<PAGE> 1
As filed with the Securities and Exchange Commission on September 10, 1997
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Tractor Supply Company
(Exact Name of Registrant as Specified in its Charter)
Delaware 13-3139732
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
320 Plus Park Boulevard
Nashville, Tennessee 37217
(615) 366-4600
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
Joseph H. Scarlett, Jr.
Chairman of the Board
and Chief Executive Officer
Tractor Supply Company
320 Plus Park Boulevard
Nashville, Tennessee 37217
(615) 366-4600
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent for Service)
Copy to:
Edward M. Kane, Esq.
Richards & O'Neil, LLP
43 Arch Street
Greenwich, Connecticut 06830
(203) 869-6222
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Approximate date of commencement of proposed sale to the public: As
soon as practicable after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. /X/
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. / /
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registra-
Registered Registered(1) Per Share(2) Price(2) tion Fee
- ---------- ------------- ------------ -------- --------
<S> <C> <C> <C> <C>
Common Stock, 978,912 shares $18.125 $17,742,780 $5,376.60
par value
$.008 per share
</TABLE>
(1) Pursuant to Rule 416(a) under the Securities Act of 1933, as amended
(the "Securities Act"), this Registration Statement also covers such
additional indeterminate number of shares as may be issuable as a
result of a stock dividend, stock split, reorganization or other
similar transaction.
(2) The proposed maximum aggregate offering price, estimated solely for the
purpose of calculating the registration fee, has been computed pursuant
to Rule 457(h) promulgated under the Securities Act and is based on the
average of the high and low prices of Tractor Supply Company's Common
Stock, par value $.008 per share (the "Common Stock"), on September 5,
1997, as reported by The Nasdaq National Market.
The Registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective date until the
Registrant shall file a further amendment that specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933, as amended, or until this
Registration Statement shall become effective on such date as the Commission,
acting pursuant to said Section 8(a), may determine.
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<PAGE> 4
SUBJECT TO COMPLETION, DATED SEPTEMBER 10, 1997
PROSPECTUS
TRACTOR SUPPLY COMPANY
978,912 Shares of Common Stock
This Prospectus relates to an offering by Investors Bank & Trust
Company (the "Selling Stockholder"), as trustee of the Tractor Supply Company
Restated 401(k) Retirement Plan, of up to 978,912 shares (the "Shares") of
common stock, par value $.008 per share (the "Common Stock"), of Tractor Supply
Company, a Delaware corporation (the "Company"). Upon the effectiveness of the
Registration Statement of which this Prospectus is a part (the "Registration
Statement"), the Tractor Supply Company 401(k) Retirement Plan will be further
amended and restated (as so amended and restated, the "401 (k) Plan").
Promptly thereafter, the Shares will be transferred to the Selling Stockholder.
The Shares were originally issued to the TSC Industries, Inc. Employee Stock
Ownership Plan (the "ESOP" and, together with the 401(k) Plan, the "Plan").
Effective March 26, 1994, the ESOP was merged into the 401(k) Plan.
The Common Stock is traded in the over-the-counter market and is quoted
on The Nasdaq National Market under the symbol "TSCO". On September 5, 1997, the
closing price of the Common Stock was $18.50, as reported by The Nasdaq
National Market.
The Company will not receive any part of the proceeds from the sale of
the Shares by the Selling Stockholder. The Company has agreed to bear all of the
expenses incurred by it in connection with the registration of the Shares. The
Selling Stockholder will pay its own expenses, including any brokerage
commissions, personal legal fees or similar expenses relating to the offer or
sale of the Selling Stockholder's Shares.
For a discussion of certain factors that should be considered by
prospective investors, see "Investment Considerations" beginning on page 5
of this Prospectus.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is , 1997.
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AVAILABLE INFORMATION
A Registration Statement on Form S-3 relating to the Shares has been
filed with the Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended (the "Securities Act"). As permitted by the
rules and regulations of the Commission, this Prospectus omits certain
information contained in the Registration Statement. For further information
pertaining to the Shares, reference is made to the Registration Statement,
including the exhibits filed as a part thereof.
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in
accordance therewith, files reports, proxy statements and other information with
the Commission. Reports, proxy statements and other information filed by the
Company with the Commission can be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549, and at the following Regional Offices of the Commission: 7 World
Trade Center, Suite 1300, New York, New York 10048 and Northwest Atrium Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such
material can be obtained from the Public Reference Section of the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates and, to the
extent electronically filed, from the Commission's World Wide Web site at
http://www.sec.gov. The Company's Common Stock is presently quoted on The Nasdaq
National Market and all reports, proxy statements and other information
concerning the Company can be inspected at the public reference facilities of
the National Association of Securities Dealers maintained at 1735 K Street,
N.W., Washington, D.C. 20006.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents have been previously filed by the Company with
the Commission and are incorporated in this Prospectus by reference:
a. The Company's annual report on Form 10-K for the fiscal year ended
December 28, 1996.
b. The Company's quarterly report on Form 10-Q for the quarter ended
March 29, 1997.
c. The Company's quarterly report on Form 10-Q for the quarter ended
June 28, 1997.
d. The description of the Company's Common Stock contained in its
Registration Statement on Form 8-A, filed with the Commission on January 31,
1994, as amended by the Form 8-A/A of the Company, filed with the Commission on
February 14, 1994, and any amendment or report filed for the purpose of updating
such description.
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All documents subsequently filed by the Company with the Commission
pursuant to Section 13(a), 13(c), 14 and 15(d) of the Exchange Act after the
date of this Prospectus and prior to such time as the Company files a
post-effective amendment indicating that all securities offered hereby have been
sold, or which deregisters all such securities then remaining unsold, shall be
deemed to be incorporated by reference in this Prospectus and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
This Prospectus incorporates documents by reference which are not
presented herein or delivered herewith. The Company will provide without charge
to each person to whom this Prospectus is delivered, upon written or oral
request, a copy of any or all of the information incorporated by reference
herein (not including exhibits to such information unless such exhibits are
specifically incorporated by reference into such information). Written requests
should be addressed to: Tractor Supply Company, 320 Plus Park Boulevard,
Nashville, Tennessee 37217, Attention: Secretary. Telephone requests may be
directed to the Secretary at (615) 366-4600.
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THE COMPANY
The Company is a specialty retailer which supplies the daily farming
and maintenance needs of its target customers: hobby, part-time and full-time
farmers, as well as suburban customers, contractors and tradesmen. The Company
operates one of the largest chains of retail farm stores in the United States.
At June 28, 1997, the Company's 224 stores, located in 26 states, typically
range in size from 12,000 to 14,000 square feet of inside space and utilize at
least as many square feet of outside space. Stores are located in rural
communities and in the outlying areas of large cities where farming is a
significant factor in the local economy.
The Company meets the daily farming and maintenance needs of its target
customers with a comprehensive selection of farm maintenance products (fencing,
tractor parts and accessories, agricultural spraying equipment and tillage
parts); animal products (specialty feeds, supplements, medicines, veterinary
supplies and livestock feeders); general maintenance products (air compressors,
welders, generators, pumps, plumbing and tools); lawn and garden products
(riding mowers, tillers and fertilizers); light truck equipment; work clothing
and other products. The Company does not sell large tractors, combines, bulk
chemicals or bulk fertilizers. The Company's merchandising strategy combines
this comprehensive product selection with strong inventory support.
The Company was founded in 1938 as a catalog mail order tractor parts
supplier. In 1978, Fuqua Industries, Inc. acquired the Company, and in 1982
Fuqua, in turn, sold the Company to a group of investors, including two members
of the Company's current senior management team, both of whom are principal
stockholders. Between the acquisition in 1982 and 1996, the Company's sales have
increased from $122.5 million to $449.0 million and the Company has opened 101
stores and closed 17 stores.
The Company's principal executive offices are located at 320 Plus Park
Boulevard, Nashville, Tennessee 37217 and its telephone number is (615)
366-4600.
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INVESTMENT CONSIDERATIONS
Each prospective investor should carefully consider the following
factors before making an investment decision.
SEASONALITY, WEATHER AND GENERAL BUSINESS CONDITIONS
The Company's business is highly seasonal. Historically, the Company's
sales and profits have been the highest in the second and fourth fiscal quarters
of each year due to the farming industry's planting and harvesting seasons and
the sale of seasonal products. The Company has typically operated at a net loss
in the first fiscal quarter of each year. Unseasonable weather and excessive
rain, drought, or early or late frosts may also affect the Company's sales. The
Company believes, however, that the impact of adverse weather conditions is
somewhat mitigated by the geographic dispersion of its stores. Like many other
retail businesses, the Company may be adversely affected by unfavorable local,
regional or national economic developments that result in reduced customer
spending in the markets served by its stores. There can be no assurance that
unseasonable weather and general economic conditions will not have a material
adverse effect on the Company.
COMPETITION
The Company operates in a highly competitive market. While the Company
believes it has successfully differentiated itself from general merchandise,
home center and other specialty retailers, the Company faces select competition
from these entities, as well as competition from independently owned retail farm
stores, several regional farm store chains and farm cooperatives. Some of these
competitors are units of large national or regional chains that have
substantially greater financial and other resources than the Company.
ABILITY TO ACHIEVE FUTURE GROWTH
Management believes that the Company's ability to open additional
stores and to increase comparable store sales will be significant factors in
achieving future growth. The Company's ability to open additional stores will
depend, in part, on matters beyond the Company's control including, among other
things, suitable store sites, zoning, the availability of financing, the
availability of qualified management personnel and general business and economic
conditions. The Company believes that increases in comparable store sales will
depend, in part, on the success of the Company's merchandising and marketing
strategies. There can be no assurance that the Company's growth plans for the
future will be achieved.
DEPENDENCE ON KEY MANAGEMENT PERSONNEL
The success of the Company is largely dependent on the efforts of its
senior management. The Company does not have employment agreements with its key
executives and there can be no assurance that these individuals will continue to
work for the Company. In addition, in order
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to successfully manage its growth strategy, the Company must continue to attract
and retain qualified personnel. If several of the current key management
personnel should resign, die or become disabled, or if the Company should be
unable to continue to attract and retain qualified management personnel, there
could be a material adverse effect on the Company's results of operations.
CONTROL BY CURRENT MANAGEMENT
Approximately 23.3% of the outstanding Common Stock is held by two
members of the Company's senior management and their wives. In addition, one
current member of the Company's Board of Directors, who was formerly a member
of the Company's senior management, and his wife and children, hold an
additional 4.2% of the outstanding Common Stock. Accordingly, if such persons
vote their shares of Common Stock in the same manner, they may have sufficient
voting power to influence the election of the entire Board of Directors of the
Company, and, in general, to determine the outcome of any corporate
transactions or other matters submitted to the stockholders for approval,
including mergers and sales of assets, and to prevent, or cause, a change in
control of the Company. Also, because of their positions as three of the six
directors of the Company and two of its executive officers, these individuals
may also have the ability, if they act together, to generally direct the
business, affairs and operations of the Company.
DEFERRED TAX LIABILITY
A substantial portion of the current deferred tax liability of the
Company relates to the tax treatment of certain inventory and other assets
acquired by the Company in connection with an acquisition in 1982. Recent cases
cast some doubt as to whether the Company's tax position with respect to such
inventory and other assets would be sustained if challenged. If the Company were
challenged on its tax position, no assurance can be given as to the outcome.
However, the Company believes, based upon its understanding of the resolution of
similar situations by others, that it has established adequate reserves and
that, accordingly, resolution of this issue would not have a material adverse
effect on its results of operations or financial position.
ANTI-TAKEOVER EFFECTS
Certain provisions of the Company's Restated Certificate of
Incorporation, as amended, and Amended and Restated Bylaws could have the effect
of discouraging, delaying or preventing a change of control of the Company,
diminishing opportunities for stockholder participation in tender offers,
reducing the influence of stockholders in corporate governance and inhibiting
fluctuations in the market price of the Common Stock that could result from
attempted takeovers of the Company. Among other things, such provisions: (i)
provide the Company's Board of Directors with broad discretion to issue
preferred stock, (ii) provide for three year terms for the directors of the
Company and the election of such directors on a staggered basis, (iii) provide
that the number of directors of the Company may be changed only by a resolution
of the Board
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of Directors, (iv) provide required advance notice procedures before any
stockholder proposal relating to the nomination of candidates for election as
directors and certain other matters may be brought before an annual meeting of
the Company's stockholders, and (v) provide that the Company's stockholders are
not permitted to call special meetings of the stockholders or to require the
Board of Directors or any officer of the Company to call a special meeting of
the stockholders.
The Company is subject to the anti-takeover provisions of Section 203
of the Delaware General Corporation Law, which prohibits the Company from
engaging in a "business combination" with an "interested stockholder" for a
period of three years after the date on which the person first becomes an
"interested stockholder," unless the business combination is approved in a
prescribed manner. The application of these provisions could have the effect of
delaying or preventing a change of control of the Company, which could adversely
effect the market price of the Company's Common Stock.
SHARES ELIGIBLE FOR FUTURE SALE
Pursuant to its Restated Certificate of Incorporation, as amended, the
Company has the authority to issue additional shares of Common Stock and shares
of one or more series of Preferred Stock. No prediction can be made as to the
effect, if any, that future sales of shares of stock or the availability of such
shares for sale will have on the market price of the Common Stock prevailing
from time to time. Sales of substantial amounts of stock, or the perception that
such sales might occur, could adversely affect prevailing market prices of the
Common Stock.
PIGGYBACK REGISTRATION RIGHTS
The holders of approximately 3,731,000 outstanding shares of Common
Stock have the right, exercisable until May 1, 2001, to require the Company to
register all such shares under the Securities Act in the event the Company
registers certain additional shares of the Common Stock. The existence of such
piggyback registration rights could have an adverse effect on the orderly
marketing of, and the market price for, the Common Stock.
NO DIVIDENDS ON COMMON STOCK
The Company anticipates that for the foreseeable future all earnings
will be retained for the future operation and expansion of its business and that
the Company will not pay cash dividends on the Common Stock. The Company is also
restricted from paying cash dividends by the terms of the note agreement which
relates to mortgage notes on certain of its properties.
THE SELLING STOCKHOLDER
The following table sets forth the name of the Selling Stockholder and
(i) the number of shares of Common Stock beneficially owned by the Selling
Stockholder on September 10, 1997, (ii) the number of shares of Common Stock to
be acquired by the Selling Stockholder pursuant to the
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Plan and being offered hereby, and (iii) the number of shares of Common Stock
and the percentage of the total class of Common Stock outstanding on September
10, 1997, that will be beneficially owned by the Selling Stockholder following
this offering. There can be no assurance that the Selling Stockholder will sell
any or all of the Shares offered hereby.
<TABLE>
<CAPTION>
NUMBER
OF SHARES OF PERCENTAGE
NUMBER OF COMMON OF COMMON
SHARES NUMBER OF STOCK STOCK
OF COMMON SHARES OF BENEFICIALLY BENEFICIALLY
STOCK COMMON OWNED OWNED
NAME AND POSITION BENEFICIALLY STOCK AFTER AFTER
WITH THE COMPANY OWNED OFFERED OFFERING(1) OFFERING
<S> <C> <C> <C> <C>
Investors Bank
& Trust Company,
as trustee of the Plan -0-(2) 978,912 -0- 0%
</TABLE>
- ------------------
(1) Assumes that the Selling Stockholder disposes of all of the Shares
covered in this Prospectus and does not acquire any additional shares
of Common Stock.
(2) Promptly after the effectiveness of the Registration Statement of which
this Prospectus is a part, 978,912 Shares will be transferred to the
Selling Stockholder, as trustee of the Plan.
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PLAN OF DISTRIBUTION
The sale of the Shares by the Selling Stockholder may be effected from
time to time in transactions (which may include block transactions) on The
Nasdaq National Market or on such other exchange or market in which the Common
Stock may from time to time be trading, in negotiated transactions, or a
combination of such methods of sale, at fixed prices which may be changed, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices, or at negotiated prices. The Selling Stockholder may
effect such transactions by selling Shares directly to purchasers or to or
through broker-dealers which may act as agents or principals. Such
broker-dealers may receive compensation in the form of discounts, concessions or
commissions from the Selling Stockholder or the purchasers of Shares for whom
such broker-dealers may act as agent or to whom they sell as principal, or both
(which compensation as to a particular broker-dealer might be in excess of
customary commissions). Any such broker or dealer may be deemed to be an
"underwriter" within the meaning of Section 2(11) of the Act, and any
commissions received by any such broker or dealer in connection with such sales
and any profits received by any such broker or dealer on the resale of any
Shares acquired as principal may be deemed to be underwriting compensation.
The Company has agreed to bear all of the expenses incurred by it in
connection with the registration of the Shares. The Selling Stockholder will pay
its own expenses, including any brokerage commissions, personal legal fees or
similar expenses relating to the offer or sale of the Selling Stockholder's
Shares.
USE OF PROCEEDS
The Company will not realize any proceeds from the sale of the Shares
by the Selling Stockholder.
LEGAL MATTERS
The legality of the securities offered hereby will be passed upon for
the Company by Richards & O'Neil, LLP, New York, New York.
EXPERTS
The financial statements incorporated in this Prospectus and
Registration Statement by reference from the Company's Annual Report on Form
10-K for the fiscal year ended December 28, 1996 have been audited by Price
Waterhouse LLP, independent accountants, as stated in their report which is
incorporated herein by reference, and have been so incorporated in reliance on
the report of Price Waterhouse LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
Not applicable.
Item 15. Indemnification of Directors and Officers
Section 145 of the General Corporation Law of the State of Delaware
(the "DGCL") grants each corporation organized thereunder, such as the Company,
the power to indemnify its directors and officers against liabilities for
certain of their acts. Article VI of the Amended and Restated By-Laws of the
Company provides for indemnification of directors and officers of the Company to
the extent permitted by Section 145 of the DGCL. Section 102(b)(7) of the DGCL
permits a provision in the certificate of incorporation of each corporation
organized thereunder, such as the Company, eliminating or limiting, with certain
exceptions, the personal liability of a director to the corporation or its
stockholders for monetary damages for certain breaches of fiduciary duty as a
director. Article Seventh of the Restated Certificate of Incorporation, as
amended, of the Company eliminates the liability of directors except to the
extent that such liability arises (i) from a breach of the director's duty of
loyalty to the Company or its stockholders, (ii) as a result of acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the DGCL, or (iv) from any
transaction from which the director derived an improper personal benefit. The
foregoing statements are subject to the detailed provisions of Section 102(b)(7)
of the DGCL, Article Seventh of the Restated Certificate of Incorporation, as
amended, of the Company and Article VI of the Amended and Restated By-Laws of
the Company, as applicable.
The Company maintains directors' and officers' liability insurance
which insures against certain liabilities that directors and officers of the
Company may incur in such capacities.
Item 16. Exhibits
The following exhibits are filed (except where otherwise indicated) as
part of this Registration Statement:
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
3.1 Restated Certificate of Incorporation, as amended, of the
Company, filed with the Delaware Secretary of State on
February 14, 1994 (filed as Exhibit 3.1 to the Company's
Form 10-Q for the fiscal quarter ended June 28, 1997, filed
with the Commission on August 8, 1997, and incorporated
herein by reference).
</TABLE>
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<TABLE>
<S> <C>
3.2 Certificate of Amendment of the Restated Certificate of
Incorporation, as amended, of the Company, filed with the
Delaware Secretary of State on April 28, 1995 (filed as
Exhibit 3.2 to the Company's Form 10-Q for the fiscal
quarter ended June 28, 1997, filed with the Commission on
August 8, 1997, and incorporated herein by reference).
3.3 Certificate of Amendment of the Restated Certificate of
Incorporation, as amended, filed with the Delaware
Secretary of State on May 13, 1997 (filed as Exhibit 3.3 to
the Company's Form 10-Q for the fiscal quarter ended June
28, 1997, filed with the Commission on August 8, 1997,
and incorporated herein by reference).
3.4 Amended and Restated By-Laws of the Company (filed as
Exhibit 3.7 to the Company's Registration Statement on Form
S-1, Registration No. 33-73028, filed with the Commission
on December 17, 1993, and incorporated herein by
reference).
4.1 Tractor Supply Company Restated 401(k) Retirement Plan,
dated September 5, 1997 (the "401(k) Plan").
4.2 Trust Agreement, dated July 1, 1997, by and
between the Company and Investors Bank & Trust Company, as
Trustee, relating to the 401(k) Plan.
5 Opinion of Richards & O'Neil, LLP as to the legality of the
securities being registered.
23.1 Consent of Price Waterhouse LLP to the incorporation by
reference in this Registration Statement of their report on
the financial statements included in the Company's annual
report on Form 10-K for the fiscal year ended December 28,
1996.
23.2 Consent of Richards & O'Neil, LLP (included in the opinion
filed as Exhibit 5).
24.1 Power of Attorney, dated July 24, 1997, of Joseph H.
Scarlett, Jr.
24.2 Power of Attorney, dated July 24, 1997, of Thomas O. Flood.
24.3 Power of Attorney, dated July 24, 1997, of Joseph D.
Maxwell.
24.4 Power of Attorney, dated July 24, 1997, of Thomas J.
Hennesy, III.
24.5 Power of Attorney, dated July 24, 1997, of Joseph M.
Rodgers.
</TABLE>
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<TABLE>
<S> <C>
24.6 Power of Attorney, dated July 24, 1997, of S.P. Braud.
</TABLE>
Item 17. Undertakings
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts
or events arising after the effective date of the
Registration Statement (or the most recent
post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change
in the information set forth in the Registration
Statement;
(iii) To include any material information with
respect to the plan of distribution not previously
disclosed in the Registration Statement or any
material change to such information in the
Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of
this section do not apply if 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 Section
15(d) of the Exchange Act that are incorporated by reference
in the Registration Statement.
(2) That, for the purpose of determining any
liability under the Securities Act, each such post-effective
amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of the
offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or 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
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securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Nashville, State of Tennessee, on this 10th day
of September, 1997
TRACTOR SUPPLY COMPANY
By: /s/ Joseph H. Scarlett, Jr.*
------------------------------------
Joseph H. Scarlett, Jr.
Chairman of the Board and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
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Signature Title Date
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<S> <C> <C>
/s/ Joseph H. Scarlett, Jr.* Chairman of the Board, Chief September 10, 1997
- ---------------------------- Executive Officer and Director
Joseph H. Scarlett, Jr. (Principal Executive Officer)
/s/ Thomas O. Flood* Senior Vice President -- September 10, 1997
- ---------------------------- Administration and Finance,
Thomas O. Flood Treasurer, Chief Financial
Officer and Director (Principal
Financial Officer and Principal
Accounting Officer)
/s/ Joseph D. Maxwell* Director September 10, 1997
- ----------------------------
Joseph D. Maxwell
/s/ Thomas J. Hennesy, III* Director September 10, 1997
- ----------------------------
Thomas J. Hennesy, III
/s/ Joseph M. Rodgers* Director September 10, 1997
- ----------------------------
Joseph M. Rodgers
/s/ S.P. Braud* Director September 10, 1997
- ----------------------------
S.P. Braud
* By: /s/ Michael J. Kincaid
----------------------
Michael J. Kincaid
Attorney-In-Fact
</TABLE>
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EXHIBIT INDEX
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Exhibit No. Description
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3.1 Restated Certificate of Incorporation, as amended, of the
Company, filed with the Delaware Secretary of State on
February 14, 1994 (filed as Exhibit 3.1 to the Company's
Form 10-Q for the fiscal quarter ended June 28, 1997, filed
with the Commission on August 8, 1997, and incorporated
herein by reference).
3.2 Certificate of Amendment of the Restated Certificate of
Incorporation, as amended, of the Company, filed with the
Delaware Secretary of State on April 28, 1995 (filed as
Exhibit 3.2 to the Company's Form 10-Q for the fiscal
quarter ended June 28, 1997, filed with the Commission on
August 8, 1997, and incorporated herein by reference).
3.3 Certificate of Amendment of the Restated Certificate of
Incorporation, as amended, filed with the Delaware
Secretary of State on May 13, 1997 (filed as Exhibit 3.3 to
the Company's Form 10-Q for the fiscal quarter ended June
28, 1997, filed with the Commission on August 8, 1997,
and incorporated herein by reference).
3.4 Amended and Restated By-Laws of the Company (filed as
Exhibit 3.7 to the Company's Registration Statement on Form
S-1, Registration No. 33-73028, filed with the Commission
on December 17, 1993, and incorporated herein by
reference).
4.1 Tractor Supply Company Restated 401(k) Retirement Plan,
dated September 5, 1997 (the
"401(k) Plan").
4.2 Trust Agreement, dated July 1,1997, by and
between the Company and Investors Bank & Trust Company, as
Trustee, relating to the 401(k) Plan.
5 Opinion of Richards & O'Neil, LLP as to the legality of the
securities being registered.
23.1 Consent of Price Waterhouse LLP to the incorporation by
reference in this Registration Statement of their report on
the financial statements included in the Company's annual
report on Form 10-K for the fiscal year ended December 28,
1996.
23.2 Consent of Richards & O'Neil, LLP (included in the opinion
filed as Exhibit 5).
</TABLE>
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24.1 Power of Attorney, dated July 24, 1997, of Joseph H.
Scarlett, Jr.
24.2 Power of Attorney, dated July 24, 1997, of Thomas O. Flood.
24.3 Power of Attorney, dated July 24, 1997, of Joseph D.
Maxwell.
24.4 Power of Attorney, dated July 24, 1997, of Thomas J.
Hennesy, III.
24.5 Power of Attorney, dated July 24, 1997, of Joseph M.
Rodgers.
24.6 Power of Attorney, dated July 24, 1997, of S.P. Braud.
</TABLE>
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<PAGE> 1
EXHIBIT 4.1
TRACTOR SUPPLY COMPANY RESTATED 401(k) RETIREMENT PLAN
<PAGE> 2
Tractor Supply Company Restated 401(k) Retirement Plan
The Tractor Supply 401(k) Retirement Plan is designed to encourage and assist
Employees in a long range program of savings. This program may be used by
Employees to supplement their retirement income and may also serve to help
Employees in meeting certain financial emergencies. The Plan is hereby
designated a profit-sharing plan, and is intended to maintain Employer Stock
Accounts into which qualifying employer securities had been contributed prior to
March 26, 1994 to the extent the Accounts are not diversified by Participants
under Section 7.4. Effective upon approval of the Registration of TSC ESOP
Stock, amounts in the Employer Stock Accounts shall not be limited to investment
primarily in employer securities.
The Effective Date of the Plan is February 1, 1983. The Plan is hereby amended
and restated as of the date the Registration of TSC ESOP Stock is approved,
except as otherwise specifically indicated herein. The Plan was previously
amended and restated effective as of April 1, 1987, March 27, 1994 and January
1, 1997.
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<PAGE> 3
INDEX
The provisions of this Plan are set forth in the following order:
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Article 1. DEFINITIONS
Article 2. ELIGIBILITY AND PARTICIPATION
2.1 Entry Dates and Eligibility Requirements
2.2 Re-Employment of an Employee
2.3 Re-Employment of a Former Participant
2.4 Amended and Restated Plan
Article 3. CONTRIBUTIONS
3.1 Elective Contributions
3.2 Matching Contributions
3.3 Basic Employer Contributions
3.4 Special Employer Contributions
3.5 Qualified Non-Elective Contributions
3.6 Rollover Amounts
3.7 Employer Stock Contributions
3.8 Contributions Subject to Employer Discretion
3.9 Annual Deductible Limits
3.10 Omission of Eligible Employee
3.11 Inclusion of Ineligible Employee
Article 4. ANNUAL ADDITIONS
4.1 Limitations
4.2 Qualified Plans Included in the Determination
4.3 Maximum Permissible Amount
4.4 Allocations Included in Annual Additions
4.5 Allocations Not Included in Annual Additions
4.6 Combined Plan Limitations
4.7 Adjustments to Participant's Allocations
4.8 Correction of Excess Annual Additions
4.9 Compliance with Code Section 415
Article 5. NONDISCRIMINATION TESTING
5.1 Requirements
5.2 Actual Deferral Percentage Test
5.3 Actual Contribution Percentage Test
5.4 Special Rules
5.5 Aggregate Family Group
</TABLE>
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<TABLE>
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5.6 Multiple Use Limitation
5.7 Corrective Actions
5.8 Distribution of Excess Contributions and Excess
Aggregate Contributions
5.9 Adjustment for Income or Loss on Excess Amounts
5.10 Additional Requirements
Article 6. TOP HEAVY PROVISIONS
6.1 Top Heavy Determination
6.2 Aggregation Group
6.3 Super Top Heavy Plans
6.4 Key Employee and Non-Key Employee
6.5 Minimum Contributions
6.6 Top Heavy Vesting
Article 7. PARTICIPANT ACCOUNTS AND DIRECTED INVESTMENTS
7.1 Participant Accounts
7.2 Allocation of Contributions and Rollover Amounts
7.3 Investment Election
7.4 Diversification of Participant's Accounts
7.5 Transfer of Amounts between Funds
7.6 Crediting and Debiting of Investments
7.7 Valuation of Participant Accounts
7.8 Administrative and Expense Charges
7.9 Maintenance of Participant Accounts
Article 8. VESTING, FORFEITURES, AND BREAK IN SERVICE
8.1 Vesting Schedule
8.2 Amendment of Vesting Schedule
8.3 Vesting Formula after a Distribution
8.4 Non-Vested Interest upon Termination
8.5 Application of Forfeitures
8.6 Break in Service
8.7 Suspension of Payment of Benefits
Article 9. WITHDRAWALS AND LOANS DURING PARTICIPATION
9.1 Withdrawal Procedures
9.2 Withdrawal of Employee Contributions
9.3 Hardship Withdrawals
9.4 Withdrawal at Age 59 1/2
9.5 Withdrawal for Terminal Illness
</TABLE>
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9.6 Other Withdrawals
9.7 Amounts Cannot Be Repaid
9.8 Loan Program
Article 10. TERMINATION OF EMPLOYMENT PRIOR TO RETIREMENT DATE
10.1 General
10.2 Election of Timing of Distribution
10.3 Distribution of Benefits
10.4 Automatic Immediate Distribution
10.5 Death of a Former Participant
10.6 Cancellation of a Participant's Account
10.7 Unclaimed Account
Article 11. RETIREMENT BENEFITS
11.1 Retirement Dates
11.2 Automatic Form of Distribution
Article 12. DEATH BENEFITS
12.1 Value of Death Benefit
12.2 Election to Waive Pre-Retirement Surviving Spouse Death Benefit
12.3 Pre-Retirement Death Benefit for Unmarried Participants
12.4 Distribution Options of a Beneficiary
Article 13. BENEFIT OPTIONS AND DISTRIBUTION RULES
13.1 Payment Options
13.2 Events Triggering Distribution
13.3 Timing of Distribution Rules
13.4 Direct Rollovers
13.5 Minimum Distribution Requirements - General Rules
13.6 Death Distribution Provisions
13.7 Precedence of Minimum Distribution Rules
13.8 DEFRA Transitional Rule Distribution Election
Article 14. AMENDMENTS, TERMINATION, AND MERGERS
14.1 Amendments
14.2 Termination
14.3 Merger, Consolidation, Etc., with Another Plan
Article 15. PLAN ADMINISTRATION
15.1 Appointment By the Employer
15.2 Authority
15.3 Duties
15.4 Delegation of Duties
</TABLE>
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<TABLE>
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<S> <C>
15.5 Application of Funds
15.6 Compensation and Expenses
15.7 Information From Employer
15.8 Resignation, Removal, and Appointment of Successor
Article 16. BENEFIT CLAIMS PROCEDURE
16.1 Filing a Claim for Benefits
16.2 Timing of Decisions
16.3 Denial of Claim
16.4 Review Procedure
Article 17. GENERAL PROVISIONS
17.1 No Employment Rights Created
17.2 Return of Contributions Under Certain Circumstances
17.3 Exclusive Benefit Rule
17.4 Standard of Conduct for Fiduciaries
17.5 Gender
17.6 Construction of Plan
SCHEDULE A
</TABLE>
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<PAGE> 7
Article 1. DEFINITIONS
Whenever used in the Plan, the following terms shall have the respective
meanings hereinafter set forth or indicated, unless the context otherwise
requires.
1.1 Administrative Committee or Committee. The committee to which the
administrative duties and responsibilities under the Plan are delegated
pursuant to Section 15.4 hereof.
1.2 Affiliated Employer: The Employer and 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, or any service 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).
1.3 Age: Age at nearest birthday.
1.4 Bargaining Unit: The bargaining unit described in any collective
bargaining agreement in effect between the Employer and any union:
(a) The term Bargaining Unit however shall not mean:
(1) the bargaining unit located in Omaha, Nebraska
described in the collective bargaining agreement
between the Employer and the General Drivers and
Helpers Union Local No. 554, International
Brotherhood of Teamsters, Chauffeurs, Warehousemen
and Helpers of America; and
(2) the bargaining unit described in the collective
bargaining agreement between the Employer and the
International Brotherhood of Teamsters, Chauffeurs,
Warehousemen & Helpers of America Local Union #135.
(b) For purposes of this Plan, the collective bargaining agreement
must be a bona fide collective bargaining agreement between
bona fide Employee representatives and one or more employers.
The Employee representative must not include any organization
where more than one-half (1/2) of the members of the
organization are Employees who are owners, officers or
executives of the Employer.
(c) Whenever the Plan makes reference to an Employee included in a
bargaining unit, he shall be deemed to be included if his
status of Employment is such that his compensation, fringe
benefits and working
7
<PAGE> 8
conditions are determined by such collective bargaining
agreement whether or not he is a member of the union.
1.5 Basic Employer Contributions: Employer Contributions made for the
period prior to May 1, 1997 on behalf of a Participant in accordance
with Article 3. Basic Employer Contributions are subject to the vesting
schedules described in Article 8 and Article 6.
1.6 Beneficiary: The person(s) designated by the Employee as a Beneficiary
under the Plan to receive death benefits. Subject to the consent
requirements of Article 12, a Participant shall have the right to
designate a Beneficiary for the receipt of any death benefits payable
under the terms of the Plan and to change the Beneficiary from time to
time. If a Beneficiary has not been so designated or if no Beneficiary
survives the Participant, the Participant's estate shall be the
designated Beneficiary. Any designation of a Beneficiary shall also be
in accordance with Code section 401(a)(9).
1.7 Benefit Starting Date: The first day of the first period for which an
amount is paid to a Participant in all forms, whether by reason of
Retirement or Disability .
1.8 Board: The Employer's Board of Directors or other comparable governing
body.
1.9 Code: The Internal Revenue Code of 1986, as now in effect and as
hereinafter amended. Reference to any section or subsection of the Code
includes reference to any comparable or succeeding provisions of any
legislation which amends, supplements or replaces such section or
subsection.
1.10 Compensation: The Participant's total Standard 415 Compensation from
the Employer during the Plan Year for Services rendered, such as wages,
salary, overtime, commissions, bonuses and other remuneration that is
reportable to the federal government for the purpose of withholding
federal income taxes.
(a) For purposes of allocating Contributions, Compensation shall
also include any amount that would be reportable if it were
not otherwise deferred by the Participant's election to have
it contributed to a plan of the Employer as an Elective
Contribution.
(b) For a Participant's first year of participation, Compensation
shall be recognized as of the date the Participant entered the
Plan.
(c) For purposes of Basic Employer Contributions, Compensation for
the 1997 Plan Year shall be recognized for the period of
January 1, 1997 through April 30, 1997.
(d) In addition to other applicable limitations set forth in the
Plan, and notwithstanding any other provision of the Plan to
the contrary, for Plan Years beginning on or after January 1,
1994, the annual Compensation of each Employee taken into
account under the Plan shall not exceed the OBRA '93 annual
compensation limit. The OBRA '93 annual
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<PAGE> 9
compensation limit is $150,000, as adjusted by the
Commissioner for increases in the cost of living in accordance
with Code section 401(a)(17)(B). The cost-of-living adjustment
in effect for a calendar year applies to any period, not
exceeding 12 months, over which Compensation is determined
(determination period) beginning in such calendar year. If a
determination period consists of fewer than 12 months, the
OBRA '93 annual compensation limit will be multiplied by a
fraction, the numerator of which is the number of months in
the determination period, and the denominator of which is 12.
(1) For Plan Years beginning on or after January 1, 1994,
any reference in this Plan to the limitation under
Code section 401(a)(17) shall mean the OBRA '93
annual compensation limit set forth in this
provision.
(2) If Compensation for any prior determination period is
taken into account in determining an Employee's
benefits accruing in the current Plan Year, the
Compensation for that prior determination period is
subject to the OBRA '93 annual compensation limit in
effect for that prior determination period. For this
purpose, for determination periods beginning before
the first day of the first Plan Year beginning on or
after January 1, 1994, the OBRA '93 annual
compensation limit is $150,000.
(3) For Plan Years beginning on or after January 1, 1989,
but prior to January 1, 1994, the annual Compensation
of each Participant shall not exceed $200,000, or
such other amount established subsequent to 1989 by
the Secretary of the Treasury in accordance with Code
section 401(a)(17). For Plan Years beginning prior to
January 1, 1989, a $200,000 limit (without regard to
the rules of Code section 414(q)(6)) shall only apply
to a Plan Year in which the Plan is determined to be
top heavy (as described in Article 6) and shall not
be adjusted.
(e) For purposes of this limitation, the Family Member aggregation
rules of Code section 414(q)(6) shall apply, except in
applying such rules, the term "family" shall include only the
Spouse of the Participant and any lineal descendants of the
Participant who have not attained age 19 before the close of
the year. If, as a result of the application of such rules,
the adjusted $150,000 limitation is exceeded, then the
limitation shall be prorated among the affected individuals in
proportion to each such individual's Compensation under this
definition prior to the application of this limitation.
1.11 Computation Period
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<PAGE> 10
(a) For the purpose of determining an Employee's eligibility to
participate in the Plan, the initial eligibility Computation
Period shall be the 12-consecutive month period beginning with
an Employee's Employment Commencement Date (or, if applicable,
his Re-Employment Commencement Date). The succeeding
eligibility Computation Period shall shift to the current Plan
Year which includes the anniversary of an Employee's
Employment Commencement Date (or, if applicable, his
Re-Employment Commencement Date). Thereafter, the eligibility
Computation Period shall be the 12-consecutive month period
beginning on the first day of the Plan Year and ending on the
last day of the Plan Year.
(b) For the purpose of determining a Participant's vested
interest, as described in Article 8, the vesting Computation
Period shall be the 12-consecutive month period beginning on
the first day of the Plan Year and ending on the last day of
the Plan Year.
1.12 Contributions: Employer Contributions and Employee Contributions.
1.13 Deposit Account: An account in which the Employer shall hold any funds
released in connection with the reduction, adjustment, or termination
of any Participant's Account, or other transaction involving the Plan
and to which no Participant, former Participant or Beneficiary shall be
entitled.
1.14 Disability: A Participant's total and permanent disability as a result
of disease or bodily injury so as to render the Participant incapable
of engaging in any substantial gainful activity by reason of any
medically determinable physical or mental impairment or impairments
that can be expected to result in death or that has lasted or can be
expected to last for a continuous period of not less than twelve (12)
months, provided that the Participant is eligible for and receives
disability benefits under the Social Security Act. The Plan
Administrator shall have the exclusive right of determining, with the
assistance of a competent physician whether a Participant has suffered
Disability. A certificate to that effect, executed by the Plan
Administrator and supported by the affidavit of an examining physician,
shall be sufficient evidence of such fact and may be so accepted by the
Plan Administrator without further inquiry, provided that all
Participants under similar circumstances shall be treated alike.
1.15 Disability Retirement Date: The first day of the calendar month
following the month during which the Plan Administrator makes a
determination that a Participant's incapacity is a Disability.
1.16 Early Retirement Date: Effective January 1, 1997, the first day of the
calendar month (prior to his Normal Retirement Age) coincident with or
next following the termination of Service of a Participant who attains
age 55 and completes 6 Years of Service. For the Plan Years beginning
prior to January 1, 1997 "6 Years of Service" shall be replaced for "7
Years of Service".
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1.17 Effective Date: The initial effective date is February 1, 1983. The
Plan was subsequently amended and restated effective as of April 1,
1987, March 27, 1994 and January 1, 1997. This amended and restated
Plan shall be effective as of the date of the registration of TSC ESOP
Stock, except as otherwise provided herein.
1.18 Elective Contributions: Employer Contributions made to the Plan at the
election of the Participant in lieu of cash compensation pursuant to a
written salary reduction agreement. Elective Contributions are subject
to the dollar limitation contained in Code section 402(g), are
nonforfeitable when made, are distributable only as described in
Regulation 1.401(k)-1(d), and are required to satisfy the
nondiscrimination requirements of Regulation 1.401(k)-1(b)(2), the
provisions of which are specifically incorporated herein by reference.
With respect to any taxable year, a Participant's Elective
Contributions are the sum of all Employer contributions made on behalf
of such Participant pursuant to an election to defer under any
qualified cash or deferred arrangement as described in Code section
401(k), any simplified employee pension cash or deferred arrangement as
described in Code section 402(h)(1)(B), any eligible deferred
compensation plan under Code section 457, any plan as described under
Code section 501(c)(18), and any Employer contributions made on behalf
of a Participant for the purchase of an annuity contract under Code
section 403(b) pursuant to a salary reduction agreement. Elective
Contributions shall not include any deferrals properly distributed as
excess annual additions.
1.19 Employee: An individual currently employed by the Employer. To the
extent necessary to meet the requirements of Code section 414(n) or
(o), the term "Employee" shall include a Leased Employee.
1.20 Employee Contributions: Nondeductible contributions made to the Plan by
a Participant prior to January 1, 1987. Employee Contributions are
nonforfeitable when made.
1.21 Employee in the Eligible Class: An Employee who is not an Excluded
Employee.
1.22 Employer Stock Amounts: Employee Stock Ownership Amounts which were
made on behalf of a Participant under the TSC Industries, Inc. Employee
Stock Ownership Plan and transferred to this Plan pursuant to a merger
on March 26, 1994, together with adjustments allocable thereto under
the terms of the Plan.
(a) Employer Stock Amounts are allocated to the Employer Stock
Fund which shall consist of :
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(1) Stock Account: Qualifying employer securities which
shall be expressed in terms of the number of units of
such qualifying employer securities and shall be
readily tradeable on an established securities market
pursuant to registration under the Securities and
Exchange Act; and
(2) Cash Account: All other funds attributable to
Employer Stock Amounts.
(b) Employer Stock Amounts are subject to the vesting schedules
described in Article 8 and Article 6. Any Forfeitures
reallocated as Employer Stock Amounts will be considered
Employer Stock Amounts for purposes of the Plan.
(c) "Qualifying Employer Securities" are shares of common stock
issued by the Employer. Such shares constitute "employer
securities" as defined in section 409(l) of the Code.
1.23 Employer Stock Fund: An Investment Fund which holds Employer Stock
Amounts as defined in Section 1.23 of the Plan.
1.24 Employer: Tractor Supply Company or any successor thereto, and any
other member of the Affiliated Employer group which adopts this Plan.
1.25 Employer Contributions: Elective Contributions, Qualified Non-Elective
Contributions, Matching Contributions, Special Employer Contributions,
Employer Stock Contributions and Minimum Contributions made on behalf
of a Participant.
1.26 Employment Commencement Date: The first date on which the Employee is
credited with an Hour of Service.
1.27 Entry Date: January 1st and July 1st of every year.
1.28 ERISA: The Employee Retirement Income Security Act of 1974, as amended
to date.
1.29 Excess Elective Contributions: Those Elective Contributions (as defined
in Regulation 1.402(g)-1(e)) that are includible in a Participant's
gross income under Code section 402(g) to the extent such Participant's
Elective Contributions for a taxable year exceed the dollar limitation
under such Code section. Excess Elective Contributions shall be treated
as annual additions under the Plan, unless such amounts are distributed
no later than the first April 15 following the close of the
Participant's taxable year.
1.30 Excluded Employee: An Employee who is:
(a) a Leased Employee
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(b) a Bargaining Unit Employee.
1.31 Family Member: With respect to an affected Participant, such
Participant's Spouse and such Participant's lineal ascendants and
descendants and their spouses, all as described in Code section
414(q)(6)(B).
1.32 Five Percent Owner: Any individual within the meaning of Code section
416(i)(l)(B)(iii) who owns (or is considered as owning within the
meaning of Code section 318) more than five percent of the outstanding
stock of the Employer or stock possessing more than five percent of the
total combined voting power of all stock of the Employer or, in the
case of an unincorporated business, any individual who owns more than
five percent 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.
1.33 Forfeiture: A Participant's non-vested interest in his Participant's
Account upon his termination of Service as described in Article 8.
1.34 414(s) Compensation: For the purpose of testing nondiscrimination in
the Plan, 414(s) Compensation shall mean a Participant's Compensation
plus any amounts that would be paid to the Employee during the Plan
Year except for the Employee's election to defer such compensation
under a cafeteria plan described in Code section 125, a cash or
deferred arrangement described in Code section 402(e)(3), a simplified
employee pension plan described in Code section 402(h)(i)(B), a tax
exempt plan described in Code section 403(b), an eligible deferred
compensation plan under Code section 457(b), and an employee
contribution pick-up plan under Code section 414(h)(2). The amount of
414(s) Compensation with respect to an Employee shall include 414(s)
Compensation for the Plan Year, except that the Employer will limit the
period taken into account under this method to that portion of the Plan
Year in which the Employee was an "eligible Employee", provided this
limit is applied uniformly to all eligible Employees under the Plan (or
portion thereof). For purposes of Code section 401(k) or 401(m),
"eligible Employee" is as described in Regulations 1.402(k)-1(g)(4) and
1.401(m)-(f)(4).
1.35 415 Compensation: Compensation used to determine (a) the maximum
permissible annual additions with respect to a Participant for a
Limitation Year under Code section 415 pursuant to Article 4 of the
Plan, (b) the identity of a Highly Compensated Employee as described in
Code section 414(q), (c) the identity of a key Employee as described in
Code section 416(i)(l) pursuant to Article 6 of the Plan, and (d) the
required Minimum Contribution as described in Code section 416(c)(2).
For purposes of determining the identity of a Highly Compensated
Employee, a Non-Highly Compensated Employee or a key
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Employee,415 Compensation shall include deferrals under Code sections
125, 402(a)(8), 402(h) and 403(b) made on behalf of a Participant
during a Plan Year. 415 Compensation for any Limitation Year is the
compensation actually paid or includible in gross income during such
year.
1.36 Hardship Withdrawal:
(a) A distribution from a Participant's Account that is necessary
to satisfy an immediate and heavy financial need of a
Participant. The Employer shall, in accordance with uniform
and non-discriminatory standards herein set forth in the Plan,
determine the existence of financial hardship and the amount
to be withdrawn to alleviate such hardship. A withdrawal will
be deemed to be made on account of an immediate and heavy
financial need if it is made on account of:
(1) Expenses for medical care (as described in Code
section 213(d)) incurred by the Participant, his
Spouse or any of his dependents (as defined in Code
section 152) or necessary for these persons to obtain
such medical care; or
(2) Costs directly related to the purchase (excluding
mortgage payments) of a principal residence for the
Participant; or
(3) Payment of tuition and related educational fees for
the next 12 months of post-secondary education for
the Participant, his Spouse, children or dependents;
or
(4) The need to prevent the eviction of the Participant
from his principal residence or foreclosure on the
mortgage of the Participant's principal residence; or
(5) Any other expense deemed a hardship by the
Commissioner of Internal Revenue as set forth in a
Revenue Ruling, Notice or other document of general
applicability.
(b) A withdrawal will be deemed to be necessary to satisfy the
Participant's financial need if all the following requirements
are satisfied:
(1) The withdrawal is not in excess of the amount of the
Participant's immediate and heavy financial need
(including 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 non-taxable
loans currently available under all plans maintained
by the Employer;
(3) Elective Contributions and Employee Contributions
made on behalf of the Participant under the Plan and
all other plans (as
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described in Regulation 1.401(k)-1(d)(2)(iv)(B)(4))
maintained by the Affiliated Employer are suspended
for a period of 12 months commencing as of the date
of receipt of the Hardship Withdrawal; and
(4) The amount of Elective Contributions made on behalf
of a Participant under the Plan and all other plans
maintained by the Affiliated Employer during the
Participant's taxable year immediately following the
taxable year in which he has made a Hardship
Withdrawal does not exceed the applicable dollar
limit under Code section 402(g) for such next taxable
year, less the amount of Elective Contributions made
on his behalf during the taxable year in which he
made the Hardship Withdrawal.
1.37 Highly Compensated Employee: The term Highly Compensated Employee
includes active Highly Compensated Employees and former Highly
Compensated Employees.
(a) (1) An active Highly Compensated Employee includes any
Employee who performs Service for an Affiliated
Employer during the determination year and who,
during the look-back year:
(A) received 415 Compensation from an Affiliated
Employer in excess of $75,000 (as adjusted
pursuant to Code section 415(d));
(B) received 415 Compensation from an Affiliated
Employer in excess of $50,000 (as adjusted
pursuant to Code section 415(d)) and was
member of the Top-Paid Group for such year;
or
(C) was an officer (within the meaning of Code
section 416(i) and the Regulations
thereunder) of the Employer and received 415
Compensation during such year that is
greater than 50 percent of the dollar
limitation in effect under Code section
415(b)(1)(A).
(2) An active Highly Compensated Employee also includes:
(A) Employees who are both described in
subsection (1) above if the "determination
year" is substituted for "look-back year"
and the Employee is one of the 100 Employees
who received the most 415 Compensation from
an Affiliated Employer during the
determination year (the Employer may elect
not to apply the 100-Employee Rule for the
determination year); and
(B) Employees who are Five Percent Owners at any
time during the look-back year or
determination year.
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(3) If no officer has satisfied the 415 Compensation
requirement of subsection (1)(C) above during either
a determination year or look-back year, the highest
paid officer for such year shall be treated as a
Highly Compensated Employee.
(4) The number of officers is limited to 50 (or, if less,
the greater of 3 Employees or 10% of Employees).
(b) A former Highly Compensated Employee includes any Employee who
separated from Service (or was deemed to have separated) prior
to the determination year, performs no Service for an
Affiliated Employer during the determination year, and was an
active Highly Compensated Employee for either the separation
year or any determination year ending on or after the
Employee's 55th birthday.
(c) The determination of who is a Highly Compensated Employee,
including the determinations of the number and identity of
Employees in the Top Paid Group, the top 100 Employees, the
number of Employees treated as officers and the 415
Compensation that is considered, will be made in accordance
with Code section 414(q) and the Regulations thereunder.
(d) For the purpose of identifying a Highly Compensated Employee
the "determination year" shall be the Plan Year. The
"look-back year" shall be the twelve-month period immediately
preceding the determination year.
1.38 Hour of Service: An Hour of Service which must, as a minimum, be
counted for the purposes of determining a Year of Service and a 1-Year
Break in Service means:
(a) Each hour for which an Employee is paid or entitled to
payment, for the performance of duties for the Employer during
the applicable Computation Period during which the duties are
performed; and
(b) Each hour for which an Employee is paid, or entitled to
payment by the Employer on account of a period of time during
which no duties are performed (irrespective of whether the
employment relationship has terminated) due to vacation,
holiday, illness, incapacity (including disability), layoff,
jury duty, military duty or leave of absence, provided no more
than 501 Hours of Service are required to be credited under
this paragraph to an Employee on account of any single
continuous period (whether or not such period occurs in a
single Computation Period). Hours under this paragraph will be
calculated and credited pursuant to section 2530.200b-2 of the
Department of Labor Regulations which is incorporated herein
by reference; and
(c) Each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by the Employer. Such
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
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which the award agreement or payment is made. The same Hours
of Service shall not be credited under both subparagraph (a)
or subparagraph (b) as the case may be, and under this
subparagraph (c). Hours of Service will be credited for
employment with the Affiliated Employer. Hours of Service will
also be credited for any individual considered an Employee for
purposes of this Plan under Code section 414(n) or Code
section 414(o) and the Regulations thereunder.
(d) For purposes of determining whether a 1-Year Break in Service
for participation and vesting purposes has occurred in a
Computation Period, the Plan must also treat as an Hour of
Service each hour for which an Employee is absent due to a
paid or unpaid maternity or paternity absence from work if
such absence is caused by pregnancy of the Employee, birth of
a child of the Employee, placement of a child with the
Employee in connection with the adoption of such child by such
Employee, or caring of such child for a period beginning
immediately following such birth or placement. Up to 501 Hours
of Service may be credited only in the year in which the
maternity or paternity absence begins if the Employee would be
prevented from incurring a 1-Year Break in Service by sole
virtue of these service credits or, in any other case, in the
immediately following year. No credit will be given for a
maternity or paternity absence unless the Employee furnishes
to the Plan Administrator such timely information as the Plan
Administrator may reasonably require to establish that the
absence from work is due to one of the reasons listed above,
and the number of days for which there was such an absence.
(e) Hours of Service shall be determined on the basis of actual
hours for which an Employee is paid or entitled to payment.
Any records of the Employer, such as payroll records, which
accurately reflect Hours of Service may be used to determine
the Hours of Service creditable to a particular Employee.
1.39 Investment Fund: Any fund in which investment is permitted by the Plan.
1.40 Leased Employee: Any individual who, pursuant to an agreement between
the Employer and any other entity ("leasing organization"), has
performed services for the Employer (or for the Employer 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 performed under the primary direction and control of
the Employer.
(a) Contributions or benefits provided for a Leased Employee by
the leasing organization which are attributable to services
performed for the Employer shall be treated as provided by the
Employer.
(b) A Leased Employee shall not be considered an Employee of the
Employer if:
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(1) such Employee is covered by a money purchase pension
plan providing:
(A) a nonintegrated employer contribution rate
of at least 10 percent of 415 Compensation,
including Elective Contributions, made on
behalf of such employee;
(B) immediate participation; and
(C) full and immediate vesting; and
(2) Leased Employees do not constitute more than 20
percent of the Affiliated Employer's non-highly
compensated work force (as set forth in Code section
414(n)(5)(C)). Clause (1)(B)) shall not apply to any
individual whose 415 Compensation from the leasing
organization in each Plan Year during the four-year
period ending with the relevant Plan Year is less
than $1,000.
1.41 Limitation Year: The Plan Year.
1.42 Matching Contributions: Employer Contributions made on behalf of a
Participant on account of a Participant's Elective Contributions, in
accordance with Article 3. Matching Contributions are subject to the
vesting schedules described in Article 8 and Article 6 and are required
to satisfy the actual contribution percentage test described in Article
5.
1.43 Minimum Contributions: Non-Elective Contributions required to be made
in accordance with Article 6 on behalf of certain eligible Participants
who are non-key Employees in any Plan Year in which the Plan is top
heavy.
1.44 Net Profits: The Employer's income or profits for a year as shown upon
the statement of the independent auditors of the Employer for said year
without any reduction for taxes based upon income or for Employer
Contributions to this Plan and any other qualified plan.
1.45 Non-Elective Contributions: Minimum Contributions made on behalf of a
Participant in accordance with Article 6.
1.46 Non-Highly Compensated Employee: An Employee of the Affiliated Employer
who is not a Highly Compensated Employee or a Family Member of a Highly
Compensated Employee.
1.47 Normal Retirement Age: The Normal Retirement Age of a Participant shall
be his 65th birthday.
1.48 Normal Retirement Date: The first day of the calendar month coincident
with or next following the date a Participant attains his Normal
Retirement Age.
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1.49 1-Year Break in Service: An eligibility Computation Period or vesting
Computation Period during which the Participant does not complete more
than 500 Hours of Service.
1.50 Optional Employer Contributions: Discretionary Contributions made on
behalf of a Participant prior to January 1, 1997. Optional Employer
Contributions are subject to the vesting schedules in Article 8 and
Article 6.
1.51 Participant: Any Employee or former Employee who is participating in
the Plan in accordance with its provisions. The term "Participant"
shall include an inactive Participant, if applicable, a former
Participant and an alternate payee as described in Code Section 414(p),
except that such Participant or alternate payee shall not be entitled
to have any Contributions and, if applicable, Forfeitures made on his
behalf. For the purpose of a nondiscrimination test as described in
Article 5, if an Elective Contribution is required as a condition of
participation in the Plan, then any Employee who could be a Participant
in the Plan shall be treated as an eligible Participant on behalf of
whom no Contributions have been made.
1.52 Participant's Account: The individual account maintained for a
Participant in accordance with the terms of the Plan, as described in
Article 7.
1.53 Plan: Tractor Supply Company Restated 401(k) Retirement Plan as
contained herein and as amended from time to time.
The Plan is designed to qualify as a profit-sharing plan for purposes of Code
section 401(a) and include a qualified cash or deferred arrangement
under Code section 401(k).
1.54 Plan Administrator: The Employer or any individual(s) or entity
designated in writing by the Employer and any successor thereto.
1.55 Plan Year: Effective January 1, 1996, the 12 consecutive month period
beginning on January 1st and ending on the next following December
31st. For Plan Years prior to 1996, the Plan Year was the 12
consecutive month period ending on the last Saturday in March. The Plan
Year that began on March 26, 1995 was short. It began on March 26, 1995
and ended on December 31, 1995.
1.56 Postponed Retirement Date: The first day of the month coinciding with
or next following the date a Participant is separated from Service with
the Employer after his Normal Retirement Date for any reason other than
death.
1.57 Qualified Domestic Relations Order: Any judgment, decree or order made
pursuant to a state's domestic relations law (within the meaning of
Code section 414(p)), which relates to provision of child support,
alimony payments or marital property rights to an alternate payee of a
Participant. Upon receipt of a domestic relations order, the Plan
Administrator shall promptly notify the Participant and any other
alternate payee of the receipt of such order and the Plan's procedures
for determining the qualified status of the domestic relations order.
An alternate payee is a Spouse, former Spouse, child or other dependent
of a Participant who is recognized by a domestic relations order as
having a right to
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<PAGE> 20
receive all or a portion of the benefits payable under a plan with
respect to such Participant. Distributions to an alternate payee
pursuant to a Qualified Domestic Relations Order shall be made without
respect to the age or employment status of the Participant.
1.58 Qualified Election Period shall mean the five-Plan-Year period
beginning with the Plan Year after which the Participant first becomes
a Qualified Participant.
1.59 Qualified Non-Elective Contributions: Employer Contributions made to
the Plan in accordance with Article 3. Qualified Non-Elective
Contributions are nonforfeitable when made and are distributable only
as described in Regulation 1.401(k)-1(d). If necessary, the Employer
may elect to use Qualified Non-Elective Contributions to satisfy either
the actual deferral percentage test or the actual contribution
percentage test, if applicable, both of which are described in Article
5.
1.60 Qualified Participant shall mean a Participant who has attained age 55
and who has completed at least 10 years of participation in the Plan.
1.61 Re-Employment Commencement Date: The first day following a 1-Year Break
in Service on which the Employee is credited with an Hour of Service.
1.62 Regulation: An Income Tax Regulation as promulgated by the Secretary of
the Treasury or his delegate, and as amended from time to time.
1.63 Retirement Date: The date a Participant attains his Normal Retirement
Date, Postponed Retirement Date, Early Retirement Date or Disability
Retirement Date, whichever is applicable to a Participant.
1.64 Rollover Amounts: Any contributions made to the Plan pursuant to Code
sections 402(c) and 408(d), in accordance with Article 3.
1.65 Service: A period of uninterrupted employment with the Employer.
(a) Unless employment is actually terminated, temporary absence
for a period authorized by the Employer because of disability,
sickness or injury, or absence for any period during an
authorized vacation, leave of absence or layoff, or by reason
of jury duty, or by reason of service with the armed forces of
the United States of America to the extent provided below,
shall not be construed as interrupting Service and shall be
included in determining length of Service with the Employer,
subject to Sections 1.36 and 1.47 of the Plan. The Employer's
leave of absence policy shall be granted in a uniform and
non-discriminatory manner with respect to all Participants
under similar circumstances.
(b) If the employment of an Employee is actually terminated or
interrupted for any reason other than for service with the
armed forces of the United States of America to the extent
provided below, and if at any time he subsequently resumes
employment with the Employer, he shall be treated as any other
new Employee for the purposes of the Plan, except
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<PAGE> 21
that his prior period of uninterrupted employment with the
Employer shall be included in determining the length of his
Service. Such prior period of employment will be included in
accordance with the Break in Service rules of Section 1.75 and
Article 8.6
(c) In the case of an Employee whose employment is terminated or
interrupted by reason of service with the armed forces of the
United States of America and who subsequently resumes
employment with the Employer, he shall be treated as any other
new Employee for the purposes of the Plan except that (a) his
prior period of uninterrupted employment with the Employer
shall be included in determining the length of his Service,
and (b) if he returns to active employment within 90 days
following his discharge from said armed forces, his period of
service with said armed forces as well as his prior period of
uninterrupted employment with the Employer shall be included
in determining the length of his Service.
(d) Any service as a sole proprietor or partner of a predecessor
business organization prior to becoming an Employee of the
Employer shall not be taken into consideration as Service with
the Employer for the purposes of the Plan.
1.66 Short Plan Year: A Plan Year of less than a twelve month period. In the
event that the Plan has a Short Plan Year, the determination of whether
an Employee has completed a Year of Service for vesting and eligibility
purposes shall be made in accordance with Department of Labor
Regulation 2530.203-2(c).
1.67 Special Employer Contributions: Qualified Non-Elective Contributions
made on behalf of a Participant listed in Schedule A and in accordance
with Article 3.
1.68 Spouse: The Spouse or surviving Spouse of the Participant. A former
Spouse may be treated as the Spouse or surviving Spouse to the extent
provided under a Qualified Domestic Relations Order as described in
Code section 414(p).
1.69 Standard 415 Compensation: A Participant's earned income, wages,
salaries, fees for professional services and other amounts received for
personal services actually rendered in the course of employment with
the Employer maintaining the Plan (including, but not limited to,
commissions paid salesmen, compensation for Services on the basis of a
percentage of profits, commissions on insurance premiums, tips, and
bonuses) and excluding the following:
(a) Employer contributions to a plan of deferred compensation
which are not includible in the Employee's gross income for
the taxable year in which contributed, or Employer
contributions under a simplified employee pension plan to the
extent such contributions are excludible from the Employee's
gross income, or any distributions from a plan of deferred
compensation;
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(b) Contributions made by the Employer to a plan of deferred
compensation to the extent that all or a portion of such
contributions are recharacterized as a voluntary Employee
contribution;
(c) Amounts realized from the exercise of a non-qualified stock
option, or when restricted stock (or property) held by an
Employee becomes freely transferable or is no longer subject
to a substantial risk of forfeiture;
(d) Amounts realized from the sale, exchange or other disposition
of stock acquired under a qualified stock option; and
(e) Other amounts which received special tax benefits, or
contributions made by an Employer (whether or not under a
salary reduction agreement) towards the purchase of an annuity
contract described in Code section 403(b) (whether or not the
contributions are excludible from the gross income of the
Employee).
1.70 Top Paid Group: The top twenty percent of the Employees who performed
Services for the Employer during the applicable year pursuant to Code
section 414(q) and the Regulations thereunder. Such Employees are
ranked on the basis of 415 Compensation paid during such Plan Year.
Affiliated Employers shall be taken into account as a single Employer,
and Leased Employees shall be treated as Employees pursuant to Code
section 414(n) or (o). Employees who are non-resident aliens 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. For purposes of determining the number of Employees in the
Top Paid Group, the exclusions under Code sections 414(q)(8)(A),(B),
(C) and (D) shall not apply. Employees who are included in a unit of
employees covered by an agreement that the Secretary of Labor finds to
be a collective bargaining agreement between employee representatives
and the Employer are included, except as otherwise provided under Code
section 414(q) and its Regulations.
1.71 Trust Agreement: The agreement, as amended from time to time, entered
into between the Employer and the Trustees to carry out the purposes of
the Plan.
1.72 Trust Fund: The cash and other investments held and administered by the
Trustees in accordance with the provisions of the Plan and the Trust
Agreement.
1.73 Trustees: Trustees or Successor Trustees of the Tractor Supply Company
Restated 401(k) Retirement Plan as amended from time to time.
1.74 Valuation Date: Except as provided in Article 6, the last day of the
Plan Year and such other dates during the Plan Year, as selected by the
Plan Administrator for valuing the assets under the Plan.
1.75 Voluntary Individual Retirement Amounts: Deductible Employee
contributions made to the Plan by a Participant prior to January 1,
1987. Voluntary Individual Retirement Amounts are nonforfeitable when
made.
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1.76 Year of Service:
(a) An Employee shall be considered to have rendered a Year of
Service if he completes at least 1,000 Hours of Service during
the applicable Computation Period.
(b) If an Employee's Service is terminated and if at any time he
subsequently resumes his employment with the Employer, his
prior Years of Service shall be taken into account in
computing his Years of Service subject to the following rules:
(1) Any former Participant who, under the Plan, had no
nonforfeitable right to any interest in the Plan
resulting from Employer Contributions, upon
termination of employment, shall lose credits for
Years of Service before a Break in Service if his
consecutive 1-Year Breaks in Service equal or exceed
the greater of (A) five or (B) the aggregate number
of his pre-break Years of Service. Such aggregate
number of Years of Service before such breaks shall
not include any Years of Service which are not
required to be taken into account by reason of any
prior break in Service.
(2) In the case of a Participant who has five consecutive
1-Year Breaks in Service, Years of Service completed
after such 5 year period shall not be taken into
account for purposes of determining the
nonforfeitable percentage of his account balance
derived from Employer Contributions which accrued
before such 5 year period.
(c) An Employee who becomes an Excluded Employee but who remains
in the employ of the Employer and who completes at least 1,000
Hours of Service during a vesting Computation Period shall
accrue a Year of Service for each such vesting Computation
Period.
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Article 2. ELIGIBILITY AND PARTICIPATION
2.1 Entry Dates and Eligibility Requirements.
(a)(1) Each Employee in the Eligible Class shall become a Participant
on the first Entry Date coincident with or next following his
completion of one Year of Service and attainment of Age 21.
(2) Regardless of the Age and Service requirements above, an
Employee in the Eligible Class who is employed on May 1, 1997
shall become a Participant on May 1, 1997.
(b) Notwithstanding the requirements set forth above, an Employee
in the Eligible Class may become a Participant in the Plan
solely for the purpose of contributing a Rollover Amount.
(c) In the event that an Excluded Employee becomes an Employee in
the Eligible Class, he shall become a Participant in the Plan
solely for the purpose of contributing a Rollover Amount.
2.2 Re-Employment of an Employee. An Employee in the Eligible Class who was
not previously a Participant and who has had a 1-Year Break in Service
and who, prior to that break, had satisfied the Service requirement
shall become a Participant on the first Entry Date on which he again
becomes an Employee in the Eligible Class and satisfies the Age
requirement.
2.3 Re-Employment of a Former Participant. An Employee in the Eligible
Class who was previously a Participant whose Service with the Employer
terminated shall become a Participant on the day on which he resumes
Service with the Employer.
2.4 Amended and Restated Plan. All Participants under the Plan as in effect
on June 30, 1997 shall continue to be Participants hereunder on the
Amendment and Restatement date effected upon approval of Registration
of TSC ESOP Stock.
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Article 3. CONTRIBUTIONS
3.1 Elective Contributions. The Employer shall contribute to the Plan
during the Plan Year on behalf of each Participant, as an Elective
Contribution, that portion of Compensation otherwise payable by the
Employer to the Participant that such Participant has elected to be
deferred and contributed to the Plan in that Plan Year. In no event
shall the portion of Compensation to be deferred be less than 1% of the
Participant's Compensation nor more than 15% of the Participant's
Compensation up to the maximum described below.
(a) (1) The percentage of Elective Contributions to be
deferred shall be elected by the Participant in a
written salary reduction agreement between the
Participant and the Employer. The salary reduction
agreement shall be in such form and subject to such
rules as the Employer shall prescribe. Such agreement
shall specify the percentage the Participant has
elected to defer and contribute to the Plan.
(2) A Participant may elect to commence or modify
Elective Contributions on January 1st and July 1st.
In addition, a Participant may terminate his Elective
Contributions at any time.
(b) In any Plan Year beginning after December 31, 1987, the amount
of Elective Contributions for any Participant under this Plan,
together with the Elective Contributions (as defined in Code
section 402(g)(3)) made on behalf of a Participant in any
other qualified plan maintained by the Employer, shall not
exceed the dollar limitation contained in Code section 402(g)
in effect at the beginning of each calendar year. The Plan
shall distribute to the Participant, upon notification from
the Participant of the amount of Excess Elective Contributions
received by the Plan, any amount in excess of such limit. Such
amount shall be adjusted for gain or loss in accordance with
the method used for excess contributions as described in
Article 5. Notwithstanding any other provision of the Plan,
such excess amount shall be distributed not later than the
April 15th following the calendar year in which such excess
amount is made. A Participant is deemed to notify the Plan
Administrator of any Excess Elective Contributions that arise
by taking into account only those Elective Contributions made
to this Plan and any other plans of the Affiliated Employer.
3.2 Matching Contributions. The Employer may make a Matching Contribution
each Plan Year in accordance with the following formula:
(a) 100% of the first 3% of Elective Contributions made under
Section 3.1 above, and
(b) 50% of the next additional 4% of Elective Contributions made
under Section 3.1 above.
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In no event shall the total Matching Contribution made on behalf of a
Participant exceed 5% of such Participant's Compensation in any Plan
Year.
3.3 Basic Employer Contribution.
(a) For Plan Years prior to May 1, 1997, the Employer may make a
Basic Employer Contribution each Plan Year of an amount that
shall be determined and authorized by resolution of the Board
of Directors. The percentage for such Contribution is
currently set at 2% of a Participant's Compensation.
(b) In no event shall a Basic Employer Contribution be made on
behalf of a Participant whose employment terminates prior to
the end of the applicable Plan Year.
3.4 Special Employer Contributions. For each Plan Year ending on or before
the date described on Schedule A, the Employer will make a Special
Employer Contribution in behalf of each Participant listed in Schedule
A. Such Contribution will be equal to the monthly contribution amount
listed on the Schedule for each Participant multiplied by twelve, or in
the case of a Participant who terminates during the Plan Year, the
monthly contribution multiplied by the number of months employed during
such Plan Year. However, for the Short Plan year that began on March
26, 1995, the monthly contribution amount listed on the Schedule shall
be multiplied by nine.
3.5 Qualified Non-Elective Contributions. The Employer may make Qualified
Non-Elective Contributions in accordance with Articles 5 and 6.
3.6 Rollover Amounts. The Plan may accept a Rollover Amount from an
Employee provided that, such amount qualifies as a Rollover Amount
pursuant to Code sections 402(c) and 408(d), and all of the following
conditions are met:
(a) the amount distributed from such plan is transferred to this
Plan no later than the 60th day after such distribution was
received by the Employee;
(b) the amount transferred to this Plan does not include any
amounts contributed by the Employee to the prior plan;
(c) no part of the rollover is a distribution from a plan that was
required due to the age of the Employee pursuant to section
401(a)(9) of the Code;
(d) the rollover of funds does not constitute a direct or indirect
transfer from a plan which was subject to the qualified joint
and survivor annuity requirements of sections 401(a)(11) and
417 of the Code;
(e) the Participant shall be 100% vested in any such Rollover
Amount;
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(f) the Plan may require, as a condition of accepting a Rollover
Amount on behalf of a Participant, an opinion of counsel that
such amount qualifies as a permitted Rollover Amount and the
Employer may rely on such opinion; and
(g) the Plan may require that a Participant pay the cost of such
opinion as a condition of accepting such amount.
Such rollover may also be made through an Individual Retirement Plan
qualified under section 408 of the Code, where the Individual
Retirement Plan was used solely as a conduit from the plan from which
the distribution was made and the rollover is made in accordance with
subsections (a) through (g) of this Section; provided, further, that
the amount so transferred does not include contributions made by the
Employee to the Individual Retirement Plan or earnings on such
contributions. Furthermore, a rollover of "accumulated deductible
employee contributions" (as defined by section 72(o) of the Code) may
be made if and to the extent permitted by the Secretary of the
Treasury.
3.7 Employer Stock Contributions. Employee Stock Ownership Contributions
made prior to March 26, 1994. For Plan Years beginning on or after
March 26, 1994, the Employer will no longer make such Contributions.
3.8 Contributions Subject to Employer Discretion. Employer Contributions
shall be made, without regard to the Employer's current or accumulated
Net Profits.
3.9 Annual Deductible Limits. In no event shall Employer Contributions made
hereunder during a taxable year of the Employer exceed the annual
deductible limit for Employer Contributions to a qualified
profit-sharing plan as set forth in Code section 404(a)(3) as limited
by Code section 404(j).
3.10 Omission of Eligible Employee. If, in any Plan Year, any Employee who
should be included as a Participant is erroneously omitted and
discovery of such omission is not made until after an Employer
Contribution has been made, the Employer shall make a subsequent
Employer Contribution, so that the omitted Employee receives a total
amount which the said Employee would have received 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.
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3.11 Inclusion of Ineligible Employees. If, 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 an Employer Contribution for the year has been made,
except as provided in Article 17.2(b), the Employer shall not be
entitled to recover such Employer 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 for the Plan Year in which the discovery is made.
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Article 4. ANNUAL ADDITIONS
4.1 Limitations. In no event shall the amount of annual additions credited
to a Participant's accounts under all qualified plans maintained by the
Affiliated Employer, or a welfare benefit fund (as defined in Code
section 419(e)) maintained by the Affiliated Employer, or an individual
medical account (as defined in Code Section 415(1)(2)) maintained by
the Affiliated Employer, exceed the maximum permissible amount (as
described below) for any Limitation Year. Affiliated Employers will be
determined pursuant to the modifications made by Code section 415(h).
4.2 Qualified Plans Included in the Determination. In determining the
maximum permissible amount, the following rules shall apply with
respect to multiple qualified plans:
(a) All defined contribution plans of the Affiliated Employer
(whether terminated or not) will be considered one plan.
(b) All defined benefit plans of the Affiliated Employer (whether
terminated or not) will be considered one plan.
4.3 Maximum Permissible Amount. The maximum annual additions that may be
credited to a Participant's Account in a Limitation Year is the lesser
of (a) $30,000 (or, if greater, 1/4 of the dollar limitation in effect
under Code section 415(b)(1)(A)) or (b) 25% of the Participant's 415
Compensation for the Limitation Year. If a short Limitation Year is
created because of an amendment changing the Limitation Year to a
different 12 consecutive month period, the maximum permissible amount
will not exceed the defined contribution maximum dollar amount
multiplied by the following fraction:
number of months in the short Limitation Year
---------------------------------------------
twelve
4.4 Allocations Included in Annual Additions. Amounts included in
determining the annual additions for a Limitation Year shall mean the
sum of the following allocations and contributions:
(a) Affiliated Employer contributions;
(b) Employee contributions, if applicable;
(c) Forfeitures, if applicable;
(d) 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 Affiliated
Employer, if applicable; and
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<PAGE> 30
(e) Additions to a separate medical benefit account which provides
post-retirement benefits to key Employees (as defined in Code
section 419A(d)(3)) maintained under a welfare benefit fund
(as defined in Code section 419(e)) for a Participant by an
Affiliated Employer, if applicable, provided that such amount
is not subject to the maximum limit of 25% of 415
Compensation.
4.5 Allocations Not Included in Annual Additions. The following allocations
to a Participant's Account shall not be included in determining annual
additions:
(a) Rollover Amounts;
(b) Loan repayments made by a Participant to the Plan;
(c) Distributions from the Plan that a re-employed Participant
repays to the Plan under Code section 411(a)(7)(B);
(d) Distributions of a Participant's mandatory contributions that
a Participant repays to a plan under Code section
411(a)(3)(D);
(e) Employee contributions to a simplified employee pension plan
excludible from gross income under Code section 408(k)(6);
(f) Transfer of funds from one qualified plan to another; and
(g) Earnings on Contributions.
4.6 Combined Plan Limitations. If a Participant is also participating in a
tax-qualified defined benefit plan maintained by the Affiliated
Employer, the sum of the Participant's defined contribution plan
fraction and defined benefit plan fraction, as described below, will
not exceed 1.0 for any Limitation Year.
(a) The numerator of the defined contribution fraction is the sum
of the annual additions to the Participant's accounts under
all defined contribution plans (whether or not terminated)
maintained by the Affiliated Employer for the current and all
prior Limitation Years. The numerator also includes the annual
additions attributable to the Participant's nondeductible
voluntary employee contributions to any defined benefit plans,
whether or not terminated, maintained by the Affiliated
Employer; the annual additions attributable to all welfare
benefit funds as defined in Code section 419(e) maintained by
the Affiliated Employer; and the annual additions attributable
to an individual medical account, as defined in Code section
415(l)(2) maintained by the Affiliated Employer. The
denominator of the defined contribution fraction is the sum of
the maximum aggregate amounts for the current and all prior
Limitation Years of Service with the Affiliated Employer
(regardless of whether a defined contribution plan was
maintained by the Affiliated Employer). The maximum aggregate
amount in any Limitation Year is the lesser of 125 percent of
the defined
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<PAGE> 31
contribution dollar limitation or 35 percent of the
Participant's 415 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 Affiliated Employer which were in existence on May 5,
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 the Plan. Under the
adjustment, an amount equal to the product of (i) the excess
of the sum of the fractions over 1.0 times (ii) the
denominator of the defined contribution fraction, will be
permanently subtracted from the numerator of the defined
contribution 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. Notwithstanding the foregoing,
and if applicable, for any Limitation Year in which the Plan
was top heavy, as described in Article 6, "100" shall be
substituted for "125" unless the Employer elects to increase
the top heavy minimum allocation as described in Section 6.3
of the Plan. For any Plan Year in which this Plan was a super
top heavy Plan, "100" shall be substituted for "125" in any
event.
(b) The numerator of the defined benefit fraction is the sum of
the Participant's projected annual benefits under all defined
benefit plans (whether or not terminated) maintained by the
Affiliated 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 a Participant's highest average 415 Compensation
for three consecutive Years of Service, 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 Affiliated Employer which were
in existence on May 6, 1986, the denominator of the defined
benefit 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 end 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,
1996. 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. Notwithstanding the
foregoing and if applicable, for any Limitation Year in which
such defined benefit plan or plans were top heavy, "100" shall
be substituted for "125" unless the Employer elects to
increase the top heavy minimum allocation in this Plan as
described in Section 6.3 of the Plan. For
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<PAGE> 32
any Plan Year in which this Plan was a super top heavy plan,
"100" shall be substituted for "125" in any event.
4.7 Adjustments to Participant's Allocations. If the annual additions with
respect to a Participant under other defined contribution plans and
welfare benefit funds maintained by the Affiliated Employer are less
than the maximum permissible amount and the Employer Contribution that
would otherwise be contributed or allocated to the Participant's
Account under this Plan would cause the annual additions for the
Limitation Year to exceed this limitation, the amount contributed or
allocated will be reduced so that the annual additions under all such
plans and funds for the Limitation Year will equal the maximum
permissible amount. If the annual additions with respect to the
Participant under such other defined contribution plans and welfare
benefit funds in the aggregate are equal to or greater than the maximum
permissible amount, no amount will be contributed or allocated to the
Participant's Account under this Plan for the Limitation Year.
4.8 Correction of Excess Annual Additions. If the annual additions made
with respect to a Participant in any Limitation Year would exceed the
Code section 415 limitation due to a reasonable error in the estimation
of a Participant's 415 Compensation, or a reasonable error in
determining the amount of Elective Contributions that may be made with
respect to an individual under the limits of Code section 415, or the
allocation of Forfeitures, or other limited facts and circumstances
that the Commissioner of Internal Revenue Service finds justify the
availability of this Section, then the following steps shall be taken,
in the order indicated, until such excess ceases to exist:
(a) Any unmatched nondeductible Employee contributions (with any
gains thereon), to the extent such contributions would reduce
the excess amount, will be returned to the Participant;
(b) Any unmatched Elective Contributions (with any gains thereon),
to the extent such contributions would reduce the excess
amount, will be returned to the Participant;
(c) Any matched nondeductible Employee Contributions (with any
gains thereon), to the extent such contributions would reduce
the excess amount, will be returned to the Participant.
Simultaneously, any Employer matching contributions (with any
gains thereon) that relate to these nondeductible Employee
contributions, to the extent such contributions would reduce
the excess amount, will be treated as follows: if the
Participant is covered by the Plan at the end of the
Limitation Year, such excess amount in the Participant's
Account will be used to reduce Employer Contributions for such
Participant in the next Limitation Year, and succeeding
Limitation Years, as necessary. If the Participant is not
covered by the Plan at the end of the Limitation Year, such
excess amount will be held unallocated in a suspense account
and used to reduce Employer Contributions for the next
Limitation Year (and succeeding Limitation Years, as
necessary) for all of the remaining Participants in the Plan;
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<PAGE> 33
(d) Any matched Elective Contributions (with any gains thereon),
to the extent such contributions would reduce the excess
amount, will be returned to the Participant. Simultaneously,
any Employer matching contributions (with any gains thereon)
that relate to these Elective Contributions, to the extent
such contributions would reduce the excess amount, will be
treated in accordance with the same procedure which is applied
to the Employer matching contributions (with any gains
thereon) under the preceding subparagraph (c);
(e) If, after the application of subparagraphs (a), (b), (c), and
(d), an excess amount still exists and the Participant is
covered by the Plan at the end of the Limitation Year, the
excess amount in the Participant's Account will be used to
reduce Employer Contributions for such Participant in the next
Limitation Year, and each succeeding Limitation Year, as
necessary;
(f) If, after the application of subparagraphs (a), (b), (c), and
(d), an excess amount still exists and the Participant is not
covered by the Plan at the end of the Limitation Year, the
excess amount will be held unallocated in a suspense account,
and used to reduce Employer Contributions for the next
Limitation Year, and succeeding Limitation Years, as
necessary, for all of the remaining Participants in the Plan;
(g) If a suspense account is in existence at any time during a
Limitation Year pursuant to this Section, it will not
participate in the allocation of investment gains and losses.
If a suspense account is in existence at any time during a
particular Limitation Year, all amounts in the suspense
account must be allocated and reallocated to Participants'
Accounts before any Employer Contributions or any Employee
contributions, if applicable, which would constitute annual
additions may be made to the Plan for that Limitation Year.
Excess amounts attributable to Employer Contributions (other
than Elective Contributions) may not be distributed to
Participants or former Participants.
(h) Notwithstanding anything to the contrary in this Section 4.8,
amounts attributable to Forfeitures from a Participant's
Employer Stock Amount shall be reduced prior to the reduction
of any other Contributions.
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<PAGE> 34
4.9 Compliance with Code Section 415. Notwithstanding anything contained in
this Article to the contrary, the limitations, adjustments and other
requirements prescribed in this Article 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.
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<PAGE> 35
Article 5. NONDISCRIMINATION TESTING
5.1 Requirements. In order that Contributions made under the Plan do not
discriminate in favor of Highly Compensated Employees, the actual
deferral percentage test in Code section 401(k)(3) and, if applicable,
the actual contribution percentage test in Code section 401(m) shall be
met each year. Insofar as is permissible, the provisions of Code
sections 401(k)(3) and 401(m) and the Regulations thereof are
incorporated herein by reference. The determination and treatment of
the actual deferral percentage and the actual contribution percentage
shall satisfy such other requirements as may be prescribed by the
Secretary of Treasury.
5.2 Actual Deferral Percentage Test.
(a) The "actual deferral percentage" shall mean, for a specified
group of Participants for a Plan Year, the average of the
ratios (calculated separately for each Participant in the
specified group).
(1) The average of the ratios shall be:
(A) The amount of Employer Contributions
actually paid over to the Plan on behalf of
each Participant for the Plan Year to
(B) The Participant's 414(s) Compensation for
such Plan Year.
(2) Employer contributions shall include:
(A) Any Elective Contributions (including Excess
Elective Contributions of Highly Compensated
Employees), but excluding (i) Excess
Elective Contributions of Non-Highly
Compensated Employees that arise solely from
Elective Contributions made under this Plan
or other plans of the Employer and (ii)
Elective Contributions that are taken into
account in the actual contribution
percentage test (provided the actual
deferral percentage test is satisfied both
with and without including such Elective
Contributions); and
(B) At the election of the Employer, any
Qualified Non-Elective Contributions or
qualified matching contributions, if
applicable.
(b) For each Plan Year beginning after December 31, 1986, the
"actual deferral percentage test" must satisfy one of the
following tests:
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<PAGE> 36
(1) The actual deferral percentage for Participants who
are Highly Compensated Employees for the Plan Year
shall not exceed the actual deferral percentage for
Participants who are Non-Highly Compensated Employees
for the same Plan Year multiplied by 1.25; or
(2) The actual deferral percentage for Participants who
are Highly Compensated Employees for the Plan Year
shall not exceed the actual deferral percentage for
Participants who are Non-Highly Compensated Employees
for the same Plan Year multiplied by 2, provided that
the actual deferral percentage for Participants who
are Highly Compensated Employees does not exceed the
average deferral percentage for Participants who are
Non-Highly Compensated Employees by more than 2
percentage points.
5.3 Actual Contribution Percentage Test. For each Plan Year beginning after
December 31, 1986:
(a) The actual contribution percentage shall mean the average of
the contribution percentages of the eligible Participants in a
group.
(1) The "contribution percentage" shall mean the ratio
(expressed as a percentage) of the Participant's
contribution percentage amounts to the Participant's
414(s) Compensation for the Plan Year.
(2) The "contribution percentage amounts" shall mean the
sum of any employee contributions, matching
contributions, and qualified matching contributions
(to the extent not taken into account for purposes of
the actual deferral percentage) made under the Plan
on behalf of a Participant for the Plan Year.
(A) Such contribution percentage amounts shall
not include matching contributions that are
forfeited either to correct excess aggregate
contributions (as described below) or
because the Contributions to which they
relate are Excess Elective Contributions,
excess contributions or excess aggregate
contributions.
(B) Such contribution percentage amounts may
include Elective Contributions and Qualified
Non-Elective Contributions that meet the
applicable requirements of the Regulations
under Code section 401(k). The actual
deferral percentage test must be met before
Elective Contributions can be used as
contribution percentage amounts.
(b) The "actual contribution percentage test" must satisfy one of
the following tests:
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<PAGE> 37
(1) The actual contribution percentage for Participants
who are Highly Compensated Employees for the Plan
Year shall not exceed the actual contribution
percentage for Participants who are Non-Highly
Compensated Employees for the same Plan Year
multiplied by 1.25; or
(2) The actual contribution percentage for Participants
who are Highly Compensated Employees for the Plan
Year shall not exceed the actual contribution
percentage for Participants who are Non-Highly
Compensated Employees for the same Plan Year
multiplied by 2, provided that the actual
contribution percentage for Participants who are
Highly Compensated Employees does not exceed the
actual contribution percentage for Participants who
are Non-Highly Compensated Employees by more than 2
percentage points.
5.4 Special Rules.
(a) The actual deferral percentage for any eligible Participant
who is a Highly Compensated Employee for the Plan Year and who
is eligible to have Elective Contributions and any other
contributions necessary to satisfy the tests allocated to his
accounts under two or more arrangements described in Code
section 401(k) that are maintained by the Affiliated Employer
shall be determined as if all such contributions were made
under a single arrangement.
(1) If a Highly Compensated Employee participates in two
or more cash or deferred arrangements that have
different plan years, all cash or deferred
arrangements ending with or within the same calendar
year shall be treated as one cash or deferred
arrangement with respect to such Employee.
Notwithstanding the foregoing, certain plans shall be
treated as separate if mandatorily disaggregated in
Regulations under Code section 401(k).
(2) In the event that the Plan satisfies the requirements
of Code sections 401(a)(4), 401(k) and/or 401(m), or
410(b) only if aggregated with one or more other
plans or, if one or more other plans satisfy the
requirements of Code sections 401(a)(4), 401(k)
and/or 401(m), or 410(b) only if aggregated with this
Plan, the actual deferral percentages and/or the
actual contribution percentages of eligible
Participants shall be determined as if all such plans
were a single plan. For Plan Years beginning after
December 31, 1988, plans may be aggregated to satisfy
Code sections 401(k) and 401(m) only if they have the
same plan year.
(3) For purposes of determining the actual deferral
percentage of a Participant who is a Five Percent
Owner or one of the ten most highly-paid Highly
Compensated Employees, the Elective
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<PAGE> 38
Contributions (and Qualified Non-Elective
Contributions or qualified matching contributions, or
both if treated as Elective Contributions for
purposes of the actual deferral percentage test) and
414(s) Compensation of such Participant shall include
the Elective Contributions (and, if applicable,
Qualified Non-Elective Contributions and qualified
matching contributions, or both) and 414(s)
Compensation for the Plan Year of Family Members (as
defined in Code section 414(q)(6)).
(b) The actual contribution percentage for any Participant who is
a Highly Compensated Employee for the Plan Year and who is
eligible to have Employee contributions, matching
contributions (or, as applicable, qualified matching
contributions or Qualified Non-Elective Contributions or
Elective Contributions treated as matching contributions for
the Plan Year) allocated to his accounts under two or more
plans maintained by the Affiliated Employer, shall be
determined as if the total of such contribution percentage
amounts was made under one plan, unless disaggregation is
required by Regulations under Code section 401(m).
(1) If a Highly Compensated Employee participates in two
or more plans that have different plan years, this
Subsection (b) is applied by treating all plans whose
plan years end with or within the same calendar year
a single plan.
(2) For purposes of determining the contribution
percentage of a Participant who is a Five Percent
Owner or one of the ten most highly-paid Highly
Compensated Employees, the contribution percentage
amounts and 414(s) Compensation of such Participant
shall include the contribution percentage amounts and
414(s) Compensation for the Plan Year of Family
Members.
5.5 Aggregate Family Group. Family Members with respect to a Five Percent
Owner or with respect to one of the ten most highly-paid Highly
Compensated Employees shall be disregarded as separate Employees in
determining the actual deferral percentage test and, if applicable, the
actual contribution percentage test both for Participants who are
Non-Highly Compensated Employees and for Participants who are Highly
Compensated Employees.
5.6 Multiple Use Limitation. For Plan Years beginning after December 31,
1988, in order to prevent the multiple use of the alternative limit as
described in Code section 401(m)(9)(A), the provisions of Regulations
1.401(m)-2(b) are incorporated herein by reference. In the event that
the multiple use limitation is not met, the required reduction shall be
treated as an excess contribution. The amount of the reduction of the
actual deferral percentage of the entire group of Highly Compensated
Employees eligible in the arrangement subject to 401(k) shall be
calculated in the manner described in Regulation 1.401(k)-1(f)(2).
Instead of making this reduction, the Employer may eliminate such
multiple use by making Qualified Non-Elective Contributions in
accordance with Regulation 1.401(k)-1(b)(5) and (f)(1).
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<PAGE> 39
5.7 Corrective Actions. In any Plan Year in which the Employer determines
that Contributions in excess of the above limitations of this Article 5
have been made to the Plan, the Employer shall correct such excess by
either of the following methods, or a combination thereof:
(a) The Employer may make a Qualified Non-Elective Contribution on
behalf of any or all Non-Highly Compensated Employees who are
eligible Employees under the cash or deferred arrangement or
Plan being tested. Such contribution shall be allocated to the
Participant's Account of such an individual in the same ratio
that his 414(s) Compensation bears to the total 414(s)
Compensation of all Non-Highly Compensated Employees eligible
to participate in the Plan. For purposes of this allocation,
the term "eligible Employee" is as defined in Regulations
under Code section 401(k) or 401(m), as applicable.
(b) Any contribution made on behalf of a Participant who is a
Highly Compensated Employee that is designated by the Employer
as an excess contribution or excess aggregate contribution (as
described below), adjusted for gain or loss, shall within 2
1/2 months, but in no event later than 12 months following the
close of the Plan Year in which the Employer determines such
excess contribution or excess aggregate contribution was made,
be distributed to the Participant; or, if forfeitable, be
forfeited.
5.8 Distribution of Excess Contributions and Excess Aggregate
Contributions. In the event that an Employer does not correct a
deficient actual deferral percentage test or actual contribution
percentage test, if applicable, by means of a Qualified Non-Elective
Contribution and notwithstanding any other provisions of this Plan, the
following rules shall apply:
(a) Excess contributions, plus any income and minus any loss
allocable thereto, shall be distributed no later than the last
day of each Plan Year to Participants to whose accounts such
excess contributions were allocated for the preceding Plan
Year. Excess aggregate contributions, plus any income and
minus any loss allocable thereto, shall be forfeited if
forfeitable; or, if not forfeitable, distributed no later than
the last day of each Plan Year to Participants to whose
accounts such excess aggregate contributions were allocated
for the preceding Plan Year. If such excess contributions and,
if applicable, excess aggregate contributions are distributed
more than 2 1/2 months after the last day of the Plan Year in
which such excess amounts arose, a ten percent excise tax will
be imposed with respect to such amounts on the Employer
maintaining the plan.
(b) Such distributions shall be made to Highly Compensated
Employees on the basis of the respective portions of the
excess contributions and, if applicable, excess aggregate
contributions attributable to each of such Employees.
39
<PAGE> 40
(1) The actual deferral ratio or, if applicable, the
actual contribution ratio of the Highly Compensated
Employee with the highest actual deferral ratio or,
if applicable, the highest actual contribution ratio,
is reduced to the extent necessary to satisfy the
actual deferral percentage test or, if applicable,
the actual contribution percentage test or cause such
ratio to equal the actual deferral percentage ratio
or, if applicable, the actual contribution percentage
ratio of the Highly Compensated Employee with the
next highest ratio.
(2) This process is repeated until the test is satisfied.
(c) (1) Excess contributions of Participants who are
subject to the Family Member aggregation rules shall
be allocated among the Family Members in proportion
to the Elective Contributions (and amounts treated
as Elective Contributions) of each Family Member
that is combined to determine the combined actual
deferral percentage (in accordance with the leveling
method described in Section 1.401(k)-1(f)(2) of the
Regulations), and
(4) Excess aggregate contributions of Participants
subject to the Family Member aggregation rules shall
be allocated among the Family Members in proportion
to the Employee contributions and matching
contributions (or amounts treated as matching
contributions) of each Family Member that is combined
to determine the combined actual contribution
percentage (in accordance with the leveling method
described in Section 1.401(m)-1(e)(2) of the
Regulations).
(d) Excess contributions and excess aggregate contributions shall
be treated as annual additions under the Plan.
(e) Such excess amounts shall have the following meanings:
(1) "Excess contributions" shall mean, with respect to
any Plan Year, the excess of:
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<PAGE> 41
(A) the aggregate amount of Employer
Contributions actually taken into account in
computing the actual deferral percentage of
Highly Compensated Employees for such Plan
Year, over
(B) the maximum amount of such contributions
permitted by the actual deferral percentage
test (determined by reducing contributions
made on behalf of Highly Compensated
Employees in order of the actual deferral
percentages, beginning with the highest of
such percentages).
(2) "Excess aggregate contributions" shall mean, with
respect to any Plan Year, the excess of:
(A) The aggregate contribution percentage
amounts taken into account in computing the
numerator of the contribution percentage
actually made on behalf of Highly
Compensated Employees for such Plan Year
over
(B) The maximum contribution percentage amounts
permitted by the actual contribution
percentage test (determined by reducing
contributions made on behalf of Highly
Compensated Employees in order of the actual
contribution percentages beginning with the
highest of such percentages).
(f) Excess contributions (with any gains thereon) with regard to a
Plan Year shall be distributed as follows:
(1) First, from unmatched Elective Contributions; and
then, if applicable,
(2) From any matched Elective Contributions; any matching
contributions (even if qualified) that relate to such
Elective Contributions shall be forfeited; and
finally, if applicable,
(3) From any Qualified Non-Elective Contributions only to
the extent that excess contributions exceed the
balance in the Participant's Account attributable to
Elective Contributions and matching contributions.
(g) Excess aggregate contributions (with any gains thereon) with
regard to a Plan Year, shall be distributed (or, where
indicated below, forfeited) as follows:
(1) First, if applicable, any matching contributions
(even if qualified) that relate to Elective
Contributions distributed pursuant to the above
subsection shall be forfeited; and then, if
applicable,
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<PAGE> 42
(2) From any unmatched Employee contributions; and then,
if applicable,
(3) From any unmatched Elective Contributions used to
satisfy the actual contribution percentage test; and
then, if applicable,
(4) From any matched Employee contributions; any matching
contributions (even if qualified) that relate to such
matched Employee contributions shall be forfeited;
and then, if applicable,
(5) From any remaining matching contributions (even if
qualified); and then, if applicable,
(6) From any Qualified Non-Elective Contributions.
(h) The amount of excess contributions to be distributed with
respect to an Employee for a Plan Year shall be reduced by any
Excess Elective Contributions previously distributed to the
Employee for the Employee's taxable year ending with or within
the same Plan Year in accordance with Code section 402(g)(3).
The amount of Excess Elective Contributions to be distributed
for a taxable year will be reduced by excess contributions
previously distributed for the Plan Year beginning with or
within such taxable year.
5.9 Adjustment for Income or Loss on Excess Amounts. Excess contributions
or, if applicable, excess aggregate contributions shall be adjusted for
any income or loss up to the date of distribution or Forfeiture, if
applicable. Any amounts distributed in accordance with this Article
shall include a proportionate share of gain or loss (hereinafter
referred to as allocable income) for the Plan Year in which the excess
amounts arose and for the period measured from the beginning of the
next Plan Year to the date of distribution or Forfeiture, if applicable
(hereinafter referred to as "gap period"). Allocable income for the
"gap period" shall be deemed to equal ten percent of the income
allocable to excess contributions or, if applicable, excess aggregate
contributions for the Plan Year of the Participant multiplied by the
number of calendar months in the "gap period". For purposes of
determining the number of calendar months in the "gap period", a
distribution occurring on or before the fifteenth day of the month
shall be treated as having been made on the last day of the preceding
month and a distribution occurring after such fifteenth day shall be
treated as having been made on the first day of the next subsequent
month.
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5.10 Additional Requirements. Any Contributions used in the
nondiscrimination tests set forth in this Article and allocated to a
Participant's Account under the terms of the Plan as of any date within
the Plan Year must be actually paid to the Plan before the last day of
the twelve-month period immediately following the Plan Year to which
such Contributions relate. The Plan Administrator shall maintain
records sufficient to demonstrate satisfaction of the tests and the
amount of Qualified Non-Elective Contributions or qualified matching
contributions, or both, used to satisfy the actual deferral percentage
test and, if applicable, the actual contribution percentage test.
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Article 6. TOP HEAVY PROVISIONS
6.1 Top Heavy Determination. This Plan or the aggregation group of which it
is a member will be considered a top heavy plan or top heavy group for
the Plan Year if the top-heavy ratio exceeds 60%. This Plan or the
aggregation group of which it is a member will be considered a super
top heavy plan or group for the Plan Year if the top-heavy ratio
exceeds 90%.
(a) The top-heavy ratio is the total present value of accrued
benefits for key Employees under this Plan and all plans of an
aggregation group (as described below) as a percentage of the
total present value of accrued benefits for all Employees
under this Plan and all plans of an aggregation group.
(b) The "determination date" and "valuation date" for a Plan in
its first Plan Year will be as of the last day of the Plan
Year. For any Plan Year other than the first Plan Year, the
determination date and the valuation date will be as of the
last day of the preceding Plan Year.
(c) The top heavy determination will be made without regard to (1)
any non-key Employee who was formerly a key Employee and (2)
any individual who has not been credited with at least one
Hour of Service with the Employer at any time during the five
year period ending on the determination date.
(d) For the purpose of determining whether the Plan is top heavy,
the accrued benefit of a Participant who is a non-key Employee
in a defined benefit plan will be determined under a uniform
accrual method which applies in all defined benefit plans
maintained by the Employer or, where there is no such method,
as if such benefit accrued not more rapidly than the slowest
rate of accrual permitted under the fractional rule of Code
section 411(b)(1)(C). The present value of accrued benefits
includes (to the extent required by Code section 416 and the
Regulations thereunder) distributions, rollovers, Employee
non-deductible contributions and transfers from plans of the
Employer made during the Plan Year and the preceding four Plan
Years, including any distribution from a terminated plan (as
described in Regulation 1.416-1,T-4) which, if it had not been
terminated, would have been required to be in the aggregation
group.
(e) In determining whether this Plan is top heavy, all members of
the Affiliated Employer that are aggregated under Code
sections 414(b),(c), and (m) must be taken into account as a
single employer for the Plan Year in question.
6.2 Aggregation Group. An aggregation group is a required aggregation group
or a permissive aggregation group.
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<PAGE> 45
(a) A required aggregation group is each qualified plan of the
Employer in which a key Employee participates or participated
at any time during the determination period (regardless of
whether or not the plan has terminated) and each other
qualified plan of the Employer that enables the plan in which
the key Employee participates to meet the requirements of Code
section 401(a)(4) or 410. In the case of a required
aggregation group, each plan in the group will be considered a
top heavy plan if the group is top heavy. No plan in the
required aggregation group will be top heavy if the group is
not top heavy.
(b) A permissive aggregation group is all plans of the Employer
that are required to be aggregated, plus one or more plans
that are not part of a required aggregation group but that
satisfy the requirements of Code sections 401(a)(4) and 410
when considered together with the required 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.
(c) When aggregating plans, the value of account balances and
accrued benefits will be calculated with reference to the
determination dates that fall within the same calendar year.
(d) A 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 Participant accounts of key Employees under all
defined contribution plans included in the group
exceeds sixty percent of a similar sum determined for
all Participants.
6.3 Super Top Heavy Plans. If the Plan is super top heavy and if a
Participant is also participating in a defined benefit plan of the
Employer, in no event shall the annual additions under this Plan and
the defined benefit plan made with respect to such a Participant in any
Plan Year exceed 1.0 of the defined contribution plan fraction and the
defined benefit plan fraction, as described in Article 4. The above
limitation shall also apply if the Plan, although not in a super top
heavy group is, in fact, top heavy, unless the Plan provides a Minimum
Contribution equal to 7 1/2% of a Participant's 415 Compensation for
each Plan Year the Plan is top heavy.
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<PAGE> 46
6.4 Key Employee and Non-Key Employee.
(a) In determining whether or not this Plan is a top heavy plan or
a member of a top heavy group, the term "key Employee" shall
mean any Employee or former Employee (and the Beneficiaries of
such Employees), who at any time during the Plan Year
containing the determination date or the preceding four Plan
Years is:
(1) An officer of the Employer if such individual's
annual 415 Compensation exceeds 50 percent of the
dollar limitation under Code section 415(b)(1)(A);
(2) An owner (or considered an owner under Code section
318) of one of the ten largest interests in the
Employer if such individual's 415 Compensation
exceeds 100 percent of the dollar limitation in
effect under Code section 415(c)(1)(A));
(3) A Five Percent Owner of the Employer; or
(4) A one percent owner of the Employer who has annual
415 Compensation from the Employer of more than
$150,000 as indexed.
(b) The determination period is the Plan Year containing the
determination date and the four preceding Plan Years.
(c) The determination of who is a key Employee shall be made in
accordance with Code section 416(i)(1) and the Regulations
thereunder.
(d) A "non-key Employee" is any Employee who is not a key
Employee. Non-key Employees include former key Employees.
6.5 Minimum Contributions. For any Plan Year in which this Plan is a
top-heavy plan:
(a) Except as otherwise provided in this Section 6.5, Employer
Contributions and Forfeitures, if applicable, allocated on
behalf of any Participant who is not a key Employee shall not
be less than the lesser of: 3% of such Participant's 415
Compensation or, in the case where the Employer has no defined
benefit plan which designates this Plan to satisfy Code
section 401, the largest percentage of Employer Contributions
and Forfeitures, as a percentage of the key Employee's 415
Compensation allocated on behalf of any key Employee for that
year. The Minimum Contribution is determined without regard to
any Social Security contribution. The Minimum Contribution
shall be made even if, under other Plan provisions, such
Participant would not otherwise be entitled to receive an
allocation, or would have received a lesser allocation for the
year, because of:
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<PAGE> 47
(1) the Participant's failure to complete 1000 Hours of
Service (or any equivalent provided in the Plan), or
(2) 415 Compensation of less than a stated amount, or
(3) the Participant's failure to make Elective
Contributions.
(b) The Minimum Contribution shall not be subject to the
availability of current or accumulated Net Profits.
(c) Except as authorized by Regulation 1.416-1, no contributions
used to satisfy the actual deferral percentage test or the
actual contribution percentage test, both of which tests are
described in Article 5, shall be used in determining whether a
non-key Employee has received the required minimum allocation.
(d) No Minimum Contribution will be required for a non-key
Employee under this Plan for any Plan Year if the Affiliated
Employer maintains another qualified plan under which a
minimum benefit or contribution is being accrued or made for
such Employee in accordance with Code section 416(c).
6.6 Top Heavy Vesting. The vesting schedule set forth in Section 8.1 meets
the requirements of Code section 416 and shall continue to be the
vesting schedule for the Plan in the event that the Plan becomes top
heavy.
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<PAGE> 48
Article 7. PARTICIPANT ACCOUNTS AND DIRECTED INVESTMENTS
7.1 Participant Accounts. A Participant's Account shall be maintained for
or with respect to each Participant under the Plan. The Plan
Administrator shall maintain a separate accounting record with respect
to Elective Contributions, Qualified Non-Elective Contributions,
Matching Contributions, Basic Employer Contributions, Minimum
Contributions, Optional Employer Contributions, Special Employer
Contributions, Employee Contributions, Voluntary Individual Retirement
Amounts , Rollover Amounts and Employer Stock Ownership Amounts
credited to each Participant's Account, as well as of any income,
expenses, gains or losses on each such separately recorded amounts.
7.2 Allocation of Contributions and Rollover Amounts. The amount of
Contributions and Rollover Amounts made on each Participant's behalf
shall be deposited by the Employer (except for any portion of such
amounts which may be retained as an administrative or expense charge)
and shall be allocated to the appropriate Investment Funds in multiples
of whole percentages.
7.3 Investment Election. The Participant shall elect in writing on the
prescribed form the percentage of Elective Contributions, Basic
Employer Contributions, Matching Contributions, Special Employer
Contributions, Employee Contributions, Voluntary Individual Retirement
Contributions and Rollover Amounts which shall be allocated to each
Investment Fund excluding the Employer Stock Fund. Notwithstanding any
other provisions to the contrary, each Participant shall have the right
to exercise control over the direction of the investment of all amounts
allocated to their respective Employer Stock Amounts. The participants
may direct the investment of their respective Employer Stock Amounts in
any investment funds available under the Plan. To the extent that any
Participant directs the investment of the Participant's Accounts, the
Plan is intended to satisfy the requirements of ERISA Section 404(c)
and Department of Labor Regulation Section 2550.404c-1, as amended from
time to time. The Employer shall determine the percentage of any other
Contributions which shall be allocated to each Investment Fund
excluding the Employer Stock Fund. The Participant may change his
election at least quarterly, or more frequently, as required by law,
and may change the allocation as permitted by the Plan Administrator,
by the method prescribed by the Plan Administrator.
7.4 Diversification of Participant's Accounts.
(a) In lieu of limiting the Participants' right to exercise
control over the investment of their Employer Stock Amounts
until the Participants attain the status of Qualified
Participants, all Participants shall have the right to direct
the investment of all amounts allocated to their respective
Employer Stock Amounts at any time. Except for the
Participant's right to demand stock under Section 13.1(b(3)
below and except as otherwise
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<PAGE> 49
required by law, no Participant may elect to direct the
investment of the previously diversified Employer Stock
Amounts back into Employer stock after having elected to
diversify the amount into other investment alternatives.
(b) In the event that a Participant becomes a Qualified
Participant before diversifying the investment of at least 25%
of the balance in the Participant's Employer Stock Amounts and
in addition to the Participant's rights described in Section
7.3 above, the Qualified Participant shall be entitled, during
the Qualified Election Period, to elect to receive a
distribution of up to 25% of the Participant's Employer Stock
Amounts, to the extent that the Participant had not previously
elected to direct the investment or receive a distribution of
at least 25% of the Employer Stock Amounts, determined by
taking into account any prior direction or distribution. The
Participant may make the election under this Section 7.4(b)
within 90 days after the close of each Plan Year in the
Qualified Election Period. The Plan shall distribute the
applicable amount pursuant to the Participant's election
within 90 days after the last day of the period during which
the election can be made.
(c) In the case of an election year in which the Participant can
make the last election, subsection (b) above shall be applied
by substituting "50%" for "25%."
(d) If a Participant elects to diversify the investment of at
least 25% of the Employer Stock Amounts before becoming a
Qualified Participant or during any year other than the last
year of the Qualified Election Period (or 50% before or during
the last year of the Qualified Election Period), the
Participant shall have no right to elect to receive a
distribution under subsection (b) above.
(e) Notwithstanding the foregoing, any election under Section
7.4(b) by a Qualified Participant to receive a distribution
shall be subject to the consent requirements of Articles 10
and 11 of the Plan. If the consent is not secured, the amounts
otherwise distributable under Section 7.4(b) shall remain in
the Plan.
7.5 Transfer of Amounts between Funds. The Participant may elect to
transfer monies attributable to Elective Contributions, Basic Employer
Contributions, Matching Contributions, Employer Stock Amounts, Special
Employer Contributions, Employee Contributions, Voluntary Individual
Retirement Contributions and Rollover Amounts from any Investment Fund
and to any Investment Fund except the Employer Stock Fund by the method
prescribed by the Plan Administrator. The Employer may elect to
transfer monies attributable to any other Contributions to or from any
Investment Fund except no transfers may be made to the Employer Stock
Fund. Any such transfer to or from any account shall be made subject
to, and in accordance with, the rules applicable to such Investment
Fund.
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<PAGE> 50
7.6 Crediting and Debiting of Investments. Amounts allocated to said
accounts on behalf of a Participant shall be credited to his
Participant's Account. Any other credits (including any income, gains,
dividends or interest credits, if applicable), debits (including any
expenses or losses, if applicable), transfers or withdrawals to or from
any such account shall be appropriately and equitably allocated to the
Participant's Account of each Participant.
7.7 Valuation of Participant Accounts. As of each day of each Plan Year,
each Participant's Account shall be appropriately and equitably
adjusted to reflect any dividends, interest credits, other credits or
other gains, or losses on the investments and any changes in the value
of investments. The value of the monies standing to the credit of a
Participant in his Participant's Account shall reflect the total value
of his interest in said accounts.
7.8 Administrative and Expense Charges. Administrative and expense charges
incurred in connection with the operation of the Plan shall be paid
from Participant Accounts, if not paid by the Employer.
7.9 Maintenance of Participant Accounts. A Participant's Account shall be
maintained for or with respect to each Participant under the Plan
unless or until canceled in accordance with the provisions of Article
10 or Article 13.
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<PAGE> 51
Article 8. VESTING, FORFEITURES, AND BREAK IN SERVICE
8.1 Vesting Schedule. A Participant shall have a vested interest of 100% in
that portion of his Participant's Account equal to the value of
Elective Contributions, Qualified Non-Elective Contributions, Voluntary
Individual Retirement Amounts, Special Employer Contributions, Employee
Contributions and Rollover Amounts standing to his credit in such
account. Upon death, Disability or attainment of his Normal Retirement
Age or Early Retirement Date, a Participant shall also have a vested
interest of 100% in that portion of his Participant's Account equal to
the value of any Basic Contributions, Matching Contributions, Optional
Employer Contributions, Employer Stock Amounts and any Minimum
Contributions standing to his credit in such account. In all other
cases, a Participant's vested interest in that portion of his
Participant's Account attributable to Basic Contributions, Matching
Contributions, Optional Employer Contributions, Employer Stock Amounts
and Minimum Contributions shall be based on his Years of Service in
accordance with the following schedules, except as required under
Article 6:
(a) For Plan Years prior to January 1, 1997
<TABLE>
<CAPTION>
Completed Years Percentage of
of Service Vested Interest
---------- ---------------
<S> <C> <C>
Less than 3 None
3 20%
4 40%
5 60%
6 80%
7 or more 100%
</TABLE>
(b) For Plan Years beginning on or after January 1, 1997:
<TABLE>
<CAPTION>
Completed Years Percentage of
of Service Vested Interest
---------- ---------------
<S> <C> <C>
Less than 2 None
2 20%
3 40%
4 60%
5 80%
6 or more 100%
</TABLE>
8.2 Amendment of Vesting Schedule. If the vesting provisions of the Plan
should be amended, each Participant who has completed 3 Years of
Service may elect during the election period to have his vested
percentage determined without regard to such amendment. The election
period shall begin on the date the Plan amendment is adopted and shall
end on the latest of the following dates:
(a) The date which is 60 days after the day the Plan amendment is
adopted;
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<PAGE> 52
(b) The date which is 60 days after the day the Plan amendment
becomes effective;
(c) The date which is 60 days after the day the Participant is
issued written notice of the Plan amendment by the Employer or
Plan Administrator.
8.3 Vesting Formula after a Distribution. In the event a Participant
receives an in service distribution from his Participant's Account
prior to being 100% vested in that portion of his Participant's Account
attributable to Employer Stock Amounts, then any future determination
of his vested interest in that portion of his Participant's Account
derived from such contributions shall be determined in accordance with
the following formula until the Participant is 100% vested in such
Employer Contributions:
X = P (AB + D) - D
P = vested percent at relevant time
AB = balance of Participant's Account at relevant time
D = amount of a prior distribution.
8.4 Non-Vested Interest upon Termination. The value of any portion of a
Participant's Account which is not vested as of a Participant's
termination of Service shall be forfeited and credited to the Deposit
Account on the earlier of (i) the date the former Participant receives
a distribution of his vested interest or (ii) the date he incurs five
consecutive 1-Year Breaks in Service. A Participant who has no vested
interest in his Participant's Account shall be deemed to have received
an immediate distribution.
8.5 Application of Forfeitures.
(a) (1) Funds held in the Deposit Account which are
attributable to a former Participant's non-vested
interest in all Contributions, except Employer Stock
Amounts, shall be applied as follows:
(A) To restore a Participant's Account in
accordance with the provisions of Section
8.6;
(B) To reduce future Employer Contributions.
(2) Funds held in the Deposit Account which are
attributable to a former Participant's non-vested
interest in Employer Stock Amounts shall be allocated
on the last day of the Plan Year to all Participants
who have Employer Stock Amounts, have completed 1,000
Hours of Service during the Plan Year, and are
employed on the last day of the Plan Year. Such
Forfeitures will be allocated in the same ratio as
each such Participant's Compensation bears to the
total of all such Participants.
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<PAGE> 53
(b) In the event of the termination of the Plan, any funds
attributable to a former Participant's non-vested interest
shall be allocated to each Participant on the date of the
termination of the Plan in the same ratio as each
Participant's Compensation bears to the total Compensation of
all Participants.
(c) Funds attributable to forfeited Matching Contributions
credited to the Deposit Account pursuant to Article 5 and held
in the Deposit Account at the end of each Plan Year, or at the
date of termination of the Plan, if earlier, shall be
allocated to each Non-Highly Compensated Employee who is a
Participant as of the end of such Plan Year, or earlier date
of termination of Plan, in the same ratio that each Non-Highly
Compensated Employee's Compensation bears to the total
Compensation of all such Non-Highly Compensated Employees.
8.6 Break in Service. Upon termination of employment, any non-vested
portion of a Participant's Account shall be disposed of as a
Forfeiture.
(a) Upon resumption of employment as a Participant under the Plan
before 5 consecutive 1-Year Breaks in Service and before
having received a distribution, such former Participant's
Account shall be re-established with respect to him as a
Participant and the non-vested portion of such Participant's
Account, adjusted as to gains or losses, shall be reinstated.
(b) Upon resumption of employment as a Participant under the Plan
after having received a distribution, such former
Participant's Account shall be re-established with respect to
him as a Participant and the non-vested portion of such former
Participant's Account, unadjusted as to gains or losses, shall
be reinstated to his Participant's Account provided that, if
such Participant had received a total distribution of his
Participant's Account as a former Participant in the form of a
lump sum payment, he makes full repayment of such amount
before the earlier of
(1) the close of the first period of 5 consecutive 1-Year
Breaks in Service commencing after the distribution,
or
(2) within 5 years following his resumption of employment
with the Employer.
8.7 Suspension of Payment of Benefits. The payment of any benefits under
the Plan shall be suspended for such period as the Employee is
re-employed by the Employer subsequent to the commencement of payment
of such benefits.
53
<PAGE> 54
Article 9. WITHDRAWALS AND LOANS DURING PARTICIPATION
9.1 Withdrawal Procedures.
(a) Except as described in paragraph (b) below, a Participant may
elect to make withdrawals from his Participant's Account by
written notice to the Plan Administrator on its prescribed
form at least 31 days prior to the effective date stated in
the notice, unless a Participant elects to waive the 31 days
as described in Section 13.3.
(b) A Participant may not elect to withdraw any amounts
attributable to Basic Employer Contributions, Matching
Contributions, Optional Employer Contributions, Qualified
Non-Elective Contributions, Special Employer Contributions or
Employer Stock Amounts, except as provided in Section 9.5
below, prior to his termination of Service.
9.2 Withdrawal of Employee Contributions. Once a year a Participant may
withdraw from his Participant's Account all or a portion of the dollar
amount and earnings thereon of his Employee Contributions.
9.3 Hardship Withdrawals. A Participant may elect to make a Hardship
Withdrawal from his Elective Contributions account as described below:
(a) Such amount shall not exceed the dollar amount of his Elective
Contributions plus any earnings credited to such contributions
as of March 26, 1988, standing to his credit in such account,
without Forfeiture of the non-vested portion of his
Participant's Account, subject to the conditions and
limitations described in the definition of Hardship Withdrawal
in Article 1.
(b) Any Participant who elects to make such Hardship Withdrawal in
any amount may not make Elective Contributions to the Plan and
all other plans (defined in Regulation
1.401(k)-1(d)(2)(iv)(B)(4)) of the Affiliated Employers for a
period of one year from the Participant's receipt of such
withdrawal.
9.4 Withdrawal at Age 59 1/2 . A Participant who has attained age 59 1/2
may elect to withdraw all or a portion of his vested Participant's
Account except for amounts attributable to Basic Employer
Contributions, Matching Contributions, Optional Employer Contributions,
Qualified Non-Elective Contributions, Special Employer Contributions,
and Employer Stock Amounts.
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<PAGE> 55
9.5 Withdrawal for Terminal Illness. A Participant may elect to withdraw
any amounts attributable to Basic Employer Contributions, Matching
Contributions, Optional Employer Contributions, Special Employer
Contributions and Employer Stock Amounts only upon a determination by
the Plan Administrator that such Participant has a terminal illness,
which shall mean a physical condition which, more likely than not, will
result in the Participant's death, even with medical treatment, within
12 months from the date of the Participant's request for the
withdrawal. Such determination shall be made by the Plan Administrator
based upon a medical opinion from a licensed physician acceptable to
the Plan Administrator.
9.6 Other Withdrawals. Once a year, a Participant may elect to withdraw
from his Participant's Account all or a portion of his Rollover Amounts
and Voluntary Individual Retirement Amounts and any earnings thereon.
9.7 Amounts Cannot Be Repaid. Any withdrawals made by a Participant
pursuant to this Article may not be repaid to the Plan.
9.8 Loan Program. The Employer, as the Plan fiduciary, is explicitly
authorized to establish a Participant loan program under the Plan.
(a) 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. Such
Participant loan program may be modified or amended in writing
from time to time without the necessity of amending this
Section of the Plan.
(b) Anything to the contrary notwithstanding, loans made under the
Participant loan program shall comply with Code section
401(a)(13), Code section 401(k) and the Regulations
thereunder, and Department of Labor Regulation 2550.408(b)-1.
No loan to any Participant or Beneficiary will be made to the
extent that such loan, when added to the outstanding balance
of all other loans to the Participant or Beneficiary would
exceed the lesser of:
(1) $50,000 reduced by the excess (if any) of the highest
outstanding balance of loans during the one year
period ending on the day before the loan is made,
over the outstanding balance of loans from the plan
on the date the loan is made, or
(2) one-half the present value of the nonforfeitable
accrued benefit of a Participant's Account
attributable to Elective Contributions, Matching
Contributions and Basic Employer Contributions.
For the purpose of the above limitation, all loans from all
plans of the Employer and other members of a group of
employers described in Code sections 414(b), 414(c), and
414(m) and (o) are aggregated. Furthermore, any loan from the
Plan shall by its terms require that repayment (principal
55
<PAGE> 56
and interest) be amortized in level payments, not less
frequently than quarterly, over a period not extending beyond
five years from the date of the loan, unless such loan is used
to acquire a dwelling unit which within a reasonable time
(determined at the time the loan is made) will be used as the
principal residence of the Participant.
(c) Written spousal consent (as described in Code Section
417(a)(4) and Section 1.401(a)-2 Q & A 24 of the Regulations)
must be obtained within the 90-day period ending on the date
on which the loan is to be secured.
56
<PAGE> 57
Article 10. TERMINATION OF EMPLOYMENT PRIOR TO RETIREMENT DATE
10.1 General. If a Participant terminates employment with the Employer prior
to his Retirement Date, he shall be entitled to receive the value of
the vested portion in his Participant's Account in accordance with
Article 13.
10.2 Election of Timing of Distribution . Subject to any consent
requirements imposed on him by Article 11, a Participant shall, as of
the date of his termination of employment, elect by written notice to
the Plan Administrator on its prescribed form, that the value of the
vested portion of his Participant's Account be used to provide a Plan
distribution to him in accordance with the payment options described in
Article 13, or, except as provided below, left on deposit until, at any
time before, as of, or after his Normal Retirement Date, he elects to
receive a distribution in accordance with the payment options in
Article 13. Any funds left on deposit are subject to the distribution
rules set forth in Article 13. In the event that a Participant's
election is not received by the Plan Administrator as of the date of
his termination of employment, the Participant shall be deemed to have
elected to leave his Participant's Account on deposit until such time
as a distribution is elected or required.
10.3 Distribution of Benefits. Benefits shall be payable as follows:
(a) Distribution of all Contributions: Unless a Participant elects
an earlier distibution pursuant to Section 10.3 (b) and (c),
the vested value of a Participant's Account shall be payable
within 60 days after the Valuation Date coincident with or
next following the date his employment is terminated.
(b) Election of Earlier Payment. A Participant who is entitled to
a distribution under subsection (a) above may elect to receive
such distribution at an earlier date following the date he
terminates employment with the Employer. In such event, the
distribution shall be payable as soon as administratively
feasible following the receipt of his request by the Plan
Administrator. Such amount so distributed shall include fund
earnings (as described in Article 7) credited as of the
preceding valuation date.
(c) Election to Defer Payment. Notwithstanding the foregoing
provisions of subsection 10.3(a), if the value of a
Participant's Vested Benefit is greater than $3,500, then the
Vested Benefit may not be distributed without the
Participant's written consent prior to the time he attains
what would have been his Normal Retirement Date.
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<PAGE> 58
10.4 Automatic Immediate Distribution. Notwithstanding any other provision
of the Plan to contrary, in the event that the vested portion of a
Participant's Account does not exceed $3,500 as of the date of a
Participant's termination or the earlier date of any prior
distribution, then the distribution of such vested portion shall be
made in the form of a lump sum payment as soon as administratively
practicable. Any nonvested portion will be treated as a Forfeiture.
10.5 Death of a Former Participant. Upon the death of a former Participant
prior to the application of his Participant's Account to provide a Plan
distribution to him, the value of the vested portion of his
Participant's Account shall be applied in accordance with the
provisions of Article 12 and, if applicable, Article 13.
10.6 Cancellation of a Participant's Account. Upon the total application of
the Participant's Account to provide a Plan distribution with respect
to the former Participant, such Participant's Account shall be canceled
and be of no further force or effect under the Plan. In no event will
any Contributions or Rollover Amounts be made to the Plan on behalf of
a former Participant unless the former Participant again becomes an
Employee and a Participant under the Plan.
10.7 Unclaimed Account. In the event that all or any portion of the
distribution payable to a Participant or his Beneficiary hereunder
shall at his Normal Retirement Date remain unpaid solely by reason of
the inability of the Plan 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, first from Forfeitures, if
any, and then from an additional Employer contribution if necessary.
However, in the event of Plan termination, the Plan Administrator may
direct the Trustee to distribute the benefits to an interest bearing
savings account established in the name of the missing Participant or
Beneficiary.
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<PAGE> 59
Article 11. RETIREMENT BENEFITS
11.1 Retirement Dates. Each Participant may terminate his employment with
the Employer and retire for the purposes hereof on and after his
Retirement Date. Upon such event, a Participant is entitled to receive
his vested Participant's Account. Upon a Participant's Retirement Date,
or as soon thereafter as practical, the Plan Administrator shall direct
the distribution of all amounts in accordance with Article 13.
11.2 Automatic Form of Distribution. Unless the Participant elects an
optional form of benefit uner Section 13.6, a Participant who does not
die before his Benefit Starting Date shall receive his benefit in the
form of a lump sum payment in cash or if applicable in qualifying
employer stock.
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<PAGE> 60
Article 12. DEATH BENEFITS
12.1 Value of Death Benefit.
(a) Upon the death of a Participant prior to his Benefit Starting
Date, the deceased Participant's Beneficiary shall be entitled
to receive the Participant's nonforfeitable Participant's
Account balance (reduced by any security interest held by the
Plan by reason of a loan outstanding to such Participant) in
accordance with the payment options described in Section 13.1
and limited by the death distribution requirements described
in Section 13.6. Any designation of a Beneficiary by a married
Participant shall comply with Section 12.2 below.
(b) Upon the death of a former Participant after his Benefit
Starting Date, the deceased former Participant's Beneficiary
shall be entitled to receive the remaining value, if any, of
his Participant's Account (reduced by any security interest
held by the Plan by reason of a loan outstanding to such
Participant) in accordance with the payment options described
in Section 13.1 and limited by the death distribution
requirements described in Section 13.6.
12.2 Election to Waive Pre-Retirement Surviving Spouse Death Benefit. Each
married Participant shall be deemed to have designated his Spouse as
the sole Beneficiary of his pre-retirement surviving spouse death
benefit.
(a) A Participant may waive the pre-retirement surviving Spouse
death benefit by designating a specific non-Spouse Beneficiary
and obtaining the signed and written consent of the
Participant's Spouse, witnessed by a Plan representative or
notary public, to such non-Spouse Beneficiary. Notwithstanding
the foregoing, the Participant may change a prior Beneficiary
designation without further spousal consent, provided the
consent of the Spouse acknowledges that the Spouse has the
right to limit consent only to a specific non-Spouse
Beneficiary and the Spouse voluntarily elects to relinquish
such right. Any consent obtained under this provision will be
valid only with respect to the Spouse who signs the consent
and will be treated as being irrevocable with respect to that
Spouse.
(b) The Participant may designate a non-Spouse Beneficiary without
the consent of his Spouse if it is established to the
satisfaction of a Plan representative that there is no Spouse,
that the Spouse cannot be located, that the Participant is
legally separated or that the Participant has been abandoned
(within the meaning of local law) and the Participant has a
court order to such effect. In such case, spousal consent is
not required unless a Qualified Domestic Relations Order
provides otherwise.
(c) A Participant may, at any time prior to his Benefit Starting
Date, revoke his prior waiver of the pre-retirement surviving
Spouse death benefit and
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restore the Spouse as Beneficiary, without spousal consent by
filing written notice of such revocation with the Plan
Administrator. The number of revocations shall not be limited.
12.3 Pre-Retirement Death Benefit for Unmarried Participants. If a
Participant is unmarried at death prior to his Benefit Starting Date, a
death benefit shall be paid in a lump sum to his Beneficiary. The
amount of his death benefit shall be the total value of his
Participant's Account determined as of the date of payment, subject to
Section 12.1.
12.4 Distribution Options of a Beneficiary.
(a) The surviving Spouse may direct that payments of the
applicable death benefit commence within a reasonable period
of time after the death of the Participant, but shall not be
required to begin receiving payments prior to the date on
which the Participant would have attained Normal Retirement
Age.
(b) The Participant's surviving Spouse (or any other designated
Beneficiary) may elect another payment option described in
Section 13.1 in lieu of the form of distribution which would
otherwise be provided, subject to and limited by the death
distribution requirements described in Section 13.6.
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Article 13. BENEFIT OPTIONS AND DISTRIBUTION RULES
13.1 Payment Options.
(a) The automatic form of distribution is a lump sum payment.
(b) (1) Subject to the distribution rules of this Article, a
Participant or, if applicable, a Beneficiary may
elect, by written notice to the Plan Administrator on
its prescribed form that the distribution of his
Participant's Account be made in installment payments
in either cash or in qualifying employer securities
as described below.
(2) Installments. Installment payments from a
Participant's Account may be payable in monthly,
quarterly, semi-annual or annual installments, over a
specified period of years not in excess of twenty
(20) years, as elected by the Participant. The
distribution in any year shall be determined as a
fraction of the remaining Participant Account, such
fraction being determined as of the most recent
valuation date as one (1) divided by the remaining
number of years of the specified period, in
accordance with the election of the Participant;
provided, however, that no arrangement may be made
which would result in a periodic payment of less than
fifty dollars ($50.00). Upon the death of the
Participant after distributions commence hereunder,
the Beneficiary, if living, may similarly elect to
receive the balance of the Account of the Participant
in installments over not more than five (5) years or
in a lump sum, and upon the Beneficiary's subsequent
death, the balance, if any, of the Participant's
Account shall be paid in a lump sum to the estate of
the Beneficiary.
(3) Qualifying Employer Securities. Subject to the
provisions in Section 7.4, a Participant shall have
the right to elect that all or a portion of his
benefit attributable to his Employer Stock Amounts be
distributed to him in the form of qualifying employer
securities exept for fractional shares which will be
distributed in cash. If the Participant has
previously elected to diversify all or a portion or
receive a distribution of a portion of his Employer
Stock Amounts, the Participant's right to demand
stock shall be limited to the amount in his Employer
Stock Amounts in excess of the lesser of (i) that
portion which the Participant has elected to
diversify or receive as a distribution, or (ii) the
minimum amount required to be available for
diversification under Code Section 401(a)(28)(B). In
the event that a Participant diversifies an amount in
excess of the minimum amount required under Code
Section 401(a)(28) and the Participant elects to
receive a distribution of Employer securities under
this Section 13.1(b)(3), to the extent necessary the
Trustees shall use the applicable amount from the
Participant's Employer Stock Amounts which have been
diversified to
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purchase a sufficient number of shares of Employer
securities at the then current fair market value in
order to comply with the Participant's election. The
Plan Administrator shall advise the Participant in
writing of his right to elect qualifying employer
securities before the Trustee may distribute cash to
him.
13.2 Events Triggering Distributions.
(a) The only events which may trigger a distribution of Elective
Deferrals (and any Qualified Non-Elective Contributions and
Qualified Matching Contributions, if applicable) and the
income allocable thereto are:
(1) Death;
(2) Disability;
(3) Termination of employment;
(4) Termination of the Plan without establishment or
maintenance of another defined contribution plan,
other than an employee stock ownership plan (as
defined in Code section 4975(e) or Code section 409)
or a simplified employee pension plan (as defined in
Code section 408(k)), but not before the time such
distribution is permitted under the terms of the
applicable group annuity contract or other funding
vehicle;
(5) The date of the sale or other disposition by a
corporation to an unrelated corporation of
substantially all of the assets (within the meaning
of Code section 409(d)(2)) used in a trade or
business of such corporation if such corporation
continues to maintain the Plan after disposition, but
only with respect to Employees who continue
employment with the corporation acquiring such
assets;
(6) The disposition by a corporation to an unrelated
entity of such corporation's interest in a subsidiary
(within the meaning of Code section 409(d)(3)) if
such corporation continues to maintain the Plan, but
only with respect to Employees who continue
employment with such subsidiary;
(7) The hardship of a Participant, to the extent
permitted under Articles 1 and 9 of the Plan.
(b) All distributions that may be made pursuant to one or more of
the foregoing distributable events are subject to the spousal
and Participant consent requirements (if applicable) contained
in Code sections 401(a)(11) and 417 as described in Article
12. In addition, distributions after March 31, 1988, that are
permitted by this Plan and that are triggered by any of the
events enumerated in subsections (4), (5) and (6), shall be
made in a lump sum.
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13.3 Timing of Distribution Rules.
(a) Unless a Participant otherwise elects, in no event will the
distribution of benefits under the Plan begin later than the
60th day after the close of the Plan Year in which the latest
of the following occurs: (a) the date on which the Participant
attains age 65 (or the Normal Retirement Age, if earlier), (b)
the 10th anniversary of the Participant's commencement of
participation in the Plan, or (c) the date on which the
Participant terminates his Service with the Employer.
Notwithstanding the foregoing, the failure of a Participant
and, if required, the Spouse to consent to a distribution
while a benefit is immediately distributable, within the
meaning of Regulation 1.417(e)-1, shall be deemed to be an
election to defer commencement of payment of any benefit
sufficient to satisfy the timing of distribution rules.
(b) If a distribution is one to which Code sections 401(a)(11) and
417 do not apply, such distribution may commence less than 30
days after the notice required under Section 1.411(a)-11(c) of
the Income Tax Regulations is given, provided that:
(1) the Plan Administrator clearly informs the
Participant that the Participant has a right to a
period of at least 30 days after receiving the notice
to consider the decision of whether or not to elect a
distribution (and, if applicable, a particular
distribution option), and
(2) the Participant, after receiving the notice,
affirmatively elects a distribution.
13.4 Direct Rollovers.
(a) Effective January 1, 1993, and 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 Plan
Administrator, to have any portion of an eligible rollover
distribution paid directly to an eligible retirement plan
specified by the distributee in a direct rollover.
(b) Definitions:
(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:
(A) 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
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the distributee and the distributee's
designated Beneficiary, or for a specified
period of ten years or more;
(B) any distribution to the extent such
distribution is required under Code section
401(a)(9); and
(C) the portion of any distribution that is not
includible in gross income (determined
without regard to the exclusion for net
unrealized appreciation with respect to
Employer securities).
(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.
13.5 Minimum Distribution Requirements - General Rules.
(a) The entire interest of a Participant must be distributed or
begin to be distributed no later than the Participant's
"required beginning date." As of the first distribution
calendar year (as defined in Regulations under Code section
401(a)(9)), distributions, if not made in a single sum, may
only be made over one of the following periods (or a
combination thereof):
(1) The life of the Participant;
(2) The life of the Participant and Beneficiary;
(3) A period certain not extending beyond the life
expectancy of the Participant; or
(4) A period certain not extending beyond the joint and
last survivor expectancies of the Participant and
Beneficiary.
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(b) The Participant or, if applicable, the Spouse may make an
irrevocable election to have life expectancies recalculated
annually. If no election is made by the time of the first
required distribution under Code section 401(a)(9), then the
life expectancy of the Participant and the Participant's
Spouse shall not be subject to recalculation. 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.
(c) "Required beginning date".
(1) General rule. The required beginning date of a
Participant is the first day of April of the calendar
year following the calendar year in which the
Participant attains age 70 1/2.
(2) Transitional rules. The required beginning date of a
Participant who attains age 70 1/2 before January 1,
1988, shall be determined in accordance with (A) or
(B) below:
(A) Non-Five Percent Owners. The required
beginning date of a Participant who is not a
Five Percent Owner is the first day of April
of the calendar year following the calendar
year in which the later of retirement or
attainment of age 70 1/2 occurs.
(B) Five Percent Owners. The required beginning
date of a Participant who is a Five Percent
Owner during any year beginning after
December 31, 1979, is the first day of April
following the later of:
(i) the calendar year in which the
Participant attains age 70 1/2, or
(ii) the earlier of the calendar year
with or within which ends the Plan
Year in which the Participant
becomes a Five Percent Owner, or the
calendar year in which the
Participant retires.
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(C) A Participant is treated as a Five Percent
Owner for purposes of this Section if such
Participant is a Five Percent Owner
(determined in accordance with Code section
416 but without regard to whether the Plan
is top heavy) at any time during the Plan
Year ending with or within the calendar year
in which such owner attains age 66 1/2 or
any subsequent Plan Year.
(D) Once distributions have begun to a Five
Percent Owner under this Section, they must
continue to be distributed, even if the
Participant ceases to be a Five Percent
Owner in a subsequent year.
(3) The required beginning date of a Participant who is
not a Five Percent Owner who attains age 70 1/2
during 1988 and who has not retired as of January 1,
1989, is April 1, 1990.
(d) For purposes of Sections 13.5 through 13.7 and pursuant to
applicable Regulations, any amount paid to a child shall be
treated as if it had been paid to the surviving Spouse if such
amount will become payable to the surviving Spouse upon such
child reaching majority (or other designated event permitted
under such Regulations).
13.6 Death Distribution Provisions.
(a) If the Participant dies after distribution of his or her
interest has begun, the remaining portion of such interest
will continue to be distributed at least as rapidly as under
the method of distribution being used prior to the
Participant's death.
(b) If the Participant dies before distribution of his or her
interest begins, distribution of the Participant's entire
interest shall be completed by December 31 of the calendar
year containing the fifth anniversary of the Participant's
death except to the extent that an election is made to receive
distributions in accordance with (1) or (2) below.
(1) If any portion of the Participant's interest is
payable to a Beneficiary, distributions may be made
over the life of the Beneficiary or over a period
certain not greater than the life expectancy of the
Beneficiary commencing on or before December 31 of
the calendar year immediately following the calendar
year in which the Participant died; or
(2) If the Beneficiary is the Participant's surviving
Spouse, the date distributions are required to begin
in accordance with (1) above shall not be earlier
than the later of
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(A) December 31 of the calendar year immediately
following the calendar year in which the
Participant died, and
(B) December 31 of the calendar year in which
the Participant would have attained age 70
1/2.
(c) If the Participant has not made an election pursuant to (b)
above by the time of his or her death, the Participant's
Beneficiary must elect the method of distribution no later
than the earlier of (1) December 31 of the calendar year in
which distributions would be required to begin under this
Section, or (2) December 31 of the calendar year which
contains the fifth anniversary of the date of death of the
Participant. If the Participant has no Beneficiary, or if the
Beneficiary does not elect a method of distribution,
distribution of the Participant's entire interest must be
completed by December 31 of the calendar year containing the
fifth anniversary of the Participant's death.
(d) For purposes of this Section, if the surviving Spouse dies
after the Participant but before payments to such Spouse
begin, the provisions of this Section, with the exception of
paragraph (b)(2) therein, shall be applied as if the surviving
Spouse were the Participant.
13.7 Precedence of Minimum Distribution Rules. Notwithstanding any other
provision of the Plan to the contrary, distributions will be made in
accordance with Regulations issued under Code section 401(a)(9),
including the minimum incidental death benefit requirement of
Regulation 1.401(a)(9)-2. Any provisions of the Plan reflecting Code
section 401(a)(9) shall take precedence over any distribution options
in the Plan that are inconsistent with Code section 401(a)(9).
13.8 DEFRA Transitional Rule Distribution Election.
Notwithstanding the other minimum distribution requirements of this Article and
subject to the requirements of Articles 11 and 12 (dealing with the survivor
annuity requirements of Code section 417), distribution on behalf of any
Employee, including a Five Percent Owner, may be made in accordance with all of
the following requirements (regardless of when such distribution commences):
(1) The distribution by the Plan is one which would not
have disqualified such Plan under section 401(a)(9)
of the Code as in effect prior to amendment by the
Deficit Reduction Act of 1984 ("DEFRA").
(2) The distribution is in accordance with a method of
distribution designated by the Employee whose
interest in the Plan is being distributed or, if the
Employee is deceased, by a Beneficiary of such
Employee.
(3) Such designation was in writing, was signed by the
Employee or the Beneficiary, and was made before
January 1, 1984.
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(4) The Employee had accrued a benefit under the Plan as
of December 31, 1983.
(5) The method of distribution designated by the Employee
or the Beneficiary specifies the time at which
distribution will commence, the period over which
distributions will be made, and in the case of any
distribution upon the Employee's death, the
Beneficiaries of the Employee listed in order of
priority.
(b) A distribution upon death will not be covered by this
transitional rule unless the information in the designation
contains the required information described above with respect
to the distributions to be made upon the death of the
Employee.
(c) For any distribution which commences before January 1, 1984,
but continues after December 31, 1983, the Employee, or the
Beneficiary, to whom such distribution is being made, will be
presumed to have designated the method of distribution under
which the distribution is being made if the method of
distribution was specified in writing and the distribution
satisfies the requirements in subsections (1) and (5) above.
(d) If a designation is revoked, any subsequent distribution must
satisfy the requirements of section 401(a)(9) of the Code and
the proposed Regulations thereunder. If a designation is
revoked subsequent to the date distributions are required to
begin, the Plan must distribute by the end of the calendar
year following the calendar year in which the revocation
occurs the total amount not yet distributed which would have
been required to have been distributed to satisfy Code section
401(a)(9) and the proposed Regulations thereunder, but for the
Code section 242(b)(2) election. For calendar years beginning
after December 31, 1988, such distributions must meet the
minimum distribution incidental benefit requirements in
section 1.401(a)(9)-2 of the proposed Regulations. Any changes
in the designation will be considered to be a revocation of
the designation. However, the mere substitution or addition of
another Beneficiary (one not named in the designation) under
the designation will not be considered to be a revocation of
the designation, so long as such substitution or addition does
not alter the period over which distributions are to be made
under the designation, directly or indirectly (for example, by
altering the relevant measuring life). In the case in which an
amount is transferred or rolled over from one plan to another
plan, the rules in Q & A J-2 and Q & A J-3 of section
1.401(a)(9)-2 of the proposed regulations shall apply.
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ARTICLE 14. AMENDMENTS, TERMINATION, AND MERGERS
14.1 Amendments. The Employer may, by action of its Board at any time, and
from time to time, amend in whole or in part any or all of the
provisions of the Plan. No such amendment shall reduce any
Participant's benefit attributable to his Employee Contributions or to
Employer Contributions made for him before the amendment took effect
unless the amendment is necessary to qualify the Plan. Nor shall any
amendment be made by which any funds attributable to Contributions
hereunder can be used except for the exclusive benefit of Participants
and their beneficiaries. Except as permitted by Regulations, including
Regulation 1.411(d)-4, no Plan amendment or transaction having the
effect of a Plan amendment (such as a merger, plan transfer or similar
transaction) shall be effective if it eliminates or reduces any
"Section 411(d)(6) protected benefit" or adds or modifies conditions
related to any "Section 411(d)(6) protected benefit", the result of
which would be 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) protected benefits" are described in Regulation
1.411(d)-4.
14.2 Termination. While it is the intention of the Employer to permanently
continue the Plan, the Employer reserves the right to terminate the
Plan at any time by written notice to the Plan Administrator and the
Trustees specifying the effective date of termination. Anything in the
preceding sentence to the contrary notwithstanding, the Plan shall
terminate upon complete discontinuance of Employer Contributions under
the Plan. No Employee, Participant or Beneficiary shall have any right
of consultation or approval of termination of this Plan.
(a) Upon termination of the Plan, or partial termination with
respect to a group of Participants, all funds in each affected
Participant's Account (as well as any funds thereafter
credited to any Participant's Account) shall be fully vested
and nonforfeitable. Such funds shall remain on deposit until a
method of distribution is elected in accordance with, and as
permitted by, the provisions of Article 13 of the Plan,
subject to the provisions in Section 10.7. Distributions in
accordance with Article 13 shall be made as soon as
administratively feasible.
(b) The rights of any Participant whose Retirement Date coincides
with the date of termination of the Plan (and those of his
Beneficiary, if any,) shall be determined solely in accordance
with the terms of Articles 11, 12, 13 and 14. If, upon the
date of termination of the Plan, a Participant's Account is
being held with respect to a former Participant, then such
former Participant's rights (and those of his Beneficiary, if
any,) shall be determined solely in accordance with the terms
of Articles 11, 12, 13 and 14.
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14.3 Merger, Consolidation, Etc. with Another Plan.
(a) At no time shall there occur any merger or consolidation of
this Plan with, or transfer of the assets or liabilities of
this Plan to, any other plan unless, if such plan then
terminated, each Participant and each Beneficiary would be
entitled to a benefit immediately after the merger,
consolidation or transfer which is equal to or greater than
the benefit which such Participant or Beneficiary would have
been entitled to receive immediately before the merger,
consolidation or transfer if this Plan had then terminated.
(b) In the event that a money purchase plan merges or consolidates
or transfers its assets to this Plan, then the assets accrued
under the money purchase plan shall continue to be subject to
the distribution restrictions and requirements of the money
purchase plan.
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Article 15. PLAN ADMINISTRATOR
15.1 Appointment by the Employer. The Plan Administrator shall be appointed
by the Employer and be subject to the terms of the Plan and Trust. The
Plan Administrator shall have general supervision of the administration
of the Plan.
15.2 Authority. The Plan Administrator shall administer the Plan in a
nondiscriminatory manner for the exclusive benefit of Participants and
their Beneficiaries.
15.3 Duties. The Plan Administrator shall perform all such duties as are
necessary to administer and manage the Plan in accordance with the
terms thereof, including but not limited to the following:
(a) To determine all questions relating to a Participant's
coverage under the Plan;
(b) To maintain all necessary records for the administration of
the Plan;
(c) To compute and authorize the payment of benefits to eligible
Participants and Beneficiaries;
(d) To interpret and construe the provisions of the Plan and to
make rules which are not inconsistent with the terms thereof;
and
(e) To advise or assist Participants regarding any rights,
benefits, or elections available under the Plan.
The Plan Administrator shall take all such actions as are necessary to
administer and manage the Plan as a retirement program which is at all
times in full compliance with any law or regulation affecting the Plan.
The Plan Administrator (and those to whom it has delegated its
authority) shall have vested in it under the terms of the Plan full
discretionary and final authority when exercising its duties hereunder.
15.4 Delegation of Duties. The fiduciary and non-fiduciary duties and
responsibilities of the Plan Administrator as set forth in this Article
and elsewhere in the Plan may be delegated in whatever manner it
chooses, in whole or in part, to an Administrative Committee consisting
of such persons as the Plan Administrator shall select. The Plan
Administrator shall certify to the Trustee in writing as to the
membership and extent of authority of the Committee and any changes
relative thereto as may occur from time to time. The authority of the
Committee shall be deemed to be that of the Plan Administrator to the
extent so certified by the Plan Administrator. The Trustee shall be
entitled to rely on the last such certification received and to
continue to rely thereon until subsequent written certification to the
contrary is received from the Plan Administrator. The Plan
Administrator shall indemnify and hold harmless the members of the
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Committee, and each of them, from any liability arising from the
effects and consequences of their acts, omissions, and conduct in their
official capacity with respect to the Plan and the administration
thereof, except to the extent that such liability shall result from
their willful misconduct or gross negligence. The Plan Administrator,
or the Administrative Committee to which it has delegated its duties
and responsibilities hereunder, may employ such competent agent or
agents as it may deem appropriate or desirable to perform such
ministerial duties or consultative or other services as the Plan
Administrator or its Committee may deem necessary to facilitate the
efficient and proper administration of the Plan. The Plan Administrator
and its Committee shall be entitled to rely upon all reports, advice
and information furnished by such agent or agents, and all action taken
or suffered by them in good faith in reliance thereon shall be
conclusive upon all such agents, Participants, Beneficiaries and other
persons interested in the Plan.
15.5 Application of Funds. The Plan Administrator may authorize any person
or persons having duties in connection with administration of the Plan
or any agent to execute or deliver any instrument or make any payment
on its behalf. A request for funds from, or a direction for, the
payment or application of funds shall be signed by the Plan
Administrator or its duly authorized representative.
15.6 Compensation and Expenses. The Plan Administrator shall serve without
compensation for any services hereunder. All reasonable and necessary
costs, expenses and liabilities incurred by the Plan Administrator in
the supervision of the administration of the Plan and the Trust shall
be paid by the Employer separate and apart from any Employer
Contributions.
15.7 Information from Employer. To enable the Plan Administrator to perform
its functions, the Employer shall supply full and timely information to
the Plan Administrator on all matters relating to the Plan, as the Plan
Administrator may require.
15.8 Resignation, Removal, and Appointment of Successor. The Plan
Administrator may resign at any time by delivering to the Employer a
written notice of resignation, to take effect at a date specified
therein, which shall not be less than 30 days after the delivery
thereof, unless such notice shall be waived. The Plan Administrator may
be removed with or without cause by the Employer by delivery of written
notice of removal, to take effect at a date specified therein, which
shall be not less than 30 days after delivery thereof, unless such
notice shall be waived. The Employer, upon receipt of, or giving notice
of, the resignation or removal of the Plan Administrator, shall
promptly designate a successor Plan Administrator who must signify
acceptance of this position in writing. In the event no successor is
appointed, the Board of Directors of the Employer will function as the
Plan Administrator.
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Article 16. BENEFIT CLAIMS PROCEDURES
16.1 Filing a Claim for Benefits. A Participant or Beneficiary shall notify
the Plan Administrator of a claim of benefits under the Plan. Such
request shall be in writing to the Plan Administrator and shall set
forth the basis of such claim and shall authorize the Plan
Administrator to conduct such examinations as may be necessary to
determine the validity of the claim and to take such steps as may be
necessary to facilitate the payment of any benefits to which the
Participant or Beneficiary may be entitled under the terms of the Plan.
16.2 Timing of Decision. The Plan Administrator shall notify the affected
Participant or Beneficiary (hereinafter referred to as "claimant") of
its decision within 90 days after the receipt of the claimant's benefit
request. In the event that, due to special circumstances, the Plan
Administrator requires more than 90 days to process the benefit
request, the Plan Administrator shall inform the claimant by written
notice of the extension prior to the expiration of such 90 day period.
The notice shall indicate the special circumstances requiring the
extension and the date by which the Plan Administrator expects to reach
a decision on the claim. In no event shall such extension exceed 180
days following the initial receipt of the claimant's benefit request.
16.3 Denial of Claim. Whenever a claim for benefits by any Participant or
Beneficiary has been denied in whole or in part by the Plan
Administrator, a written notice prepared in a manner calculated to be
understood by such Participant or Beneficiary must be provided. The
written notice must set forth:
(a) The specific reason(s) for the denial,
(b) Specific reference to pertinent Plan provisions on which the
denial is based,
(c) A description of any additional material or information
necessary for the claimant to perfect the claim and an
explanation of why such material or information is necessary,
and
(d) An explanation of the Plan's review procedure with respect to
the denial of benefits.
16.4 Review Procedure.
(a) The claimant, or his duly authorized representative, may
request a review of the benefit denial by a written
application to the Plan Administrator within 60 days of the
claimant's receipt of the written notice of benefit denial.
Should the claimant or his duly authorized representative deem
it necessary to review pertinent documents in order to prepare
the issues and comments for review, the claimant or
representative may make a request to review such pertinent
documents within the 60 day period
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<PAGE> 75
after receipt of the written notice of benefit denial. The
Plan Administrator and the claimant or representative shall
establish a mutually agreeable time during normal business
hours of the Employer to review such documents.
(b) The claimant may request a 30 day extension in writing to the
Plan Administrator in the event that the 60 day period is an
insufficient amount of time for the claimant to prepare the
issues and comments for review.
(c) The Plan Administrator shall notify the claimant in writing
not later than 60 days after its receipt of a request for
review. In the event that special circumstances require an
extension of the time for processing the benefit claim, a
decision shall be rendered as soon as possible, but not later
than 120 days after receipt of a request for review. The Plan
Administrator will notify the claimant in writing prior to the
commencement of the extension period. The Plan Administrator's
decision on the claims appeal review shall be in writing and
shall include specific reasons for the decision, written in a
manner calculated to be understood by the claimant with
specific references to the pertinent Plan provisions on which
the decision is based. If the Plan Administrator does not
furnish its decision on review within the times specified in
this Section 16.4(c), the claim shall be deemed denied on
review.
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Article 17. GENERAL PROVISIONS
17.1 No Employment Rights Created. Nothing contained in the Plan shall be
deemed or construed to enlarge or otherwise affect the employment
rights of any Employee. The establishment and continuation of the Plan
and the payment of any benefits shall not be construed as giving any
Employee any legal or equitable right as against the Employer, except
as may be expressly provided in the Plan, or as in any manner or degree
conferring any rights upon any Employee for continuation of employment
by the Employer or limiting in any way the right of the Employer to
treat the Employee without regard to the effect which such treatment
will have upon him as a Participant under the Plan.
17.2 Return of Contributions under Certain Circumstances. Contributions may
be returned to the Employer under the following circumstances:
(a) In the event that the Commissioner of Internal Revenue
determines that the Plan is not initially qualified under the
Code, the Plan may return to the Employer in a single sum any
Contributions made by the Employer that were conditioned on
initial qualification of the Plan under Code section 401(a) or
Code section 403(a), provided the application for
determination is made within the time prescribed by law for
filing the Employer's return for the taxable year in which
such Plan was adopted, or such later date as the Secretary of
the Treasury shall prescribe. Such return may only occur
within one year after the adverse determination by the
Internal Revenue Service.
(b) In the event the Employer shall make a Contribution by a
mistake of fact, then the Employer may demand repayment of
such Contribution at any time within one year following the
time of payment and the Plan may return such amount to the
Employer, provided the one year period has not then expired.
Earnings attributable to the Contribution may not be returned
to the Employer but any losses attributable thereto must
reduce the amount so returned.
(c) If a Contribution is conditioned upon the deductibility of the
Contribution under Code section 404 then, to the extent the
deduction is disallowed and the Plan receives the necessary
documentation regarding that fact, the Plan may, on written
request of the Plan Administrator, return to the Employer the
amount of such Contribution (to the extent disallowed) or, if
less, its value, within one year after the disallowance of the
deduction.
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17.3 Exclusive Benefit Rule. No benefit or interest hereunder will be
subject to assignment or alienation, either voluntarily or
involuntarily. The preceding sentence shall also apply to the creation,
assignment, or recognition of a right to any benefit payable with
respect to a Participant pursuant to a domestic relations order, unless
such order is determined to be a Qualified Domestic Relations Order, as
defined in Code section 414(p), or any domestic relations order entered
before January 1, 1985.
17.4 Standard of Conduct for Fiduciaries. The Employer is the named
fiduciary of the Plan for the purposes of managing and controlling the
operation of the Plan, and for the purposes of managing and controlling
the assets of the Plan. The Plan Administrator is the named fiduciary
of the Plan for the purpose of managing and controlling the
administration of the Plan, as well as the appropriate named fiduciary
for conducting the claims appeal procedure as described in Article 16.
Each such fiduciary of this Plan shall discharge his fiduciary duties
with respect to the Plan solely in the interest of the Participants and
their Beneficiaries for the exclusive purpose of providing benefits to
Participants and their Beneficiaries and defraying reasonable expenses
of administering the Plan. Each such fiduciary shall discharge such
duties with the care, skill, prudence and diligence under the
circumstances then prevailing which a prudent man acting in like
capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims.
17.5 Gender. Masculine pronouns include the feminine as well as the
masculine gender. Feminine pronouns include the masculine as well as
the feminine gender.
17.6 Construction of Plan. The Plan shall be construed, enforced and
administered according to any federal law or regulation governing the
provisions or administration of the Plan and the laws of the State of
Tennessee. This Plan is intended to comply with all requirements for
qualification under the Code. If any provision hereof is subject to
more than one interpretation or any term used herein is subject to more
than one construction, such ambiguity shall be resolved in favor of
that interpretation or construction which is consistent with the Plan
being so qualified. If any provision of the Plan is held invalid or
unenforceable, such invalidity or unenforceability shall not affect any
other provisions, and this Plan shall be construed and enforced as if
such provision had not been included.
The above Plan was adopted by the Board of Directors at a
meeting duly held on July 24, 1997.
For the Company:
/s/ Daisy L. Vanderlinde Vice President-Human Resources
----------------------------------------------------
(Signature) (Title)
Attest:
September 5, 1997
/s/ Wanda S. Gobbell -----------------------
- -------------------- (Date)
77
<PAGE> 1
EXHIBIT 4.2
TRUST AGREEMENT
<PAGE> 2
TRUST AGREEMENT
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ARTICLE I
ESTABLISHMENT
SECTION PAGE
- ------- ----
<S> <C>
Section 1.1 Establishment of Trust.................................... 1
Section 1.2 Plan Qualification........................................ 1
ARTICLE II
ADMINISTRATION OF TRUST FUND
Section 2.1 General Administration.................................... 1
Section 2.2 Contributions to Trust.................................... 2
Section 2.3 Accounts.................................................. 2
Section 2.4 Distributions from Trust.................................. 2
ARTICLE III
INVESTMENT DIRECTION
Section 3.1 Directed Trustee.......................................... 3
Section 3.2 Named Fiduciary-Investment Direction...................... 3
Section 3.3 Participant-Investment Direction.......................... 3
Section 3.4 Short-Term Holdings Pending Instructions.................. 4
ARTICLE IV
POWERS OF TRUSTEE
Section 4.1 Directed Powers of the Trustee............................ 4
Section 4.2 Discretionary Powers of the Trustee....................... 5
Section 4.3 Delegation................................................ 5
Section 4.4 Delivery and Custody of Funds and Securities.............. 5
Section 4.5 Voting.................................................... 6
ARTICLE V
ACCOUNTINGS
Section 5.1 Valuation and Reports..................................... 6
Section 5.2 Approval of Account....................................... 6
</TABLE>
i
<PAGE> 3
<TABLE>
<CAPTION>
ARTICLE VI
COMPENSATION, FEES AND TAXES
SECTION PAGE
- ------- ----
<S> <C>
Section 6.1 Trustee Compensation...................................... 6
Section 6.2 Fees...................................................... 7
Section 6.3 Method of Payment......................................... 7
Section 6.4 Taxes..................................................... 7
ARTICLE VII
RESIGNATION OR REMOVAL OF TRUSTEE
Section 7.1 Resignation or Removal of Trustee......................... 7
ARTICLE VIII
PROTECTION/LIMITATION ON LIABILITY FOR TRUSTEE
Section 8.1 Trustee's Protection...................................... 8
Section 8.2 Reliance by Trustee....................................... 8
Section 8.3 Absence of Instructions................................... 8
Section 8.4 Indemnification by the Employer and Plan Administrator.... 9
ARTICLE IX
PROHIBITION OF DIVERSION
Section 9.1 Prohibition of Diversion.................................. 9
ARTICLE X
AMENDMENT AND TERMINATION OF THE TRUST
Section 10.1 Amendment................................................. 10
Section 10.2 Termination............................................... 10
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.1 Relationship to Plan..................................... 10
Section 11.2 Nonalienation............................................ 10
Section 11.3 Certification of Trust Agreement......................... 10
Section 11.4 Not A Party to Trust..................................... 10
Section 11.5 Governing Law............................................ 11
Section 11.6 Definition of Employer................................... 11
Section 11.7 Titles................................................... 11
Section 11.8 Counterparts............................................. 11
Section 11.9 Severability............................................. 11
Section 11.10 Written Notice........................................... 11
</TABLE>
ii
<PAGE> 4
TRUST AGREEMENT
THIS AGREEMENT, made and entered into the 1st day of July, 1997,
supercedes the previous Agreement of November 1, 1996 by and between Tractor
Supply Company (the "Employer"), a Corporation having its principal office in
Nashville, Tennessee, and Investors Bank & Trust Company (the "Trustee") .
W I T N E S S E T H:
WHEREAS, the Employer has duly established the Tractor Supply Company
401(k) Retirement Plan, hereinafter called the "Plan", for certain of its
employees and the employees of other adopting employers, if so provided in the
Plan, and has authorized the creation of a Trust Fund to be administered under
the Plan by the Trustee, to which Trust Fund contributions are to be made from
time to time by the Employer and the other adopting employers, to be used for
the exclusive benefit of its employees and their successors in interest in
accordance with the provisions of the Plan and as hereinafter set forth; and
WHEREAS, the Trustee is willing to serve as a directed trustee and to
hold and administer such money and other property pursuant to the terms of the
Plan and this Trust Agreement;
NOW, THEREFORE, the Employer and the Trustee agree as follows:
ARTICLE I
ESTABLISHMENT
1.1 Establishment of Trust. The Employer hereby establishes the Trust to hold
assets of the tax-qualified pension Plan, which will consist of amounts
contributed or transferred to the Trustee, investments and proceeds thereof
and earnings (minus losses) thereon, reduced by payments from the Trust as
provided herein. If the plan ceases at any time and for any reason to be
qualified under Section 401 (a) of the Internal Revenue Code of 1986, as
amended ("Code"), the trust will not be made available, nor will it remain
available, to the Employer. In addition, the Trust will not be made
available, nor will it remain available, to any Employer who does not
contribute 100% of the tax qualified Plan's assets to it, or who fails to
maintain 100% of the Plan's assets within it; provided, however, that this
restriction to the Employer does not apply to the following plan assets:
(i) Plan assets held in trust by a Trustee other than Investors Bank
& Trust Company.
(ii) Plan assets held under an insurance company group annuity
contract not issued to Investors Bank & Trust Company as Plan
Trustee.
The Trustee, by executing this Trust Agreement, accepts the Trust and
agrees to administer the Trust as provided herein.
1.2 Plan Qualification. The Employer hereby represents that the Plan is a
qualified plan under Section 401(a) of the Internal Revenue Code of 1986,
as amended (the "Code"), and agrees to notify the Trustee if it has reason
to believe the Plan has ceased or will cease to be so qualified. The
Trustee will have no liability or responsibility for the validity, legal
effect or tax qualification of the Plan.
ARTICLE II
ADMINISTRATION OF TRUST FUND
2.1 General Administration. This Trust Fund shall be a part of the Plan and
shall be administered by the Trustee for the exclusive purposes of
providing benefits to Participants, as defined in the Plan, and their
successors in interest and defraying reasonable expenses of administering
the Plan, and shall be administered in accordance with the provisions of
the Plan and of the Employee Retirement Income Security Act of 1974
("ERISA"). The Trustee, by executing this Trust Agreement, agrees to be
bound by the terms of the Plan applicable to it and by the terms of this
Agreement. The Employer hereby agrees to provide a copy of the Plan
document to the
1
<PAGE> 5
Trustee; to notify the Trustee of any amendment to the Plan and to provide
promptly a copy of such amendment to the Trustee.
2.2 Contributions to Trust. The Trustee will accept such cash contributions of
cash or Employer Securities as defined by Code Section 409(1) made by or on
behalf of Participants as it receives from time to time from the Employer,
and such assets as may be transferred by Participants or by the trustee or
custodian of another qualified plan or individual retirement account, if
the Plan Administrator, as described in the Plan, has certified that such
transfer is in accordance with the Plan.
The Trustee will have no responsibility for determining the time or amount
of any contribution to the Trust or enforcing the collection of any
contribution. Also, the Trustee will have no responsibility for determining
that contributions satisfy any applicable requirement of the Plan or law,
including, but not limited to, the minimum contribution requirements of
Code Sections 412 and 416. Also, the Trustee will have no responsibility
for determining whether the amount of any contribution (or the portion of
such contribution allocated to the account(s) of a Participant) is within
any applicable limit, including, but not limited to, the limits imposed by
Code Sections 401(k) and (m), 402(g), 404 and 415. The contribution or
transfer of any amount to the Trustee hereunder constitutes a certification
by the Employer and the Plan Administrator that such contribution or
transfer is in accordance with the Plan.
2.3 Accounts. The Trustee will maintain such accounts or funds as are necessary
for the Trustee to carry out its responsibilities under the Trust; and the
Trustee will make credits to or charges against such accounts or funds as
provided therein. The Trustee will not maintain records of individual
Participant's accounts.
2.4 Distributions from Trust. The Trustee shall pay benefits, fees and/or
dividends paid on Employer Securities, if any, from the Trust Fund only
upon receipt of written direction from Diversified Investment Advisors,
Inc. ("Diversified").
Diversified will provide direction to the Trustee based on the written
direction it receives from the Plan Administrator or a third party
administrator, if authorized by the Plan Administrator. The Trustee shall
rely on directions from Diversified and shall be under no duty to ascertain
whether the directions are in accordance with the Plan.
Upon receipt of a written notice from the Plan Administrator or a third
party administrator, if authorized by the Plan Administrator, certifying
that an amount is payable to a Participant or other person under the Plan,
Diversified will give direction to the Trustee who will promptly pay such
amount in accordance with the notice and will be fully protected in so
doing. The Plan Administrator's notice will include all information
necessary to enable Diversified to direct the Trustee to make such payment,
including income tax withholding instructions and the account or accounts
or investment fund or funds to be charged with such payments. The Plan
Administrator's giving of a payment notice constitutes a certification from
the Plan Administrator to the Trustee and Diversified that such payment is
in accordance with the Plan, that the Plan Administrator has provided the
Participant any and all notices and explanations required by law and that
the Plan Administrator has properly obtained any waivers or consents of the
Participant, the Participant's spouse or other distributee required by law.
The Trustee will have no responsibility for the application of any payment
by the recipient, for determining the rights or benefits of any person in
the Trust or under the Plan, for the administration of the Plan, or for the
adequacy of the Trust to meet all liabilities arising under the Plan. The
Trustee shall have no responsibility for calculating or determining any
amount to be distributed to a Participant and/or for compliance with any
applicable requirements for distribution.
2
<PAGE> 6
ARTICLE III
INVESTMENT DIRECTION
3.1 Directed Trustee. The Trustee shall act only as a directed Trustee and
shall exercise no discretion over the investment or distribution of the
Trust Fund. The Trustee shall invest and reinvest the Trust Fund, without
distinction between principal and income, in accordance with investment
directions, as provided in this Article. Notwithstanding the foregoing, if
the Plan (a) is a defined contribution individual account plan, not more
than forty-nine percent (49%) of the Plan's assets shall be invested in
Employer Securities; and (b) is a defined benefit pension plan, not more
than ten percent (10%) of the Plan's assets shall be invested in Employer
Securities. The Trustee will have no responsibility to question such
instructions or directions and will have no responsibility or liability for
compliance with any applicable requirements concerning Plan investments
under the Plan or ERISA or for any loss or diminution in value which
results from the choice of investments for the Trust Fund. Whenever the
Trustee is permitted or required to act upon instructions or directions of
the Named Fiduciary, Plan Administrator, or Participant, the Trustee will
have no responsibility or liability for any action taken or omitted by the
Trustee in reliance thereon.
It is understood and agreed by the parties that although the Trustee will
perform certain ministerial and custodial duties with respect to the assets
held in Trust, such duties will be performed in the normal course by
officers and other employees of the Trustee or by such other person or
persons with whom the Trustee has contracted to perform services for it,
all of whom may be unfamiliar with investment management, and that such
duties will not include the exercise of any discretionary authority or
other authority to manage and control assets comprising the Trust Fund.
3.2 Named Fiduciary-Investment Direction. Subject to Sections 3.3 and 3.4, the
Trustee shall invest the Trust Fund pursuant to the written direction of
the Plan's Named Fiduciary. The Trustee is authorized to take investment
instructions from Diversified. Diversified will provide investment
instructions to the Trustee based on the written direction it receives from
the Plan's Named Fiduciary or the person authorized to act on behalf of the
Named Fiduciary. The Employer will certify to Diversified the identity of
the Named Fiduciary (and of any other person authorized to act on behalf of
the Named Fiduciary for purposes of the Plan) and will provide specimen
signatures of such person(s). The Trustee may assume that the authority of
such person or persons continues unless Diversified is otherwise notified
in writing. The Trustee will not be liable for or in any way obligated to
inquire into the acts or omissions of a Named Fiduciary.
3.3 Participant-Investment Direction. If the Plan permits Participants to
direct the investment of some or all of their Plan accounts, the Trustee
will invest the Trust Fund pursuant to the Plan and the Participant's
investment directions. Each Participant shall convey investment
instructions to the Plan Administrator and the Plan Administrator shall
transmit those instructions, in writing, promptly to Diversified.
Diversified will then provide such investment instructions to the Trustee.
The Employer and Diversified may agree, in a separate written agreement, to
an alternative method of communicating Participant directed investments.
Each Participant who has established a Schwab Personal Choice(TM)
Retirement Account and completed a Limited Power of Attorney ("LPOA") is
authorized by the Trustee to relay trading instructions direct to Charles
Schwab & Co., Inc. ("Schwab"). The Trustees may revoke the LPOA at any time
by giving written notice to Schwab.
3.4 Short-Term Holdings Pending Instructions. In the event the Trustee fails to
receive proper direction with respect to the investment of any contribution
made to the Plan, the Trustee may hold such assets without liability for
interest for a reasonable length of time from the date of receipt; and,
then, if proper instructions have still not been received, the Trustee
shall invest such contribution in the Investors Bank & Trust Cash Reserve
Fund, or any successor short-term investment fund with similar investment
objectives. The Trustee may also hold assets awaiting distribution from the
Plan for a reasonable length of time without liability for interest.
3
<PAGE> 7
ARTICLE IV
POWERS OF TRUSTEE
4.1 Directed Powers of the Trustee. The Trustee shall have the following powers
and authority in the administration of the Trust; provided, however, that
such powers and authority shall be exercised by the Trustee only upon the
receipt of direction as provided in Article III:
a) to deal with all or any part of the Trust assets, including the power
to acquire and dispose of assets;
b) to hold any part of the Trust Fund in cash for a reasonable time
pending the investment or distribution thereof, without liability for
interest;
c) to enforce by suit or otherwise, or to waive its rights on behalf of
the Trust, and to defend claims asserted against it or the Trust;
however, the Trustee will not be required to institute or defend
itself, the Plan or the Trust in any court or administrative
proceeding unless it has first been indemnified to its satisfaction
for the costs and expenses thereof;
d) to compromise, adjust and settle any and all claims against or in
favor of it or the Trust;
e) to vote, or give proxies to vote, any stock or other security, and to
waive notice of meetings; provided, however, that such rights shall be
exercisable with respect to Employer Securities held as part of the
Trust Fund only to the extent and in the manner set forth in the Plan
or Operating Procedures;
f) to oppose, or participate in and consent to the reorganization,
merger, consolidation or readjustment of the finances or
capitalization of any enterprise, to pay assessments and expenses in
connection therewith, and to deposit securities under deposit
agreements;
g) to invest or reinvest principal and income of the funds belonging to
the Trust Fund in common or preferred stocks, including Employer
Securities, mutual funds, bonds, or other securities, or limited
partnership interests, or real or personal properties or interests
therein, or any options, warrants or other instruments representing
rights to receive, purchase, or subscribe for the same, or evidencing
or representing any other rights or interests therein, or group
annuity contracts which may include separate accounts issued by a
legal reserve life insurance company authorized to do business in New
York or to hold any reasonable amounts of such principal or income in
cash;
h) to execute such deeds, leases, contracts, bills of sale, notes,
proxies and other instruments in writing as shall be deemed requisite
or desirable in the proper administration of the Trust Fund;
i) unless otherwise provided in the Plan, to cause all or any part of the
money or other property of this Trust to be commingled with the money
or other property of trusts created by others by causing such assets
to be invested as part of any one or more collective investment funds
or group trusts maintained by fiduciaries with respect to this Plan
and Trust, including the Trustee. The declaration of trust under which
each such collective investment fund or group trust is established and
maintained, as from time to time amended, is hereby made a part of
this Trust to the same extent as if its terms were set out in full
herein;
j) to sell for cash, to convert, redeem or exchange for other securities
or other property, to tender securities pursuant to tender offers, or
otherwise to dispose of any securities or other property at any time
held by the Trustee;
k) to exercise any conversion privilege, subscription or other rights
incident to property in the Trust and to make payments incidental
thereto;
l) to do all acts and things, not specified herein, which it deems
advisable to carry out the Trust; and generally to exercise any of the
powers of an owner with respect to all or any part of the Trust.
4.2 Discretionary Powers of the Trustee. The Trustee shall have the following
powers and authority in the administration of the Trust to be exercised in
its sole discretion:
a) to register or cause to be registered any securities held by it
hereunder in its own name or in the name of a nominee with or without
the addition of words indicating that such securities are held in a
fiduciary capacity, to permit securities or other property to be held
by or in the name of others, to hold any securities in bearer form and
to deposit any securities or other property in a domestic depository,
clearing corporation, or similar corporation; provided the
requirements of Department of Labor Regulation 2550.404b-1 are met;
b) to make, execute, and deliver as Trustee hereunder, any and all
instruments in writing necessary or proper for the accomplishment of
any of the powers referred to in Section 4.1 or in this Section 4.2;
c) to employ suitable agents, advisers, and counsel and to pay their
reasonable expenses and compensation as expenses of the Trust;
4
<PAGE> 8
d) to contract with another person or persons, related or unrelated to
the Trustee, to perform any of the Trustee's duties hereunder,
including, but not limited to, Trust Fund recordkeeping, provided that
the expenses and compensation of such person or persons shall be an
expense of the Trustee, and not an expense of the Trust;
e) to bring, join in, or oppose any suits or legal proceedings involving
the Trust where the Trustee may be adversely affected by the outcome,
individually or as trustee, or where it is advised by counsel that
such action is required on its part by ERISA or other applicable law
provided that the Trustee shall promptly give written notice to the
Employer and offer the Employer the right to control any such action
as long as such action has not been initiated by the Employer or any
of its affiliates;
f) to receive all rents, issues, dividends, income, profits, and
properties of every nature due the Trust Fund, and to hold or make
distribution therefor in accordance with the terms of this Trust
Agreement;
g) to take any action committed to the Trustee's discretion by other
provisions of this Agreement;
h) generally to exercise such powers and to do such acts (exclusive of
powers and acts involving investment management or otherwise committed
to the discretion of Named Fiduciary or any other party hereunder)
whether or not expressly authorized, which may be considered necessary
or desirable by the Trustee for the protection of the Trust.
4.3 Delegation. In the management of the Trust Fund, the Trustee may employ
agents and delegate to them such ministerial and limited discretionary
duties as the Trustee shall see fit. As of the effective date of the Trust
Agreement, the Trustee has appointed Diversified as the agent to which it
has delegated certain duties. Also, as of the effective date of the Trust
Agreement, the Trustee appoints the Employer as its authorized
representative to which it has delegated the authority to sign on the
Trustee's behalf all documents relating to the investment of Plan assets in
any vehicle sponsored by or made available through Diversified and its
affiliates.
4.4 Delivery and Custody of Funds and Securities. All settlements of
transactions shall be carried out through the Trustee. The Trustee shall
comply with applicable law as to such custody, including without
limitation, Section 404(b) of ERISA (relating to location of indicia of
ownership) and any regulations issued thereunder.
4.5 Voting. The Trustee shall forward all proxies, shareholder information
calls for redemption, offer or exchange, subscription, reorganization or
other proceedings affecting securities in the Trust Fund to the individual
or entity holding voting power with respect to the securities involved and
shall take action in respect thereto as directed; with respect to Employer
Securities, the provisions of the Plan or Operating Procedures shall
determine who has such voting power.
ARTICLE V
ACCOUNTINGS
5.1 Valuation and Reports.
a) The Trustee will keep full accounts of all its receipts, disbursements
and other transactions hereunder, and, annually, will determine the
fair market value of the assets of the Trust as of the last day of the
Plan Year. (If any Plan Year is less than a 12-month period, the
Trustee shall make the same valuation as of the last day of said short
Plan Year.) If any assets of the Trust Fund are invested in Employer
Securities for which there is no readily ascertainable market value,
the Employer shall supply the Trustee with a proper valuation. For
purposes of such accounts, the fiscal year of the Trust will coincide
with the Plan Year. Within a reasonable time after the end of the Plan
Year, or within a reasonable time after its removal or resignation, or
the termination of the Trust, the Trustee will render to the Plan
Administrator an account of its administration of the Trust since the
last previous such accounting.
b) With the consent of the Trustee, the Plan Administrator or Employer
may establish other valuation dates, and the Trustee will render to
the Plan Administrator an account of the value of the Trust assets as
of the current valuation date and, if requested, of its transactions
hereunder since the preceding valuation date.
c) The Trustee's records pertaining to the Trust Fund as to each Plan
shall be open to inspection, copying and audits at reasonable times by
the Plan Administrator and Diversified. No person other than the Plan
Administrator will have the right to demand or receive any report or
account from the Trustee. In any
5
<PAGE> 9
proceeding for a judicial settlement of any account or for
instructions, the only necessary parties will be the Trustee,
Diversified, and the Plan Administrator.
5.2 Approval of Account. To the extent permissible under applicable law, the
written approval of any account by the Plan Administrator will be final and
binding upon the Employer, the Participants and all persons who then are or
thereafter become interested in the Trust, as to all matters and
transactions stated or shown therein. The failure of the Plan Administrator
to notify the Trustee or its duly appointed agent within 60 days of the
Plan Administrator's objections (if any) to the account after the Trustee's
sending of any account to the Employer will be the equivalent of written
approval. If the Plan Administrator files any objections within such 60 day
period with respect to any matters or transactions stated or shown in the
account and the Plan Administrator and the Trustee cannot resolve the
questions raised by such objections, the Trustee will have the right to
have such questions settled by judicial proceedings. Nothing herein will
deprive the Trustee of the right to have a judicial settlement of its
accounts.
ARTICLE VI
COMPENSATION, FEES AND TAXES
6.1 Trustee Compensation. There are currently no fees due the Trustee from the
Plan. However, the Trustee reserves the right to impose and/or amend a fee
schedule upon the giving of 90 days' advance written notice to the
Employer.
6.2 Fees. All fees pursuant to Section 6.1 actually and properly incurred in
the administration of the Trust Fund may be paid directly by the Employer.
All fees not so directly paid by the Employer shall be paid from the assets
of the Trust Fund.
6.3 Method of Payment. In order to provide for payment of any fees not paid
directly by the Employer as provided in Section 6.2, the Trustee in its
discretion may partially or fully liquidate any asset in the Trust Fund and
shall not be liable for any loss occasioned thereby. Any fees of the
Trustee which are not paid from the Trust for whatever reason will be the
responsibility of the Employer. Any payment out of the Trust Fund of any of
the fees authorized in this Article VI shall be deemed to be for the
exclusive benefit of the Participants and their successors in interest.
6.4 Taxes.
a) All real and personal property taxes, income taxes and other taxes of
any and all kinds whatsoever upon or in respect of the Trust Fund
hereby created or any money, income or property forming a part
thereof, shall be paid directly from the assets of the Trust Fund
following advance written notice to the Employer.
b) The Trustee may assume that any taxes assessed on or in respect of the
Trust Fund are lawfully assessed unless the Plan Administrator or the
Employer shall in writing advise the Trustee that in the opinion of
counsel for the Employer such taxes are not lawfully assessed. In the
event that the Plan Administrator or Employer shall so advise the
Trustee, the Trustee, if so requested by the Plan Administrator and
suitable provision for their indemnity having been made, shall contest
the validity of such taxes in any manner deemed appropriate by the
Plan Administrator, Employer or counsel for the Employer. The word
"taxes" in this Section 6.4 shall be deemed to include any interest or
penalties that may be levied or imposed in respect to any taxes
assessed.
c) In order to provide for payment of any taxes as provided in Section
6.4, the Trustee in its discretion may partially or fully liquidate
any asset in the Trust Fund and shall not be liable for any loss
occasioned thereby. Any payment out of the Trust Fund of any taxes
authorized in this Article VI, shall be deemed to be for the exclusive
benefit of the Participants and their successors in interest.
6
<PAGE> 10
ARTICLE VII
RESIGNATION
7.1 Resignation or Removal of Trustee.
a) The Trustee may resign at any time by giving at least 90 days' written
notice to the Employer, and the Employer may remove the Trustee at any
time by giving at least 90 days' written notice to the Trustee; in
either case, the notice period may be reduced to such shorter period
as the Trustee and the Employer agree upon. The Trustee's removal or
resignation will be effective upon the last day of the notice period
or, if later, the acceptance of the Trust by the successor Trustee.
Until the effective date of the appointment of a successor Trustee,
the incumbent Trustee will have full authority and responsibility to
act as Trustee hereunder.
b) The Trustee shall give the Employer at least 90 days' notice of its
resignation upon the occurrence of any one of the following events:
(i) The giving of notice of termination by either party to the
Pension Services Agreement, if any, between Diversified and the
Employer;
(ii) The Employer or the Named Fiduciary directs that any Plan assets
be invested in investments or investment vehicles not made
available through or permitted by Diversified or one of its
affiliates.
c) When the Trustee's resignation or removal becomes effective, the
Trustee will perform all acts necessary to transfer the assets of the
Trust to its successor. However, the Trustee may reserve such portion
of the trust assets as it may reasonably determine to be necessary for
payment of its fees, if any, and any taxes and expenses; any balance
of such reserve remaining after payment of such fees, taxes and
expenses will be paid over to its successor.
d) Resignation or removal of the Trustee will not terminate the Trust. In
the event of any vacancy in the position of Trustee, whether by the
resignation or removal of the Trustee, the Employer will appoint a
successor Trustee and such appointment will become effective upon the
acceptance of its office by the successor trustee. If the Employer
does not appoint such a successor within 90 days after notice of
resignation or removal is given, the Trustee may apply to a court of
competent jurisdiction for such appointment. Each successor Trustee so
appointed and accepting a Trusteeship hereunder will have all of the
rights and powers and all of the duties and obligations of the
original trustee under the provisions hereof. However, the Trustee may
reserve such portion of the Trust assets as it may reasonably
determine to be necessary for payment of its fees, if any, and any
taxes and expenses; any balance of such reserve remaining after
payment of such fees, taxes and expenses will be paid over to its
successor.
e) No Trustee will be liable or responsible for anything done or omitted
to be done in the administration of the Trust before it became Trustee
or after it ceases to be Trustee.
7
<PAGE> 11
ARTICLE VIII
PROTECTION/LIMITATION ON LIABILITY FOR TRUSTEE
8.1 Trustee's Protection. The Trustee shall have no duty to take any action
other than as herein specified, unless the Plan Administrator shall furnish
it with instructions in proper form and such instructions shall have been
specifically agreed to by it, or to defend or engage in any suit unless it
shall have first agreed in writing to do so and shall have been fully
indemnified to its satisfaction.
8.2 Reliance by Trustee.
a) The Trustee may rely upon any decision of the Plan Administrator
purporting to be made pursuant to the terms of the Plan, and upon any
information, statements, certifications or directions submitted by the
Employer or the Plan Administrator (including statements concerning
the entitlement of any Participant to benefits under the Plan or
directions to make payments), and will not be bound to inquire as to
the basis of any such decision or information or statements, and will
incur no obligation or liability for any action taken or omitted by
the Trustee in reliance thereon.
b) Whenever the Trustee is permitted or required to act upon the
instructions or directions of the Employer or Plan Administrator, the
Trustee will be fully protected in not acting in the absence hereof.
c) The Trustee may conclusively rely upon and shall be protected in
acting in good faith upon any written representation or order from the
Plan Administrator or any other notice, request, consent, certificate
or other instrument or paper believed by the Trustee to be genuine and
properly executed, or any instrument or paper if the Trustee believes
the signature thereon to be genuine.
d) The Trustee may consult with legal counsel (who may or may not be
counsel for the Employer) concerning any questions which may arise
with respect to its rights and duties hereunder, and the opinion of
such counsel will be full and complete protection in respect of any
action taken or omitted by the Trustee hereunder in good faith and in
accordance with the opinion of such counsel.
8.3 Absence of Instructions. If the Trustee receives no instructions from the
Plan Administrator or the Employer in response to communications sent to
the Plan Administrator or the Employer at the last known address as shown
on the books of the Trustee, the Trustee may make such determination with
respect to distributions and other administrative matters arising under the
Plan as it considers reasonable. Any determinations so made will be binding
on all persons having or claiming any interest under the Plan or Trust, and
the Trustee will incur no obligation or responsibility for any such
determination made in good faith or for any action taken in pursuant
thereof.
8.4 Indemnification by the Employer and Plan Administrator.
a) The Employer shall indemnify and hold harmless the Trustee and its
officers, directors, employees, shareholders, and agents (the
"Indemnitees") from and against any losses, costs, damages, or
expenses, including reasonable attorneys' fees, which the Indemnitees
may incur or pay out by reason of (i) the Indemnitees acting in
accordance with the directions of the Employer or Plan Administrator
or failing to act in the absence of such certification or other
information provided by the Employer or Plan Administrator; (ii) the
Trustee's exercise and performance of its powers and duties hereunder,
unless the same are determined to be due to the Trustee's gross
negligence, bad faith, willful misconduct, breach of this Agreement,
or of applicable law; or (iii) any (alleged or actual) action or
inaction on the part of the Employer or Plan Administrator, unless
such losses, costs, damages, or expenses arise out of the Trustee's
gross negligence, bad faith, willful misconduct, breach of this
Agreement, or of applicable law.
b) In addition, regardless of whether the Plan meets the requirements of
Section 404(c) of ERISA, and regulations thereunder, if the
Participant controls the investment of his or her account, the
Employer shall indemnify and hold harmless the Indemnitees from and
against any losses, costs, damages, or expenses, including reasonable
attorneys' fees, which the Indemnitees may incur or pay out by reason
of the Indemnitees' acting in accordance with a Participant's
directions or failing to act in the absence of such directions or
acting or failing to act in reliance on a Participant's instructions
incorrectly conveyed by the Plan Administrator.
c) The Employer further agrees to indemnify and hold harmless the Trustee
for any losses, costs, damages, or expenses, including reasonable
attorneys' fees, which the Indemnitees may incur or pay out by reason
of any (alleged or actual) action or inaction on the part of any
predecessor or successor Trustee.
8
<PAGE> 12
d) Any obligation to provide indemnification under this Agreement shall
be expressly conditioned upon the Indemnitees providing written notice
to the Employer of any pending or threatened action within a
reasonable time after learning of such action and offering the
Employer the right to control the defense of any such action as long
as the Employer or any of its affiliates did not initiate such action.
ARTICLE IX
PROHIBITION OF DIVERSION
9.1 Prohibition of Diversion.
a) Except as provided in subparagraph (b) hereof, at no time prior to the
satisfaction of all liabilities with respect to Participants and their
successor in interest under the Plan shall any part of the corpus or
income of the Trust Fund be used for, or diverted to, purposes other
than for the exclusive benefit of Participants or their successors in
interest or for defraying reasonable expenses of administering the
Plan.
b) The provisions of subparagraph (a) notwithstanding, contributions made
by the Employer under the Plan shall be returned to the Employer under
the following conditions:
(i) if a contribution to the Plan (other than a multi-employer Plan)
is made by mistake of fact, such contribution shall be returned
to the Employer within one year of the payment of such
contribution; and
(ii) contributions to the Plan are specifically conditioned upon their
deductibility under the Internal Revenue Code. To the extent a
deduction is disallowed for any such contribution, it shall be
returned to the Employer within one year after the disallowance
of the deduction. Contributions which are not deductible in the
taxable year in which made but are deductible in subsequent
taxable years shall not be considered to be disallowed for
purposes of this subsection.
ARTICLE X
AMENDMENT AND TERMINATION OF THE TRUST
10.1 Amendment. Either the Trustee or the Employer may amend all or any part of
the Agreement at any time provided, however, that any amendment shall not
be effective until it has been agreed to and executed by both parties. Any
such amendment may be retroactive if necessary or appropriate to qualify or
maintain the Trust as a part of a plan and trust exempt from Federal income
tax under Sections 401(a) and 501(a) of the Code, the provisions of ERISA,
or other applicable law. Notwithstanding the foregoing, no amendment shall
increase the duties or liabilities of the Trustee without the Trustee's
consent; and, provided further, that no amendment shall divert any part of
the Trust Fund to any purpose other than providing benefits to Participants
and their successors in interest or defraying reasonable expenses of
administering the Plan.
10.2 Termination. If the Plan is terminated in whole or in part, the Trustee
shall distribute the Trust Fund or any part thereof in such manner and at
such times as the Plan Administrator or its designee shall direct in
writing. The Trust created hereunder will terminate upon the distribution
or application of all the assets of the Trust Fund.
9
<PAGE> 13
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1 Relationship to Plan. Unless the context of this Agreement clearly
indicates otherwise, the terms defined in the Plan shall, when used
herein, have the same meaning as in the Plan.
11.2 Nonalienation. Except as otherwise required in the case of any qualified
domestic relations order within the meaning of Section 414(p) of the
Code, the benefits or proceeds of any allocated or unallocated portion of
the assets of the Trust Fund and any interest of any Participant or
beneficiary arising out of or created by the Plan either before or after
the Participant's retirement shall not be subject to execution,
attachment, garnishment or other legal or judicial process whatsoever by
any person, whether creditor or otherwise, claiming against such
Participant or successor in interest. No Participant or successor in
interest shall have the right to alienate, encumber or assign any of the
payments or proceeds or any other interest arising out of or created by
the Plan and any action purporting to do so shall be void. The provisions
of this Section shall apply to all Participants and successors in
interest regardless of their citizenship or place of residence.
11.3 Certification of Trust Agreement. Any person dealing with the Trustee may
rely upon a copy of this Agreement and any amendments thereto certified
to be true and correct by the Trustee.
11.4 Not a Party to Trust. If any contract issued by an insurance company
shall form a part of the Trust assets, the insurance company shall not be
deemed a party to this Trust Agreement. A certification in writing by the
Trustee as to the occurrence of any event contemplated by this Trust
Agreement or the Plan shall be conclusive evidence thereof and the
insurance company shall be protected in relying upon such certification
and shall incur no liability for so doing. With respect to any action
under any such contract, the insurance company may deal with the Trustee
as the sole owner thereof and need not see that any action of the Trustee
is authorized by this Trust Agreement or the Plan.
11.5 Governing Law. The construction, validity and administration of this
Agreement shall be governed by the laws of the Commonwealth of
Massachusetts, except to the extent that such laws have been specifically
superseded by ERISA.
11.6 Definition of Employer. As used in the Agreement, "Employer" means: (i)
the employer specified in the Agreement and (ii) any other entity,
maintaining the Plan, that is required to be aggregated with such
employer under Code Sections 414 (b), (c), (m), or (o) and which has
authorized such employer to act on its behalf for purposes of this
Agreement. The term "Employer" shall include other adopting employers
under the Plan, to the extent not inconsistent with the terms of the
Plan.
11.7 Titles. The titles to sections of this Trust Agreement are placed herein
for convenience of reference only, and the Trust Agreement is not to be
construed by reference thereto.
11.8 Counterparts. This Trust Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original but all of
which together shall constitute but one instrument, which may
sufficiently be evidenced by any counterpart.
11.9 Severability. If any provision of this Trust Agreement shall be held
invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provisions thereof, and this Trust Agreement shall be
construed and enforced as if such provisions had not been included.
11.10 Written Notice. Any written notice, demand, direction, or instruction
given to the parties to this Agreement shall be duly given if mailed or
delivered:
a) to the Trustee, at Investors Bank & Trust Company, 89 South
Street, Boston, MA 02111, Attention: Mr. George Sullivan or any
other address as shall be specified by the Trustee in writing; and
b) to the Employer, at the address indicated on the signature page
hereto.
10
<PAGE> 14
A copy of any written notice, demand, direction, or instruction between
the parties to the Agreement shall be sent to Diversified Investment
Advisors, Inc., 4 Manhattanville Road, Purchase, NY 10577, Attention: Mr.
Peter G. Kunkel.
IN WITNESS WHEREOF, this Agreement has been executed on behalf of the parties
hereto, all on the day and year first above written.
EMPLOYER
By: /s/ Daisy L. Vanderlinde
-----------------------------------
Address for receipt of notices:
Tractor Supply Company
320 Plus Park Boulevard
Nashville, Tennessee 37217
Attest:
/s/ Gee Thurman
- -----------------------------------
Name
Benefit Coordinator
- -----------------------------------
Title
TRUSTEE
By: /s/ Martin J. Sullivan
----------------------------------
Vice President
Attest:
/s/ Rita A. Berry
- -----------------------------------
Name
Administrative Assistant
- -----------------------------------
Title
11
<PAGE> 1
EXHIBIT 5
OPINION OF RICHARDS & O'NEIL, LLP
<PAGE> 2
RICHARDS & O'NEIL, LLP
885 THIRD AVENUE
NEW YORK, NEW YORK 10022-4873
(212) 207-1200
September 10, 1997
Tractor Supply Company
320 Plus Park Boulevard
Nashville, Tennessee 37217
Re: Tractor Supply Company
Dear Sir or Madam:
We have acted as counsel to Tractor Supply Company, a Delaware
corporation (the "Company"), in connection with the Company's Registration
Statement on Form S-3 (the "Registration Statement") filed with the Securities
and Exchange Commission pursuant to the Securities Act of 1933, as amended,
relating to the resale of 978,912 shares (the "Shares") of the Company's common
stock, par value $.008 per share ("Common Stock"), held by Investors Bank &
Trust Company, as trustee of the Company's Restated 401(k) Retirement Plan (the
"Plan").
In connection with this opinion, we have examined originals or
copies, certified or otherwise identified to our satisfaction, of such
documents, corporate records and other instruments as we have deemed necessary
for the purpose of rendering this opinion. In our examinations, we have assumed
the genuineness of all signatures on, and the authenticity and completeness of,
all documents submitted to us as originals and the conformity to original
documents and completeness of all documents submitted to us as certified,
conformed or photostatic copies. We also have assumed that all meetings, the
minutes or certified extracts of which have been submitted to us, were properly
convened and held, and that all resolutions voted upon at such meetings were
properly proposed and passed.
We are members of the bar of the State of New York and do not
purport to be experts in, or to express any opinion herein concerning, the law
of any jurisdiction other than the State of New York, the United States of
America and the State of Delaware (but only insofar as set forth in the General
Corporation Law of the State of Delaware).
Based upon and subject to the foregoing, we are of the opinion
that the Shares have been duly authorized and validly issued, and are fully paid
and nonassessable.
<PAGE> 3
Tractor Supply Company
September 10, 1997
Page 2
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement on Form S-3 being filed herewith by the Company
with the Securities and Exchange Commission and the reference to this firm under
the caption "Legal Matters" in the prospectus contained therein.
Very truly yours,
/s/ Richards & O'Neil, LLP
<PAGE> 1
EXHIBIT 23.1
CONSENT OF PRICE WATERHOUSE LLP
<PAGE> 2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
January 22, 1997, which appears on page 15 of the 1996 Annual Report to
Stockholders of Tractor Supply Company (the "Company"), which is incorporated by
reference in the Company's Annual Report on Form 10-K for the fiscal year ended
December 28, 1996. We also consent to the references to us under the heading
"Experts" in such Prospectus.
/s/ Price Waterhouse LLP
Nashville, Tennessee
August 25, 1997
<PAGE> 1
EXHIBIT 24.1
--------------------------------------------
POWER OF ATTORNEY
--------------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears
below constitutes and appoints Thomas O. Flood and Michael J. Kincaid, and each
of them acting alone, his true and lawful attorneys-in-fact and agents, with
full power of substitution and revocation, for him and in his name, place and
stead, in any and all capacities, to sign the Registration Statement on Form S-3
(the "Registration Statement") of Tractor Supply Company (the "Company")
relating to the shares of the Company's Common Stock originally issued pursuant
to the TSC Industries, Inc. Employee Stock Ownership Plan and currently held in
accounts for the benefit of certain participants in the Tractor Supply Company
Restated 401(k) Plan, and any and all amendments to the 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 attorneys-in-fact and agents full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully as to
all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or either of them, or his
or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Dated: July 24, 1997
/s/ Joseph H. Scarlett, Jr.
---------------------------
Joseph H. Scarlett, Jr.
<PAGE> 1
EXHIBIT 24.2
--------------------------------------------
POWER OF ATTORNEY
--------------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears
below constitutes and appoints Joseph H. Scarlett, Jr. and Michael J. Kincaid,
and each of them acting alone, his true and lawful attorneys-in-fact and agents,
with full power of substitution and revocation, for him and in his name, place
and stead, in any and all capacities, to sign the Registration Statement on Form
S-3 (the "Registration Statement") of Tractor Supply Company (the "Company")
relating to the shares of the Company's Common Stock originally issued pursuant
to the TSC Industries, Inc. Employee Stock Ownership Plan and currently held in
accounts for the benefit of certain participants in the Tractor Supply Company
Restated 401(k) Plan, and any and all amendments to the 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 attorneys-in-fact and agents full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully as to
all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or either of them, or his
or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Dated: July 24, 1997
/s/ Thomas O. Flood
-------------------
Thomas O. Flood
<PAGE> 1
EXHIBIT 24.3
--------------------------------------------
POWER OF ATTORNEY
--------------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears
below constitutes and appoints Thomas O. Flood and Michael J. Kincaid, and each
of them acting alone, his true and lawful attorneys-in-fact and agents, with
full power of substitution and revocation, for him and in his name, place and
stead, in any and all capacities, to sign the Registration Statement on Form S-3
(the "Registration Statement") of Tractor Supply Company (the "Company")
relating to the shares of the Company's Common Stock originally issued pursuant
to the TSC Industries, Inc. Employee Stock Ownership Plan and currently held in
accounts for the benefit of certain participants in the Tractor Supply Company
Restated 401(k) Plan, and any and all amendments to the 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 attorneys-in-fact and agents full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully as to
all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or either of them, or his
or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Dated: July 24, 1997
/s/ Joseph D. Maxwell
---------------------
Joseph D. Maxwell
<PAGE> 1
EXHIBIT 24.4
--------------------------------------------
POWER OF ATTORNEY
--------------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears
below constitutes and appoints Thomas O. Flood and Michael J. Kincaid, and each
of them acting alone, his true and lawful attorneys-in-fact and agents, with
full power of substitution and revocation, for him and in his name, place and
stead, in any and all capacities, to sign the Registration Statement on Form S-3
(the "Registration Statement") of Tractor Supply Company (the "Company")
relating to the shares of the Company's Common Stock originally issued pursuant
to the TSC Industries, Inc. Employee Stock Ownership Plan and currently held in
accounts for the benefit of certain participants in the Tractor Supply Company
Restated 401(k) Plan, and any and all amendments to the 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 attorneys-in-fact and agents full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully as to
all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or either of them, or his
or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Dated: July 24, 1997
/s/ Thomas J. Hennesy, III
--------------------------
Thomas J. Hennesy, III
<PAGE> 1
EXHIBIT 24.5
--------------------------------------------
POWER OF ATTORNEY
--------------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears
below constitutes and appoints Thomas O. Flood and Michael J. Kincaid, and each
of them acting alone, his true and lawful attorneys-in-fact and agents, with
full power of substitution and revocation, for him and in his name, place and
stead, in any and all capacities, to sign the Registration Statement on Form S-3
(the "Registration Statement") of Tractor Supply Company (the "Company")
relating to the shares of the Company's Common Stock originally issued pursuant
to the TSC Industries, Inc. Employee Stock Ownership Plan and currently held in
accounts for the benefit of certain participants in the Tractor Supply Company
Restated 401(k) Plan, and any and all amendments to the 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 attorneys-in-fact and agents full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully as to
all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or either of them, or his
or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Dated: July 24, 1997
/s/ Joseph M. Rodgers
---------------------
Joseph M. Rodgers
<PAGE> 1
EXHIBIT 24.6
--------------------------------------------
POWER OF ATTORNEY
--------------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears
below constitutes and appoints Thomas O. Flood and Michael J. Kincaid, and each
of them acting alone, his true and lawful attorneys-in-fact and agents, with
full power of substitution and revocation, for him and in his name, place and
stead, in any and all capacities, to sign the Registration Statement on Form S-3
(the "Registration Statement") of Tractor Supply Company (the "Company")
relating to the shares of the Company's Common Stock originally issued pursuant
to the TSC Industries, Inc. Employee Stock Ownership Plan and currently held in
accounts for the benefit of certain participants in the Tractor Supply Company
Restated 401(k) Plan, and any and all amendments to the 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 attorneys-in-fact and agents full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully as to
all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or either of them, or his
or their substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Dated: July 24, 1997
/s/ S.P. Braud
--------------
S.P. Braud
