Employer. It is the intention of the parties that the
Participating Employer shall be a party to the Plan and
treated in all respects as the Employer thereunder, with its
employees to be considered as the Employees or Participants,
as the case may be, thereunder. However, the participation
of the Participating Employer in the Plan shall in no way
diminish, augment, modify, or in any way affect the rights
and duties of the Employer, its Employees, or Participants,
under the Plan.
(2) The Trustees hereby agree to receive and allocate
contributions made to the Plan by the Employer and by the
Participating Employer, as well as to do and perform all
acts that are necessary to keep records and accounts of all
<PAGE>
funds held for Participants who are Employees of
the respective employers.
(3) The execution of this Agreement by this Participating
Employer shall be construed as the adoption of the Plan in
every respect as if said Plan had this date been executed
between the Participating Employer and the Trustees, except
as otherwise expressly provided herein or in any amendment
that may subsequently be adopted hereto.
(4) All actions required by the Plan and Trust to be taken
by the Employer shall be effective with respect to the
Participating Employer if taken by the Employer and pursuant
to Plan Section 11.3, the Participating Employer hereby
irrevocably designates the Employer as its agent for such
purposes.
<PAGE>
IN WITNESS WHEREOF, the Participating Employer, the Employer and
the Trustees have caused this Supplemental Participation Agreement to be
executed in their respective names on the day and date first above written.
Signed, sealed, and delivered in the presence of:
BLC Financial Services, Inc.
_____________________________ BY__________________________
- -----------------------------
As to Participating Employer
Signed, sealed, and delivered in the presence of:
BLC Financial Services, Inc.
_____________________________ BY__________________________
- -----------------------------
As to Employer
TRUSTEES
- ----------------------------- -----------------------------
- ----------------------------- -----------------------------
As to Trustees
-----------------------------
<PAGE>
CERTIFICATE OF CORPORATE RESOLUTION
The undersigned Secretary of BLC Financial Services, Inc. (the
Corporation) hereby certifies that the following resolutions were duly adopted
by the board of directors of the Corporation on ______________________, and that
such resolutions have not been modified or rescinded as of the date hereof:
RESOLVED, that the form of the Supplemental Participation
Agreement of BLC Financial Services, Inc., a Participating Employer, which
evidences the adoption of the amended Profit Sharing Plan and Trust sponsored by
BLC Financial Services, Inc. is hereby approved and adopted and that the proper
officers of the Corporation are hereby authorized and directed to execute and
deliver to the Trustee of the Plan one or more counterparts of the Supplemental
Participation Agreement.
RESOLVED, that for purposes of the limitations on contributions
and benefits under the Plan, prescribed by Section 415 of the Internal Revenue
Code, the "limitation year" shall be the Plan Year.
RESOLVED, that not later than the due date (including extensions
thereof) of the Corporation's federal income tax return for each of its fiscal
years hereafter, the Corporation shall contribute to the Plan for each such
fiscal year such amount as shall be determined by the board of directors of the
Corporation and that the Treasurer of the Corporation is authorized and directed
to pay such contribution to the Trustee of the Plan in cash or property and to
designate to the Trustee the year for which such contribution is made.
RESOLVED, that the proper officers of the Corporation shall act as
soon as possible to notify the employees of the Corporation of the adoption of
the Profit Sharing Plan by delivering to each employee a copy of the summary
description of the Plan in the form of the Summary Plan Description presented to
this meeting, which form is hereby approved.
<PAGE>
The undersigned further certifies that attached hereto as Exhibits
A, B and C, respectively, are true copies of BLC Financial Services, Inc. 401(k)
Plan as amended and restated, Summary Plan Description and Funding Policy and
Method approved and adopted in the foregoing resolutions.
--------------------------------
Secretary
Date: __________________________
<PAGE>
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
FUNDING POLICY AND METHOD
A pension benefit plan (as defined in the Employee Retirement
Income Security Act of 1974) has been adopted by the company for the purpose of
rewarding long and loyal service to the company by providing to employees
additional financial security at retirement. Incidental benefits are provided in
the case of disability, death or other termination of employment.
Since the principal purpose of the plan is to provide benefits at
normal retirement age, the principal goal of the investment of the funds in the
plan should be both security and long-term stability with moderate growth
commensurate with the anticipated retirement dates of participants. Investments,
other than "fixed dollar" investments, should be included among the plan's
investments to prevent erosion by inflation. However, investments should be
sufficiently liquid to enable the plan, on short notice, to make some
distributions in the event of the death or disability of a participant.
<PAGE>
SUPPLEMENTAL PARTICIPATION AGREEMENT
A Participation Agreement made and entered into this ____ day of
__________________, 19____, between Business Loan Center, Inc. (hereinafter
referred to as the "Participating Employer"), BLC Financial Services, Inc.
(hereinafter referred to as the "Employer"), and Louis Hafkin, Tracy Connors,
Jennifer Goldstein and Leonard Rudolph (hereinafter referred to as the
"Trustees").
WHEREAS, the Participating Employer desires to reward its
employees for faithful service, to establish a bond between employer and
employee, to provide an incentive for efficient and conscientious work, to
provide a fund for retirement, disability, or death, and to retain high-calibre
fellow employees; and
WHEREAS, there exists a Profit Sharing Plan entered into on the
____ day of __________________, 19____ namely the BLC Financial Services, Inc.
401(k) Plan, called the "Plan," between the Employer and the Trustees (a copy
being attached hereto as Exhibit "A" and made a part hereof by reference); and
WHEREAS, Plan Section 11.1 provides that any other Participating
Employer may, with the consent of the Employer, adopt the Plan and participate
therein by a properly executed document evidencing said intent of said
Participating Employer;
NOW, THEREFORE, the Participating Employer hereby becomes a party
to the Plan, effective the _____ day of _________________ , 19____, and the
Employer and the Trustees hereby consent to such adoption and participation upon
the following terms:
(1) Wherever a right or obligation is imposed upon the
Employer by the terms of the Plan, the same shall extend to
the Participating Employer as the "Employer" under the Plan
and shall be separate and distinct from that imposed upon
the Employer. It is the intention of the parties that the
Participating Employer shall be a party to the Plan and
treated in all respects as the Employer thereunder, with its
employees to be considered as the Employees or Participants,
as the case may be, thereunder. However, the participation
of the Participating Employer in the Plan shall in no way
diminish, augment, modify, or in any way affect the rights
and duties of the Employer, its Employees, or Participants,
under the Plan.
(2) The Trustees hereby agree to receive and allocate
contributions made to the Plan by the Employer and by the
Participating Employer, as well as to do and perform all
acts that are necessary to keep records and accounts of all
<PAGE>
funds held for Participants who are Employees of
the respective employers.
(3) The execution of this Agreement by this Participating
Employer shall be construed as the adoption of the Plan in
every respect as if said Plan had this date been executed
between the Participating Employer and the Trustees, except
as otherwise expressly provided herein or in any amendment
that may subsequently be adopted hereto.
(4) All actions required by the Plan and Trust to be taken
by the Employer shall be effective with respect to the
Participating Employer if taken by the Employer and pursuant
to Plan Section 11.3, the Participating Employer hereby
irrevocably designates the Employer as its agent for such
purposes.
<PAGE>
IN WITNESS WHEREOF, the Participating Employer, the Employer and
the Trustees have caused this Supplemental Participation Agreement to be
executed in their respective names on the day and date first above written.
Signed, sealed, and delivered in the presence of:
Business Loan Center, Inc.
_____________________________ BY__________________________
- -----------------------------
As to Participating Employer
Signed, sealed, and delivered in the presence of:
BLC Financial Services, Inc.
_____________________________ BY__________________________
- -----------------------------
As to Employer
TRUSTEES
- ----------------------------- -----------------------------
- ----------------------------- -----------------------------
As to Trustees
-----------------------------
<PAGE>
CERTIFICATE OF CORPORATE RESOLUTION
The undersigned Secretary of Business Loan Center, Inc. (the
Corporation) hereby certifies that the following resolutions were duly adopted
by the board of directors of the Corporation on ______________________, and that
such resolutions have not been modified or rescinded as of the date hereof:
RESOLVED, that the form of the Supplemental Participation
Agreement of Business Loan Center, Inc., a Participating Employer, which
evidences the adoption of the amended Profit Sharing Plan and Trust sponsored by
BLC Financial Services, Inc. is hereby approved and adopted and that the proper
officers of the Corporation are hereby authorized and directed to execute and
deliver to the Trustee of the Plan one or more counterparts of the Supplemental
Participation Agreement.
RESOLVED, that for purposes of the limitations on contributions
and benefits under the Plan, prescribed by Section 415 of the Internal Revenue
Code, the "limitation year" shall be the Plan Year.
RESOLVED, that not later than the due date (including extensions
thereof) of the Corporation's federal income tax return for each of its fiscal
years hereafter, the Corporation shall contribute to the Plan for each such
fiscal year such amount as shall be determined by the board of directors of the
Corporation and that the Treasurer of the Corporation is authorized and directed
to pay such contribution to the Trustee of the Plan in cash or property and to
designate to the Trustee the year for which such contribution is made.
RESOLVED, that the proper officers of the Corporation shall act as
soon as possible to notify the employees of the Corporation of the adoption of
the Profit Sharing Plan by delivering to each employee a copy of the summary
description of the Plan in the form of the Summary Plan Description presented to
this meeting, which form is hereby approved.
<PAGE>
The undersigned further certifies that attached hereto as Exhibits
A, B and C, respectively, are true copies of BLC Financial Services, Inc. 401(k)
Plan as amended and restated, Summary Plan Description and Funding Policy and
Method approved and adopted in the foregoing resolutions.
--------------------------------
Secretary
Date: __________________________
<PAGE>
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
FUNDING POLICY AND METHOD
A pension benefit plan (as defined in the Employee Retirement
Income Security Act of 1974) has been adopted by the company for the purpose of
rewarding long and loyal service to the company by providing to employees
additional financial security at retirement. Incidental benefits are provided in
the case of disability, death or other termination of employment.
Since the principal purpose of the plan is to provide benefits at
normal retirement age, the principal goal of the investment of the funds in the
plan should be both security and long-term stability with moderate growth
commensurate with the anticipated retirement dates of participants. Investments,
other than "fixed dollar" investments, should be included among the plan's
investments to prevent erosion by inflation. However, investments should be
sufficiently liquid to enable the plan, on short notice, to make some
distributions in the event of the death or disability of a participant.
<PAGE>
SUPPLEMENTAL PARTICIPATION AGREEMENT
A Participation Agreement made and entered into this ____ day of
__________________, 19____, between BLC Financial Network (hereinafter referred
to as the "Participating Employer"), BLC Financial Services, Inc. (hereinafter
referred to as the "Employer"), and Louis Hafkin, Tracy Connors, Jennifer
Goldstein and Leonard Rudolph (hereinafter referred to as the "Trustees").
WHEREAS, the Participating Employer desires to reward its
employees for faithful service, to establish a bond between employer and
employee, to provide an incentive for efficient and conscientious work, to
provide a fund for retirement, disability, or death, and to retain high-calibre
fellow employees; and
WHEREAS, there exists a Profit Sharing Plan entered into on the
____ day of __________________, 19____ namely the BLC Financial Services, Inc.
401(k) Plan, called the "Plan," between the Employer and the Trustees (a copy
being attached hereto as Exhibit "A" and made a part hereof by reference); and
WHEREAS, Plan Section 11.1 provides that any other Participating
Employer may, with the consent of the Employer, adopt the Plan and participate
therein by a properly executed document evidencing said intent of said
Participating Employer;
NOW, THEREFORE, the Participating Employer hereby becomes a party
to the Plan, effective the _____ day of _________________ , 19____, and the
Employer and the Trustees hereby consent to such adoption and participation upon
the following terms:
(1) Wherever a right or obligation is imposed upon the
Employer by the terms of the Plan, the same shall extend to
the Participating Employer as the "Employer" under the Plan
and shall be separate and distinct from that imposed upon
the Employer. It is the intention of the parties that the
Participating Employer shall be a party to the Plan and
treated in all respects as the Employer thereunder, with its
employees to be considered as the Employees or Participants,
as the case may be, thereunder. However, the participation
of the Participating Employer in the Plan shall in no way
diminish, augment, modify, or in any way affect the rights
and duties of the Employer, its Employees, or Participants,
under the Plan.
(2) The Trustees hereby agree to receive and allocate
contributions made to the Plan by the Employer and by the
Participating Employer, as well as to do and perform all
acts that are necessary to keep records and accounts of all
<PAGE>
funds held for Participants who are Employees of
the respective employers.
(3) The execution of this Agreement by this Participating
Employer shall be construed as the adoption of the Plan in
every respect as if said Plan had this date been executed
between the Participating Employer and the Trustees, except
as otherwise expressly provided herein or in any amendment
that may subsequently be adopted hereto.
(4) All actions required by the Plan and Trust to be taken
by the Employer shall be effective with respect to the
Participating Employer if taken by the Employer and pursuant
to Plan Section 11.3, the Participating Employer hereby
irrevocably designates the Employer as its agent for such
purposes.
<PAGE>
IN WITNESS WHEREOF, the Participating Employer, the Employer and
the Trustees have caused this Supplemental Participation Agreement to be
executed in their respective names on the day and date first above written.
Signed, sealed, and delivered in the presence of:
BLC Financial Network
_____________________________ BY__________________________
- -----------------------------
As to Participating Employer
Signed, sealed, and delivered in the presence of:
BLC Financial Services, Inc.
_____________________________ BY__________________________
- -----------------------------
As to Employer
TRUSTEES
- ----------------------------- -----------------------------
- ----------------------------- -----------------------------
As to Trustees
-----------------------------
<PAGE>
CERTIFICATE OF CORPORATE RESOLUTION
The undersigned Secretary of BLC Financial Network (the
Corporation) hereby certifies that the following resolutions were duly adopted
by the board of directors of the Corporation on ______________________, and that
such resolutions have not been modified or rescinded as of the date hereof:
RESOLVED, that the form of the Supplemental Participation
Agreement of BLC Financial Network, a Participating Employer, which evidences
the adoption of the amended Profit Sharing Plan and Trust sponsored by BLC
Financial Services, Inc. is hereby approved and adopted and that the proper
officers of the Corporation are hereby authorized and directed to execute and
deliver to the Trustee of the Plan one or more counterparts of the Supplemental
Participation Agreement.
RESOLVED, that for purposes of the limitations on contributions
and benefits under the Plan, prescribed by Section 415 of the Internal Revenue
Code, the "limitation year" shall be the Plan Year.
RESOLVED, that not later than the due date (including extensions
thereof) of the Corporation's federal income tax return for each of its fiscal
years hereafter, the Corporation shall contribute to the Plan for each such
fiscal year such amount as shall be determined by the board of directors of the
Corporation and that the Treasurer of the Corporation is authorized and directed
to pay such contribution to the Trustee of the Plan in cash or property and to
designate to the Trustee the year for which such contribution is made.
RESOLVED, that the proper officers of the Corporation shall act as
soon as possible to notify the employees of the Corporation of the adoption of
the Profit Sharing Plan by delivering to each employee a copy of the summary
description of the Plan in the form of the Summary Plan Description presented to
this meeting, which form is hereby approved.
<PAGE>
The undersigned further certifies that attached hereto as Exhibits
A, B and C, respectively, are true copies of BLC Financial Services, Inc. 401(k)
Plan as amended and restated, Summary Plan Description and Funding Policy and
Method approved and adopted in the foregoing resolutions.
--------------------------------
Secretary
Date: __________________________
<PAGE>
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
FUNDING POLICY AND METHOD
A pension benefit plan (as defined in the Employee Retirement
Income Security Act of 1974) has been adopted by the company for the purpose of
rewarding long and loyal service to the company by providing to employees
additional financial security at retirement. Incidental benefits are provided in
the case of disability, death or other termination of employment.
Since the principal purpose of the plan is to provide benefits at
normal retirement age, the principal goal of the investment of the funds in the
plan should be both security and long-term stability with moderate growth
commensurate with the anticipated retirement dates of participants. Investments,
other than "fixed dollar" investments, should be included among the plan's
investments to prevent erosion by inflation. However, investments should be
sufficiently liquid to enable the plan, on short notice, to make some
distributions in the event of the death or disability of a participant.
<PAGE>
SUPPLEMENTAL PARTICIPATION AGREEMENT
A Participation Agreement made and entered into this ____ day of
__________________, 19____, between BLC Financial Network of Florida, Inc.
(hereinafter referred to as the "Participating Employer"), BLC Financial
Services, Inc. (hereinafter referred to as the "Employer"), and Louis Hafkin,
Tracy Connors, Jennifer Goldstein and Leonard Rudolph (hereinafter referred to
as the "Trustees").
WHEREAS, the Participating Employer desires to reward its
employees for faithful service, to establish a bond between employer and
employee, to provide an incentive for efficient and conscientious work, to
provide a fund for retirement, disability, or death, and to retain high-calibre
fellow employees; and
WHEREAS, there exists a Profit Sharing Plan entered into on the
____ day of __________________, 19____ namely the BLC Financial Services, Inc.
401(k) Plan, called the "Plan," between the Employer and the Trustees (a copy
being attached hereto as Exhibit "A" and made a part hereof by reference); and
WHEREAS, Plan Section 11.1 provides that any other Participating
Employer may, with the consent of the Employer, adopt the Plan and participate
therein by a properly executed document evidencing said intent of said
Participating Employer;
NOW, THEREFORE, the Participating Employer hereby becomes a party
to the Plan, effective the _____ day of _________________ , 19____, and the
Employer and the Trustees hereby consent to such adoption and participation upon
the following terms:
(1) Wherever a right or obligation is imposed upon the
Employer by the terms of the Plan, the same shall extend to
the Participating Employer as the "Employer" under the Plan
and shall be separate and distinct from that imposed upon
the Employer. It is the intention of the parties that the
Participating Employer shall be a party to the Plan and
treated in all respects as the Employer thereunder, with its
employees to be considered as the Employees or Participants,
as the case may be, thereunder. However, the participation
of the Participating Employer in the Plan shall in no way
diminish, augment, modify, or in any way affect the rights
and duties of the Employer, its Employees, or Participants,
under the Plan.
(2) The Trustees hereby agree to receive and allocate
contributions made to the Plan by the Employer and by the
Participating Employer, as well as to do and perform all
acts that are necessary to keep records and accounts of all
<PAGE>
funds held for Participants who are Employees of
the respective employers.
(3) The execution of this Agreement by this Participating
Employer shall be construed as the adoption of the Plan in
every respect as if said Plan had this date been executed
between the Participating Employer and the Trustees, except
as otherwise expressly provided herein or in any amendment
that may subsequently be adopted hereto.
(4) All actions required by the Plan and Trust to be taken
by the Employer shall be effective with respect to the
Participating Employer if taken by the Employer and pursuant
to Plan Section 11.3, the Participating Employer hereby
irrevocably designates the Employer as its agent for such
purposes.
<PAGE>
IN WITNESS WHEREOF, the Participating Employer, the Employer and
the Trustees have caused this Supplemental Participation Agreement to be
executed in their respective names on the day and date first above written.
Signed, sealed, and delivered in the presence of:
BLC Financial Network of
Florida, Inc.
_____________________________ BY__________________________
- -----------------------------
As to Participating Employer
Signed, sealed, and delivered in the presence of:
BLC Financial Services, Inc.
_____________________________ BY__________________________
- -----------------------------
As to Employer
TRUSTEES
- ----------------------------- -----------------------------
- ----------------------------- -----------------------------
As to Trustees
-----------------------------
<PAGE>
CERTIFICATE OF CORPORATE RESOLUTION
The undersigned Secretary of BLC Financial Network of Florida,
Inc. (the Corporation) hereby certifies that the following resolutions were duly
adopted by the board of directors of the Corporation on ______________________,
and that such resolutions have not been modified or rescinded as of the date
hereof:
RESOLVED, that the form of the Supplemental Participation
Agreement of BLC Financial Network of Florida, Inc., a Participating Employer,
which evidences the adoption of the amended Profit Sharing Plan and Trust
sponsored by BLC Financial Services, Inc. is hereby approved and adopted and
that the proper officers of the Corporation are hereby authorized and directed
to execute and deliver to the Trustee of the Plan one or more counterparts of
the Supplemental Participation Agreement.
RESOLVED, that for purposes of the limitations on contributions
and benefits under the Plan, prescribed by Section 415 of the Internal Revenue
Code, the "limitation year" shall be the Plan Year.
RESOLVED, that not later than the due date (including extensions
thereof) of the Corporation's federal income tax return for each of its fiscal
years hereafter, the Corporation shall contribute to the Plan for each such
fiscal year such amount as shall be determined by the board of directors of the
Corporation and that the Treasurer of the Corporation is authorized and directed
to pay such contribution to the Trustee of the Plan in cash or property and to
designate to the Trustee the year for which such contribution is made.
RESOLVED, that the proper officers of the Corporation shall act as
soon as possible to notify the employees of the Corporation of the adoption of
the Profit Sharing Plan by delivering to each employee a copy of the summary
description of the Plan in the form of the Summary Plan Description presented to
this meeting, which form is hereby approved.
<PAGE>
The undersigned further certifies that attached hereto as Exhibits
A, B and C, respectively, are true copies of BLC Financial Services, Inc. 401(k)
Plan as amended and restated, Summary Plan Description and Funding Policy and
Method approved and adopted in the foregoing resolutions.
--------------------------------
Secretary
Date: __________________________
<PAGE>
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
FUNDING POLICY AND METHOD
A pension benefit plan (as defined in the Employee Retirement
Income Security Act of 1974) has been adopted by the company for the purpose of
rewarding long and loyal service to the company by providing to employees
additional financial security at retirement. Incidental benefits are provided in
the case of disability, death or other termination of employment.
Since the principal purpose of the plan is to provide benefits at
normal retirement age, the principal goal of the investment of the funds in the
plan should be both security and long-term stability with moderate growth
commensurate with the anticipated retirement dates of participants. Investments,
other than "fixed dollar" investments, should be included among the plan's
investments to prevent erosion by inflation. However, investments should be
sufficiently liquid to enable the plan, on short notice, to make some
distributions in the event of the death or disability of a participant.
<PAGE>
SUPPLEMENTAL PARTICIPATION AGREEMENT
A Participation Agreement made and entered into this ____ day of
__________________, 19____, between BLC Financial Network of Mid-America, Inc.
(hereinafter referred to as the "Participating Employer"), BLC Financial
Services, Inc. (hereinafter referred to as the "Employer"), and Louis Hafkin,
Tracy Connors, Jennifer Goldstein and Leonard Rudolph (hereinafter referred to
as the "Trustees").
WHEREAS, the Participating Employer desires to reward its
employees for faithful service, to establish a bond between employer and
employee, to provide an incentive for efficient and conscientious work, to
provide a fund for retirement, disability, or death, and to retain high-calibre
fellow employees; and
WHEREAS, there exists a Profit Sharing Plan entered into on the
____ day of __________________, 19____ namely the BLC Financial Services, Inc.
401(k) Plan, called the "Plan," between the Employer and the Trustees (a copy
being attached hereto as Exhibit "A" and made a part hereof by reference); and
WHEREAS, Plan Section 11.1 provides that any other Participating
Employer may, with the consent of the Employer, adopt the Plan and participate
therein by a properly executed document evidencing said intent of said
Participating Employer;
NOW, THEREFORE, the Participating Employer hereby becomes a party
to the Plan, effective the _____ day of _________________ , 19____, and the
Employer and the Trustees hereby consent to such adoption and participation upon
the following terms:
(1) Wherever a right or obligation is imposed upon the
Employer by the terms of the Plan, the same shall extend to
the Participating Employer as the "Employer" under the Plan
and shall be separate and distinct from that imposed upon
the Employer. It is the intention of the parties that the
Participating Employer shall be a party to the Plan and
treated in all respects as the Employer thereunder, with its
employees to be considered as the Employees or Participants,
as the case may be, thereunder. However, the participation
of the Participating Employer in the Plan shall in no way
diminish, augment, modify, or in any way affect the rights
and duties of the Employer, its Employees, or Participants,
under the Plan.
(2) The Trustees hereby agree to receive and allocate
contributions made to the Plan by the Employer and by the
Participating Employer, as well as to do and perform all
acts that are necessary to keep records and accounts of all
<PAGE>
funds held for Participants who are Employees of
the respective employers.
(3) The execution of this Agreement by this Participating
Employer shall be construed as the adoption of the Plan in
every respect as if said Plan had this date been executed
between the Participating Employer and the Trustees, except
as otherwise expressly provided herein or in any amendment
that may subsequently be adopted hereto.
(4) All actions required by the Plan and Trust to be taken
by the Employer shall be effective with respect to the
Participating Employer if taken by the Employer and pursuant
to Plan Section 11.3, the Participating Employer hereby
irrevocably designates the Employer as its agent for such
purposes.
<PAGE>
IN WITNESS WHEREOF, the Participating Employer, the Employer and
the Trustees have caused this Supplemental Participation Agreement to be
executed in their respective names on the day and date first above written.
Signed, sealed, and delivered in the presence of:
BLC Financial Network of
Mid-America, Inc.
_____________________________ BY__________________________
- -----------------------------
As to Participating Employer
Signed, sealed, and delivered in the presence of:
BLC Financial Services, Inc.
_____________________________ BY__________________________
- -----------------------------
As to Employer
TRUSTEES
- ----------------------------- -----------------------------
- ----------------------------- -----------------------------
As to Trustees
-----------------------------
<PAGE>
CERTIFICATE OF CORPORATE RESOLUTION
The undersigned Secretary of BLC Financial Network of Mid-America,
Inc. (the Corporation) hereby certifies that the following resolutions were duly
adopted by the board of directors of the Corporation on ______________________,
and that such resolutions have not been modified or rescinded as of the date
hereof:
RESOLVED, that the form of the Supplemental Participation
Agreement of BLC Financial Network of Mid-America, Inc., a Participating
Employer, which evidences the adoption of the amended Profit Sharing Plan and
Trust sponsored by BLC Financial Services, Inc. is hereby approved and adopted
and that the proper officers of the Corporation are hereby authorized and
directed to execute and deliver to the Trustee of the Plan one or more
counterparts of the Supplemental Participation Agreement.
RESOLVED, that for purposes of the limitations on contributions
and benefits under the Plan, prescribed by Section 415 of the Internal Revenue
Code, the "limitation year" shall be the Plan Year.
RESOLVED, that not later than the due date (including extensions
thereof) of the Corporation's federal income tax return for each of its fiscal
years hereafter, the Corporation shall contribute to the Plan for each such
fiscal year such amount as shall be determined by the board of directors of the
Corporation and that the Treasurer of the Corporation is authorized and directed
to pay such contribution to the Trustee of the Plan in cash or property and to
designate to the Trustee the year for which such contribution is made.
RESOLVED, that the proper officers of the Corporation shall act as
soon as possible to notify the employees of the Corporation of the adoption of
the Profit Sharing Plan by delivering to each employee a copy of the summary
description of the Plan in the form of the Summary Plan Description presented to
this meeting, which form is hereby approved.
<PAGE>
The undersigned further certifies that attached hereto as Exhibits
A, B and C, respectively, are true copies of BLC Financial Services, Inc. 401(k)
Plan as amended and restated, Summary Plan Description and Funding Policy and
Method approved and adopted in the foregoing resolutions.
--------------------------------
Secretary
Date: __________________________
<PAGE>
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
FUNDING POLICY AND METHOD
A pension benefit plan (as defined in the Employee Retirement
Income Security Act of 1974) has been adopted by the company for the purpose of
rewarding long and loyal service to the company by providing to employees
additional financial security at retirement. Incidental benefits are provided in
the case of disability, death or other termination of employment.
Since the principal purpose of the plan is to provide benefits at
normal retirement age, the principal goal of the investment of the funds in the
plan should be both security and long-term stability with moderate growth
commensurate with the anticipated retirement dates of participants. Investments,
other than "fixed dollar" investments, should be included among the plan's
investments to prevent erosion by inflation. However, investments should be
sufficiently liquid to enable the plan, on short notice, to make some
distributions in the event of the death or disability of a participant.
<PAGE>
SUPPLEMENTAL PARTICIPATION AGREEMENT
A Participation Agreement made and entered into this ____ day of
__________________, 19____, between BLC Capital Corp. (hereinafter referred to
as the "Participating Employer"), BLC Financial Services, Inc. (hereinafter
referred to as the "Employer"), and Louis Hafkin, Tracy Connors, Jennifer
Goldstein and Leonard Rudolph (hereinafter referred to as the "Trustees").
WHEREAS, the Participating Employer desires to reward its
employees for faithful service, to establish a bond between employer and
employee, to provide an incentive for efficient and conscientious work, to
provide a fund for retirement, disability, or death, and to retain high-calibre
fellow employees; and
WHEREAS, there exists a Profit Sharing Plan entered into on the
____ day of __________________, 19____ namely the BLC Financial Services, Inc.
401(k) Plan, called the "Plan," between the Employer and the Trustees (a copy
being attached hereto as Exhibit "A" and made a part hereof by reference); and
WHEREAS, Plan Section 11.1 provides that any other Participating
Employer may, with the consent of the Employer, adopt the Plan and participate
therein by a properly executed document evidencing said intent of said
Participating Employer;
NOW, THEREFORE, the Participating Employer hereby becomes a party
to the Plan, effective the _____ day of _________________ , 19____, and the
Employer and the Trustees hereby consent to such adoption and participation upon
the following terms:
(1) Wherever a right or obligation is imposed upon the
Employer by the terms of the Plan, the same shall extend to
the Participating Employer as the "Employer" under the Plan
and shall be separate and distinct from that imposed upon
the Employer. It is the intention of the parties that the
Participating Employer shall be a party to the Plan and
treated in all respects as the Employer thereunder, with its
employees to be considered as the Employees or Participants,
as the case may be, thereunder. However, the participation
of the Participating Employer in the Plan shall in no way
diminish, augment, modify, or in any way affect the rights
and duties of the Employer, its Employees, or Participants,
under the Plan.
(2) The Trustees hereby agree to receive and allocate
contributions made to the Plan by the Employer and by the
Participating Employer, as well as to do and perform all
acts that are necessary to keep records and accounts of all
<PAGE>
funds held for Participants who are Employees of
the respective employers.
(3) The execution of this Agreement by this Participating
Employer shall be construed as the adoption of the Plan in
every respect as if said Plan had this date been executed
between the Participating Employer and the Trustees, except
as otherwise expressly provided herein or in any amendment
that may subsequently be adopted hereto.
(4) All actions required by the Plan and Trust to be taken
by the Employer shall be effective with respect to the
Participating Employer if taken by the Employer and pursuant
to Plan Section 11.3, the Participating Employer hereby
irrevocably designates the Employer as its agent for such
purposes.
<PAGE>
IN WITNESS WHEREOF, the Participating Employer, the Employer and
the Trustees have caused this Supplemental Participation Agreement to be
executed in their respective names on the day and date first above written.
Signed, sealed, and delivered in the presence of:
BLC Capital Corp.
_____________________________ BY__________________________
- -----------------------------
As to Participating Employer
Signed, sealed, and delivered in the presence of:
BLC Financial Services, Inc.
_____________________________ BY__________________________
- -----------------------------
As to Employer
TRUSTEES
- ----------------------------- -----------------------------
- ----------------------------- -----------------------------
As to Trustees
-----------------------------
<PAGE>
CERTIFICATE OF CORPORATE RESOLUTION
The undersigned Secretary of BLC Capital Corp. (the Corporation)
hereby certifies that the following resolutions were duly adopted by the board
of directors of the Corporation on ______________________, and that such
resolutions have not been modified or rescinded as of the date hereof:
RESOLVED, that the form of the Supplemental Participation
Agreement of BLC Capital Corp., a Participating Employer, which evidences the
adoption of the amended Profit Sharing Plan and Trust sponsored by BLC Financial
Services, Inc. is hereby approved and adopted and that the proper officers of
the Corporation are hereby authorized and directed to execute and deliver to the
Trustee of the Plan one or more counterparts of the Supplemental Participation
Agreement.
RESOLVED, that for purposes of the limitations on contributions
and benefits under the Plan, prescribed by Section 415 of the Internal Revenue
Code, the "limitation year" shall be the Plan Year.
RESOLVED, that not later than the due date (including extensions
thereof) of the Corporation's federal income tax return for each of its fiscal
years hereafter, the Corporation shall contribute to the Plan for each such
fiscal year such amount as shall be determined by the board of directors of the
Corporation and that the Treasurer of the Corporation is authorized and directed
to pay such contribution to the Trustee of the Plan in cash or property and to
designate to the Trustee the year for which such contribution is made.
RESOLVED, that the proper officers of the Corporation shall act as
soon as possible to notify the employees of the Corporation of the adoption of
the Profit Sharing Plan by delivering to each employee a copy of the summary
description of the Plan in the form of the Summary Plan Description presented to
this meeting, which form is hereby approved.
<PAGE>
The undersigned further certifies that attached hereto as Exhibits
A, B and C, respectively, are true copies of BLC Financial Services, Inc. 401(k)
Plan as amended and restated, Summary Plan Description and Funding Policy and
Method approved and adopted in the foregoing resolutions.
--------------------------------
Secretary
Date: __________________________
<PAGE>
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
FUNDING POLICY AND METHOD
A pension benefit plan (as defined in the Employee Retirement
Income Security Act of 1974) has been adopted by the company for the purpose of
rewarding long and loyal service to the company by providing to employees
additional financial security at retirement. Incidental benefits are provided in
the case of disability, death or other termination of employment.
Since the principal purpose of the plan is to provide benefits at
normal retirement age, the principal goal of the investment of the funds in the
plan should be both security and long-term stability with moderate growth
commensurate with the anticipated retirement dates of participants. Investments,
other than "fixed dollar" investments, should be included among the plan's
investments to prevent erosion by inflation. However, investments should be
sufficiently liquid to enable the plan, on short notice, to make some
distributions in the event of the death or disability of a participant.
<PAGE>
MODIFIED LANGUAGE INDEX FOR PLAN (.DOC) DOCUMENT
------------------------------------------------
<PAGE>
VOLUME SUBMITTER MODIFICATIONS
BLC FINANCIAL SERVICES, INC. 401(K) PLAN
001
The enclosed Plan is being submitted for expedited review as a Volume Submitter
Plan.
No modifications from the approved specimen plan have been made to this Plan.
Corbel
Volume Submitter
Exhibit 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Form S-8
Registration Statement, relating to the registration of 100,000 shares under the
BLC Financial Services, Inc. 401(k) Plan, of our report dated August 27, 1998
with respect to our audit of the consolidated financial statements included in
the Company's Annual Report (Form 10-K) for the year ended June 30, 1998.
/s/ Richard A. Eisner & Company, LLP
Florham Park, New Jersey
December 4, 1998
NYFS12...:\99\26799\0004\2097\FRMN178M.32B
