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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) December 9, 1999
BLYTH INDUSTRIES, INC.
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(Exact name of registrant as specified in its charter)
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<S> <C> <C>
DELAWARE 1-13026 36-2984916
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
</TABLE>
100 FIELD POINT ROAD, GREENWICH, CONNECTICUT 06830
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (203) 661-1926
NOT APPLICABLE
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
On December 9, 1999, the Board of Directors unanimously approved the
adoption of the Blyth Industries, Inc. Non-Qualified Deferred Compensation Plan
(the "Plan") for certain of its executive employees. The purpose of the Plan is
to provide those employees with supplemental retirement income on a
non-qualified, unfunded basis through salary deferrals, employer credits and
deemed earnings thereon. The Plan is intended to be a top-hat plan (i.e., an
unfunded deferred compensation plan maintained for a select group of management
or highly compensated employees) which is generally exempt from the Employee
Retirement Income Security Act of 1974. See Exhibit 4.1 attached hereto.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits
4.1 Blyth Industries, Inc. Non-Qualified Deferred Compensation Plan together
with the Blyth Industries, Inc. Profit Sharing Retirement Plan and Trust,
and the amendments thereto, which is referred to therein.
1
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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<S> <C> <C>
BLYTH INDUSTRIES, INC.
Date: December 21, 1999 By: /s/ BRUCE D. KREIGER
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Name: Bruce D. Kreiger
Title: VICE PRESIDENT & GENERAL COUNSEL
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2
<PAGE>
Exhibit 4.1
BLYTH INDUSTRIES, INC.
NON-QUALIFIED DEFERRED COMPENSATION PLAN
Effective as of January 1, 2000
RECITALS
This BLYTH INDUSTRIES, INC. NON-QUALIFIED DEFERRED COMPENSATION PLAN (the
"Plan") is adopted by BLYTH INDUSTRIES, INC. AND ITS NORTH AMERICAN SUBSIDIARIES
(the "Employer") for certain of its executive employees. The purpose of the Plan
is to provide those employees with supplemental retirement income and to offer
those employees an opportunity to elect to defer the receipt of compensation in
order to provide termination of employment and related benefits pursuant to
Section 451 of the Internal Revenue Code of 1986, as amended (the Code). The
Plan is intended to be a top-hat plan (I.E., an unfunded deferred compensation
plan maintained for a select group of management or highly compensated
employees) under Sections 201(2), 301(a)(3), and 401(a)(1) of the Employee
Retirement Income Security Act of 1974 (ERISA).
Accordingly, the following Plan is adopted.
Article I - Definitions
1.1 ACCOUNT means the balance credited to a Participant's or Beneficiary's
Deferral Account, including Compensation Deferrals, Voluntary Employer
Contributions and Earnings thereon (as determined by the
Administrator). A Participant's or Beneficiary's Account shall be
determined as of the date of reference.
1.2 ADMINISTRATOR means the Chief Financial Officer or Vice President
Organization Development of Blyth Industries, Inc. under the direction
of the Compensation Committee of the Board of Directors of Blyth
Industries, Inc. The Compensation Committee shall be responsible for
the approval of all discretionary matters under the terms of the Plan
and for all aspects of interpretation and administration of the Plan.
1.3 BENEFICIARY means any person or persons, entity or entities, designated
by the Participant to receive the balance of his or her Deferral
Account in the event of his or her death.
1.4 CODE means the Internal Revenue Code of 1986 and the regulations
thereunder, as amended from time to time.
1.5 COMPENSATION shall mean, with respect to any employee, the difference
between (a) such employee's "Compensation" for purposes of the
401(k)/Profit Sharing Plan, without regard to any limitations that are
set forth in Section 1.15 of the 401(k)/Profit Sharing Plan, and (b)
the dollar amount of the limit set forth in Subsection (E) of such
Section 1.15.
1.6 COMPENSATION DEFERRAL means that amount which a Participant elects from
time to time to have withheld from his or her Compensation, to be
deferred currently and paid at a later point in time. A Compensation
Deferral is initiated by making a Deferral Election.
<PAGE>
1.7 DEFERRAL ACCOUNT means the bookkeeping account established and
maintained by Blyth Industries, Inc. to record a Participant's
cumulative Compensation Deferrals under the terms of this Plan, plus
any Voluntary Employer Contributions and any adjustments due to
Earnings. A Participant's Deferral Account may be divided into
subaccounts.
1.8 DEFERRAL ELECTION means a written agreement executed by the Participant
and delivered to Blyth Industries, Inc. by which the Participant agrees
to a Compensation Deferral.
1.9 DESIGNATION DATE means the date or dates as of which a designation of
deemed investment directions by an individual pursuant to Section 4.5,
or any change in a prior designation of deemed investment directions by
an individual pursuant to Section 4.5, shall become effective. The
Administrator shall designate the Designation Date in any Plan Year.
1.10 EARNINGS means the income, gains and losses (Earnings may be a negative
number) attributable to the deemed investment of the assets comprising
the Participant's Deferral Account.
1.11 EFFECTIVE DATE means the effective date of the Plan, which shall be
January 1, 2000.
1.12 ELIGIBLE EMPLOYEE means, for any Plan Year (or applicable portion
thereof), a person employed by the Employer who is an officer of the
Employer at the level of Vice President or above and who is designated
by the Employer to be an Eligible Employee under the Plan. By each
November 1, the Employer shall notify those individuals, if any, who
will be Eligible Employees for the next Plan Year. If the Employer
determines that an individual first becomes an Eligible Employee during
a Plan Year, the Employer shall notify such individual of its
determination and of the date during the Plan Year on which the
individual shall first become an Eligible Employee.
1.13 EMPLOYER means BLYTH INDUSTRIES, INC. AND ITS NORTH AMERICAN
SUBSIDIARIES and their successors and assigns unless otherwise herein
provided, or any other corporation or business organization that, with
the consent of BLYTH INDUSTRIES, INC. or its successors or assigns,
assumes the Employer's obligations hereunder, or any other corporation
or business organization that agrees, with the consent of BLYTH
INDUSTRIES, INC., to become a party to the Plan.
1.14 ENTRY DATE with respect to an individual means the first day of the pay
period following the date on which the individual first becomes an
Eligible Employee.
1.15 INVESTMENT FUND means any of the investment funds selected by the
Administrator for use by the Participants in the Blyth Industries, Inc.
Non-Qualified Deferred Compensation Plan.
1.16 PARTICIPANT means any individual so designated in accordance with the
provisions of Article II, including, where appropriate according to the
context of the Plan, any former employee who is or may become (or whose
beneficiaries may become) eligible to receive a benefit under the Plan.
<PAGE>
1.17 PARTICIPANT ENROLLMENT AND ELECTION FORM means the form on which a
Participant makes a Deferral Election to defer Compensation hereunder
and on which the Participant makes certain other designations as
required thereon.
1.18 PLAN means this BLYTH INDUSTRIES, INC. NON-QUALIFIED DEFERRED
COMPENSATION PLAN, as amended from time to time.
1.19 PLAN YEAR means the twelve (12) month period ending on December 31 of
each year during which the Plan is in effect.
1.20 TRUST means the trust fund established pursuant to the Plan.
1.21 TRUSTEE means the trustee named in the agreement establishing the Trust
and such successor and/or additional trustees as may be named pursuant
to the terms of the agreement establishing the Trust.
1.22 VALUATION DATE means the December 31 of each Plan Year and any other
date that the Administrator, in its sole discretion, designates as a
Valuation Date.
1.23 VOLUNTARY EMPLOYER CONTRIBUTION shall have the meaning ascribed thereto
in Section 3.1 hereof.
1.24 401(k)/PROFIT SHARING PLAN means the Blyth Industries, Inc. Profit
Sharing Retirement Plan and Trust, as amended from time to time.
Article II - Eligibility and Participation
2.1 REQUIREMENTS. Every Eligible Employee on the Effective Date shall be
eligible to become a Participant on the Effective Date. Every other
Eligible Employee shall be eligible to become a Participant on the
first Entry Date occurring on or after the date on which he or she
becomes an Eligible Employee. No individual shall become a Participant,
however, if he or she is not an Eligible Employee on the date his or
her participation is to begin.
Participation in the Plan is voluntary. In order to participate, an
Eligible Employee must make a Deferral Election in such manner as may
be required by Section 3.1 and by the Administrator and must agree to
make Compensation Deferrals as provided in Article III.
2.2 REEMPLOYMENT. If a Participant whose employment with the Employer is
terminated is subsequently reemployed and becomes an Eligible Employee
once again, he or she shall become a Participant in accordance with the
provisions of Section 2.1.
2.3 CHANGE OF EMPLOYMENT CATEGORY. During any period in which a Participant
remains in the employ of the Employer, but ceases to be an Eligible
Employee, he or she shall not be eligible to make Compensation
Deferrals hereunder.
Article III - Contributions and Credits
<PAGE>
3.1 PARTICIPANT COMPENSATION DEFERRALS AND VOLUNTARY EMPLOYER
CONTRIBUTIONS. In accordance with rules established by the
Administrator, a Participant may make a Deferral Election to defer
Compensation that is due to be earned and would otherwise be paid to
the Participant, in a fixed percentage of Compensation designated by
the Participant, which percentage shall not exceed the percentage of
compensation deferred by such Participant pursuant to Section 4.1 of
the 401(k)/Profit Sharing Plan. Amounts so deferred will be considered
a Participant's "Compensation Deferrals." Ordinarily, a Participant
shall make such a Deferral Election with respect to a coming twelve
(12) month Plan Year during the period beginning on the November 1 and
ending on the November 30 of the prior Plan Year or during such other
period established by the Administrator.
Compensation Deferrals shall be made through regular payroll deductions
or through an election by the Participant to defer the payment of a
bonus not yet payable to him or her at the time of the election. The
Participant may reduce his or her payroll deduction Compensation
Deferral amount by providing written notice to the Administrator. Such
reduction will become effective on the paycheck for the first pay
period of the following calendar quarter. Once made, a Compensation
Deferral payroll deduction election shall continue in force
indefinitely, until changed by the Participant on a subsequent
Participant Enrollment and Election Form provided by the Administrator.
Compensation Deferrals shall be deducted by the Employer from the pay
of a deferring Participant and shall be credited to the Deferral
Account of the deferring Participant.
The Employer may, but shall not be obligated to, credit to a
Participant's Deferral Account ("Voluntary Employer Contributions"),
based upon such Participant's Compensation Deferrals or such
Participant's Compensation (determined without regard to clause (b) of
Section 1.5), as the case may be, on substantially the same basis as
"Matching Contributions" or "Non-Elective Contributions"are made by the
Employer pursuant to Sections 4.2 and 4.4 of the 401(k)/Profit Sharing
Plan for the applicable Plan Year.
There shall be established and maintained by the Employer a separate
Deferral Account in the name of each Participant, to which shall be
credited or debited (a) amounts equal to the Participants Compensation
Deferrals, (b) Voluntary Employer Contributions, if any, subject to
vesting as hereinafter provided and (c) Earnings (based upon the deemed
net asset value of the Deferral Account's deemed assets, as determined
by the Administrator) attributable or allocable to (a) and (b). Subject
to Section 4.1 hereof, the Administrator shall have the discretion to
allocate such Earnings among Deferral Accounts in a manner comparable
to the manner in which investment earnings are allocated under the
401(k)/Profit Sharing Plan or pursuant to such other allocation rules
as the Administrator deems to be reasonable and administratively
practicable.
Amounts equal to the Compensation Deferrals and Voluntary Employer
Contributions will be paid by the Employer to the Trust with reasonable
promptness after the total of such Compensation Deferrals and Voluntary
Employer Contributions during any month or other period established by
the Administrator has been determined.
3.2 DEFERRAL CANCELLATION. A Participant may only cancel his or her
Deferral Election once in a calendar year. In the event of such a
cancellation, a subsequent Deferral Election may not become effective
prior to the first day of the succeeding calendar year.
<PAGE>
3.3 VESTING. An Eligible Employee shall always be one hundred percent
(100%) vested in his or her Compensation Deferrals and the Earnings
attributed thereto.
An Eligible Employee will be vested in the Voluntary Employer
Contributions and the Earnings thereon in accordance with such Eligible
Employee's Vesting Percentage, determined in accordance with the
provisions of Section 1.67 of the 401(k)/Profit Sharing Plan that are
applicable to "Matching Contributions" and "Non-Elective
Contributions".
Article IV - Allocation of Funds
4.1 ALLOCATION OF DEEMED EARNINGS ON DEFERRAL ACCOUNTS. Pursuant to Section
4.5, each Participant shall have the right to direct the Administrator
as to how his or her Deferral Account shall be deemed to be invested.
In such a case, the Administrator may, but shall not be obligated to,
direct the Trustee to invest the Deferral Account maintained in the
Trust on behalf of the Participant pursuant to the direction the
Administrator has received from that Participant, but in any case such
Deferral Account shall be deemed to have been invested as so directed.
The Participant's Deferral Account will be credited or debited with the
increase or decrease in the net asset value of the designated deemed
investments, as follows: as of each Valuation Date, an amount equal to
the net increase or decrease in the net asset value (as determined by
the Administrator), of each deemed Investment Fund within the Trust
since the preceding Valuation Date shall be allocated among all
Participant's Deferral Accounts deemed to be invested in that
Investment Fund in accordance with the ratio that the portion of the
Deferral Account of each Participant that is deemed to be invested in
that Investment Fund, determined as provided herein, bears to the
aggregate of all Deferral Accounts deemed to be invested in that
Investment Fund.
4.2 ACCOUNTING FOR DISTRIBUTIONS. As of the date of any distribution
hereunder, the distribution to a Participant or his or her Beneficiary
or Beneficiaries shall be charged to such Participant's Deferral
Account.
4.3 SEPARATE ACCOUNTS. A separate account under the Plan shall be
established and maintained by the Employer to reflect the Deferral
Account for each Participant with subaccounts to show separately the
deemed earnings and losses credited or debited to such Deferral Account
and the applicable deemed investments of the Deferral Account.
4.4 INTERIM VALUATIONS. If it is determined by the Administrator that the
value of the Trust as of any date on which distributions are to be made
differs materially from the value of the Trust on the prior Valuation
date upon which the distribution is to be based, the Administrator, in
its discretion, shall have the right to designate any date in the
interim as a Valuation Date for the purpose of revaluing the Trust so
that the Deferral Account from which the distribution is being made
will, prior to the distribution, reflect its share of such material
difference in value.
4.5 DEEMED INVESTMENT DIRECTIONS OF PARTICIPANTS. Subject to such
limitations as may from time to time be required by law, imposed by the
Administrator or the Trustee, or contained elsewhere in the Plan, and
subject to such operating rules and procedures as may be imposed from
time to time by the Administrator or the Trustee, prior to and
effective for each Designation Date, each Participant may communicate
to the Administrator or the Trustee, as
<PAGE>
deemed appropriate by the Administrator, a direction as to how his or
her Deferral Account should be deemed to be invested among such
categories of deemed investments as may be made available by the
Employer hereunder. Such direction shall designate the percentage (in
any whole percent multiples) of each portion of the Participant's
Deferral Account that is requested to be deemed to be invested in such
categories of deemed investments and shall be subject to the following
rules:
(a) Any initial or subsequent deemed investment
direction shall be in writing, on a form
supplied by and filed with the
Administrator, and shall be effective as of
the next Designation Date that is at least
ten (10) business days after such filing.
The Administrator may allow, in its
discretion, alternative means of
communicating deemed investment directions.
(b) All amounts credited to the Participant's
Deferral Account shall be deemed to be
invested in accordance with the then
effective deemed investment direction, and,
as of the effective date of any new deemed
investment direction, all or a portion of
the Participant's Deferral Account at that
date shall be reallocated among the
designated deemed investment funds according
to the percentages specified in the new
deemed investment direction unless and until
a subsequent deemed investment election
shall be filed and become effective. An
election concerning deemed investment
choices shall continue indefinitely as
provided in the Participant's most recent
Participant Enrollment and Election Form or
other form specified by the Administrator.
(c) If the Administrator or Trustee receives an
initial or revised deemed investment
direction that it deems to be incomplete,
unclear, or improper, the Participant's
investment direction then in effect shall
remain in effect (or, in the case of a
deficiency in an initial deemed investment
direction, the Participant shall be deemed
to have filed no deemed investment
direction) until the next Designation Date,
unless the Administrator provides for, and
permits the application of, corrective
action prior thereto.
(d) If the Administrator or Trustee possesses at
any time directions as to the deemed
investment of less than all of a
Participant's Deferral Account, the
Participant shall be deemed to have directed
that the undesignated portion of the
Deferral Account be deemed to be invested in
a money market, fixed income, or similar
fund made available under the Plan as
determined by the Administrator in its
discretion.
(e) Each Participant hereunder, as a condition
to his or her participation hereunder,
agrees to indemnify and hold harmless the
Employer, the Administrator and their
respective agents and representatives from
any losses or damages of any kind relating
to the deemed investment of the
Participant's Deferral Account hereunder.
<PAGE>
(f) Each reference in this Section to a
Participant shall be deemed to include,
where applicable, a reference to a
Beneficiary.
Article V - Entitlement to Benefits
5.1 If an event shall have occurred that would have entitled a Participant
to receive a distribution pursuant to the 401(k)/Profit Sharing Plan,
assuming that the Participant was a participant therein, the
Participant's Deferral Account at the date of such event shall be
valued and payable according to the provisions of Article VI.
5.2 REEMPLOYMENT OF RECIPIENT. If a Participant receiving installment
distributions pursuant to Section 6.1 as a result of a termination of
such Participant's employment by the Employer is reemployed by the
Employer, the remaining distributions due to the Participant shall be
suspended until such time as the Participant (or his or her
Beneficiary) once again becomes eligible for benefits under Section
5.1, at which time such distribution shall commence, subject to the
limitations and conditions contained in this Plan.
Article VI - Distribution of Benefits
6.1 AMOUNT; MANNER OF PAYMENT. In the event that a Participant has become
entitled to receive a distribution pursuant to Section 5.1, the
Participant (or his or her Beneficiary) shall become entitled to
receive payment in an aggregate amount not in excess of the
Participant's Account, to the extent vested, which shall be payable in
substantially the same manner as such Participant's benefits under the
401(k)/Profit Sharing Plan, assuming that such Participant was a
participant therein. If the whole or any part of a payment hereunder by
the Trust or the Employer is to be in installments, the balance
remaining to be so paid shall continue to be deemed to be invested
pursuant to Sections 4.1 and 4.5 under such procedures as the
Administrator may establish, in which case, subject to the limitations
of Section 6.1, any Earnings attributable thereto (as determined by the
Administrator) shall be reflected in the installment payments, in such
equitable manner as the Administrator may determine.
6.2 WITHHOLDING. All payments under the Plan shall be made in cash and
shall be subject to withholding as required by applicable law.
Article VII - Beneficiaries; Participant Data
7.1 DESIGNATION OF BENEFICIARIES. Each Participant from time to time may
designate any person or persons (who may be named contingently or
successively) to receive such benefits as may be payable under the Plan
upon or after the Participant's death, and such designation may be
changed from time to time by the Participant by filing a new
designation. Each designation will revoke all prior designations by the
same Participant, shall be in a form prescribed by the Administrator,
and will be effective only when filed in writing with the Administrator
during the Participant's lifetime.
In the absence of a valid Beneficiary designation, or if, at the time
any benefit payment is due to a Beneficiary, there is no living
Beneficiary validly named by the Participant, the Participant's Account
shall be paid to the Participant's spouse, if then living, but
otherwise to the Participant's then living descendants, if any, PER
STIRPES, but, if none, to the Participant's
<PAGE>
estate. In determining the existence or identity of anyone entitled to
a benefit payment, the Administrator may rely conclusively upon
information supplied by the Participant's personal representative,
executor, or administrator. If a question arises as to the existence
or identity of anyone entitled to receive a benefit payment as
aforesaid, or if a dispute arises with respect to any such payment,
then, notwithstanding the foregoing, the Administrator, in its sole
discretion, may distribute such payment to the Participant's estate
without liability for any tax or other consequences that might flow
therefrom or may take such other action as the Administrator deems to
be appropriate.
7.2 INFORMATION TO BE FURNISHED BY PARTICIPANTS AND BENEFICIARIES/
INABILITY TO LOCATE PARTICIPANTS OR BENEFICIARIES. Any communication,
statement or notice addressed to a Participant or to a Beneficiary at
his or her last post office address as shown on the Administrator's
records shall be binding on the Participant or Beneficiary for all
purposes of the Plan. The Administrator shall not be obliged to search
for any Participant or Beneficiary beyond the sending of a registered
letter to such last known address. If the Administrator notifies any
Participant or Beneficiary that he or she is entitled to an amount
under the Plan and the Participant or Beneficiary fails to claim such
amount or make his or her location known to the Administrator within
three (3) years thereafter, then, except as otherwise required by law,
if the location of one or more of the next kin of the Participant is
known to the Administrator, the Administrator may direct distribution
of such amount to any one or more or all of such next of kin, and in
such proportions as the Administrator determines. If the location of
none of the foregoing persons can be determined, the Administrator
shall have the right to direct that the amount payable shall be deemed
to be a forfeiture, except that the dollar amount of the forfeiture,
unadjusted for deemed gains or losses in the interim, shall be paid if
a claim for the benefit is subsequently made by the Participant or the
Beneficiary to whom it was payable. If a benefit payable to an
unlocated Participant or Beneficiary is subject to escheat pursuant to
applicable state law, the Employer shall not be liable to any person
for any payment made in accordance with such law.
Article VIII - The Trust
8.1 ESTABLISHMENT OF TRUST. The Employer shall establish the Trust with the
Trustee, pursuant to such terms and conditions as are set forth in the
Trust agreement to be entered into between the Employer and the
Trustee. The Trust is intended to be treated as a grantor trust under
the Code, and the establishment of the Trust is not intended to cause
Participants to realize current income on amounts contributed thereto,
and the Trust shall be so interpreted.
Article IX - Administration
9.1 ADMINISTRATIVE AUTHORITY. Except as otherwise specifically provided
herein, the Administrator shall have sole responsibility for and the
sole control of the operation and administration of the Plan and shall
have the power and authority to take all action and to make all
decisions and interpretations that may be necessary and appropriate in
order to administer and operate the Plan, including, without limiting
the generality of the foregoing, the power, duty and responsibility to
<PAGE>
(a) Resolve and determine all disputes or questions
arising under the Plan, including the power to
determine the rights of Eligible Employees,
Participants, and Beneficiaries, and their respective
benefits, and to remedy any ambiguities,
inconsistencies, or omissions in the Plan.
(b) Adopt such rules of procedure and regulations as in
its opinion may be necessary for the proper and
efficient administration of the Plan and as are
consistent with the Plan.
(c) Implement the Plan in accordance with its terms and
the rules and regulations adopted as above.
(d) Make determinations with respect to the eligibility
of any Eligible Employee as a Participant and make
determinations concerning the crediting and
distribution of Deferral Accounts.
(e) Appoint any persons or firms, or otherwise act to
secure specialized advice or assistance, as it seems
necessary or desirable in connection with the
administration and operation of the Plan, and the
Administrator shall be entitled to rely conclusively
upon, and shall be fully protected in any action or
omission taken by it in its good faith reliance upon,
the advice or opinions of such firms or persons. The
Administrator shall have the power and authority to
delegate from time to time by written instrument all
or any part of its duties, powers, or
responsibilities under the Plan, both ministerial and
discretionary, as it deems appropriate, to any person
or committee, and in the same manner to revoke any
such delegation of duties, powers, or
responsibilities. Any action of such person or
committee in the exercise of such delegated duties,
powers, or responsibilities shall have the same force
and effect for all purposes hereunder as if such
action had been taken by the Administrator. Further,
the Administrator may authorize one or more persons
to execute any certificate or document on behalf of
the Administrator, in which event any person notified
by the Administrator of such authorization shall be
entitled to accept and conclusively rely upon any
such certificate or document executed by such person
as representing action by the Administrator until
such third person shall have been notified of the
revocation of such authority.
9.2 MUTUAL EXCLUSION OF RESPONSIBILITY. Neither the Trustee nor the
Employer (whether or not acting by or through the Administrator) shall
be obliged to inquire into or be responsible for any act or failure to
act, or the authority therefor, on the part of the other.
9.3 UNIFORMITY OF DISCRETIONARY ACTS. Whenever in the administration or
operation of the Plan discretionary actions by the Administrator are
required or permitted, such actions shall be consistently and uniformly
applied to all persons similarly situated, and no such action shall be
taken that shall discriminate in favor of any particular person or
group of persons.
9.4 LITIGATION. Except as may otherwise be required by law, in any action
or judicial proceeding affecting the Plan, no Participant or
Beneficiary shall be entitled to any notice or
<PAGE>
service of process, and any final judgment entered in such action
shall be binding on all persons interested in, or claiming under, the
Plan.
9.5 PAYMENT OF ADMINISTRATION EXPENSES. All expenses incurred in the
administration and operation of the Plan and the Trust, including any
taxes payable by the Employer in respect of the Plan or Trust or
payable by or from the Trust pursuant to its terms, shall be paid by
the Employer.
9.6 CLAIMS PROCEDURE. Any person claiming a benefit under the Plan (a
"Claimant") shall present the claim, in writing, to the Administrator,
and the Administrator shall respond in writing. If the claim is denied,
the written note of denial shall state, in a manner calculated to be
understood by the Claimant:
(a) the specific reason or reasons for the denial, with
specific references to the Plan provisions on which
the denial is based;
(b) a description of any additional material or
information necessary for the Claimant to perfect his
or her claim and an explanation of why such material
or information is necessary; and
(c) an explanation of the Plan's claims review procedure.
The written notice denying or granting the Claimant's claim
shall be provided to the Claimant within ninety (90) days
after the Administrator's receipt of the claim, unless special
circumstances require an extension of time for processing the
claim. If such an extension is required, written notice of the
extension shall be furnished by the Administrator to the
Claimant within the initial ninety (90) day period and in no
event shall such extension exceed a period of ninety (90) days
from the end of the initial ninety (90) day period. Any
extension notice shall indicate the special circumstances
requiring the extension and the date on which the
Administrator expects to render a decision on the claim. Any
claim not granted or denied within the period noted above
shall be deemed to have been denied.
Any Claimant whose claim is denied or deemed to have been
denied under the preceding sentence (or such Claimant's
authorized representative) may, within sixty (60) days after
the Claimant's receipt of notice of the denial or after the
date of the deemed denial, request a review of the denial by
notice given, in writing, to the Administrator. Upon such a
request for review, the claim shall be reviewed by the
Administrator (or its designated representative), which may,
but shall not be required to, grant the Claimant a hearing. In
connection with the review, the Claimant may have
representation, may examine pertinent documents, and may
submit issues and comments in writing.
The decision on review normally shall be made with sixty (60)
days of the Administrator's receipt of the request for review.
If an extension of time is required due to special
circumstances, the Claimant shall be notified, in writing, by
the Administrator, and the time limit for the decision on
review shall be extended to one hundred twenty (120) days. The
decision on review shall be in writing and shall state, in a
manner calculated to be understood by the Claimant, the
specific reasons
<PAGE>
for the decision and shall include references to the relevant
Plan provisions on which the decision is based. The written
decision on review shall be given to the Claimant within the
sixty (60) day (or, if applicable, the one hundred twenty
(120) day) time limit discussed above. If the decision on
review is not communicated to the Claimant within the sixty
(60) day (or, if applicable, the one hundred twenty (120) day)
time limit discussed above, the claim shall be deemed to have
been denied upon review. All decisions on review shall be
final and binding with respect to all concerned parties.
Article X - Amendment
10.1 RIGHT TO AMEND. The Employer, by written instrument executed by the
Employer, shall have the right to amend the Plan, at any time and with
respect to any provisions hereof, and all parties hereto or claiming
any interest hereunder shall be bound by such amendment; provided,
however, that no such amendment shall deprive a Participant or a
Beneficiary of a right accrued hereunder prior to the date of the
amendment.
10.2 AMENDMENTS TO ASSURE PROPER CHARACTERIZATION OF PLAN. Notwithstanding
the provisions of Section 10.1, the Plan and the Trust agreement may be
amended by the Employer at any time, retroactively if required, if
found necessary, in the opinion of the Employer, in order to ensure
that the Plan is characterized as a top hat plan of deferred
compensation maintained for a select group of management or highly
compensated employees as described under ERISA Sections 201(2),
301(a)(3), and 401(a)(1) and to conform the Plan to the provisions and
requirements of any applicable law (including ERISA and the Code). No
such amendment shall be considered prejudicial to any interest of a
Participant or a Beneficiary hereunder.
Article XI - Termination
11.1 EMPLOYER'S RIGHT TO TERMINATE OR SUSPEND PLAN. The Employer reserves
the right, at any time, to terminate the Plan and/or its obligation to
make further credits to Deferral Accounts. The Employer also reserves
the right, at any time, to suspend the operation of the Plan for a
fixed or indeterminate period of time.
11.2 AUTOMATIC TERMINATION OF PLAN. The Plan, but not the Trust,
automatically shall terminate upon the dissolution of the Employer or
upon its merger into or consolidation with any other corporation or
business organization if there is a failure by the surviving
corporation or business organization to adopt specifically and agree to
continue the Plan.
11.3 SUSPENSION OF COMPENSATION DEFERRALS. In the event of a suspension of
the Plan, the Employer shall continue all aspects of the Plan, other
than Compensation Deferrals and Voluntary Employer Contributions under
Section 3.1, during the period of the suspension, in which event
payments hereunder will continue to be made during the period of the
suspension in accordance with Articles V and VI.
11.4 ALLOCATION AND DISTRIBUTION. This Section shall become operative upon a
complete termination of the Plan. The provisions of this Section also
shall become operative in the event of a partial termination of the
Plan, as determined by the Employer, but only with respect to that
portion of the Plan attributable to the Participants to whom the
partial
<PAGE>
termination is applicable. Upon the effective date of any such event,
notwithstanding any other provision of the Plan, (i) no persons who
were not theretofore Participants shall be eligible to become
Participants, and (ii) the value of the vested interests of all
Participants and Beneficiaries shall be determined and, after
deduction of estimated expenses in liquidating and, if applicable,
paying Plan benefits, paid to them as soon as is practicable after
such termination.
11.5 SUCCESSOR TO EMPLOYER. Any corporation or other business organization
that is a successor to the Employer by reason of a consolidation,
merger, or purchase of substantially all of the assets of the Employer
shall have the right to become a party to the Plan by adopting the same
by resolution of the entity's board of directors or other appropriate
governing body. If, within ninety (90) days from the effective date of
such consolidation, merger, or sale of assets, such new entity does not
become a party hereto, as above provided, the Plan automatically shall
be terminated, and the provisions of Section 11.4 shall become
operative.
Article XII - Miscellaneous
12.1 LIMITATIONS ON LIABILITY OF EMPLOYER. Neither the establishment of the
Plan or any modification thereof, nor the creation of any account under
the Plan, nor the payment of any benefits under the Plan shall be
construed as giving to any Participant or other person any legal or
equitable right against the Employer or any officer or employee
thereof, except as provided by law or by any Plan provision. The
Employer does not in any way guarantee any Participant's Deferral
Account from loss or depreciation caused by poor investment performance
of a deemed investment. In no event shall the Employer, or any
successor, employee, officer, director or stockholder of the Employer,
be liable to any person on account of any claim arising by reason of
the provisions of the Plan or of any instrument or instruments
implementing its provisions, or for the failure of any Participant,
Beneficiary, or other person to be entitled to any particular tax
consequences with respect to the Plan, or any credit or distribution
thereunder.
12.2 CONSTRUCTION. If any provision of the Plan is held to be illegal or
void, such illegality or invalidity shall not affect the remaining
provisions of the Plan, but shall be fully severable, and the Plan
shall be construed and enforced as if said illegal or invalid provision
had never been inserted herein. For all purposes of the Plan, where the
context admits, the singular shall include the plural, and the plural
shall include the singular. Headings of Articles and Sections herein
are inserted only for convenience of reference and are not to be
considered in the construction of the Plan. The laws of the State of
Connecticut shall govern, control and determine all questions of law
arising with respect to the Plan and the interpretation and validity of
its respective provisions, except where those laws are preempted by the
laws of the United States. Participation under the Plan will not give
any Participant any right or claim to any benefit under the Plan unless
such right or claim has specifically accrued hereunder. Nothing in this
Plan shall be deemed to constitute an agreement of employment with any
Eligible Employee or to entitle any Eligible Employee to continue in
the employ of the Employer for any particular period of time nor,
subject to the terms of any separate agreement, to interfere with the
Employer's right to terminate any Eligible Employee's employment at any
time for any reason.
The Plan is intended to be and at all times shall be interpreted and
administered so as to qualify as an unfunded deferred compensation
plan, and no provision of the Plan shall be interpreted so as to give
any individual any right in any assets of the Employer which right is
greater than the rights of a general unsecured creditor of the
Employer.
12.3 SPENDTHRIFT PROVISION. No amount payable to a Participant or a
Beneficiary under the Plan will, except as otherwise specifically
provided by law, be subject in any manner to anticipation, alienation,
attachment, garnishment, sale, transfer, assignment (either at law or
in equity), levy, execution, pledge, encumbrance, charge, or any other
legal or equitable process, and any attempt to do so will be void; nor
will any benefit be in any manner liable for or subject to the debts,
contracts, liabilities, engagements, or torts of the person entitled
thereto. Further, the withholding of taxes from Plan benefit payments;
the recovery under the Plan of overpayment of benefits previously made
to a Participant or Beneficiary; if applicable, the transfer of benefit
rights from the Plan to another plan; or the direct deposit of benefit
payments to an account in a banking institution (if not actually part
of an arrangement constituting an assignment or alienation) shall not
be construed as an assignment or alienation.
In the event that any Participant's or Beneficiary's benefits hereunder
are garnished or attached by order of any court, the Employer may bring
an action or a declaratory judgment in a court of competent
jurisdiction to determine the proper recipient of the benefits to be
paid under the Plan. During the pendency of said action, any benefits
that become payable shall be held as credits to the Participant's or
Beneficiary's Deferral Account or, if the Employer prefers, paid into
the court as they become payable, to be distributed by the court to the
recipient as the court deems proper at the close of said action.
<PAGE>
IN WITNESS WHEREOF, the Employer has caused the Plan to be executed and
its seal to be affixed hereto, effective as of the first day of
January, 2000.
ATTEST/WITNESS BLYTH INDUSTRIES, INC.
By:_________________________ By:____________________________
Print Name: ________________ Print Name:____________________
[SEAL] Date:_____________________
ATTEST/WITNESS [NORTH AMERICAN SUBSIDIARIES]
By:_________________________ By:____________________________
Print Name: ________________ Print Name:____________________
Date:_____________________________
[SEAL]
[SEAL]
<PAGE>
AMENDMENT TO
CANDLE CORPORATION OF AMERICA PROFIT SHARING/401(K) PLAN
WHEREAS, Candle Corporation of America, Partylite Gifts, Inc. and Aromatic
Industries, Inc. (hereinafter referred to as the "Employer") established the
Candle Corporation of America Profit Sharing/401(k) Plan (hereinafter referred
to as the "Plan") effective April 30, 1980 for the benefit of its eligible
Employees and their Beneficiaries; and
WHEREAS, the Employer reserved the right to amend the Plan under the terms
thereof; and
WHEREAS, the Employer now desires to amend the Plan and restate its provisions
to comply with the requirements of the Tax Reform Act of 1986 (TRA '86), the
Omnibus Budget Reconciliation Act of 1986 (OBRA '86), and the Unemployment
Compensation Amendment of 1992 (UCA '92) if applicable;
WHEREAS, the Employer also desires to change the name of the Plan to the Blyth
Industries, Inc. Profit Sharing
Retirement Plan and Trust;
NOW THEREFORE, the Plan is hereby amended and restated in its entirety effective
February 1, 1992 except as follows:
1. Effective for calendar years beginning on January 1, 1987, the provisions
regarding limits on Elective Deferral Contributions shall be amended and
governed by the terms of Article IV of the Plan attached hereto.
2. Effective on the first day of the Plan Year beginning in 1987, the
provisions relating to the special nondiscrimination test for Elective
Deferral Contributions under Code section 401(k), as defined in Article I,
shall be amended and governed by the terms of the Plan attached hereto.
3. Effective on the first day of the Plan Year beginning in 1987, the
provisions relating to the special nondiscrimination test for Matching
Contributions and Employee Contributions under Code section 401(m), as
defined in Article I, shall be amended and governed by the terms of the
Plan attached hereto.
4. Effective on the first day of the Plan Year beginning in 1987, the
provisions defining Highly Compensated Employee shall be amended and
governed by the terms of Article I of the Plan attached hereto.
5. Effective on the first day of the Plan Year beginning in 1987, the
provisions regarding Limitations on Allocations shall be amended and
governed by the terms of Article V of the Plan attached hereto.
6. Effective on January 1, 1989, the provisions relating to required minimum
distributions shall be amended and governed by the terms of the Plan
attached hereto.
7. Effective on the first day of the Plan Year beginning in 1992, gap period
earnings associated with Excess Contributions shall not be distributed.
8. Effective on the first day of the Plan Year beginning in 1992, gap period
earnings associated with Excess Aggregate Contributions shall not be
distributed.
9. Effective on the first day of the 1992 Plan Year, the provisions relating
to the determination of a financial need for a Serious Financial Hardship
shall be liberalized in accordance with the rules set forth in the final
401(k) regulations.
<PAGE>
10. Effective on the first day of the 1992 Plan Year, the provisions relating
to the correction of excess Annual Additions shall be amended and governed
by the terms of Article V of the Plan attached hereto.
11. Effective March 26, 1992, the provisions relating to Employer and Plan
shall be amended and governed by the new definitions of those terms
contained in Article I of the Plan attached hereto.
12. Effective January 1, 1993, the provisions relating to Direct Rollovers
shall be added to the Plan as governed by the terms of Article VI-A of the
Plan attached hereto.
13. Effective January 1, 1993, the name of the Plan shall be the Blyth
Industries, Inc. Profit Sharing Retirement Plan and Trust.
14. Effective January 1, 1994, the provisions relating to Rollover
Contributions shall be amended and governed by the terms of Article IV of
the Plan attached hereto.
15. Effective January 1, 1994, the provisions relating to Investment of
Contributions and Transfers Between Investment Funds shall be amended and
governed by the terms of Article XIII of the Plan attached hereto.
16. Effective on the first day of the Plan Year beginning in 1994, Compensation
for purposes of the Plan shall be limited to a maximum of $150,000.
17. Effective January 1, 1995, the provisions relating to the Investment of
Contributions shall be amended to allow investment of contributions in
shares of stock of Blyth Industries Inc.
18. The terms of the Plan as heretofore set forth shall no longer apply with
respect to Participants under the Plan who have not terminated employment
(including terminations on account of Retirement, death or Disability); and
the terms of the Plan with respect to such Participants shall henceforth be
as set forth in the Blyth Industries, Inc. Profit Sharing Retirement Plan
and Trust, a copy of which is attached to and forms a part of this
amendment.
19. The Plan and Trust as amended and restated, shall represent a continuation
of the prior Plan and Trust as heretofore set forth and shall not abridge
or curtail any rights accorded to Participants under said prior instrument.
<PAGE>
IN WITNESS WHEREOF, the Employer, the Administrator and the Trustee have
hereunto affixed their signatures.
Executed at Chicago, Illinois on November 30, 1994
----------------------- ---------------------------------
CANDLE CORPORATION OF AMERICA
/s/ Richard Zielinski By /s/ Howard E. Rose (HER)
- ----------------------------------- ----------------------------------
Witness
Title Vice-President
------------------------------
Executed at Chicago, Illinois on November 30, 1994
----------------------- ---------------------------------
PARTYLITE GIFTS, INC.
/s/ Richard Zielinski By /s/ Howard E. Rose (HER)
- ----------------------------------- ----------------------------------
Witness
Title Vice-President
------------------------------
Executed at Chicago, Illinois on November 30, 1994
----------------------- ---------------------------------
AROMATIC INDUSTRIES, INC.
/s/ Richard Zielinski By /s/ Howard E. Rose (HER)
- ----------------------------------- ----------------------------------
Witness
Title Vice-President
------------------------------
Accepted this 30th day of November, 1994.
---- -------- ----
/s/ Richard Zielinski By /s/ Howard E. Rose (HER)
- ----------------------------------- -------------------------------------
Witness Administrator
Vice-President, Candle Corporation
of America
<PAGE>
Accepted this _______ day of ___________________, ________.
__________________________________ By ___________________________________
Witness Trustee
__________________________________ By ___________________________________
Witness Trustee
__________________________________ By ___________________________________
Witness Trustee
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
BLYTH INDUSTRIES, INC. PROFIT SHARING RETIREMENT PLAN AND TRUST
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
Table Of Contents
ARTICLE I Definitions.....................................1
ARTICLE II Service........................................17
ARTICLE III Eligibility, Enrollment and Participation......20
ARTICLE IV Contributions..................................22
ARTICLE V Limitations on Allocations.....................34
ARTICLE VI Distribution of Benefits.......................41
ARTICLE VI-A Direct Rollovers...............................48
ARTICLE VII Retirement Benefits............................50
ARTICLE VIII Joint and Survivor Annuity Requirements........51
ARTICLE IX Termination of Employment......................56
ARTICLE X Withdrawals....................................57
ARTICLE XI Fiduciary Duties and Responsibilities..........61
ARTICLE XII The Administrator..............................62
ARTICLE XIII Participants' Rights...........................64
ARTICLE XIV Amendment or Termination of the Plan...........67
ARTICLE XV Substitution of Plans..........................69
ARTICLE XVI Miscellaneous..................................70
ARTICLE XVI-A Top-Heavy Provisions...........................72
ARTICLE XVII Trust Agreement................................77
<PAGE>
ARTICLE I
DEFINITIONS
1.1 ACCRUED BENEFIT. The term Accrued Benefit means the value on any applicable
date of the Participant's Account.
1.2 ACTIVE PARTICIPANT. The term Active Participant means any Participant who
(a) performs duties as an Employee for the Employer, and (b) is not an
Inactive Participant.
1.3 ACTUAL CONTRIBUTION PERCENTAGE. The term Actual Contribution Percentage
means the average of the Actual Contribution Ratios of a specified group
computed to the nearest one-hundredth of one percent.
1.4 ACTUAL CONTRIBUTION PERCENTAGE TEST.
(A) For each Plan Year, the Plan shall satisfy the contribution percentage
requirement described in section 401(m)(2) of the Code and the
regulations thereunder, which are incorporated herein.
The Plan satisfies the Actual Contribution Percentage Test if:
(1) The Actual Contribution Percentage for the group of eligible
Highly Compensated Employees is not more than the Actual
Contribution Percentage for the group of all other eligible
Employees multiplied by 1.25; or
(2) The excess of the Actual Contribution Percentage for the group of
eligible Highly Compensated Employees over the Actual
Contribution Percentage for the group of all other eligible
Employees is not more than two percentage points, and the Actual
Contribution Percentage for the group of eligible Highly
Compensated Employees is not more than the Actual Contribution
Percentage for the group of all other eligible Employees
multiplied by two.
(B) Special Rules.
(1) Matching Contributions and Qualified Nonelective Contributions
will be considered for a Plan Year only if allocated to the
Employee's Account as of any date within the Plan Year being
tested and only if made before the last day of the twelve month
period immediately following the Plan Year to which such
contributions relate.
(2) A Matching Contribution that is forfeited to correct Excess
Aggregate Contributions, or because the contribution to which it
relates is treated as an Excess Contribution, Excess Deferral, or
Excess Aggregate Contribution, shall not be taken into account
for purposes of the Actual Contribution Percentage Test.
(3) The Employer shall maintain records sufficient to demonstrate
satisfaction of the Actual Contribution Percentage Test,
including records showing the extent to which Qualified
Nonelective Contributions and Elective Deferral Contributions are
taken into account.
1.5 ACTUAL CONTRIBUTION RATIO.
1
<PAGE>
(A) An Employee's Actual Contribution Ratio is the sum of the Contribution
Percentage Amounts allocated to the Employee's Account for the Plan
Year (including any amounts required to be taken into account under
subparagraphs (B) (1) and (B) (2) of this section) divided by the
Employee's Compensation for the Plan Year. If no Matching
Contributions, Qualified Nonelective Contributions, or Elective
Deferral Contributions are taken into account with respect to an
eligible Employee, the Actual Contribution Ratio of the Employee is
zero.
(B) Special Rules.
(1) In the event that this Plan is aggregated with one or more plans
for purposes of section 410(b) of the Code (other than for
purposes of the average benefit percentage test), or if one or
more other plans satisfy the requirements of section 410(b) of
the Code (other than the average benefit percentage test) only if
aggregated with this Plan, then this section shall be applied by
determining the Actual Contribution Ratios of Employees as if all
such plans were a single plan. Plans may be aggregated only if
they have the same Plan Year.
(2) The Actual Contribution Ratio of a Highly Compensated Employee
who is eligible to participate in more than one plan of the
Employer to which employee contributions or Matching
Contributions are made shall be calculated by treating all such
plans in which the Employee is eligible to participate as one
plan. For Plan Years beginning after December 31, 1988, if a
Highly Compensated Employee participates in two or more plans
that have different plan years, all plans ending with or within
the same calendar year shall be treated as a single plan.
However, plans that are not permitted to be aggregated under
Treasury Regulation section 1.401(m)-1(b)(3)(ii) shall not be
aggregated for purposes of this section.
(3) For purposes of determining the Actual Contribution Ratio of a
Participant who is a 5-percent owner or one of the ten most
highly-paid Highly Compensated Employees, the Contribution
Percentage Amounts and Compensation of such Participant shall
include the Contribution Percentage Amounts (including any
amounts required to be taken into account under subparagraphs (B)
(1) and (B) (2) of this section) and Compensation for the Plan
Year of all Family Members.
If the Participant is required to be aggregated as a member of
more than one family group under the Plan, all eligible Employees
who are members of those family groups that include that Employee
are aggregated as one family group.
Family Members, with respect to Highly Compensated Employees,
shall be disregarded as separate Employees in determining the
Actual Contribution Ratio both for Participants who are Nonhighly
Compensated Employees and for Participants who are Highly
Compensated Employees.
(4) The determination and treatment of the Actual Contribution Ratio
amounts of any Participant shall satisfy such other requirements
as may be prescribed by the Secretary of the Treasury.
1.6 ACTUAL DEFERRAL PERCENTAGE. The term Actual Deferral Percentage means the
average of the Actual Deferral Ratios of a specified group, computed to the
nearest one-hundredth of one percent.
1.7 ACTUAL DEFERRAL PERCENTAGE TEST.
2
<PAGE>
(A) For each Plan Year, the Plan shall satisfy the Actual Deferral
Percentage Test described in section 401(k)(3) and the regulations
thereunder, which are herein incorporated by reference.
The Plan satisfies the Actual Deferral Percentage Test for a Plan Year
only if:
(1) The Actual Deferral Percentage for the group of eligible Highly
Compensated Employees is not more than the Actual Deferral
Percentage for the group of all other eligible Employees
multiplied by 1.25; or
(2) The excess of the Actual Deferral Percentage for the group of
eligible Highly Compensated Employees over the Actual Deferral
Percentage for the group of all other eligible Employees is not
more than two percentage points, and the Actual Deferral
Percentage for the group of eligible Highly Compensated Employees
is not more than the Actual Deferral Percentage for the group of
all other eligible Employees multiplied by two.
(B) Special Rules.
(1) For purposes of determining the Actual Deferral Percentage Test,
Elective Deferral Contributions, Qualified Nonelective
Contributions, and Qualified Matching Contributions must be
allocated to the Employee's Account as of a date within the Plan
Year being tested and must be made before the last day of the
twelve-month period immediately following the Plan Year to which
such contributions relate.
(2) The Excess Deferrals of a Highly Compensated Employee shall be
taken into account for purposes of the Actual Deferral Percentage
Test. Conversely, the Excess Deferrals of an Employee who is a
Nonhighly Compensated Employee shall not be taken into account
for purposes of the Actual Deferral Percentage Test.
(3) The Employer shall maintain records sufficient to demonstrate
satisfaction of the Actual Deferral Percentage Test, including
the extent to which Qualified Nonelective Contributions and
Qualified Matching Contributions are taken into account.
1.8 ACTUAL DEFERRAL RATIO.
(A) An Employee's Actual Deferral Ratio for the Plan Year is the sum of
the Employee's Deferral Percentage Amounts allocated to the Employee's
Account for the Plan Year (including any amounts required to be taken
into account under subparagraphs (B) (1) and (B) (2) of this section),
divided by the Employee's Compensation taken into account for the Plan
Year. If an eligible Employee makes no Elective Deferral
Contributions, and no Qualified Matching Contributions or Qualified
Nonelective Contributions are taken into account with respect to the
Employee, the Actual Deferral Ratio of the Employee is zero.
(B) Special Rules.
(1) In the event that this Plan is aggregated with one or more plans
for purposes of section 410(b) of the Code (other than for
purposes of the average benefit percentage test), or if one or
more other plans satisfy the requirements of section 410(b) of
the Code (other than the average benefit percentage test) only if
aggregated with this Plan, then this section shallbe applied by
determining the Actual Deferral Ratio of Employees as if all such
plans were a single plan. Plans may be aggregated only if they
have the same Plan Year.
3
<PAGE>
(2) The Actual Deferral Ratio of a Highly Compensated Employee who is
eligible to participate in more than one cash or deferred
arrangement (as described in section 401(k) of the Code) of the
same Employer shall be calculated by treating all the cash or
deferred arrangements in which the Employee is eligible to
participate as one arrangement. If the cash or deferred
arrangements that are treated as a single arrangement under the
preceding sentence are parts of plans that have different Plan
Years, the cash or deferred arrangements are treated as a single
arrangement with respect to the Plan Years ending with or within
the same calendar year. However, plans that are not permitted to
be aggregated under Treasury Regulation section
1.401(k)-1(b)(3)(ii)(B) are not aggregated for purposes of this
section.
(3) For purposes of determining the Actual Deferral Ratio of a
Participant who is a 5 percent owner or one of the 10 most Highly
Compensated Employees, the Deferral Percentage Amounts and
Compensation of such Participant shall include the Deferral
Percentage Amounts (including any amounts required to be taken
into account under subparagraphs (B) (1) and (B) (2) of this
section) and Compensation for the Plan Year of Family Members.
If an Employee is required to be aggregated as a member of more
than one family group under the Plan, all eligible Employees who
are members of those family groups that include that Employee are
aggregated as one family group.
Family Members, with respect to such Highly Compensated
Employees, shall be disregarded as separate Employees in
determining the Actual Deferral Percentage both for Participants
who are Nonhighly Compensated Employees and for Participants who
are Highly Compensated Employees.
(4) The determination and treatment of the Actual Deferral Ratio
amounts of any Participant shall satisfy such other requirements
as may be prescribed by the Secretary of the Treasury.
1.9 ADDITIONAL MATCHING CONTRIBUTIONS. The term Additional Matching
Contributions means contributions made by the Employer pursuant to Article
IV, and shall be considered to be Matching Contributions for purposes of
determining the Actual Contribution Ratio and/or the Actual Deferral Ratio
pursuant to Article I and Annual Additions pursuant to Article V.
1.10 ANNUITY. The term Annuity means a series of payments made over a
specified period of time which, for a fixed annuity are, of equal,
specified amounts, and for a variable annuity increase or decrease to
reflect changes in investment performance of the underlying portfolio.
1.11 ANNUITY STARTING DATE. The term Annuity Starting Date means the first day
of the first period for which an amount is payable as an Annuity. In the
case of a benefit not payable in the form of an Annuity, the term Annuity
Starting Date means the first day on which all events have occurred which
entitle the Participant to such benefit.
1.12 BENEFICIARY. The Participant's Spouse is the designated Beneficiary of
the Participant's entire Vested Interest. However, each Participant shall
have the right to designate another Beneficiary and to specify the form
of death benefit the Beneficiary is to receive, subject to the
requirements of the "Qualified Election" provisions of Article VIII,
Joint and Survivor Annuity Requirements. The Participant may change the
Beneficiary and/or the form of death benefit at any time, subject to the
requirements of the "Qualified Election" provisions of Article VIII,
Joint and Survivor Annuity Requirements.
4
<PAGE>
If any distribution hereunder is made to a Beneficiary in the form of an
Annuity, and if such Annuity provides for a death benefit, then such
Beneficiary shall also have the right to designate a Beneficiary and to
change that Beneficiary from time to time. As an alternative to receiving
the benefit in the form of an Annuity, the Beneficiary may elect to
receive a single cash payment or any other form of payment provided for
in the Plan.
If a Beneficiary has not been designated, or if a Beneficiary designation
or change of Beneficiary designation does not meet the requirements of
the "Qualified Election" provisions of Article VIII, Joint and Survivor
Annuity Requirements, (including any designation made prior to August 23,
1984 by a married Participant who has an Hour of Service on or after
August 23, 1984), or if no designated Beneficiary survives the
Participant, the Participant's entire Vested Interest shall be
distributed to the Participant's Spouse, if living; otherwise in equal
shares to any surviving children of the Participant. In the event none of
the above named individuals survives the Participant, the Participant's
entire Vested Interest shall be paid to the executor or administrator of
the Participant's estate.
For purposes of Investment of Contributions as described in Sections
13.10 and 13.11 of the Plan, an individual who is designated as an
alternate payee in a qualified domestic relations order (as defined in
section 414(p) of the Code) relating to a Participant's benefits under
this Plan shall be treated as a Beneficiary hereunder, to the extent
provided by such order.
1.13 BOARD OF DIRECTORS. The term Board of Directors means the Employer's
board of directors or other comparable governing body.
1.14 CODE. The term Code means the Internal Revenue Code of 1986, as amended
from time to time.
1.15 COMPENSATION
(A) Except as otherwise provided in the Plan, the term Compensation
means wages, salaries, and fees for professional services and
other amounts received (without regard to whether or not an amount
is paid in cash) for personal services actually rendered in the
course of employment with the Employer maintaining the Plan to the
extent that the amounts are includible in gross income (including,
but not limited to, commissions paid salesmen, compensation for
services on the basis of a percentage of profits, commissions on
insurance premiums, tips, bonuses, fringe benefits, and
reimbursements, or other expense allowances under a nonaccountable
plan (as described in 1.62-2(c)), and foreign earned income (as
defined in section 911(b) of the Code) whether or not excludable
from gross income under section 911 of the Code. The term
Compensation does not include:
(1) 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 deductible by the
Employee, or any distributions from a plan of deferred
compensation;
(2) Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the
Employee either becomes freely transferable or is no longer
subject to substantial risk of forfeiture;
(3) Amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified stock
option; and
(4) Other amounts which received special tax benefits, or
contributions made by the Employer (whether or not under a
salary reduction agreement) towards the purchase of an
annuity
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contract described in section 403(b) of the Code (whether
or not the contributions are actually excludable from the
gross income of the Employee).
Notwithstanding the foregoing, Compensation shall be reduced by
all of the following items (even if includible in gross income):
reimbursements or other expense allowances, fringe benefits (cash
and noncash), moving expenses, deferred compensation, and welfare
benefits.
(B) Compensation shall include only that Compensation which is
actually paid to the Participant during the determination period.
Except as provided elsewhere in the Plan, the determination period
shall be the Plan Year. However, for the Plan Year in which an
Employee begins participation in the Plan and the Plan Year in
which an Employee ends participation in the Plan, the
determination period is the portion of the Plan Year during which
the Employee is a Participant in the Plan.
(C) Compensation shall include any amount which is contributed by the
Employer pursuant to a salary reduction agreement and which is not
includible in the gross income of the employee under sections 125,
402(e)(3), 402(h), or 403(b) of the Code; Compensation deferred
under an eligible deferred compensation plan within the meaning of
section 457(d) of the Code; and employee contributions described
in section 414(h)(2) of the Code that are picked up by the
employing unit and, thus, are treated as employer contributions.
(D) The annual Compensation of each Participant taken into account for
determining all benefits provided under the Plan for any
determination period shall not exceed $200,000. This limitation
shall be adjusted by the Secretary of the Treasury at the time and
in the same manner as under section 415(d) of the Code, except
that the dollar increase in effect on January 1 of any calendar
year is effective for determination periods beginning in such
calendar year and the first adjustment to the $200,000 limitation
is effected on January 1, 1990. If the period for determining
Compensation used in calculating an Employee's allocation for a
determination period is a short Plan Year (i.e., shorter than 12
months), the annual Compensation limit is an amount equal to the
otherwise applicable annual Compensation limit multiplied by a
fraction, the numerator of which is the number of months in the
short Plan Year, and the denominator of which is 12.
In determining the Compensation of a Participant for purposes of
this limitation, the rules of section 414(q)(6) of the Code shall
apply, except in applying such rules, the term "family" shall
include only the Spouse of the Participant and any lineal
descendants of the Participant who have not attained age 19 before
the close of the year. If, as a result of the application of such
rules, the adjusted $200,000 limitation is exceeded, then (except
for the purposes of determining the portion of Compensation up to
the Integration Level) either the limitation shall be prorated
among the affected individuals in proportion to each such
individual's Compensation as determined under this section prior
to the application of this limitation, or the limitation shall be
allocated among the affected individuals in an objective and
nondiscriminatory manner based on a reasonable, good faith
interpretation of section 401(a)(17) of the Code. The method
chosen in the preceding sentence shall be uniformly applied to all
affected individuals in a Plan Year and shall be applied
consistently from year to year.
If Compensation for any prior determination period is taken into
account in determining an Employee's allocations or benefits for
the current determination period, the Compensation for such prior
determination period is subject to the applicable annual
Compensation limit in effect for that prior year. For this
purpose, for years beginning before January 1, 1990, the
applicable annual Compensation limit is $200,000.
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(E) 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 Compensation limit is $150,000, as adjusted by
the Commissioner for increases in the cost of living in accordance
with section 401(a)(17)(B) of the Code. The cost-of-living
adjustment in effect for a calendar year applies to any period,
not exceeding 12 months, over which Compensation is determined
(determination period) beginning in such calendar year. If a
determination period consists of fewer than 12 months, the OBRA
'93 annual Compensation limit will be multiplied by a fraction,
the numerator of which is the number of months in the
determination period, and the denominator of which is 12. For Plan
Years beginning on or after January 1, 1994, any reference in this
Plan to the limitation under section 401(a)(17) of the Code shall
mean the OBRA '93 annual Compensation limit set forth in this
provision. If Compensation for any prior determination period is
taken into account in determining an employee's benefits accruing
in the current Plan Year, the Compensation for that prior
determination period is subject to the OBRA '93 annual
Compensation limit in effect for that prior determination period.
For this purpose, for determination periods beginning before the
first day of the first Plan Year beginning on or after January 1,
1994, the OBRA '93 annual Compensation limit is $150,000.
1.16 CONSIDERED NET PROFITS. The term Considered Net Profits means the entire
amount of the accumulated or current operating profits (excluding capital
gains from the sale or involuntary conversion of capital or business
assets) of the Employer after all expenses and charges other than (i) the
contributions made by the Employer to the Plan, and (ii) federal or state
or local taxes based upon or measured by income, as determined by the
Employer, either on an estimated basis or a final basis, in accordance
with the generally accepted accounting principles used by the Employer.
When the amount of Considered Net Profits has been determined by the
Employer, and the contributions are made by the Employer on the basis of
such determination, for any Plan Year, such determination and
contribution shall be final and conclusive and shall not be subject to
change because of any adjustments in income or expense which may be
required by the Internal Revenue Service or otherwise. Such determination
and contribution shall not be open to question by any Participant either
before or after the contributions by the Employer have been made.
1.17 CONTRIBUTION PERCENTAGE AMOUNTS. The term Contribution Percentage Amounts
means the sum of the Matching Contributions and Qualified Matching
Contributions (to the extent not taken into account for purposes of the
Actual Deferral Percentage Test) made under the Plan on behalf of the
Employee for the Plan Year. The term Contribution Percentage Amounts also
includes Qualified Nonelective Contributions and Elective Deferral
Contributions treated as Matching Contributions and taken into account in
determining the Employee's Actual Contribution Ratio for the Plan Year.
1.18 CONTRIBUTION PERIOD. The term Contribution Period means that regular
period specified by the Employer in Article IV for which contributions
shall be made.
1.19 DEFERRAL PERCENTAGE AMOUNTS. The term Deferral Percentage Amounts means
an Employee's Elective Deferral Contributions for the Plan Year. The term
Deferral Percentage Amounts also includes Qualified Nonelective
Contributions and Qualified Matching Contributions treated as Elective
Deferral Contributions and taken into account in determining the
Employee's Actual Deferral Ratio for the Plan Year.
1.20 DISABILITY. The term Disability means a Participant's incapacity to
engage in any substantial gainful activity because of a medically
determinable physical or mental impairment which can be expected to
result in death, or to be of long, continued and indefinite duration.
Such determination of Disability shall be made by the Administrator with
the advice of competent medical authority. All Participants in similar
circumstances will be treated alike.
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1.21 DISABILITY RETIREMENT DATE. The term Disability Retirement Date means the
first day of the month after the Plan Administrator has determined that a
Participant's incapacity is a Disability.
1.22 EFFECTIVE DATE. The term Effective Date means February 1, 1992.
1.23 ELECTIVE DEFERRAL CONTRIBUTION. The term Elective Deferral Contribution
means any Employer Contribution made to the Plan at the election of the
Participant, in lieu of cash compensation, and includes contributions
made pursuant to a Salary Deferral Agreement or other deferral mechanism.
Solely for purposes of the dollar limitation specified in section 402(g)
of the Code, with respect to any taxable year, a Participant's Elective
Deferral 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 section 401(k) of
the Code, any simplified employee pension cash or deferred arrangement
described in section 402(h)(1)(B) of the Code, any plan as described
under section 501(c)(18) of the Code, and any employer contributions made
on behalf of a Participant for the purchase of a tax sheltered annuity
contract under section 403(b) of the Code pursuant to a salary reduction
agreement.
The term Elective Deferral Contribution shall not include any deferrals
properly distributed as excess annual additions.
1.24 EMPLOYEE. The term Employee means an individual who performs services for
the Employer and who is either a common law employee of the Employer or a
self-employed individual/owner employee treated as an Employee pursuant
to Code section 401(c)(1). The term Employee also includes a Leased
Employee who is treated as an Employee of the Employer-recipient pursuant
to the provisions of Code section 414(n) or 414(o). For purposes of
determining the Highly Compensated Employees, the Employer may elect, on
a reasonable and consistent basis, to treat such Leased Employees covered
by a plan described in Code section 414(n)(5) as Employees.
1.25 EMPLOYEE CONTRIBUTIONS. The term Employee Contributions means any
contributions to the Plan or any other plan that are designated or
treated at the time of contribution as after-tax Employee Contributions
and are allocated to a separate account to which the attributable
earnings and losses are allocated. Such term includes Employee
Contributions applied to the purchase of life insurance policies.
Such term does not include buy-back of benefits described in code section
(411)(a)(7)(c) or employee contributions transferred to this Plan.
1.26 EMPLOYER. The term Employer means Candle Corporation of America,
Partylite Gifts, Inc. and Aromatic Industries, Inc. and any successor
organization to such Employer which elects to continue the Plan. In the
case of a group of employers which constitutes a controlled group of
corporations (as defined in Code section 414(b)), or which constitutes
trades or businesses (whether or not incorporated) which are under common
control (as defined in Code section 414(c)), or which constitutes an
affiliated service group (as defined in Code section 414(m)), all such
employers shall be considered a single employer for purposes of
participation, vesting, Top-Heavy provisions and determination of Highly
Compensated Employees.
1.27 EMPLOYER CONTRIBUTION. The term Employer Contribution means any
contribution made to the Plan by the Employer on behalf of a Participant,
other than a Rollover Contribution or a mandatory or voluntary
contribution made to the Plan by the Employee that is treated at the time
of contribution as an after-tax employee contribution.
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1.28 ENTRY DATE. The term Entry Date means either the Effective Date or
monthly thereafter when an Employee who has fulfilled the eligibility
requirements commences participation in the Plan.
Any Employee who has satisfied the maximum eligibility requirements
permissible under ERISA, shall be eligible to commence participation in
this Plan no later than the earlier of (A) or (B) below, as applicable;
provided that the Employee has not separated from the Service of the
Employer:
(A) The first day of the first Plan Year beginning after the date on
which the Employee satisfied such requirements; or
(B) The date six months after the date on which the Employee satisfied
such requirements.
If an Employee is not in the active Service of the Employer as of his
initial Entry Date, his subsequent Entry Date shall be the date he
returns to the active Service of the Employer, provided he still meets
the eligibility requirements. If an Employee does not enroll as a
Participant as of his initial Entry Date, his subsequent Entry Date shall
be the applicable Entry Date as specified above when the Employee
actually enrolls as a Participant.
1.29 ERISA. The term ERISA means the Employee Retirement Income Security Act
of 1974 (PL 93-406) as it may be amended from time to time, and any
regulations issued pursuant thereto as such Act and such regulations
affect this Plan and Trust.
1.30 EXCESS AGGREGATE CONTRIBUTIONS.
(A) The term Excess Aggregate Contributions means, with respect to any
Plan Year, the excess of the aggregate amount of the Contribution
Percentage Amounts actually made on behalf of Highly Compensated
Employees for the Plan Year (including any amounts required to be
taken into account under subparagraphs (B) (1) and (B) (2) of
Section 1.5 of the Plan), over the maximum amount of contributions
permitted under the Actual Contribution Percentage Test. The
amount of Excess Aggregate Contributions for each Highly
Compensated Employee is determined by using the method described
in paragraph (B) of this section.
(B) The amount of Excess Aggregate Contributions for a Highly
Compensated Employee for a Plan Year is the amount (if any) by
which the Employee's Matching Contributions must be reduced for
the Employee's Actual Contribution Ratio to equal the highest
permitted Actual Contribution Ratio under the Plan.
To calculate the highest permitted Actual Contribution Ratio under
the Plan, the Actual Contribution Ratio of the Highly Compensated
Employee with the highest Actual Contribution Ratio is reduced by
the amount required to cause the Employee's Actual Contribution
Ratio to equal the ratio of the Highly Compensated Employee with
the next highest Actual Contribution Ratio. If a lesser reduction
would enable the Plan to satisfy the Actual Contribution
Percentage Test, only this lesser reduction may be made. This
process shall be repeated until the Plan satisfies the Actual
Contribution Percentage Test. The highest Actual Contribution
Percentage Ratio remaining under the Plan after leveling is the
highest permitted Actual Contribution Ratio.
For each Highly Compensated Employee, the amount of Excess
Aggregate Contributions for a Plan Year is equal to the total
Contribution Percentage Amounts (including any amounts required to
be taken into account under subparagraphs (B) (1) and (B) (2) of
Section 1.5 of the Plan), minus the
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amount determined by multiplying the Employees's highest permitted
Actual Contribution Ratio (determined after application of this
section) by the compensation used in determining the ratio.
1.31 EXCESS CONTRIBUTION.
(A) The term Excess Contribution means, with respect to a Plan Year,
the excess of Deferral Percentage Amounts made on behalf of
eligible Highly Compensated Employees for the Plan Year (including
any amounts required to be taken into account under subparagraphs
(B) (1) and (B) (2) of Section 1.8 of the Plan) over the maximum
amount of such contributions permitted under the Actual Deferral
Percentage Test for the Plan Year. The amount of Excess
Contributions for each Highly Compensated Employee is determined
by using the method described in paragraph (B) of this section.
(B) The amount of Excess Contributions for a Highly Compensated
Employee for a Plan Year is the amount (if any) by which the
Employee's Elective Deferral Contributions must be reduced for the
Employee's Actual Deferral Ratio to equal the highest permitted
Actual Deferral Ratio under the Plan.
To calculate the highest permitted Actual Deferral Ratio under the
Plan, the Actual Deferral Ratio of the Highly Compensated Employee
with the highest Actual Deferral Ratio is reduced by the amount
required to cause the Employee's Actual Deferral Ratio to equal
the ratio of the Highly Compensated Employee with the next highest
Actual Deferral Ratio. If a lesser reduction would enable the
arrangement to satisfy the Actual Deferral Percentage Test, only
this lesser reduction shall be made. This process shall be
repeated until the cash or deferred arrangement satisfies the
Actual Deferral Percentage Test. The highest Actual Deferral Ratio
remaining under the Plan after leveling is the highest permitted
Actual Deferral Ratio.
1.32 EXCESS DEFERRALS. The term Excess Deferrals means those Elective Deferral
Contributions that are includible in a Participant's gross income under
section 402(g) of the Code to the extent such Participant's Elective
Deferral Contributions for a taxable year exceed the dollar limitation
under such Code section.
1.33 FAIL-SAFE CONTRIBUTION. The term Fail-Safe Contribution means a
Nonelective Contribution, designated by the Employer at the time of
contribution as a Qualified Nonelective Contribution, which is
contributed to the Plan solely for the purposes of satisfying either the
Actual Deferral Percentage Test or the Actual Contribution Percentage
Test and is made in accordance with the provisions of Article IV of this
Plan.
1.34 FAMILY MEMBER. The term Family Member means, with respect to any
Employee, such Employee's Spouse and lineal ascendants and descendants
and the spouses of such lineal ascendants and descendants.
1.35 FIDUCIARY. The term Fiduciary means any, or all, of the following, as
applicable:
(A) Any Person who exercises any discretionary authority or control
respecting the management of the Plan or its assets; or
(B) Any Person who renders investment advice for a fee or other
compensation, direct or indirect, respecting any monies or other
property of the Plan or has authority or responsibility to do so;
or
(C) Any Person who has discretionary authority or responsibility in
the administration of the Plan; or
(D) Any Person who has been designated by a Named Fiduciary pursuant
to authority granted by the Plan, who acts to carry out a
fiduciary responsibility, subject to any exceptions granted
directly or indirectly by ERISA.
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1.36 FORFEITURE. The term Forfeiture means the amount, if any, by which the
value of a Participant's Account exceeds his Vested Interest following
such Participant's Termination of Employment, and at the time specified
in Section 9.1.
1.37 HIGHLY COMPENSATED EMPLOYEE. The term Highly Compensated Employee means
any Highly Compensated Active Employee or Highly Compensated Former
Employee as further defined herein.
For purposes of the determination of Highly Compensated Employees, the
term Compensation means Compensation as defined in Article V of the Plan,
but includes the amount of any elective contributions made by the
Employer on the Employee's behalf to a cafeteria plan established in
accordance with the provisions of Code section 125, a qualified cash or
deferred arrangement in accordance with the provisions of Code section
402(e)(3), a simplified employee pension plan in accordance with the
provisions of Code section 402(h), or a tax sheltered annuity plan
maintained in accordance with the provisions of Code section 403(b).
A "Highly Compensated Active Employee" is any Employee who performs
services for the Employer during the current Plan Year and who, during
the current Plan Year or the 12-month period immediately preceding such
Plan Year:
(A) Owns (or is considered to own within the meaning of section 318 of
the Code, as modified by section 416(i)(1)(B)(iii) of the Code),
more than 5% of the outstanding stock of the Employer or stock
possessing more than 5% of the total combined voting power of all
stock of the Employer, or, if the Employer is other than a
corporation, owns more than 5% of the capital or profits interest
in the Employer. The determination of 5% ownership shall be made
separately for each member of a controlled group of corporations
(as defined in Code section 414(b)), or of a group of trades or
businesses (whether or not incorporated) that are under common
control (as defined in Code section 414(c)), or of an affiliated
service group (as defined in Code section 414(m)); or
(B) Receives Compensation in excess of $75,000 multiplied by the
applicable cost-of-living adjustment factor prescribed under Code
section 415(d) and then prorated in the case of a short Plan Year;
or
(C) Receives Compensation in excess of $50,000, as adjusted for
cost-of-living increases in accordance with Code section 415(d)
and then prorated in the case of a short Plan Year, and is in the
top 20% of Employees ranked by Compensation; or
(D) Is, at any time, an officer of the Employer and receives
Compensation in excess of 50% of the amount in effect under Code
section 415(b)(1)(A) for the applicable period.
If no officer receives Compensation in excess of the amount
specified above, the highest paid officer for the applicable
period shall be a Highly Compensated Employee.
In no event if there are more than 500 Employees, shall more than
50 Employees or, if there are less than 500 Employees, shall the
greater of three Employees or 10% of all Employees, be taken into
account as officers.
In determining both the top 20% of Employees ranked by Compensation for
purposes of paragraph (C) above, and officers of the Employer for
purposes of paragraph (D) above, Employees who have not completed six
months of Service by the end of the applicable period, Employees who
normally work less than 17-1/2 hours per week, Employees who normally
work less than six months during a year, Employees who have not attained
21, and nonresident aliens who receive no earned income from U.S. sources
shall be excluded.
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Also excluded under the above paragraph are Employees who are covered by
an agreement which the Secretary of Labor finds to be a collective
bargaining agreement. Such Employees will be excluded only if retirement
benefits were the subject of good faith bargaining, 90% of the Employees
of the Employer are covered by the agreement, and the Plan covers only
Employees who are not covered by the agreement.
Notwithstanding the above provisions, an Employee, other than a 5% owner
as described in paragraph (A) above who was not highly compensated during
the 12-month period immediately preceding the current Plan Year will not
be considered to be a Highly Compensated Employee in the current Plan
Year unless such Employee is one of the top 100 Employees ranked by
Compensation for the current Plan Year.
A "Highly Compensated Former Employee" is any former Employee who
separated from Service with the Employer in a Plan Year preceding the
current Plan Year and was a Highly Compensated Active Employee in either:
(A) the Plan Year in which his separation from Service occurred; or
(B) any Plan Year ending on or after such former Employee's 55th
birthday.
A former Employee is an Employee who performs no services for the
Employer during a Plan Year (for example, by reason of a leave of
absence).
1.38 INACTIVE PARTICIPANT. The term Inactive Participant means any Participant
who does not currently meet the requirements to be an Active Participant
due to a suspension of the performance of duties for the Employer.
In addition, a Participant who ceases to meet the eligibility
requirements in accordance with Section 3.1 shall be considered an
Inactive Participant.
1.39 INSTALLMENT REFUND ANNUITY. The term Installment Refund Annuity means an
annuity which provides fixed monthly payments for a period certain of not
less than three nor more than 15 years. If the Participant dies before
the period certain expires, the annuity will be paid to the Participant's
Beneficiary for the remainder of the period certain. The period certain
shall be chosen by the Participant at the time the annuity is purchased,
and the Installment Refund Annuity will be the amount of benefit which
can be purchased with the Participant's Vested Interest. The Installment
Refund Annuity is not a life annuity and in no event shall the period
certain extend to a period which equals or exceeds the life expectancy of
the Participant.
1.40 JOINT AND SURVIVOR ANNUITY. The term Joint and Survivor Annuity means an
Annuity for the life of the Participant with a survivor Annuity for the
life of the Participant's Spouse which is not less than one-half, nor
greater than, the amount of the Annuity payable during the joint lives of
the Participant and the Participant's Spouse. The Joint and Survivor
Annuity will be the amount of benefit which can be purchased with the
Participant's vested account balance. In the case of an unmarried
Participant, Joint and Survivor Annuity means an Annuity payable over the
Participant's life.
1.41 LATE RETIREMENT DATE. The term Late Retirement Date means 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 Age,
for any reason other than death.
1.42 LEASED EMPLOYEE. The term Leased Employee means any person (other than an
Employee of the recipient) who, pursuant to an agreement between the
recipient and any other person ("leasing organization"),
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has performed services for the recipient (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 of a type historically performed by employees in the
business field of the recipient Employer.
1.43 MATCHING CONTRIBUTIONS. The term Matching Contributions means
contributions made by the Employer to the Plan on behalf of a Participant
on account of either Elective Deferral Contributions, if any, Employee
Contributions, if any, or required contributions, if any. In addition,
any Forfeitures reallocated as a Matching Contribution, pursuant to
Article IV, shall be considered a Matching Contribution for purposes of
this Plan.
1.44 NAMED FIDUCIARY. The term Named Fiduciary means the Plan Administrator,
the Trustee and any other Fiduciary designated in writing by the
Employer, and any successor thereto.
1.45 NONELECTIVE CONTRIBUTIONS. The term Nonelective Contributions means
contributions made by the Employer (other than Matching Contributions)
that the Participant may not elect to have paid in cash or other benefits
instead of being contributed to the Plan. In addition, any Forfeitures
reallocated as a Nonelective Contribution, pursuant to Article IV, shall
be considered a Nonelective Contribution for purposes of this Plan.
1.46 NONHIGHLY COMPENSATED EMPLOYEE. The term Nonhighly Compensated Employee
means an Employee who is not a Highly Compensated Employee.
1.47 NORMAL RETIREMENT AGE. The term Normal Retirement Age means the date the
Participant attains age 62, or if later, the fifth anniversary of the
Participant's commencement date. The Participant's commencement date is
the first day of the first Plan Year in which the Participant began
participating.
1.48 NORMAL RETIREMENT DATE. The term Normal Retirement Date means the first
day of the month coinciding with or next following the date a Participant
attains his Normal Retirement Age.
1.49 PARTICIPANT. The term Participant means any Employee of the Employer, who
is or becomes eligible to participate under this Plan in accordance with
its provisions and shall include an Active Participant and an Inactive
Participant and, for purposes of Investment of Contributions as described
in Sections 13.10 and 13.11 of the Plan, former participant. Former
participants shall include those Participants who upon termination of
employment defer distribution in accordance with Section 6.2 of the Plan.
1.50 PARTICIPANT'S ACCOUNT. The term Participant's Account means the sum of
the following sub-accounts held on behalf of each Participant:
- Elective Deferral Contributions, if any, and earnings thereon.
- Matching Contributions, if any, and earnings thereon.
- Additional Matching Contributions, if any, and earnings thereon.
- Qualified Matching Contributions, if any, and earnings thereon.
- Nonelective Contributions, if any, and earnings thereon.
- Qualified Nonelective Contributions, if any, and earnings thereon.
- Prior Employee Contributions, if any, and earnings thereon.
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- Rollover Contributions, if any, and earnings thereon.
A Participant's Account shall be invested in accordance with the rules
established by the Plan Administrator, which shall be applied in a
consistent and nondiscriminatory manner.
1.51 PARTICIPANT'S EMPLOYER STOCK ACCOUNT. The term Participant's Employer
Stock Account means that portion, if any, of the Participant's Account
which is invested in shares of the stock of Blyth Industries, Inc. Such
Participant's Employer Stock Account shall be credited with dividends
paid, if any. Such Participant's Employer Stock Account will be valued on
the last day of each month that the public exchange over which the stock
of Blyth Industries, Inc. is traded is open for unrestricted trading.
Amounts which are to be invested in the Participant's Employer Stock
Account may be invested in any short term account prior to actual
investment in the Participant's Employer Stock Account.
The Trustee will vote the shares of the stock of Blyth Industries, Inc.
invested in the Participant's Employer Stock Account in accordance with
the Participant's instructions. The Trustee will request voting, tender
and other similar instructions from the Participants.
The common stock of Blyth Industries, Inc. will be held by the stock
custodian.
1.52 PERSON. The term Person means any natural person, partnership,
corporation, trust or estate.
1.53 PLAN. The term Plan means Blyth Industries, Inc. Profit Sharing
Retirement Plan and Trust, the terms of which are set forth herein as it
may be amended from time to time.
1.54 PLAN ADMINISTRATOR. The terms Plan Administrator and Administrator are
used interchangeably throughout the Plan and Trust and shall mean the
Employer.
1.55 PLAN YEAR. The term Plan Year means the 12-month period commencing on
January 1 and ending on the following December 31.
1.56 PRIOR EMPLOYEE CONTRIBUTIONS. The term Prior Employee Contributions means
Employee Contributions that were made prior to February 1, 1992. Prior
Employee Contributions shall be considered to be Employee Contributions
for purposes of determining a Participant's Vested Interest, pursuant to
Article I. In addition, Prior Employee Contributions shall also be
considered to be Employee Contributions for the purposes of determining
the Actual Contribution Ratio pursuant to Article I and Annual Additions
pursuant to Article V.
1.57 QUALIFIED MATCHING CONTRIBUTIONS. The term Qualified Matching
Contributions shall mean Matching Contributions which are subject to the
distribution and nonforfeitability requirements under section 401(k) of
the Code when made.
1.58 QUALIFIED NONELECTIVE CONTRIBUTIONS. The term Qualified Nonelective
Contributions shall mean Nonelective Contributions which are subject to
the distribution and nonforfeitability requirements under section 401(k)
of the Code when made.
1.59 ROLLOVER CONTRIBUTION. The term Rollover Contribution means an amount
representing all or part of a distribution from a pension or
profit-sharing plan meeting the requirements of Code section 401(a) that
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is eligible for rollover to this Plan in accordance with the requirements
set forth in Code section 402 or Code section 408(d)(3), whichever is
applicable.
1.60 SALARY DEFERRAL AGREEMENT. The term Salary Deferral Agreement means an
agreement between a Participant and the Employer to defer the
Participant's Compensation for the purpose of making Elective Deferral
Contributions to the Plan.
1.61 SOCIAL SECURITY INTEGRATION LEVEL. The term Social Security Integration
Level means $20,000 annually.
1.62 SOCIAL SECURITY TAXABLE WAGE BASE. The term Social Security Taxable Wage
Base means, with respect to any Plan Year, the maximum amount of earnings
which may be considered wages for such year under section 3121(a)(i) of
the Code.
1.63 TERMINATION OF EMPLOYMENT. The term Termination of Employment means a
severance of the Employer-Employee relationship which occurs prior to a
Participant's Normal Retirement Age for any reason other than Disability
or death.
1.64 TRUST. The term Trust means the trust agreement entered into by the
Employer, the Administrator and the Trustee, which trust agreement forms
a part of, and implements the provisions of this Plan.
1.65 TRUSTEE. The term Trustee means one or more individuals collectively
appointed and acting under the trust agreement, and any successor
thereto.
1.66 VESTED INTEREST. The term Vested Interest on any date means the
nonforfeitable right to an immediate or deferred benefit in the amount
which is equal to the following:
(A) the value on that date of that portion of the Participant's
Account that is attributable to the following contributions:
- Elective Deferral Contributions, if any
- Employee Contributions, if any
- Rollover Contributions, if any
- Additional Matching Contributions, if any
- Qualified Matching Contributions, if any
- Qualified Nonelective Contributions, if any
(B) plus the value on that date of that portion of the Participant's
Account that is attributable to and derived from:
- Matching Contributions, if any
- Nonelective Contributions, if any
- Forfeitures, if any
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<PAGE>
Such contributions pursuant to Subsection (B), plus the earnings
thereon, shall be, at any relevant time, a part of the
Participant's Vested Interest equal to an amount ("X") determined
by the following formula:
X = P(AB + D) - D
For the purposes of applying this formula:
P = The Participant's Vesting Percentage at the
relevant time.
AB = The account balance attributable to such
contributions, plus the earnings thereon, at the
relevant time.
D = The amount of the distribution.
1.67 VESTING PERCENTAGE. The term Vesting Percentage means the percentage used
to determine a Participant's Vested Interest in contributions made by the
Employer, plus the earnings thereon, credited to his Participant's
Account that are not 100% immediately vested. The Vesting Percentage for
each Participant shall be determined in accordance with the following
schedule based on Years of Service with the Employer:
<TABLE>
<CAPTION>
YEARS OF SERVICE VESTING PERCENTAGE
----------------- -----------------
<S> <C>
Less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 but less than 6 80%
6 or more 100%
</TABLE>
However, if an Active Participant dies or becomes disabled prior to
attaining his Normal Retirement Age, his Vesting Percentage shall be
100%.
16
<PAGE>
ARTICLE II
SERVICE
2.1 SERVICE. The term Service means active employment with the Employer as an
Employee. For purposes of determining Service, employment with any
company which is under common control with the Employer as specified in
section 414 of the Internal Revenue Code shall be treated as employment
with the Employer.
2.2 ABSENCE FROM EMPLOYMENT. Absence from employment on account of a leave of
absence authorized by the Employer pursuant to the Employer's established
leave policy will be counted as employment with the Employer provided
that such leave of absence is of not more than two years' duration.
Absence from employment on account of active duty with the Armed Forces
of the United States will be counted as employment with the Employer. If
the Employee does not return to active employment with the Employer, his
Service will be deemed to have ceased on the date the Administrator
receives notice that such Employee will not return to the active Service
of the Employer. The Employer's leave policy shall be applied in a
uniform and nondiscriminatory manner to all Participants under similar
circumstances.
2.3 HOUR OF SERVICE. The term Hour of Service means a period of Service
during which an Employee shall be credited with one Hour of Service as
described in (A), (B), (C), and (D) below:
(A) Each hour for which an Employee is directly or indirectly paid, or
entitled to payment, by the Employer for the performance of
duties. These hours shall be credited to the Employee for the
computation period or periods in which the duties are performed;
and
(B) Each hour for which an Employee is directly or indirectly paid, or
entitled to payment, by the Employer for reasons (such as
vacation, sickness or Disability) other than for the performance
of duties. Hours under this Subsection shall be calculated and
credited pursuant to section 2530.200b-2 of the Department of
Labor Regulations which are incorporated herein by this reference;
and
(C) Each hour for which back pay, irrespective of mitigation of
damages, has been either awarded or agreed to by the Employer.
These hours shall be credited to the Employee for the computation
period or periods to which the award or agreement pertains rather
than the computation period in which the award, agreement or
payment is made; and
(D) Each hour for which an Employee is on an authorized unpaid leave
(such as service with the Armed Forces, jury duty, educational
leave). These hours shall be credited to the Employee for the
computation period or periods in which such authorized leave takes
place. However, no more than 501 hours shall be credited under
this subparagraph (D).
Hours of Service will be credited for employment with other members of an
affiliated service group (under Internal Revenue Code section 414(m)), a
controlled group of corporations (under Internal Revenue Code section
414(b)), or a group of trades or businesses under common control (under
Internal Revenue Code section 414(c)), of which the adopting employer is
a member. Hours of Service will also be credited for any individual
considered an Employee under Internal Revenue Code section 414(n).
Solely for purposes of determining whether a One-Year Break in Service,
as defined in Section 2.4, for participation and vesting purposes has
occurred in a computation period, an individual who is absent from
17
<PAGE>
work for maternity or paternity reasons shall receive credit for the
Hours of Service which would otherwise have been credited to such
individual but for such absence, or in any case in which such hours
cannot be determined, eight Hours of Service per day of such absence. For
purposes of this paragraph, an absence from work for maternity or
paternity reasons means an absence (1) by reason of the pregnancy of the
individual, (2) by reason of a birth of a child of the individual, (3) by
reason of the placement of a child with the individual in connection with
the adoption of such child by such individual, or (4) for purposes of
caring for such child for a period beginning immediately following such
birth or placement. The Hours of Service credited under this paragraph
shall be credited (1) in the computation period in which the absence
begins if the crediting is necessary to prevent a Break in Service in
that period, or (2) in all other cases, in the following computation
period.
2.4 ONE-YEAR BREAK IN SERVICE. Except as provided below regarding
eligibility, the term One-Year Break in Service means any Plan Year
during which an Employee fails to complete more than 500 Hours of
Service.
2.5 DETERMINING VESTING PERCENTAGE. Vesting credit shall be given for each
Year of Service except those periods specified in Section 2.7.
If a Participant completes less than 1,000 Hours of Service during a Plan
Year while remaining in the Service of the Employer, his Vesting
Percentage shall not be increased for such Plan Year. However, at such
time as the Participant again completes at least 1,000 Hours of Service
in any subsequent Plan Year, his Vesting Percentage shall then take into
account all Year(s) of Service with the Employer except those specified
in Section 2.7.
If an individual who ceases to be an Employee and is subsequently rehired
as an Employee enrolls (or re-enrolls) in the Plan, upon his
participation (or subsequent participation) his Vesting Percentage shall
then take into account all Year(s) of Service except those specified in
Section 2.7.
2.6 YEAR(S) OF SERVICE. The term Year(s) of Service means a
12-consecutive-month period during which an Employee has completed at
least 1,000 Hours of Service.
(A) Eligibility Computation Period.
For purposes of determining Years of Service and Breaks in Service
for eligibility, the twelve-consecutive-month period shall begin
with the date on which an Employee's employment commenced and,
where additional periods are necessary, on succeeding
anniversaries of his employment commencement date. The employment
commencement date is the date on which the Employee first performs
an Hour of Service for the Employer maintaining the Plan.
The eligibility requirement specified in Article III is one or
more full Years of Service. Such requirement shall be met upon
completion of at least 1,000 Hours of Service for each Year of
Service specified.
(B) Vesting Computation Period.
In computing Years of Service and Breaks in Service for vesting,
the 12-consecutive-month period shall be the Plan Year. However,
active participation as of the last day of the Plan Year is not
required in order for a Participant to be credited with a Year of
Service for vesting purposes.
For purposes of the Vesting Computation Period, if any Plan Year
is less than 12-consecutive months, and if a Participant would
have been credited with a Year of Service during the
12-consecutive-month period beginning on the first day of the
short Plan Year, then the Participant will receive a Year of
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<PAGE>
Service for the short Plan Year. The Participant receives credit
for an additional Year of Service if the Participant would have
been credited with a Year of Service for the Plan Year immediately
following the short Plan Year.
(C) Contribution Computation Period.
For purposes of determining a Participant's eligibility to receive
a contribution made by the Employer, pursuant to Article IV, which
is conditioned upon a Year of Service requirement, the
twelve-consecutive-month period shall be any Plan Year during
which the Active Participant is credited with at least 1,000 Hours
of Service. However, when an Employee first becomes a Participant
or resumes active participation in the Plan following a One-Year
Break in Service on a date other than the first day of the Plan
Year, all Hours of Service credited to the Participant during that
Plan Year, including those hours credited prior to the date the
Employee enrolls (or re-enrolls) as an Active Participant in the
Plan, shall be counted.
For purposes of the Contribution Computation Period, if any Plan
Year is less than 12 consecutive months, the number of Hours of
Service required to accrue a Year of Service, in such short Plan
Year, shall bear the same ratio to 1000 as the number of days in
the short Plan Year bears to 365.
2.7 EXCLUDED YEARS OF SERVICE. In determining the Vesting Percentage of an
Employee, all Years of Service with the Employer shall be taken into
account except:
- Plan Years during which a Participant did not complete at least
1,000 Hours of Service.
2.8 PREDECESSOR ORGANIZATION SERVICE. For purposes of this Article, Service
with a predecessor organization of the Employer shall be treated as
Service with the Employer in any case in which the Employer maintains the
Plan of such predecessor organization.
ARTICLE III
ELIGIBILITY, ENROLLMENT AND PARTICIPATION
3.1 ELIGIBILITY. Each Employee who was a Participant prior to the Effective
Date and who is in the Service of the Employer on the Effective Date
shall continue as a Participant in the Plan. Each other Employee,
including a Leased Employee, shall be eligible to become a Participant
as of the Entry Date when he first meets the following requirement(s):
- One Year of Service
- Age 21
- Not in a unit of Employees covered by an agreement which the
Secretary of Labor finds to be a collective bargaining agreement
between Employee representatives and the Employer, if there is
evidence that retirement benefits were the subject of good faith
bargaining between such Employee representatives and the Employer,
unless the collective bargaining agreement provides for coverage
under this Plan.
3.2 ENROLLMENT AND PARTICIPATION. Each eligible Employee may enroll as of his
Entry Date by completing and delivering to the Administrator an
enrollment form and, if applicable, a Salary Deferral Agreement. He will
then become a Participant as of his Entry Date.
19
<PAGE>
3.3 RE-EMPLOYED EMPLOYEE. In the case of an individual who ceases to be an
Employee and is subsequently rehired as an Employee, the following
provisions shall apply in determining his eligibility to again
participate in the Plan:
(A) If the Employee had met the eligibility requirement(s) specified
in Section 3.1 prior to his separation from employment, he shall
become an Active Participant in the Plan as of the date he is
re-employed, after completing the applicable form(s), in
accordance with Section 3.2.
(B) If the Employee had not met the eligibility requirement(s)
specified in Section 3.1 prior to his separation from employment,
he shall be eligible to participate in the Plan on the first Entry
Date following his fulfillment of such eligibility requirement(s).
For purposes of this Subsection, all Years of Service with the Employer,
including any Years of Service prior to any Breaks in Service, shall be
taken into account.
3.4 ELIGIBLE CLASS. In the event a Participant becomes ineligible to
participate because he is no longer a member of an eligible class of
Employees, such Employee shall participate immediately upon his return to
an eligible class of Employees.
In the event an Employee who is not a member of the eligible class of
Employees becomes a member of the eligible class, such Employee shall
participate immediately if such Employee has satisfied the minimum age
and service requirements and would have previously become a Participant
had he been in the eligible class.
3.5 WAIVER OF PARTICIPATION. Notwithstanding any provision of the Plan to the
contrary, any Employee in accordance with the rules of the Plan may
decline to become a Participant or cease to be an Active Participant by
filing a written waiver of participation with the Administrator in the
manner he prescribes. Such waiver must be filed prior to the date such
Employee is eligible to become a Participant, or in the case of an Active
Participant, in the last month of the Plan Year immediately preceding the
Plan Year for which he wishes to cease being an Active Participant.
Any Employee who files such a waiver shall not become a Participant, or
if an Active Participant, shall elect to cease to be such as of the first
day of the succeeding Plan Year; and such Employee shall not receive any
additional compensation or other sums by reason of his waiver of
participation.
Any such waiver may be rescinded by an Employee effective on the first
day of the first Plan Year following one or more Plan Years commencing
after the filing of such waiver in which he was not an Active
Participant, in which event he shall become a Participant, or again
become an Active Participant, as the case may be, effective as of such
date.
As of the effective date of the waiver the Participant shall be entitled
to receive a distribution of that portion of his Account attributable to
Employee Contributions, which distribution shall be further subject to
the terms and conditions of Article VI.
20
<PAGE>
ARTICLE IV
CONTRIBUTIONS
4.1 ELECTIVE DEFERRAL CONTRIBUTIONS. Each Active Participant may enter into a
written Salary Deferral Agreement with the Employer in an amount equal to
not less than 1% nor more than 10% of his Compensation for the
Contribution Period. In consideration of such agreement, the Employer
will make a contribution for each Contribution Period on behalf of the
Participant in an amount equal to the total amount by which the
Participant's Compensation from the Employer was deferred during the
Contribution Period pursuant to the Salary Deferral Agreement then in
effect. Elective Deferral Contributions shall be paid by the Employer to
the Trust not less frequently than monthly, but in no event later than 90
days following the date the amounts were deferred.
Salary Deferral Agreements shall be governed by the following provisions:
(A) Amounts contributed pursuant to a Salary Deferral Agreement shall
be 100% vested and nonforfeitable at all times.
(B) No Participant shall be permitted to have Elective Deferral
Contributions made under this Plan, or any other qualified plan
maintained by the Employer, during any taxable year, in excess of
the dollar limitation contained in section 402(g) of the Code in
effect at the beginning of the taxable year. However, this $7,000
limit shall not apply to certain amounts deferred in 1987 that
were attributable to Service performed in 1986.
(C) Amounts contributed pursuant to a Salary Deferral Agreement, which
are not in excess of the limit described in Subsection (B) above,
shall be subject to the Limitations on Allocations in accordance
with Article V. Elective Deferral Contributions that are in excess
of the limit described in Subsection (B) shall also be subject to
the Limitations on Allocations in accordance with Article V.
(D) A Salary Deferral Agreement may be changed by a Participant four
times during the Plan Year, at any time, by filing written notice
thereof with the Administrator. Such notice shall be effective,
and the Salary Deferral Agreement shall be changed on the date
specified in such notice or as soon as administratively possible,
which date must be at least 15 days after such notice is filed.
(E) Elective Deferral Contributions shall be subject to the Actual
Deferral Percentage Test limitations.
(F) Correction of Excess Contributions.
(1) If the Employer determines prior to the end of the Plan
Year that the Actual Deferral Percentage Test may not be
satisfied, the Employer may take the corrective action
specified in Section 4.13 of the Plan.
(2) If, after the end of the Plan Year, the Employer determines
that the Plan will fail the Actual Deferral Percentage
Test, the Employer shall take the corrective action
specified in Section 4.15 or Section 4.18 of the Plan, or a
combination of such corrective actions, in order to ensure
that the Plan does not fail the Actual Deferral Percentage
Test for the Plan Year being tested.
21
<PAGE>
4.2 MATCHING CONTRIBUTIONS. The Employer, in its discretion, may make a
Matching Contribution for a Contribution Period on behalf of Participants
who are eligible to share in Matching Contributions for such Contribution
Period. The amount of such discretionary Matching Contribution shall be
equal to a percentage of each such Participant's Compensation for the
Contribution Period (the exact percentage to be determined by the
Employer), the Matching Contribution not to exceed however, a percentage
of the Participant's Elective Deferral Percentage Amount for the
Contribution Period (the exact percentage to be determined by the
Employer).
Notwithstanding anything contained above to the contrary, the Matching
Contribution:
(1) shall be made out of Considered Net Profits. If there are
insufficient Considered Net Profits, the amount of the Matching
Contribution shall be diminished to the amount that can be made
from the Employer's Considered Net Profits.
(2) shall be subject to the Limitations on Allocations specified in
Article V.
The Matching Contribution shall be paid to the Trust not less frequently
than quarterly. Matching Contributions shall be subject to the Actual
Contribution Percentage Test. The Employer may designate at the time of
contribution that all or a portion of such Matching Contributions be
treated as Qualified Matching Contributions.
If the Employer determines prior to the end of the Plan Year that the
Actual Contribution Percentage Test may not be satisfied, the Employer
may take the corrective action specified in Section 4.14 of the Plan.
If, after the end of the Plan Year, the Employer determines that the Plan
will fail the Actual Contribution Percentage Test, the Employer shall
take the corrective action specified in Section 4.16 or Section 4.18 of
the Plan, or a combination of such corrective actions, in order to ensure
that the Plan does not fail the Actual Contribution Percentage Test for
the Plan Year being tested.
All Active Participants as of the last day of the Contribution Period
shall be eligible to be allocated the Matching Contribution. The Matching
Contribution shall be allocated as of the last day of the Contribution
Period for which such contribution is made.
Each calendar quarter and each Plan Year shall constitute a Contribution
Period.
4.3 ADDITIONAL MATCHING CONTRIBUTIONS. The Employer shall make a contribution
under the Plan for each Plan Year of an amount equal to $100.00 on behalf
of each Active Participant, for the first $1.00 contributed by such
Participant during the Plan Year pursuant to a Salary Deferral Agreement
subject to the Limitations on Allocations Specified in Article V.
The Employer may designate at the time of contribution that all or a
portion of such Additional Matching Contribution be treated as Qualified
Matching Contributions. Contributions treated as Qualified Matching
Contributions shall be subject to the Actual Deferral Percentage Test.
Additional Matching Contributions not treated as Qualified Matching
Contributions shall be subject to the Actual Contribution Percentage
Test.
Additional Matching Contribution shall be allocated as of the last day of
the Plan Year for which such contribution is made and shall be 100%
vested and nonforfeitable at all times.
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<PAGE>
The contribution as described above, for any Plan Year, shall be paid to
the Trust at the end of the Plan Year, or as soon as possible on or after
the last day of such Plan Year, but in any event not later than the date
which is prescribed by law for filing the Employer's income tax return,
including any extension thereof.
4.4 NONELECTIVE CONTRIBUTIONS. The Employer may make a contribution under the
Plan for any Plan Year of an amount out of Considered Net Profits that
the Employer's Board of Directors shall determine by resolution. Such
resolution shall either be a fixed amount or specify a definite formula
by which a fixed amount can be determined.
Such Nonelective Contribution shall be allocated as of the last day of
the Plan Year for which such contribution is made to each Participant
who:
- has a Year of Service for contribution purposes, as defined in
Article II.
- is an Active Participant as of the last day of the Plan Year.
Subject to the Limitations on Allocations specified in Article V, for
each Plan Year the contribution shall be allocated in accordance with the
following:
(A) An amount equal to 4.3% (or, if greater, the maximum percentage
allowed pursuant to Code section 401(1) and the regulations
thereunder), of the sum of each Participant's total Compensation
plus the Participant's Compensation in excess of the Social
Security Integration Level as defined in Article 1, Section 1.60,
for the Plan Year shall be allocated to each Participant's
Account. If the Employer does not contribute such amount for all
Participants, an amount shall be allocated to each Participant's
Account equal to the same portion that each Participant's total
Compensation plus the Participant's Compensation in excess of the
Social Security Integration Level for the Plan Year bears to the
total Compensation plus the Compensation in excess of the Social
Security Integration Level of all Participants in the Plan.
(B) Remaining contributions, if any, after the application of
subparagraph (a) above shall be allocated to each Participant's
Account in the same proportion that his Compensation for the Plan
Year bears to the total Compensation of all Participants for such
year.
The contribution as described above, for any Plan Year, shall be paid to
the Trust at the end of the Plan Year, or as soon as possible on or after
the last day of such Plan Year, but in any event not later than the date
which is prescribed by law for filing the Employer's income tax return,
including any extension thereof.
4.5 FAIL-SAFE CONTRIBUTION. The Employer reserves the right to make a
discretionary Nonelective Contribution to the Plan for any Plan Year, if
the Employer determines that such a contribution is necessary to ensure
that either the Actual Deferral Percentage Test or the Actual
Contribution Percentage Test will be satisfied for that Plan Year. Such
amount shall be designated by the Employer at the time of contribution as
a Qualified Nonelective Contribution and shall be known as a Fail-Safe
Contribution.
The Fail-Safe Contribution shall be made on behalf of all eligible
Nonhighly Compensated Employees who are Participants and who are
considered under the Actual Deferral Percentage Test or the Actual
Contribution Percentage Test. This contribution shall be allocated to the
Participant's Account of each such Participant in an amount equal to a
fixed percentage of such Participant's Compensation. The fixed percentage
shall be equal to the minimum fixed percentage necessary to be
contributed by the Employer on behalf of each eligible Nonhighly
Compensated Employee who is a Participant so that the Actual Deferral
Percentage Test or the Actual Contribution Percentage Test is satisfied.
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<PAGE>
The Fail-Safe Contribution for any Plan Year as determined above shall be
paid to the Trust at the end of the Plan Year, or as soon as possible on
or after the last day of such Plan Year, but in no event later than the
date which is prescribed by law for filing the Employer's income tax
return, including any extensions thereof.
4.6 PROFITS NOT REQUIRED. Contributions to this Plan shall not be precluded
because the Employer does not have Considered Net Profits.
Notwithstanding the existence of Considered Net Profits, the Employer may
determine in its sole discretion that it will make no contributions for
such Plan Year.
4.7 PAYMENT OF EXPENSES. The Employer may contribute to the Plan the amount
necessary, to pay any applicable expense charges and administration
charges. In lieu of the Employer's contributing the amount necessary to
pay such charges, these expenses may be paid from the Trust fund.
4.8 ALLOCATION OF FORFEITURES. Forfeitures available for reallocation in
accordance with Section 9.3 shall be allocated to each Participant in the
proportion that the Compensation paid to each Participant during the Plan
Year bears to the Compensation paid to all such Participants, subject to
the Limitations on Allocations specified in Article V.
4.9 CREDITING OF ELECTIVE DEFERRAL AND OTHER CONTRIBUTIONS. Elective Deferral
Contributions and other contributions made by the Employer (and any
Forfeitures available for reallocation in accordance with Section 9.3)
shall be credited to the Participant Account of each Participant for whom
such contributions are made, in accordance with the provisions of Article
XIII.
4.10 ROLLOVER CONTRIBUTIONS. The Plan may receive Rollover Contributions on
behalf of an Employee. Receipt of a Rollover Contribution shall be
subject to the approval of the Plan Administrator. Before approving the
receipt of a Rollover Contribution, the Plan Administrator may request
any documents or other information from an Employee or opinions of
counsel which the Plan Administrator deems necessary to establish that
such amount is a Rollover Contribution.
A Participant's Account shall be maintained on behalf of each Employee
from whom Rollover Contributions are received, regardless of such
Employee's eligibility to participate in the Plan in accordance with the
requirements of Article III, and Rollover Contributions may be invested
in any manner authorized under the provisions of this Plan.
Rollover Contributions received from an Employee who is not otherwise
eligible to participate in the Plan may not be withdrawn in accordance
with the provisions of Article X until such Employee becomes a
Participant, except that such Employee may receive a distribution of his
Participant's Account if his Termination of Employment occurs.
Rollover Contributions shall be credited to the Participant's Account and
may be invested in any manner authorized under the provisions of this
Plan.
4.11 TRANSFERS. Without regard to the Limitations on Allocations imposed under
Article V, the Trustee may receive, directly from another qualified
pension or profit-sharing plan meeting the requirements of Internal
Revenue Code section 401(a), all or part of the entire amount
distributable on behalf of a Participant from such plan. Likewise, the
Trustee may receive Transfers representing the assets of any predecessor
plan.
Transfers may be invested in any manner authorized under the provisions
of this Plan.
4.12 SUSPENSION OF ELECTIVE DEFERRAL CONTRIBUTIONS. The following provisions
shall apply with respect to suspension of Elective Deferral
Contributions.
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<PAGE>
(A) Elective Suspension. An Active Participant may elect to suspend
his Salary Deferral Agreement for Elective Deferral Contributions
by filing a written notice thereof with the Administrator at any
time. The Salary Deferral Agreement shall be suspended on the date
specified in such notice, which date must be at least 15 days
after such notice is filed. The notice shall specify the period
for which such suspension shall be effective. Such period may
extend indefinitely.
(B) Suspension for Leave. A Participant who is absent from employment
on account of an authorized leave of absence or military leave
shall have his Salary Deferral Agreement suspended during such
leave. Such suspension of contributions shall be effective on the
date payment of Compensation by the Employer to him ceases, and
shall remain in effect until payment of Compensation is resumed.
(C) Withdrawal Suspension. An Active Participant who elects a
withdrawal in accordance with Article X may have his Salary
Deferral Agreement suspended on the date such election becomes
effective. Such suspension shall remain in effect for the number
of months specified therein.
(D) Non-Elective Suspension. An Active Participant who ceases to meet
the eligibility requirements as specified in Section 3.1 but who
remains in the employ of the Employer, shall have his Salary
Deferral Agreement suspended, effective as of the date he ceases
to meet the eligibility requirements. Such suspension shall remain
in effect until he again meets such eligibility requirements.
The Participant may elect to reactivate his Salary Deferral Agreement for
Elective Deferral Contributions by filing a written notice thereof with
the Plan Administrator. The Salary Deferral Agreement shall be
reactivated at any time following the expiration of the suspension period
described above.
4.13 LIMITATION OF ELECTIVE DEFERRAL CONTRIBUTIONS. If the Employer determines
prior to the end of the Plan Year that the Plan may not satisfy the
Actual Deferral Percentage Test for the Plan Year, the Employer may
require that the amount of Elective Deferral Contributions being
allocated to the accounts of Highly Compensated Employees be reduced to
the extent necessary to prevent Excess Contributions from being made to
the Plan.
Although the Employer may reduce the amount of Elective Deferral
Contributions that may be allocated to the Participant's Account of
Highly Compensated Employees, the affected Employees shall continue to
participate in the Plan. When the situation that resulted in the
reduction of Elective Deferral Contributions ceases to exist, the
Employer shall reinstate the amount of Elective Deferral Contributions
elected by the Participant in the Salary Deferral Agreement to the
fullest extent possible for all affected Participants in a
nondiscriminatory manner.
4.14 LIMITATION OF MATCHING CONTRIBUTIONS. If the Employer determines prior to
the end of the Plan Year that the Plan may not satisfy the Actual
Contribution Percentage Test for the Plan Year, the Employer may require
that the amount of Matching Contributions being allocated to the Accounts
of Highly Compensated Employees be reduced to the extent necessary to
prevent Excess Aggregate Contributions from being made to the Plan.
4.15 CORRECTIVE DISTRIBUTION OF EXCESS CONTRIBUTIONS.
(A) The Employer may distribute Excess Contributions (and income
allocable thereto) to the appropriate Highly Compensated Employee
after the close of the Plan Year in which the Excess Contribution
arose and within 12 months after the close of that Plan Year.
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<PAGE>
(B) The income allocable to Excess Contributions is equal to the sum
of the allocable gain or loss for the Plan Year and shall be
determined as follows:
(1) The income allocable to Excess Contributions is determined
by multiplying the income for the Plan Year allocable to
Deferral Percentage Amounts by a fraction. The numerator of
the fraction is the Excess Contributions attributable to
the Employee for the Plan Year. The denominator of the
fraction is equal to the sum of (A) the total account
balance of the Employee attributable to Deferral Percentage
Amounts as of the beginning of the Plan Year, plus (B) the
Employee's Deferral Percentage Amounts for the Plan Year.
(2) The allocable gain or loss for the period between the end
of the Plan Year and the date of distribution shall not be
taken into consideration when determining the income
allocable to Excess Contributions.
(C) The amount of Excess Contributions to be distributed with respect
to an Employee for a Plan Year shall be reduced by Excess
Deferrals previously distributed to the Employee for the
Employee's taxable year ending with or within the Plan Year.
(D) The distribution of Excess Contributions made to the Family
Members of a family group that was combined for purposes of
determining a Highly Compensated Employee's Actual Deferral Ratio
shall be allocated among the Family Members in proportion to the
Elective Deferral Contribution (including any amounts required to
be taken into account under subparagraphs (B) (1) and (B) (2) of
Section 1.8 of the Plan) of each Family Member that is combined to
determine the Actual Deferral Ratio.
(E) A corrective distribution of Excess Contributions (and income)
shall be made without regard to any Participant or spousal consent
or any notice otherwise required under sections 411(a)(11) and 417
of the Code.
(F) Any Matching Contributions or Qualified Matching Contributions
that relate to the Excess Contribution being distributed shall be
forfeited. The Matching Contribution so forfeited shall be in
proportion to the applicable Employee's vested and nonvested
interest in Matching Contributions under the Plan for the Plan
Year in which the Excess Contribution arose. Forfeitures of
Matching Contributions or Qualified Matching Contributions that
relate to Excess Contributions shall be applied to reduce Employer
contributions or pay Plan expenses.
(G) In no case may the amount of Excess Contributions to be
distributed for a Plan Year with respect to any Highly Compensated
Employee exceed the amount of Elective Deferral Contributions made
on behalf of the Highly Compensated Employee for the Plan Year.
(H) In the event of a complete termination of the Plan during the Plan
Year in which an Excess Contribution arose, the corrective
distribution must be made as soon as administratively feasible
after the date of the termination of the Plan, but in no event
later than 12 months after the date of termination.
(I) Any distribution of less than the entire amount of Excess
Contributions with respect to any Highly Compensated Employee
shall be treated as a pro-rata distribution of Excess
Contributions and allocable income or loss.
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4.16 CORRECTION OF EXCESS AGGREGATE CONTRIBUTIONS.
(A) Excess Aggregate Contributions may be corrected using one of the
methods described in subparagraphs (1) and (2) below. The Employer
shall elect the method of correction to be used and shall apply
such method to the correction of the Excess Annual Contribution
for the Plan Year.
(1) Method 1:
(a) The Excess Aggregate Contribution (and income) shall
be forfeited, if forfeitable, or distributed on a
pro-rata basis from the Employee's Account
attributable to Contribution Percentage Amounts. The
distribution or forfeiture shall be made after the
close of the Plan Year in which the Excess Aggregate
Contribution arose and within 12 months after the
close of that Plan Year. Whether an amount is
distributed or forfeited under this subparagraph (a)
shall be determined based on the rules set forth in
paragraph (B) of this section.
(2) Method 2:
(a) Any Matching Contributions (and Qualified Matching
Contributions, to the extent not taken into account
for purposes of the Actual Deferral Percentage
Test), and income allocable thereto, shall be
forfeited, if forfeitable, or distributed to the
appropriate Highly Compensated Employee. The
distribution or forfeiture shall be made after the
close of the Plan Year in which the Excess Aggregate
Contribution arose and within 12 months after the
close of that Plan Year. Whether an amount is
forfeited or distributed shall be determined under
the rules set forth in paragraph (B) of this
section.
(B) Determination of Distributable and Forfeitable Amounts. For
purposes of paragraph (A) of this section:
(1) An Excess Aggregate Contribution attributable to vested
Matching Contributions, Qualified Matching Contributions
(and, if applicable, Qualified Nonelective Contributions
and Elective Deferral Contributions) shall be distributed
to the appropriate Highly Compensated Employee in
accordance with the terms of this section.
(2) An Excess Aggregate Contribution attributable to an
Employee's nonvested Matching Contributions shall be
forfeited in accordance with the terms of this section.
(3) A Highly Compensated Employee's vested and nonvested
interest in Matching Contributions (and income allocable
thereto) attributable to Excess Aggregate Contributions
shall be based on the proportion that represents the
Employee's Vested Interest in Matching Contributions under
the Plan for the Plan Year in which the Excess Aggregate
Contribution arose.
(C) Forfeited Excess Aggregate Contributions. In accordance with
paragraph (B) of this section, the amount that represents the
Employee's nonvested interest in Matching Contributions (and
income), and is attributable to Excess Aggregate Contributions,
shall be forfeited and, as such, shall be applied to reduce
Employer contributions or pay expenses.
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(D) Income Allocable to Excess Aggregate Contributions. For purposes
of this section, the income allocable to Excess Aggregate
Contributions is equal to the sum of the allocable gain or loss
for the Plan Year, and shall be determined as follows:
(1) The income allocable to Excess Aggregate Contributions is
determined by multiplying the income for the Plan Year
allocable to Contribution Percentage Amounts by a fraction.
The numerator of the fraction is the Excess Aggregate
Contributions for the Employee for the Plan Year. The
denominator of the fraction is equal to the sum of (A) the
total account balance of the Employee attributable to
Contribution Percentage Amounts as of the beginning of the
Plan Year, plus (B) the Contribution Percentage Amounts for
the Plan Year.
(2) The allocable gain or loss for the period between the end
of the Plan Year and the date of correction shall not be
taken into consideration when determining the income
allocable to Excess Aggregate Contributions.
(E) The distribution of Excess Aggregate Contributions (and income)
made to Family Members of a family group that was combined for
purposes of determining a Highly Compensated Employee's Actual
Contribution Ratio shall be allocated among Family Members in
proportion to the Contribution Percentage Amounts (including any
amounts required to be taken into account under subparagraphs (B)
(1) and (B) (2) of Section 1.5 of the Plan) of each Family Member
that are combined to determine the Actual Contribution Ratio.
(F) In the event of a complete termination of the Plan during the Plan
Year in which an Excess Aggregate Contribution arose, the
corrective distribution or forfeiture shall be made as soon as
administratively feasible after the date of termination of the
Plan, but in no event later than 12 months after the date of
termination.
(G) If the entire account balance of a Highly Compensated Employee is
distributed during the Plan Year in which the Excess Aggregate
Contribution arose, the distribution shall be deemed to have been
a corrective distribution of Excess Aggregate Contributions (and
income) to the extent that a corrective distribution would
otherwise have been required.
(H) Any distribution of less than the entire amount of Excess
Aggregate Contributions (and income) shall be treated as a
pro-rata distribution of Excess Aggregate Contributions and
allocable income or loss.
(I) In no case may the amount of Excess Aggregate Contributions
distributed to a Highly Compensated Employee exceed the amount of
Matching Contributions made on behalf of the Highly Compensated
Employee for the Plan Year.
(J) A distribution of Excess Aggregate Contributions (and income)
shall be made under this section without regard to any notice or
consent otherwise required under sections 411(a)(11) and 417 of
the Code.
4.17 CORRECTIVE DISTRIBUTION OF EXCESS DEFERRALS. Notwithstanding any other
provision of the Plan, Excess Deferrals, plus any income and minus any
loss allocable thereto, may be distributed to any Participant to whose
account Excess Deferrals were allocated for the individual's taxable
year. Such a corrective distribution shall be made in accordance with
this section.
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(A) Correction of Excess Deferrals After Taxable Year.
(1) Not later than the March 15 following the close of a
Participant's taxable year, the Participant may notify the
Plan of the amount of Excess Deferrals received by the Plan
during that taxable year. The notification shall be in
writing, shall specify the Participant's Excess Deferrals,
and shall be accompanied by the Participant's written
statement that if such amounts are not distributed, these
amounts, when added to all other Elective Deferral
Contributions made on behalf of the Participant during the
taxable year, shall exceed the dollar limitation specified
in section 402(g) of the Code.
(2) The Participant is deemed to have notified the Plan of
Excess Deferrals if, not later than the March 1 following
the close of a Participant's taxable year, the Employer
notifies the Plan on behalf of the Participant of the
Excess Deferrals. Such Excess Deferrals shall be calculated
by taking into account only Elective Deferral Contributions
under the Plan and any other plans of the Employer.
(3) Not later than the April 15 following the close of the
taxable year, the Plan shall distribute to the Participant
the amount of Excess Deferrals designated under
subparagraphs (1) or (2) above.
(B) Correction of Excess Deferrals During the Taxable Year. A
Participant who has an Excess Deferral during a taxable year may
receive a corrective distribution during the same year. Such a
corrective distribution shall be made if:
(1) The Participant designates the distribution as an Excess
Deferral. The designation shall be made in the same manner
as the notification described in subparagraph (A) (1) of
this section. The Participant will be deemed to have
designated the distribution as an Excess Deferral if the
Employer makes the designation on behalf of the Participant
to the extent that the Participant has Excess Deferrals for
the taxable year calculated by taking into account only
Elective Deferral Contributions to the Plan and other plans
of the Employer.
(2) The corrective distribution is made after the date on which
the Plan received the Excess Deferral.
(3) The Plan designates the distribution as a distribution of
Excess Deferrals.
(C) If the Participant provides the Employer with satisfactory
evidence and written notice to demonstrate that all Elective
Deferral Contributions by the participant in this Plan and any
other qualified plan exceed the applicable limit under section
402(g) of the Code for such individual's taxable year, then the
Plan Administrator may (but is not required to) distribute
sufficient Elective Deferral Contributions (not to exceed the
amount of Elective Deferral Contributions actually contributed on
behalf of the Participant to this Plan during the Participant's
taxable year) from this Plan to allow the Participant to comply
with the applicable limit. The evidence provided by the
Participant must establish clearly the amount of Excess Deferrals.
The Participant must present this evidence to the Plan
Administrator by the March 1 following the end of the calendar
year in which the Excess Deferrals occurred.
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(D) Income Allocable to Excess Deferrals. The income allocable to
Excess Deferrals is equal to the sum of allocable gain or loss for
the taxable year of the individual and shall be determined as
follows:
(1) The gain or loss allocable to Excess Deferrals is
determined by multiplying the income for the taxable year
allocable to Elective Deferral Contributions by a fraction.
The numerator of the fraction is the Excess Deferrals by
the Employee for the taxable year. The denominator of the
fraction is equal to the sum of:
(a) The total account balance of the Employee
attributable to Elective Deferral Contributions as
of the beginning of the Plan Year, plus
(b) The Employee's Elective Deferral Contributions for
the taxable year.
(2) The income allocable to Excess Deferrals shall not include
the allocable gain or loss for the period between the end
of the taxable year and the date of distribution.
(E) No Employee or Spousal Consent Required. A corrective distribution
of Excess Deferrals (and income) shall be made without regard to
any notice or consent otherwise required under sections 411(a)(11)
and 417 of the Code.
(F) Any Matching Contributions or Qualified Matching Contributions
that relate to the Excess Deferral being distributed shall be
forfeited. The Matching Contribution so forfeited shall be in
proportion to the applicable Employee's vested and nonvested
interest in Matching Contributions under the Plan for the Plan
Year in which the Excess Deferral arose. Forfeitures of Matching
Contributions or Qualified Matching Contributions that relate to
Excess Deferrals shall be applied to reduce Employer contributions
or pay Plan expenses.
4.18 QUALIFIED CONTRIBUTIONS. In lieu of distributing Excess Contributions as
provided in Section 4.15 of the Plan, or Excess Aggregate Contributions
as provided in Section 4.16 of the Plan, the Employer may take the
actions specified below in order to satisfy the Actual Deferral
Percentage Test or the Actual Contribution Percentage Test, or both,
pursuant to the regulations under the Code.
(A) At the election of the Employer, Qualified Nonelective
Contributions or Qualified Matching Contributions, or both, may be
taken into account as Elective Deferral Contributions for purposes
of calculating the Actual Deferral Ratio of a Participant.
The amount of Qualified Nonelective Contributions or Qualified
Matching Contributions made under the terms of this Plan and taken
into account as Elective Deferral Contributions for purposes of
calculating the Actual Deferral Ratio, subject to such other
requirements as may be prescribed by the Secretary of the
Treasury, shall be such Qualified Nonelective Contributions or
Qualified Matching Contributions, or both, that are needed to meet
the Actual Deferral Percentage Test.
(B) At the election of the Employer, Qualified Nonelective
Contributions or Elective Deferral Contributions, or both, may be
taken into account as Matching Contributions for purposes of
calculating the Actual Contribution Ratio of a Participant.
The amount of Qualified Nonelective Contributions or Elective
Deferral Contributions made under the terms of this Plan and taken
into account for purposes of calculating the Actual Contribution
Ratio, subject to such other requirements as may be prescribed by
the Secretary of the Treasury, shall
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be such Qualified Nonelective Contributions or Elective Deferral
Contributions, or both, that are needed to meet the Actual
Contribution Percentage Test.
(C) Any Qualified Nonelective Contribution, Qualified Matching
Contribution, and Elective Deferral Contribution taken into
account under paragraphs (A) or (B) must be allocated to the
Employee's Account as of a date within the Plan Year in which the
Excess Contribution or Excess Aggregate Contribution arose and
must be paid to the Plan no later than the 12-month period
immediately following the Plan Year to which the contribution
relates.
4.19 MULTIPLE USE OF ALTERNATIVE LIMITATION.
(A) Multiple use of the alternative limitation occurs if all of the
conditions of this paragraph (A) are satisfied:
(1) One or more Highly Compensated Employee of the Employer are
eligible employees in both a cash or deferred arrangement
subject to section 401(k) and a plan maintained by the
Employer subject to section 401(m).
(2) The sum of the Actual Deferral Percentage of the entire
group of eligible Highly Compensated Employees under the
arrangement subject to section 401(k) and the Actual
Contribution Percentage of the entire group of eligible
Highly Compensated Employees under the Plan subject to
section 401(m) exceeds the aggregate limit of paragraph (C)
of this section.
(3) Actual Deferral Percentage of the entire group of eligible
Highly Compensated Employees under the arrangement subject
to section 401(k) exceeds the amount described in section
401(k)(3)(A)(ii)(I).
(4) The Actual Contribution Percentage of the entire group of
eligible Highly Compensated Employees under the arrangement
subject to section 401(m) exceeds the amount described in
section 401(m)(2)(A)(i).
(B) For purposes of this section, the aggregate limit is the greater
of:
(1) The sum of-
(a) 1.25 times the greater of the relevant Actual
Deferral Percentage or the relevant Actual
Contribution Percentage, and
(b) Two percentage points plus the lesser of the
relevant Actual Deferral Percentage or the relevant
Actual Contribution Percentage. In no event,
however, may this amount exceed twice the lesser of
the relevant Actual Deferral Percentage or the
Actual Contribution Percentage; or
(2) The sum of-
(a) 1.25 times the lesser of the relevant Actual
Deferral Percentage or the relevant Actual
Contribution Percentage, and
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(b) Two percentage points plus the greater of the
relevant Actual Deferral Percentage or the relevant
Actual Contribution Percentage. In no event,
however, may this amount exceed twice the greater of
the relevant Actual Deferral Percentage or the
relevant Actual Contribution Percentage.
(C) For purposes of paragraph (B) of this section, the term "relevant
Actual Deferral Percentage" means the Actual Deferral Percentage
of the group of Nonhighly Compensated Employees under the
arrangement subject to section 401(k) for the Plan Year, and the
term "relevant Actual Contribution Percentage" means the Actual
Contribution Percentage of the group of Nonhighly Compensated
Employees eligible under the Plan subject to section 401(m) for
the Plan Year beginning with or within the Plan Year of the
arrangement subject to section 401(k).
(D) The Actual Deferral Percentage and Actual Contribution Percentage
of the group of eligible Highly Compensated Employees are
determined after use of Qualified Nonelective Contributions and
Qualified Matching Contributions to meet the requirements of the
Actual Deferral Percentage Test and after use of Qualified
Nonelective Contributions and Elective Deferral Contributions to
meet the requirements of the Actual Contribution Percentage Test.
The Actual Deferral Percentage and Actual Contribution Percentage
of the group of Highly Compensated Employees are determined after
any corrective distribution or forfeiture of Excess Deferrals,
Excess Contributions, or Excess Aggregate Contributions and after
recharacterization of Excess Contributions required without regard
to this section. Only plans and arrangements maintained by the
Employer are taken into account under paragraph (B). If the
Employer maintains two or more cash or deferred arrangements
subject to section 401(k) that must be mandatorily disaggregated
pursuant to section 401(k)-1(g)(11)(iii) multiple use is tested
separately with respect to each plan.
(E) If multiple use of the alternative limit occurs with respect to
two or more plans or arrangements maintained by the Employer, it
shall be corrected by reducing the Actual Contribution Percentage
of Highly Compensated Employees in the manner described in
paragraph (F) of this section. Instead of making this reduction,
the Employer may eliminate the multiple use of the alternative
limitation by making Qualified Nonelective Contributions to the
Plan.
(F) The amount of the reduction by which each Highly Compensated
Employee's Actual Contribution Ratio is reduced shall be treated
as an Excess Aggregate Contribution. The Actual Contribution
Percentage of all Highly Compensated Employees under the plan
subject to reduction shall be reduced so that there is no multiple
use of the alternative limitation.
ARTICLE V
LIMITATIONS ON ALLOCATIONS
5.1 LIMITATIONS ON ALLOCATIONS. Definitions - The following definitions are
atypical terms which refer only to terms used in the Limitations on
Allocations Sections of this Article V.
(A) Annual Additions. The term Annual Additions shall mean the sum of
the following amounts allocated on behalf of a Participant for a
Limitation Year:
(1) all contributions made by the Employer which shall include:
- Elective Deferral Contributions, if any;
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- Matching Contributions, if any;
- Qualified Matching Contributions, if any;
- Nonelective Contributions, if any;
- Qualified Nonelective Contributions, if any;
(2) all Forfeitures, if any;
(3) all Employee Contributions, if any.
For the purposes of this Article, Excess Amounts reapplied under
Section 5.2 (D) shall also be included as Annual Additions. Also,
for the purposes of this Article, Employee Contributions are
determined without regard to deductible employee contributions
within the meaning of section 72(o)(5) of the Code.
Amounts allocated after March 31, 1984, to an individual medical
account, as defined in Internal Revenue Code section 415(l)(1),
which is part of a defined benefit plan maintained by the
Employer, are treated as Annual Additions to a defined
contribution plan. Also, amounts derived from contributions paid
or accrued attributable to post-retirement medical benefits
allocated to the separate account of a key employee, as defined in
Internal Revenue Code section 419A(d)(3), under a welfare benefit
fund, as defined in Internal Revenue Code section 419(e),
maintained by the Employer, are treated as Annual Additions to a
defined contribution plan.
Contributions do not fail to be Annual Additions merely because
they are Excess Deferrals, Excess Contributions or Excess
Aggregate Contributions or merely because Excess Contributions or
Excess Aggregate Contributions are corrected through distribution
or recharacterization. Excess Deferrals that are distributed in
accordance with Section 4.17 of the Plan are not Annual Additions.
Forfeited Matching Contributions that are forfeited because the
contributions to which they relate are treated as Excess Aggregate
Contributions, Excess Contributions, or Excess Deferrals and that
are reallocated to the Participant Accounts of other Participants
for the Plan Year in which the forfeiture occurs, are treated as
Annual Additions for the Participants to whose accounts they are
reallocated and for the Participants from whose accounts they are
forfeited.
(B) Compensation. The term Compensation means wages, salaries, and
fees for professional services and other amounts received (without
regard to whether or not an amount is paid in cash) for personal
services actually rendered in the course of employment with the
Employer maintaining the Plan to the extent that the amounts are
includible in gross income (including, but not limited to,
commissions paid salesmen, compensation for services on the basis
of a percentage of profits, commissions on insurance premiums,
tips, bonuses, fringe benefits, and reimbursements, or other
expense allowances under a nonaccountable plan (as described in
1.62-2(c)), and foreign earned income (as defined in section
911(b) of the Code) whether or not excludable from gross income
under section 911 of the Code. The term Compensation does not
include:
(1) 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 deductible by the
employee, or any distributions from a plan of deferred
compensation;
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(2) Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the
Employee either becomes freely transferable or is no longer
subject to substantial risk of forfeiture;
(3) Amounts realized from the sale, exchange, or other
disposition of stock acquired under a qualified stock
option; and
(4) Other amounts which received special tax benefits, or
contributions made by the Employer (whether or not under a
salary reduction agreement) towards the purchase of an
annuity contract described in section 403(b) of the Code
(whether or not the contributions are actually excludable
from the gross income of the Employee).
For Limitation Years beginning after December 31, 1991, for
purposes of applying the limitations of this article, Compensation
for a Limitation Year is the Compensation actually paid or made
available during such Limitation Year.
(C) Defined Contribution Dollar Limitation. The term Defined
Contribution Dollar Limitation shall mean $30,000 or, if greater,
one-fourth of the defined benefit dollar limitation set forth in
Internal Revenue Code section 415(b)(1) as in effect for the
Limitation Year.
(D) Employer. The term Employer shall mean the Employer that adopts
this Plan. In the case of a group of employers which constitutes a
controlled group of corporations (as defined in Internal Revenue
Code section 414(b) as modified by section 415(h)), or which
constitutes trades or business (whether or not incorporated) which
are under common control (as defined in section 414(c) as modified
by section 415(h)), or affiliated service groups (as defined in
section 414(m)) of which the adopting Employer is a part, all such
employers shall be considered a single Employer for purposes of
applying the limitations of this Article.
(E) Excess Amount. The term Excess Amount shall mean the excess of the
Participant's Annual Additions for the Limitation Year over the
Maximum Permissible Amount.
(F) Limitation Year. The term Limitation Year shall mean the calendar
year.
(G) Maximum Permissible Amount. The term Maximum Permissible Amount
shall mean the lesser of (1) the Defined Contribution Dollar
Limitation, or (2) 25% of the Participant's Compensation for the
Limitation Year.
If a short Limitation Year is created because of an amendment
changing the Limitation Year to a different period of 12
consecutive months, the Maximum Permissible Amount for the short
Limitation Year will be the lesser of (1) the Defined Contribution
Dollar Limitation multiplied by a fraction, the numerator of which
is the number of months in the short Limitation Year, and the
denominator of which is 12, or (2) 25% of the Participant's
Compensation for the short Limitation Year.
5.2 LIMITATIONS ON ALLOCATIONS. If the Employer does not maintain any
qualified plan in addition to this Plan:
(A) The amount of Annual Additions which may be allocated under this
Plan on a Participant's behalf for a Limitation Year shall not
exceed the lesser of the Maximum Permissible Amount or any other
limitation contained in this Plan.
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(B) Prior to the determination of the Participant's actual
Compensation for a Limitation Year, the Maximum Permissible Amount
may be determined on the basis of the Participant's estimated
annual Compensation. Such Compensation shall be determined on a
reasonable basis and shall be uniformly determined for all
Participants similarly situated. Any employer contributions based
on estimated annual Compensation shall be reduced by any Excess
Amounts carried over from prior years.
(C) As soon as is administratively feasible after the end of the
Limitation Year, the Maximum Permissible Amount for such
Limitation Year shall be determined on the basis of the
Participant's actual Compensation for such Limitation Year. In the
event a Participant separates from the Service of the Employer
prior to the end of the Limitation Year, the Maximum Permissible
Amount for such Participant shall be determined prior to any
distribution of his Participant's Account on the basis of his
actual Compensation. Any Excess Amounts shall be disposed of in
accordance with Section 5.2 (D).
(D) If there is an Excess Amount with respect to a Participant for a
Limitation Year as a result of a reasonable error in estimating
the Participant's annual compensation, an allocation of
forfeitures, a reasonable error in determining the amount of
elective deferrals (within the meaning of section 402(g)(3) of the
Code) that may be made with respect to any individual under the
limits of section 415 of the Code, or under other limited facts
and circumstances which the commissioner finds justified, such
Excess Amount shall be disposed of as follows:
(1) If an Excess Amount exists, the Excess Amount in the
Participant's Account (excluding Elective Deferral
Contributions) shall be held unallocated in a suspense
account for the Limitation Year and allocated and
reallocated in the next Limitation Year to all Participants
in the Plan. The excess amount must be used to reduce
Employer Contributions for the next Limitation Year (and
succeeding Limitation Years, as necessary) for all of the
Participants in the Plan. For purposes of this
subparagraph, the Excess Amount may not be distributed to
Participants or former Participants.
(2) If, after the application of subparagraph (1) an Excess
Amount still exists, then the Participant's Elective
Deferral Contributions (including earnings and losses
thereon) allocated for the Limitation Year shall be
returned to the Participant to the extent that an Excess
Amount exists. This distribution shall be made as soon as
administratively feasible after the Excess Amount is
determined. Any Elective Deferral Contributions returned
under this paragraph shall be disregarded for purposes of
the Actual Deferral Percentage Test.
(3) Alternatively, the Plan Administrator may elect to dispose
of the Excess Amount by applying the procedure in
subparagraph (2) before applying the procedure in
subparagraph (1). If the Plan Administrator makes this
election, the Plan Administrator must apply it uniformly to
all Participants in a Limitation Year.
(4) 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 or
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
which would constitute Annual Additions may be made to the
Plan for that Limitation Year.
5.3 LIMITATIONS ON ALLOCATIONS. If the Employer maintains one or more defined
contribution plans in addition to this Plan:
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<PAGE>
(A) The amount of Annual Additions which may be allocated under this
Plan on a Participant's behalf for a Limitation Year, shall not
exceed the lesser of:
(1) The Maximum Permissible Amount, reduced by the sum of any
Annual Additions allocated to the Participant's Account for
the same Limitation Year under this Plan and such other
defined contribution plan; or
(2) Any other limitation contained in this Plan.
Prior to the determination of the Participant's actual
Compensation for the Limitation Year, the amounts referred to in
Subsection (1) above may be determined on the basis of the
Participant's estimated annual Compensation for such Limitation
Year. Such estimated annual Compensation shall be determined for
all Participants similarly situated.
Any contribution made by the Employer based on estimated annual
Compensation shall be reduced by any Excess Amounts carried over
from prior years, if applicable.
(B) As soon as is administratively feasible after the end of the
Limitation Year, the amounts referred to in Section 5.3 (A) shall
be determined on the basis of the Participant's actual
Compensation for such Limitation Year.
(C) If amounts are contributed to a Participant's Account under this
Plan on an allocation date which does not coincide with the
allocation date(s) for all such other plans, and if a
Participant's Annual Additions under this Plan and all such other
plans result in an Excess Amount, such Excess Amount shall be
deemed to have derived from those contributions last allocated.
(D) If an Excess Amount was allocated to a Participant on an
allocation date of this Plan which coincides with an allocation
date of another plan, the Excess Amount attributable to this Plan
will be the product of (1) and (2) below:
(1) The total Excess Amount allocated as of such date
(including any amount which would have been allocated but
for the limitations of Internal Revenue Code section 415).
(2) The ratio of (1) the amount allocated to the Participant as
of such date under this Plan, divided by (2) the total
amount allocated as of such date under all qualified
defined contribution plans (determined without regard to
the limitations of Internal Revenue Code section 415).
(E) Any Excess Amounts attributed to this Plan shall be disposed of as
provided in Section 5.2 (D).
5.4 LIMITATIONS ON ALLOCATIONS. If the Employer maintains a defined benefit
plan in addition to this Plan:
(A) If an individual is a Participant at any time in both this Plan
and a defined benefit plan maintained by the Employer, the sum of
the Defined Benefit Plan Fraction and the Defined Contribution
Plan Fraction for any year may not exceed 1.0. In the event that
the sum of the Defined Contribution Plan Fraction and the Defined
Benefit Plan Fraction exceeds 1.0, the Defined Contribution Plan
Fraction will be reduced until the sum of the Defined Contribution
Plan Fraction and the Defined Benefit Plan Fraction does not
exceed 1.0.
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If an individual was a Participant in this Plan or in any other
defined contribution plan maintained by the Employer which was in
existence on July 1, 1982, the numerator of the Defined
Contribution Plan Fraction will be adjusted if the sum of the
Defined Contribution Plan Fraction and the Defined Benefit Plan
Fraction would otherwise exceed 1.0 under the terms of this Plan.
Under the adjustment, an amount equal to the product of (1) the
excess of the sum of the Fractions over 1.0 times (2) the
denominator of the Defined Contribution Plan Fraction, will be
permanently subtracted from the numerator of the Defined
Contribution Plan Fraction. The adjustment is calculated using the
Fractions as they would be computed as of the later of the end of
the last Limitation Year beginning before January 1, 1983, or June
30, 1983. This adjustment also will be made if at the end of the
last Limitation Year beginning before January 1, 1984, the sum of
the Fractions exceeds 1.0 because of accruals or additions that
were made before the limitations of this Article became effective
to any plans of the Employer in existence on July 1, 1982.
In addition, if an individual was a Participant in this Plan or in
any other defined contribution plan maintained by the Employer
which was in existence on May 6, 1986, the numerator of the
Defined Contribution Plan Fraction will be adjusted if the
Employer's defined benefit plan was also in existence on May 6,
1986, and the sum of the Defined Contribution Plan Fraction and
the Defined Benefit Plan Fraction would otherwise exceed 1.0 under
the terms of this Plan. Under the adjustment, an amount equal to
the product of (1) the excess of the sum of the Fractions over 1.0
times (2) the denominator of the Defined Contribution Plan
Fraction, will be permanently subtracted from the numerator of the
Defined Contribution Plan Fraction. This 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. In the
event that a Participant's accrued benefit as of December 31,
1986, under the defined benefit plan exceeds the defined benefit
dollar limitation set forth in Internal Revenue Code section
415(b)(1), the amount of that accrued benefit shall be used in
both the numerator and the denominator of the Defined Benefit Plan
Fraction in making this adjustment.
For purposes of this Section 5.4, all defined benefit plans of the
Employer, whether or not terminated, will be treated as one
defined benefit plan and all defined contribution plans of the
Employer, whether or not terminated, will be treated as one
defined contribution plan.
(B) The Defined Benefit Plan Fraction for any year is a fraction, the
numerator of which is the Participant's Projected Annual Benefit
under the defined benefit plan (determined as of the close of the
Limitation Year), and the denominator of which is the lesser of
(1) or (2) below:
(1) 1.25 times the dollar limitation in effect under Internal
Revenue Code section 415(b)(1)(A) on the last day of the
Limitation Year; or
(2) 1.4 times the amount which may be taken into account under
Internal Revenue Code section 415(b)(1)(B) with respect to
such Participant for the Limitation Year.
Notwithstanding the above, if the Participant was a participant in
one or more defined benefit plans maintained by the Employer which
were in existence on July 1, 1982, the denominator of the Defined
Benefit Plan Fraction will not be less than 125% of the sum of the
annual benefits under such plans which the Participant had accrued
as of the later of the end of the last Limitation Year beginning
before January 1, 1983 or June 30, 1983. The preceding sentence
applies only if the defined benefit plans individually and in the
aggregate satisfied the requirements of Internal Revenue Code
section 415 as in effect at the end of the 1982 Limitation Year.
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(C) A Participant's Projected Annual Benefit is equal to the annual
benefit to which the Participant would be entitled under the terms
of the defined benefit plan based upon the following assumptions:
(1) The Participant will continue employment until reaching
Normal Retirement Age as determined under the terms of the
plan (or current age, if that is later);
(2) The Participant's Compensation for the Limitation Year
under consideration will remain the same until the date the
Participant attains the age described in sub-division (1)
of this subparagraph; and
(3) All other relevant factors used to determine benefits under
the plan for the Limitation Year under consideration will
remain constant for all future Limitation Years.
(D) The Defined Contribution Plan Fraction for any Limitation Year is
a fraction, the numerator of which is the sum of the Annual
Additions to the Participant's Accounts in such Limitation Year
and for all prior Limitation Years, and the denominator of which
is the lesser of (1) or (2) below for such Limitation Year and for
all prior Limitation Years of such Participant's employment
(assuming for this purpose, that Internal Revenue Code section
415(c) had been in effect during such prior Limitation Years):
(1) 1.25 times the dollar limitation in effect under Internal
Revenue Code section 415(c)(1)(A) on the last day of the
Limitation Year; or
(2) 1.4 times the amount which may be taken into account under
Internal Revenue Code section 415(c)(1)(B) with respect to
such Participant for the Limitation Year.
For the purposes of determining these Limitations on Allocations,
any nondeductible employee contributions made under a defined
benefit plan will be considered to be a separate defined
contribution plan and will be considered to be part of the Annual
Additions for the appropriate Limitation Year.
Annual Additions for any Limitation Year beginning before January
1, 1987, shall not be recomputed to treat all Employee
Contributions as Annual Additions.
(E) Notwithstanding the foregoing, at the election of the Plan
Administrator, in computing the Defined Contribution Plan Fraction
with respect to any Plan Year ending after December 31, 1982, the
denominator shall be an amount equal to the product of:
(1) The denominator of the Defined Contribution Plan Fraction,
computed in accordance with the rules in effect for the
Plan Year ending in 1982; and
(2) the transition fraction, which is a fraction
(a) the numerator of which is the lesser of:
(i) $51,875, or
(ii) 1.4 times 25% of the Compensation of the
Participant for the Plan Year ending in 1981,
and
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(b) the denominator of which is the lesser of:
(i) $41,500, or
(ii) 25% of the Compensation of the Participant
for the Plan Year ending in 1981.
ARTICLE VI
DISTRIBUTION OF BENEFITS
6.1 DISTRIBUTIONS IN GENERAL. Each Participant may elect, with his Spouse's
consent if required, a distribution in the form of an Annuity, a single
sum payment in cash or in property, or a combination of the above. All
distributions are subject to the provisions of Article VIII, Joint and
Survivor Annuity Requirements.
6.2 TIMING OF DISTRIBUTIONS. If the value of a Participant's Vested Interest
exceeds (or at the time of any prior distribution exceeded) $3,500 and is
immediately distributable (as defined in Section 8.5), the Participant
and his Spouse, if required, must consent to the distribution before it
is made.
Instead of consenting to a distribution, the Participant may make a
written election to defer the distribution for a specified period of time
ending no later than the Participant's Normal Retirement Age. Such
election to defer shall be irrevocable.
If the Participant and Spouse, if applicable, do not consent to a
distribution or if no election to defer is made within 90 days after
receiving a written explanation of the optional forms of benefit
available pursuant to Income Tax Regulation 1.411(a)(11), all benefits
shall be deferred to, and distribution shall be made as of the
Participant's Normal Retirement Age. The distribution will be made in the
form of a single sum cash payment (in the case of a Participant's meeting
the requirements of Section 8.1 (A)) or in accordance with Section 8.2
(in the case of a Participant's not meeting the requirements of Section
8.1 (A)), unless the Participant elects another form of benefit within
the 90-day period prior to the date the distribution is made.
A Participant whose actual retirement date is on or after his Normal
Retirement Age may not elect to defer distribution of his benefit beyond
the date of his actual retirement.
If the value of a Participant's Vested Interest is $3,500 or less at the
time it becomes payable, the distribution shall be made in the form of a
single sum cash payment and shall be made upon such Participant's
Termination of Employment. Such a distribution may not be deferred.
Unless the Participant elects otherwise, the payment of benefits under
this Plan to the Participant shall begin not later than the 60th day
after the close of the Plan Year in which the later of (A) or (B), below,
occurs:
(A) the date on which the Participant attains his Normal Retirement
Age or age 62, if later; or
(B) the date on which the Participant terminates his Service
(including Termination of Employment, death or Disability) with
the Employer.
Notwithstanding the foregoing, the failure of a Participant and Spouse,
if required, to consent to a distribution while a benefit is immediately
distributable shall be deemed to be an election to defer commencement of
payment of any benefit sufficient to satisfy the above paragraph.
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6.3 DISTRIBUTION LIMITATION. Elective Deferral Contributions, Qualified
Nonelective Contributions and Qualified Matching Contributions, and
income allocable to each, are not distributable to a Participant or a
Beneficiary, in accordance with such Participant's or Beneficiary's
election, earlier than upon the Participant's Termination of Employment,
death, or disability.
Such amounts may also be distributed upon:
(A) Termination of the Plan without the establishment or maintenance
of a successor plan.
For purposes of this paragraph, a successor plan is any other
defined contribution plan maintained by the same employer.
However, if fewer than two percent of the Employees who are
eligible under the Plan at the time of its termination are or were
eligible under another defined contribution plan at any time
during the 24 month period beginning 12 months before the time of
the termination, the other plan is not a successor plan. The term
"defined contribution plan" means a plan that is a defined
contribution plan as defined in section 414(i) of the Code, but
does not include an employee stock ownership plan as defined in
section 4975(e) or 409 of the Code or a simplified employee
pension as defined in section 408(k) of the Code. A plan is a
successor plan only if it exists at the time the Plan is
terminated or within the period ending 12 months after
distribution of all assets from the Plan.
A distribution may be made under this paragraph only if it is a
lump sum distribution. The term "lump sum distribution" has the
same meaning provided in section 402(e)(4) of the Code, without
regard to subparagraphs (A)(i) through (iv), (B), and (H) of that
section.
(B) The disposition by the Employer to an unrelated corporation of
substantially all the assets (within the meaning of section
409(b)(2) of the Code) used in the trade or business of the
Employer if the Employer continues to maintain this Plan after the
disposition. However, a distribution may be made under this
paragraph only to an Employee who continues employment with the
corporation acquiring such assets.
In addition, this requirement is satisfied only if the purchaser
does not maintain the Plan after the disposition. A purchaser
maintains the plan of the seller if it adopts the plan or
otherwise becomes an employer whose employees accrue benefits
under the Plan. A purchaser also maintains the Plan if the Plan is
merged or consolidated with, or any assets or liabilities are
transferred from the Plan to a plan maintained by the purchaser in
a transaction subject to section 414(l)(1) of the Code. A
purchaser is not treated as maintaining the Plan merely because
the Plan that it maintains accepts rollover contributions of
amounts distributed by the Plan.
For purposes of this paragraph, the sale of "substantially all"
the assets used in a trade or business means the sale of at least
85 percent of the assets.
A distribution may be made under this paragraph only if it is a
lump sum distribution. The term "lump sum distribution" has the
same meaning provided in section 402(e)(4) of the Code, without
regard to subparagraphs (A)(i) through (iv), (B), and (H) of that
section.
(C) The disposition by the Employer to an unrelated entity or
individual of the Employer's interest in a subsidiary (within the
meaning of section 409(d)(3) of the Code) if the Employer
continues to maintain this Plan. However, a distribution may be
made under this paragraph only to an Employee who continues
employment with such subsidiary.
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In addition, this requirement is satisfied only if the purchaser
does not maintain the Plan after the disposition. A purchaser
maintains the plan of the seller if it adopts the plan or
otherwise becomes an employer whose employees accrue benefits
under the Plan. A purchaser also maintains the Plan if the Plan is
merged or consolidated with, or any assets or liabilities are
transferred from the Plan to a plan maintained by the purchaser in
a transaction subject to section 414(l)(1) of the Code. A
purchaser is not treated as maintaining the Plan merely because
the Plan that it maintains accepts rollover contributions of
amounts distributed by the Plan.
A distribution may be made under this paragraph only if it is a
lump sum distribution. The term "lump sum distribution" has the
same meaning provided in section 402(e)(4) of the Code, without
regard to subparagraphs (A)(i) through (iv), (B), and (H) of that
section.
(D) In the case of Elective Deferral Contributions only, the
attainment of age 59-1/2, as described in Section 10.1 of the
Plan.
(E) In the case of Elective Deferral Contributions only, the hardship
of the Participant, as described in Section 10.3 of the Plan.
6.4 COMMENCEMENT OF DISTRIBUTIONS. Notwithstanding the provisions of the
preceding Timing of Distributions Section, distributions to a Participant
will commence no later than the date determined in accordance with the
provisions of this Section.
Distribution to a Participant must commence no later than the required
beginning date. The first 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.
The required beginning date of a Participant who attains age 70-1/2
before January 1, 1988, shall be 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, provided the Participant was not a 5%
owner in the Plan Year ending in the year in which the Participant
attained age 66-1/2 or any later Plan Year. A Participant is treated as a
5% owner for purposes of this section if such Participant is a 5% owner
as defined in section 416(i) of the Code (determined in accordance with
section 416 but without regard to whether the Plan is Top-Heavy). The
required beginning date of a Participant who is a 5% owner during any
year beginning after December 31, 1979, is the first day of April
following the later of:
(A) the calendar year in which the Participant attained age 70-1/2, or
(B) the earlier of the calendar year with or within which ends the
Plan Year in which the Participant becomes a 5% owner, or the
calendar year in which the Participant retires.
Once distributions have begun to a 5% owner under this section, they must
continue to be distributed, even if the Participant ceases to be a 5%
owner in a subsequent year. Distribution to such Participant must
commence no later than the first day of April following the calendar year
in which the Participant's Termination of Employment occurs.
If distribution to any Participant is made in other than a single sum
payment, the second payment shall be distributed no later than the
December 31 following the April 1 by which the first payment was required
to be distributed. Each succeeding payment shall be distributed no later
than each December 31 thereafter.
6.5 DISTRIBUTION REQUIREMENTS.
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(A) Except as otherwise provided in Article VIII, the requirements of
this Section shall apply to any distribution of a Participant's
Accrued Benefit.
(B) All distributions required under this Article shall be determined
and made in accordance with the Income Tax Regulations under
section 401(a)(9), including the minimum distribution incidental
benefit requirement of section 1.401(a)(9)-2 of the regulations.
(C) Limits on Settlement Options. Distributions, if not made in a lump
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 a designated 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 expectancy of the Participant and a designated
Beneficiary.
(D) Minimum Amounts to be Distributed. If the Participant's entire
Vested Interest is to be distributed in other than a lump sum,
then the amount to be distributed each year must be at least an
amount equal to the quotient obtained by dividing the
Participant's entire Vested Interest by the life expectancy of the
Participant or the joint and last survivor expectancy of the
Participant and designated Beneficiary. Life expectancy and joint
and last survivor expectancy are computed by the use of the return
multiples contained in section 1.72-9 of the Income Tax
Regulations. For purposes of this computation, a Participant's
life expectancy may be recalculated no more frequently than
annually; however, the life expectancy of a Beneficiary other than
the Participant's Spouse may not be recalculated.
(1) If the Participant's Spouse is not the designated
Beneficiary, the method of distribution selected must
assure that at least 50% of the present value of the amount
available for distribution is paid within the life
expectancy of the Participant.
(2) For calendar years beginning after December 31, 1988, the
amount to be distributed each year, beginning with
distributions for the first distribution calendar year,
shall not be less than the quotient obtained by dividing
the Participant's benefit by the lesser of (1) the
applicable life expectancy or (2) if the Participant's
Spouse is not the designated Beneficiary, the applicable
divisor determined from the table set forth in Q&A-4 of
section 1.401(a)(9)-2 of the Income Tax Regulations.
Distributions after the death of the Participant shall be
distributed using the applicable life expectancy in
subsection (d)(1) above as the relevant divisor without
regard to regulations section 1.401(a)(9)-2.
(3) The minimum distribution required for the Participant's
first distribution calendar year must be made on or before
the Participant's required beginning date. The minimum
distribution for other calendar years, including the
minimum distribution for the distribution calendar year in
which the Employee's required beginning date occurs, must
be made on or before December 31 of that distribution
calendar year.
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6.6 NON-TRANSFERABLE. The Participant's right to any Annuity payments,
benefits, and refunds is not transferable and shall be free from the
claims of all creditors to the fullest extent permitted by law.
6.7 DEATH DISTRIBUTION PROVISIONS. If the Participant dies before
distribution of his Vested Interest commences, the following provisions
shall apply:
(A) If a distribution is to be made to a Beneficiary other than the
Surviving Spouse:
(1) If the present value of the Participant's Vested Interest
exceeds (or at the time of any prior distribution exceeded)
$3,500, unless the Beneficiary elects another form of
distribution, that portion of the Participant's Vested
Interest payable to the Beneficiary will be distributed in
the form of a single sum cash payment within a reasonable
period of time after the Plan Administrator is notified of
the Participant's death.
(2) If the present value of the Participant's Vested Interest
is $3,500 or less at the time it becomes payable, the
distribution shall always be made in the form of a single
sum cash payment and shall be paid within a reasonable
period of time after the Plan Administrator is notified of
the Participant's death.
(B) If the distribution is to be made to a Beneficiary who is the
Surviving Spouse, such distribution will be made in accordance
with the following:
(1) If the Participant had never elected a life Annuity form of
distribution under the Plan:
(a) If the present value of the Participant's Vested
Interest exceeds (or at the time of any prior
distribution exceeded) $3,500, unless the surviving
spouse elects another form of distribution, that
portion of the Participant's Vested Interest payable
to the Surviving Spouse will be distributed in the
form of a single sum cash payment within a
reasonable period of time after the Plan
Administrator is notified of the Participant's
death.
(b) If the present value of the Participant's Vested
Interest payable to the Surviving Spouse is $3,500
or less at the time it becomes payable, the
distribution shall always be made in the form of a
single sum cash payment and shall be made within a
reasonable period of time after the Plan
Administrator is notified of the Participant's
death.
(2) If the Participant had previously elected a life Annuity
form of distribution under the Plan:
(a) If the present value of the Participant's Vested
Interest exceeds (or at the time of any prior
distribution exceeded) $3,500 and is immediately
distributable (as defined in Section 8.5), the
Surviving Spouse must consent to the distribution
before it is made. If the Surviving Spouse does not
consent to a distribution, all benefits shall be
deferred to a date that complies with the terms of
Section 6.8 (B).
The distribution shall be made in accordance with
the provisions of Section 8.3.
(b) If the present value of the Participant's Vested
Interest is $3,500 or less at the time it becomes
payable, the distribution shall always be made in
the form of a single sum cash payment and shall be
paid within a reasonable period of time after the
Plan Administrator is notified of the Participant's
death.
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6.8 DEATH DISTRIBUTION COMMENCEMENT DATE. Upon the death of the Participant,
the following distribution provisions shall take effect:
(A) If the Participant dies after distribution of his entire Vested
Interest has commenced, the remaining portion of such Vested
Interest will continue to be distributed at least as rapidly as
under the method of distribution being used prior to the
Participant's death.
In no event shall distribution of the Participant's remaining
Vested Interest be made in a lump sum after the Participant's
death unless such distribution is consented to, in writing, by the
Participant's Surviving Spouse, if any.
(B) If the Participant dies before distribution of his Vested Interest
commences, the Participant's entire Vested Interest will be
distributed no later than five years after 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 Vested Interest is
payable to a designated Beneficiary, distributions may be
made in substantially equal installments over the life or
life expectancy of the designated Beneficiary (or over a
period not extending beyond the life expectancy of such
Beneficiary), commencing no later than one year after the
Participant's death;
(2) If the designated 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 date on which the Participant would have attained
age 70-1/2. However, the Surviving Spouse may elect, at any
time following the Participant's death, to defer the date
on which distributions will begin until no later than the
date on which the Participant would have attained age
70-1/2 and, if the Spouse dies before payments begin,
subsequent distributions shall be made as if the Spouse had
been the Participant.
(C) For purposes of (B) above, payments will be calculated by use of
the return multiples specified in section 1.72-9 of the Income Tax
Regulations. Life expectancy of a Surviving Spouse may be
recalculated annually; however, in the case of any other
designated Beneficiary, such life expectancy will be calculated at
the time payment first commences without further recalculation.
(D) For purposes of this Section (Death Distribution Commencement
Date) any amount paid to a child of the Participant will be
treated as if it had been paid to the Surviving Spouse if the
amount becomes payable to the Surviving Spouse when the child
reaches the age of majority.
6.9 TRANSITIONAL RULE.
(A) Notwithstanding the other requirements of this Article and subject
to the requirements of Article VIII, distribution on behalf of any
Employee 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 Internal Revenue Code section
401(a)(9) as in effect prior to amendment by the Deficit
Reduction Act of 1984.
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(2) The distribution is in accordance with a method of
distribution designated by the Employee whose interest in
the trust 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.
(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
distribution 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 (A) (1) and (A) (5).
(D) If a designation is revoked, any subsequent distribution must
satisfy the requirements of Internal Revenue Code section
401(a)(9) as amended. 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).
6.10 ALTERNATE PAYEE SPECIAL DISTRIBUTION. Distributions pursuant to Section
16.8 may be made without regard to the age or employment status of the
Participant.
ARTICLE VI-A
DIRECT ROLLOVERS
6A.1 Notwithstanding any provision of the Plan to the contrary that would
otherwise limit a Distributee's election under this Article, 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, except as otherwise provided by the
Employer's administrative procedures as permitted by regulations. In
addition, a Distributee's election of a Direct Rollover shall be subject
to the following requirements:
(A) If the Distributee elects to have only a portion of an Eligible
Rollover Distribution paid to an Eligible Retirement Plan in a
Direct Rollover, that portion must be equal to at least $500.
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(B) If the entire amount of a Distributee's Eligible Rollover
Distribution is $500 or less, the distribution may not be divided.
Instead, the entire amount must either be paid to the Distributee
or to an Eligible Retirement Plan in a Direct Rollover.
(C) A Distributee may not elect a Direct Rollover if the Distributee's
Eligible Rollover Distributions during a year are reasonably
expected by the Plan Administrator to total less than $200 (or any
lower minimum amount specified by the Plan Administrator).
(D) A Distributee's election to make or not make a Direct Rollover
with respect to one payment in a series of periodic payments shall
apply to all subsequent payments in the series, except that a
Distributee shall be permitted at any time to change, with respect
to subsequent payments in the series of periodic payments, a
previous election to make or not make a Direct Rollover. A change
of election shall be accomplished by the Distributee notifying the
Plan Administrator of the change. Such notice must be in the form
and manner prescribed by the Plan Administrator.
6A.2 Definitions.
(A) Direct Rollover: A Direct Rollover is a payment by the plan to the
Eligible Retirement Plan specified by the Distributee.
(B) Distributee: A Distributee includes an Employee or former
Employee. In addition, the Employee's or former Employee's
Surviving Spouse and the Employee's or former Employee's Spouse
who is the alternate payee under a qualified domestic relations
order, as defined in section 414(p) of the Code, are Distributees
with regard to the interest of the Spouse or former Spouse.
(C) Eligible Retirement Plan: An Eligible Retirement Plan is an
individual retirement account described in section 408(a) of the
code, an individual retirement annuity described in section 408(b)
of the Code, an annuity plan described in section 403(a) of the
Code, or a qualified trust described in section 401(a) of the
Code, that accepts the Distributee's Eligible Rollover
Distribution. However, in the case of an Eligible Rollover
Distribution to the Surviving Spouse, an Eligible Retirement Plan
is an individual retirement account or an individual retirement
annuity.
(D) Eligible Rollover Distribution: An Eligible Rollover Distribution
is any distribution of all or any portion of the balance to the
credit of the Distributee, except that an Eligible Rollover
Distribution does not include: any distribution that is one of a
series of substantially equal periodic payments (not less
frequently than annually) made for the life (or life expectancy)
of the Distributee or the joint lives (or joint life expectancies)
of the Distributee and the Distributee's designated beneficiary,
or for a specified period of ten years or more; any distribution
to the extent such distribution is required under section
401(a)(9) of the Code; and the portion of any distribution that is
not includible in gross income (determined without regard to the
exclusion for net unrealized appreciation with respect to employer
securities).
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ARTICLE VII
RETIREMENT BENEFITS
7.1 NORMAL RETIREMENT. A Participant who attains his Normal Retirement Age
shall have a Vesting Percentage of 100%. If a Participant retires from
the active Service of the Employer on his Normal Retirement Date, he
shall be entitled to receive a distribution of the entire value of his
Participant's Account as of his Normal Retirement Date.
7.2 LATE RETIREMENT. A Participant may continue in the Service of the
Employer after his Normal Retirement Age, and in such event he shall
retire on his Late Retirement Date. Such Participant shall continue as a
Participant under this Plan until such Late Retirement Date. The
Participant shall have a Vesting Percentage of 100% and shall be entitled
to receive a distribution of the entire value of his Participant's
Account as of his Late Retirement Date.
7.3 DISABILITY RETIREMENT. A Participant who retires from the Service of the
Employer on account of Disability shall have a Vesting Percentage of 100%
and shall be entitled to receive a distribution of the entire value of
his Participant's Account as of his Disability Retirement Date.
ARTICLE VIII
JOINT AND SURVIVOR ANNUITY REQUIREMENTS
8.1 GENERAL. The provisions of this Article shall take precedence over any
conflicting provision in this Plan.
The provisions of this Article shall apply to any Participant who is
credited with at least one Hour of Service with the Employer on or after
August 23, 1984, and such other Participants as provided in Section 8.7,
unless:
(A) upon the death of the Participant the Participant's entire Vested
Interest will be paid to the Participant's Surviving Spouse, but
if there is no Surviving Spouse, or, if the Surviving Spouse has
already consented in a manner conforming to a Qualified Election,
then to the Participant's designated Beneficiary;
(B) the Participant does not elect payments in the form of a Life
Annuity and has not previously elected payments in the form of a
Life Annuity under the Plan, and
(C) as to the Participant, the Plan is not a direct or indirect
transferee of a defined benefit plan, money purchase pension plan
(including a target benefit plan), stock bonus, or profit-sharing
plan which would otherwise provide for a Life Annuity form of
payment to the Participant.
8.2 PAYMENT OF QUALIFIED JOINT AND SURVIVOR ANNUITY. Unless an optional form
of benefit is selected pursuant to a Qualified Election within the
ninety-day period ending on the first day on which all events have
occurred which entitle the Participant to a benefit, a married
Participant's Vested Interest will be paid in the form of a Qualified
Joint and Survivor Annuity.
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An unmarried Participant will be provided a single Life Annuity unless
the Participant elects another form of benefit during the applicable
Election Period.
8.3 PAYMENT OF QUALIFIED PRERETIREMENT SURVIVOR ANNUITY. Unless an optional
form of benefit has been selected within the Election Period pursuant to
a Qualified Election, if a married Participant dies before his Annuity
Starting Date, then the Participant's entire Vested Interest shall be
applied toward the purchase of an immediate Annuity for the life of the
Surviving Spouse. As an alternative to receiving the benefit in this form
of an Annuity, the Surviving Spouse may elect to receive a single cash
payment or any other form of payment provided for in the Plan within a
reasonable time after the Participant's death.
8.4 DEFINITIONS.
(A) Election Period: The period which begins on the first day of the
Plan Year in which the Participant attains age 35 and ends on the
date of the Participant's death. If a Participant separates from
Service prior to the first day of the Plan Year in which age 35 is
attained, with respect to the account balance as of the date of
separation, the Election Period shall begin on the date of
separation.
A Participant who has not attained age 35 as of the end of a Plan
Year, may make a special Qualified Election to waive the Qualified
Preretirement Survivor Annuity for the period beginning on the
date of such election and ending on the first day of the Plan Year
in which the Participant will attain age 35. Such election shall
not be valid unless the Participant receives a written explanation
of the Qualified Preretirement Survivor Annuity in such terms as
are comparable to the explanation required under Section 8.6 (A).
Qualified Preretirement Survivor Annuity coverage will be
automatically reinstated as of the first day of the Plan Year in
which the Participant attains age 35. Any new waiver on or after
such date shall be subject to the full requirements of this
Article.
(B) Qualified Election: A waiver of a Qualified Joint and Survivor
Annuity or a Qualified Preretirement Survivor Annuity. Any waiver
of a Qualified Joint and Survivor Annuity or a Qualified
Preretirement Survivor Annuity shall not be effective unless: (a)
the Participant's Spouse consents in writing to the election; (b)
the election designates a specific Beneficiary, including any
class of Beneficiaries or any contingent Beneficiaries, which may
not be changed without spousal consent (or the Spouse expressly
permits designations by the Participant without any further
spousal consent); (c) the Spouse's consent acknowledges the effect
of the election; and (d) the Spouse's consent is witnessed by a
Plan representative or notary public. Additionally, a
Participant's waiver of the Qualified Joint and Survivor Annuity
shall not be effective unless the election designates a form of
benefit payment which may not be changed without spousal consent
(or the Spouse expressly permits designations by the Participant
without any further spousal consent). If it is established to the
satisfaction of a Plan representative that such written consent
cannot be obtained because:
(1) there is no Spouse;
(2) the Spouse cannot be located;
(3) the Participant is legally separated or has been abandoned
within the meaning of local law, and the Participant has a
court order to such effect;
(4) of other circumstances as the Secretary of the Treasury may
by regulations prescribe, the Participant's election to
waive coverage will be considered a Qualified Election.
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Any consent by a Spouse obtained under this provision (or
establishment that the consent of a Spouse may not be obtained)
shall be effective only with respect to such Spouse. A consent
that permits designations by the Participant without any
requirement of further consent by such Spouse must acknowledge
that the Spouse has the right to limit consent to a specific
Beneficiary, and a specific form of benefit where applicable, and
that the Spouse voluntarily elects to relinquish either or both of
such rights. A revocation of a prior waiver may be made by a
Participant without the consent of the Spouse at any time before
the commencement of benefits. The number of revocations shall not
be limited. No consent obtained under this provision shall be
valid unless the Participant has received notice as provided in
Section 8.6 below.
(C) Qualified Joint and Survivor Annuity: An immediate Annuity for the
life of the Participant with a survivor Annuity for the life of
the Spouse which is not less than 50% and not more than 100% of
the amount of the Annuity which is payable during the joint lives
of the Participant and the Spouse and which is the amount of
benefit which can be purchased with the Participant's entire
Vested Interest. If no survivor Annuity percentage has been
specified in an election, the percentage payable to the Spouse
will be 50%.
Notwithstanding the above paragraph, a Qualified Joint and
Survivor Annuity for an unmarried Participant shall mean an
Annuity for the life of the Participant.
(D) Qualified Preretirement Survivor Annuity: A survivor Annuity for
the life of the Spouse in the amount which can be purchased with
the Participant's entire Vested Interest.
(E) Spouse (Surviving 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 Internal Revenue Code section
414(p).
8.5 CONSENT REQUIREMENTS. Only the Participant need consent to the
commencement of a distribution in the form of a Qualified Joint and
Survivor Annuity while the account balance is immediately distributable.
Neither the consent of the Participant nor the Participant's Spouse shall
be required to the extent that a distribution is required to satisfy
section 401(a)(9) or section 415 of the Code. An account balance is
immediately distributable if any part of the account balance could be
distributed to the Participant (or Surviving Spouse) before the
Participant attains (or would have attained if not deceased) the later of
Normal Retirement Age or age 62.
8.6 NOTICE REQUIREMENTS.
(A) In the case of a Qualified Joint and Survivor Annuity as described
in Section 8.4 (C), the Plan Administrator shall, no less than 30
days and no more than 90 days prior to the Annuity Starting Date,
provide each Participant with a written explanation of: (i) the
terms and conditions of a Qualified Joint and Survivor Annuity;
(ii) the Participant's right to make and the effect of an election
to waive the Qualified Joint and Survivor Annuity form of benefit;
(iii) the rights of a Participant's Spouse; (iv) the right to
make, and the effect of, a revocation of a previous election to
waive the Qualified Joint and Survivor Annuity; (v) a general
description of the eligibility conditions and other material
features of the optional forms of benefit; and (vi) sufficient
additional information to explain the relative values of the
optional forms of benefit available to them under this Plan.
(B) If a distribution is one to which sections 401(a)(11) and 417 of
the Code do not apply, such distribution may commence less than 30
days after the notice required provided that:
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(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.
(C) In the case of a Qualified Preretirement Survivor Annuity as
described in Section 8.4 (D), the Plan Administrator shall provide
each Participant within the period beginning on the first day of
the Plan Year in which the Participant attains age 32 and ending
with the close of the Plan Year preceding the Plan Year in which
the Participant attains age 35, a written explanation of the
Qualified Preretirement Survivor Annuity in such terms and in such
manner as would be comparable to the explanation provided for
meeting the requirements of Section 8.6 (A) to a Qualified Joint
and Survivor Annuity.
If a Participant enters the Plan after the first day of the Plan
Year in which the Participant attained age 32, the Plan
Administrator shall provide notice no later than the close of the
second Plan Year succeeding the entry of the Participant in the
Plan.
If a Participant enters the Plan after he has attained age 35, the
Plan Administrator shall provide notice within a reasonable period
of time following the entry of the Participant in the Plan.
If a Participant's Termination of Employment occurs before the
Participant attains age 35, the Plan Administrator shall provide
notice within one year of such Termination of Employment.
8.7 TRANSITIONAL RULES.
(A) Any living Participant not receiving benefits on August 23, 1984,
who would otherwise not receive the benefits prescribed by the
previous Sections of this Article must be given the opportunity to
elect to have the prior Sections of this Article relating to the
Qualified Preretirement Survivor Annuity apply if such Participant
is credited with at least one Hour of Service under this Plan or a
predecessor plan in a Plan Year beginning on or after January 1,
1976, and such Participant had at least 10 Years of Service for
vesting purposes when he separated from Service.
(B) Any living Participant not receiving benefits on August 23, 1984,
who was credited with at least one Hour of Service under this Plan
or a predecessor plan on or after September 2, 1974, and who is
not otherwise credited with any Service in a Plan Year beginning
on or after January 1, 1976, must be given the opportunity to have
his or her benefits paid in accordance with Section 8.7 (D).
(C) The respective opportunities to elect (as described in Sections
8.7 (A) and 8.7 (B) above) must be afforded to the appropriate
Participants during the period commencing on August 23, 1984, and
ending on the date benefits would otherwise commence to said
Participants.
(D) Any Participant who has elected pursuant to Section 8.7 (B) of
this Article and any Participant who does not elect under Section
8.7 (A) or who meets the requirements of Section 8.7 (A) except
that such Participant does not have at least 10 Years of Service
for vesting purposes when he separates from Service, shall have
his benefits distributed in accordance with all of the following
requirements if benefits would have been payable in the form of a
Life Annuity:
(1) Automatic Joint and Survivor Annuity. If benefits in the
form of a Life Annuity become payable to a married
Participant who:
(a) begins to receive payments under the Plan on or
after Normal Retirement Age; or
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(b) dies on or after Normal Retirement Age while still
working for the Employer; or
(c) begins to receive payments on or after the Qualified
Early Retirement Age; or
(d) separates from Service on or after attaining Normal
Retirement Age (or the Qualified Early Retirement
Age) and after satisfying the eligibility
requirements for the payment of benefits under the
Plan and thereafter dies before beginning to receive
such benefits;
then such benefits will be received under this Plan in the
form of a Qualified Joint and Survivor Annuity, unless the
Participant has elected otherwise during the election
period. The election period must begin at least six months
before the Participant attains Qualified Early Retirement
Age and end not more than 90 days before the commencement
of benefits. Any election hereunder will be in writing and
may be changed by the Participant at any time.
(2) Election of Early Survivor Annuity: A Participant who is
employed after attaining the Qualified Early Retirement Age
will be given the opportunity to elect, during the election
period, to have a survivor Annuity payable on death. If the
Participant elects the survivor Annuity, payments under
such Annuity must not be less than the payments which would
have been made to the Spouse under the Qualified Joint and
Survivor Annuity if the Participant had retired on the day
before his or her death. Any election under this provision
will be in writing and may be changed by the Participant at
any time. The election period begins on the later of (1)
the 90th day before the Participant attains the Qualified
Early Retirement Age, or (2) the date on which
participation begins, and ends on the date the Participant
terminates employment.
(3) For purposes of this Section 8.7 (D) :
(a) Qualified Early Retirement Age is the latest of:
(i) the earliest date, under the Plan, on which
the Participant may elect to receive
retirement benefits; or
(ii) the first day of the 120th month beginning
before the Participant reaches Normal
Retirement Age; or
(iii) the date the Participant begins
participation.
(b) Qualified Joint and Survivor Annuity is an Annuity
for the life of the Participant with a survivor
Annuity for the life of the Spouse as described in
Section 8.4 (C).
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ARTICLE IX
TERMINATION OF EMPLOYMENT
9.1 DISTRIBUTION. As of a Participant's Termination of Employment, he shall
be entitled to receive a distribution of his entire Vested Interest. Such
distribution shall be further subject to the terms and conditions of
Article VI.
If at the time of his Termination of Employment the Participant's Vesting
Percentage is not 100% and the Participant does not take a distribution
from the portion of his Vested Interest subject to the Vesting
Percentage, the nonvested portion of his Participant's Account will
become a Forfeiture upon the date the Participant incurs five consecutive
One-Year Breaks in Service.
If at the time of his Termination of Employment the Participant's Vesting
Percentage is not 100% and such Participant does take a distribution from
the portion of his Vested Interest subject to the Vesting Percentage, or
if the Participant's Vesting Percentage is 0%, the nonvested portion of
his Participant's Account will become a Forfeiture immediately
If the Participant, whose nonvested portion of his Participant's Account
became a Forfeiture in accordance with the terms of the preceding
paragraph, is later rehired by the Employer and re-enrolls in the Plan
before incurring five consecutive One-Year Breaks in Service, then the
amount of the Forfeiture shall be restored by the Employer and shall be
included as part of that portion of his Participant's Account subject to
the Vesting Percentage.
In addition, such rehired Participant shall be entitled to repay the
portion of the distribution made at his Termination of Employment that
was derived from Employer Contributions. The portion of the repayment
that is attributable to amounts that were subject to the Vesting
Percentage shall, upon repayment, be included as part of that portion of
his Participant's Account subject to the Vesting Percentage and will no
longer be considered a distribution for purposes of determining the
Participant's Vested Interest. Such repayment must be made before the
Participant has incurred five consecutive One-Year Breaks in Service
following the date he received the distribution or five years after the
Participant is re-employed by the Employer, whichever date is earlier.
9.2 NO FURTHER RIGHTS OR INTEREST. A Participant shall have no further
interest in or any rights to any portion of his Participant's Account
that becomes a Forfeiture due to his Termination of Employment once the
Participant incurs five consecutive One-Year Breaks in Service in
accordance with Article II.
9.3 APPLICATION OF FORFEITURES. Any Forfeiture arising in accordance with the
provisions of Section 9.1 shall be credited and allocated to the
Participants' Accounts in the manner set forth in Section 4.8 for the
reallocation of Forfeitures.
The provisions of the preceding sentence notwithstanding, in the event
that a former Participant is rehired by the Employer and the Employer is
required by the provisions of Section 9.1 of this Plan to restore the
amount of a separate account that had been created upon such
Participant's prior Termination of Employment and later forfeited,
Forfeitures, if any, will first be used to restore such separate account
to its value as of such Participant's prior Termination of Employment
date. In the event that the available Forfeitures are not
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sufficient to make such restoration, the Employer will make an additional
contribution sufficient to make such restoration.
ARTICLE X
WITHDRAWALS
10.1 WITHDRAWAL AFTER AGE 59-1/2. A Participant who has attained age 59-1/2,
may elect to withdraw from his Participant's Account, once each Plan
Year, an amount which is equal to any whole percentage (not exceeding
100%) of his Vested Interest in his Participant's Account attributable
to:
- Elective Deferral Contributions, including earnings
- Matching Contributions, including earnings
- Nonelective Contributions, including earnings
- Additional Matching Contributions, including earnings.
10.2 WITHDRAWAL FOR SERIOUS FINANCIAL HARDSHIP OF CONTRIBUTIONS OTHER THAN
ELECTIVE DEFERRAL CONTRIBUTIONS. In the event a Participant suffers a
Serious Financial Hardship, such Participant may withdraw a portion of
his Vested Interest attributable to the following to meet such need:
- Matching Contributions that are not designated as Qualified
Matching Contributions, including earnings
- Nonelective Contributions that are not designated as Qualified
Nonelective Contributions, including earnings.
- Additional Matching Contributions that are not designated as
Qualified Matching Contributions, including earnings
In no event may any such withdrawal exceed the amount required to meet
the immediate financial need created by the Serious Financial Hardship.
Such Serious Financial Hardship must be shown by positive evidence
submitted to the Plan Administrator that the hardship is of sufficient
magnitude to impair the Participant's financial security. Withdrawals
shall be determined in a consistent and nondiscriminatory manner, and
shall not affect the Participant's right under the Plan to make
additional withdrawals or to continue to be a Participant.
10.3 WITHDRAWAL FOR SERIOUS FINANCIAL HARDSHIP OF ELECTIVE DEFERRAL
CONTRIBUTIONS. Distributions of Elective Deferral Contributions may be
made to a Participant in the event of a hardship. For purposes of this
section, a distribution is made on account of hardship only if the
distribution is made both on account of an immediate and heavy financial
need of the Employee and is necessary to satisfy the financial need. In
addition, any distribution on account of hardship shall be limited to the
distributable amount described in paragraph (C) of this section.
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(A) The following are the only financial needs considered immediate
and heavy for purposes of this section:
(1) Expenses for medical care described in section 213(d) of
the Code previously incurred by the Employee, the
Employee's Spouse, or any dependents of the Employee (as
defined in section 152 of the Code) or necessary for these
persons to obtain medical care described in section 213(d)
of the Code;
(2) Payment of tuition and related educational fees for the
next 12 months of post-secondary education for the
Employee, his Spouse, children, or dependents (as defined
in section 152 of the Code);
(3) Costs directly related to the purchase of a principal
residence for the Employee (excluding mortgage payments);
or
(4) Payments necessary to prevent the eviction of the Employee
from the Employee's principal residence or foreclosure on
the mortgage on that residence.
(B) The Participant shall specify on the application for a hardship
withdrawal whether the Participant elects the provision of (1) or
(2) below to be used in determining the necessity of the hardship.
(1) A distribution will be considered as necessary to satisfy
an immediate and heavy financial need of the Employee only
if all of the following requirements are satisfied:
(a) The hardship distribution is not in excess of the
amount of the immediate and heavy financial need of
the Employee. The amount of an immediate and heavy
financial need may include the amounts necessary to
apply any federal, state, or local income taxes or
penalties reasonably anticipated to result from the
distribution.
(b) The Employee had obtained all distributions, other
than hardship distributions, and all nontaxable (at
the time of the loan) loans currently available
under all plans maintained by the Employer.
(c) The Employee is suspended from making Elective
Deferral Contributions to the Plan for at least 12
months after receipt of the hardship distribution In
addition, the Employee must be prohibited under the
terms of the plan or an otherwise enforceable
agreement from making Elective Deferral
Contributions and Employee Contributions to all
other plans maintained by the Employer for at least
12 months after receipt of the hardship
distribution.
For this purpose, the phrase "all other plans of the
Employer" means all qualified and nonqualified plans
of deferred compensation maintained by the Employer.
The phrase includes a stock option, stock purchase,
or similar plan, or a cash or deferred arrangement
that is part of a cafeteria plan within the meaning
of section 125 of the Code. However, it does not
include the mandatory employee contribution part of
a defined benefit plan. It also does not include a
health or welfare benefit plan, including one that
is part of a cafeteria plan within the meaning of
section 125 of the Code.
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(d) The Employee may not make Elective Deferral
Contributions to the Plan for the Employee's taxable
year immediately following the taxable year of the
hardship distribution in excess of the applicable
limit under section 402(g) of the Code for such
taxable year less the amount of such Employee's
Elective Deferral Contributions for the taxable year
of the hardship distribution. In addition, all other
plans maintained by the Employer must limit the
Employee's Elective Deferral Contributions for the
next taxable year to the applicable limit under
section 402(g) of the Code for that year minus the
Employee's Elective Deferral Contributions for the
year of the hardship distribution.
(2) A distribution will be treated as necessary to satisfy a
financial need if the Employer relies upon the Employee's
written representation, unless the Employer has actual
knowledge to the contrary, that the need cannot reasonably
be relieved:
(a) Through reimbursement or compensation by insurance
or otherwise;
(b) By liquidation of the Employee's assets;
(c) By cessation of Elective Deferral Contributions
under the Plan; or
(d) By other distributions or nontaxable (at the time of
the loan) loans from plans maintained by the
Employer or by any other employer, or by borrowing
from commercial sources on reasonable commercial
terms in an amount sufficient to satisfy the need.
A need cannot reasonably be relieved by one of the actions
listed above if the effect would be to increase the amount
of the need.
The amount of an immediate and heavy financial need may
include any amounts necessary to pay any federal, state, or
local income taxes or penalties reasonably anticipated to
result from the distribution.
(C) The distributable amount is equal to the Employee's total Elective
Deferral Contribution as of the date of distribution, reduced by
the amount of previous distributions of Elective Deferral
Contributions on account of hardship. The Employee's total
Elective Deferral Contributions shall not include income allocable
to such Elective Deferral Contributions.
10.4 WITHDRAWAL OF PRIOR EMPLOYEE CONTRIBUTIONS. A Participant may elect to
withdraw from his Participant's Account, at any time, an amount equal to
any whole percentage (not exceeding 100%) of his Vested Interest in his
Participant's Account attributable to the value of his Prior Employee
Contributions, including earnings.
10.5 WITHDRAWAL OF ROLLOVER CONTRIBUTIONS. Once during a Plan Year a
Participant may elect to withdraw from his Participant's Account an
amount up to 100% of the value of that portion of his account
attributable to his Rollover Contributions as defined in Article IV. Such
an election shall become effective in accordance with the Notification
Section below.
10.6 NOTIFICATION. The Participant shall notify the Administrator in writing
of his election to make a withdrawal under the preceding provisions of
this Article X. Any such election shall be effective as of the
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date specified in such notice, which date must be at least 15 days after
such notice is filed. Payment of the withdrawal shall be subject to the
terms and conditions of Article VI.
10.7 NON-REPAYMENT. Withdrawals made in accordance with this Article X may not
be repaid.
10.8 SPOUSAL CONSENT TO WITHDRAWAL. Prior to obtaining a withdrawal in
accordance with this Article X, a married Participant must obtain spousal
consent in accordance with the provisions of Article VIII unless such
Participant meets the requirements set forth in Sections 8.1 (A), (B) and
(C).
ARTICLE XI
FIDUCIARY DUTIES AND RESPONSIBILITIES
11.1 GENERAL FIDUCIARY STANDARD OF CONDUCT. Each Fiduciary of the Plan shall
discharge his duties hereunder solely in the interest of the Participants
and their Beneficiaries and for the exclusive purpose of providing
benefits to Participants and their Beneficiaries and defraying reasonable
expenses of administering the Plan. Each Fiduciary shall act with the
care, skill, prudence, and diligence under the circumstances that a
prudent man acting in a like capacity and familiar with such matters
would use in conducting an enterprise of like character and with like
aims, in accordance with the documents and instruments governing this
Plan, insofar as such documents and instruments are consistent with this
standard.
11.2 SERVICE IN MULTIPLE CAPACITIES. Any Person or group of persons may serve
in more than one fiduciary capacity with respect to this Plan.
11.3 LIMITATIONS ON FIDUCIARY LIABILITY. Nothing in this Plan shall be
construed to prevent any Fiduciary from receiving any benefit to which he
may be entitled as a Participant or Beneficiary in this Plan, so long as
the benefit is computed and paid on a basis which is consistent with the
terms of this Plan as applied to all other Participants and
Beneficiaries. Nor shall this Plan be interpreted to prevent any
Fiduciary from receiving any reasonable compensation for services
rendered, or for the reimbursement of expenses properly and actually
incurred in the performance of his duties with the Plan; except that no
Person so serving who already receives full-time pay from an Employer
shall receive compensation from this Plan, except for reimbursement of
expenses properly and actually incurred.
11.4 INVESTMENT MANAGER. When an Investment Manager has been appointed, he is
required to acknowledge in writing that he has undertaken a Fiduciary
responsibility with respect to the Plan.
ARTICLE XII
THE ADMINISTRATOR
12.1 DESIGNATION AND ACCEPTANCE. The Employer shall designate a person or
persons to serve as Administrator under the Plan and such person, by
joining in the execution of this Plan and Trust Agreement accepts such
appointment and agrees to act in accordance with the terms of the Plan.
12.2 DUTIES AND AUTHORITY. The Administrator shall administer the Plan in a
nondiscriminatory manner for the exclusive benefit of Participants and
their Beneficiaries.
The Administrator shall perform all such duties as are necessary to
operate, administer, and manage the Plan in accordance with the terms
thereof, including but not limited to the following:
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(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 retirement income and
other benefit payments to eligible Participants and Beneficiaries;
(D) To interpret and construe the provisions of the Plan and to make
regulations 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 Administrator shall take all such actions as are necessary to
operate, administer, and manage the Plan as a retirement program which is
at all times in full compliance with any law or regulation affecting this
Plan.
The Administrator may allocate certain specified duties of plan
administration to an individual or group of individuals who, with respect
to such duties, shall have all reasonable powers necessary or appropriate
to accomplish them.
12.3 EXPENSES AND COMPENSATION. All expenses of administration may be paid out
of the Trust fund unless paid by the Employer. Such expenses shall
include any expenses incident to the functioning of the Administrator,
including, but not limited to, fees of accountants, counsel, and other
specialists and their agents, and other costs of administering the Plan.
Until paid, the expenses shall constitute a liability of the Trust fund.
However, the Employer may reimburse the Trust fund for any administration
expense incurred. Any administration expense paid to the Trust fund as a
reimbursement shall not be considered an Employer Contribution. Nothing
shall prevent the Administrator from receiving reasonable compensation
for services rendered in administering this Plan, unless the
Administrator already receives full-time pay from any Employer adopting
the Plan.
12.4 INFORMATION FROM EMPLOYER. To enable the Administrator to perform his
functions, the Employer shall supply full and timely information to the
Administrator on all matters relating to this Plan as the Administrator
may require.
12.5 ADMINISTRATIVE COMMITTEE; MULTIPLE SIGNATURES. In the event that more
than one person has been duly nominated to serve on the Administrative
Committee and has signified in writing the acceptance of such
designation, the signature(s) of one or more persons may be accepted by
an interested party as conclusive evidence that the Administrative
Committee has duly authorized the action therein set forth and as
representing the will of and binding upon the whole Administrative
Committee. No person receiving such documents or written instructions and
acting in good faith and in reliance thereon shall be obliged to
ascertain the validity of such action under the terms of this Plan and
Trust. The Administrative Committee shall act by a majority of its
members at the time in office and such action may be taken either by a
vote at a meeting or in writing without a meeting.
12.6 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR. The Administrator, or
any member of the Administrative Committee, 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.
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The 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 Administrator, shall promptly designate a successor
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 Administrative Committee until a new
Administrator has been appointed and has accepted such appointment.
12.7 INVESTMENT MANAGER. The Administrator may appoint, in writing, an
Investment Manager or Managers to whom is delegated the authority to
manage, acquire, invest, or dispose of all or any part of the Trust
assets. With regard to the assets entrusted to his care, the Investment
Manager shall provide written instructions and directions to the Trustee,
who shall in turn be entitled to rely upon such written direction. This
appointment and delegation shall be evidenced by a signed written
agreement.
12.8 DELEGATION OF DUTIES. The Administrator shall have the power, to the
extent permitted by law, to delegate the performance of such Fiduciary
and non-Fiduciary duties, responsibilities, and functions as the
Administrator shall deem advisable for the proper management and
administration of the Plan in the best interests of the Participants and
their Beneficiaries.
ARTICLE XIII
PARTICIPANTS' RIGHTS
13.1 GENERAL RIGHTS OF PARTICIPANTS AND BENEFICIARIES. The Plan is established
and the Trust assets are held for the exclusive purpose of providing
benefits for such Employees and their Beneficiaries as have qualified to
participate under the terms of the Plan.
13.2 FILING A CLAIM FOR BENEFITS. A Participant or Beneficiary or the Employer
acting in his behalf, shall notify the Administrator of a claim of
benefits under the Plan. Such request shall be in writing to the
Administrator and shall set forth the basis of such claim and shall
authorize the 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.
A decision by the Administrator shall be made promptly and not later than
90 days after the Administrator's receipt of the claim of benefits under
the Plan, unless special circumstances require an extension of the time
for processing, in which case a decision shall be rendered as soon as
possible, but not later than 180 days after the initial receipt of the
claim of benefits.
13.3 DENIAL OF CLAIM. Whenever a claim for benefits by any Participant or
Beneficiary has been denied by a Plan Administrator, a written notice,
prepared in a manner calculated to be understood by the Participant, must
be provided, setting forth (1) the specific reasons for the denial; (2)
the specific reference to pertinent Plan provisions on which the denial
is based; (3) 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 (4) an explanation of the
Plan's claim review procedure.
13.4 REMEDIES AVAILABLE TO PARTICIPANTS. A Participant or Beneficiary may (1)
request a review by a Named Fiduciary, other than the Administrator, upon
written application to the Plan; (2) review pertinent
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Plan documents; and (3) submit issues and comments in writing to a Named
Fiduciary. A Participant or Beneficiary shall have 60 days after receipt
by the claimant of written notification of a denial of a claim to request
a review of a denied claim.
A decision by a Named Fiduciary shall be made promptly and not later than
60 days after the Named Fiduciary's receipt of a request for review,
unless special circumstances require an extension of the time for
processing, in which case a decision shall be rendered as soon as
possible, but not later than 120 days after receipt of a request for
review. The decision on review by a Named Fiduciary shall be in writing
and shall include specific reasons for the decision, written in a manner
calculated to be understood by the claimant, and specific references to
the pertinent Plan provisions on which the decision is based.
A Participant or Beneficiary shall be entitled, either in his own name or
in conjunction with any other interested parties, to bring such actions
in law or equity or to undertake such administrative actions or to seek
such relief as may be necessary or appropriate to compel the disclosure
of any required information, to enforce or protect his rights, to recover
present benefits due to him, or to clarify his rights to future benefits
under the Plan.
13.5 REINSTATEMENT OF BENEFIT. In the event any portion of a distribution
which is payable to a Participant or a Beneficiary shall remain unpaid on
account of the inability of the Plan Administrator, after diligent
effort, to locate such Participant or Beneficiary, the amount so
distributable shall be treated as a Forfeiture under the Plan. If a claim
is made by the Participant or Beneficiary for any benefit forfeited under
this section, such benefit shall be reinstated.
13.6 LIMITATION OF RIGHTS. Participation hereunder shall not grant any
Participant the right to be retained in the Service of the Employer or
any other rights or interest in the Plan or Trust fund other than those
specifically herein set forth.
13.7 PARTICIPANT CONTRIBUTIONS. Each Participant, regardless of his length of
Service with the Employer, shall be fully vested (100%) at all times in
any portion of his Participant's Account attributable to the following:
- Rollover Contributions
- Prior Employee Contributions.
13.8 MERGERS OR TRANSFERS. In the case of any merger or consolidation with or
transfer of assets or liabilities to any other qualified plan after
September 2, 1974, the following conditions must be met:
(A) The sum of the account balances in each plan shall equal the fair
market value (determined as of the date of the merger or transfer
as if the plans had then terminated) of the entire plan assets.
(B) The assets of each plan shall be combined to form the assets of
the plan as merged (or transferred).
(C) Immediately after the merger (or transfer), each Participant in
the plan merged (or transferred) shall have an account balance
equal to the sum of the account balances the Participant had in
the plans immediately prior to the merger (or transfer).
(D) Immediately after the merger (or transfer) each Participant in the
plan merged (or transferred) shall be entitled to the same
optional benefit forms as he was entitled to immediately prior to
the merger (or transfer).
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In the case of any merger or consolidation with or transfer of assets or
liabilities to any defined benefit plan after September 2, 1974, one of
the plans before such merger, consolidation, or transfer shall be
converted into the other type of plan and either the rules described
above, applicable to the merger of two defined contribution plans, or the
rules applicable to the merger of two defined benefit plans, as
appropriate, shall be applied.
13.9 PARTICIPANT'S ACCOUNT AND VALUATION. A Participant's Account shall be
maintained on behalf of each Participant until such account is
distributed in accordance with the terms of this Plan. At least once per
year, as of the last day of the Plan Year, each Participant's Account
shall be adjusted for any earnings, gains, losses, contributions,
withdrawals, and expenses, attributable to such Plan Year, in order to
obtain a new valuation of the Participant's Account.
13.10 INVESTMENT OF CONTRIBUTIONS. Subject to the terms set forth herein, each
Participant and/or Beneficiary shall have the exclusive authority to
direct the investment of contributions made to his Participant's Account.
In accordance with the procedures established by the Plan Administrator,
the Participant and/or Beneficiary shall elect to have a specified
percentage invested in one or more investment funds, as long as the
designated percentage for each fund is a whole number, and the sum of the
percentages allocated is equal to 100%. In addition, the Participant
and/or Beneficiary may change such election four times per Plan Year,
once during each calendar quarter, subject to rules established by the
Employer with respect to transactions by persons subject to Section 16 of
the Securities Exchange Act of 1934 as amended. All investment changes
are subject to the rules of the investment fund(s) in which the
Participant's Account is or is to be invested.
13.11 INVESTMENT OF CONTRIBUTIONS IN PARTICIPANT'S EMPLOYER STOCK ACCOUNT.
Notwithstanding anything to the contrary contained herein, only
Nonelective Contributions and earnings thereon earned prior to actual
investment in the Participant's Employer Stock Account and dividends on
the shares of stock of Blyth Industries, Inc. held in the Participant's
Employer Stock Account may be invested in the Participant's Employer
Stock Account.
This Plan is intended to be an eligible individual account plan, as
defined in Section 407(d)(3) of ERISA, and can acquire and hold
qualifying employer securities, as defined in Section 407(d)(5) of ERISA.
Until the adoption by the Securities and Exchange Commission of
amendments to the rules promulgated under Section 16 of the securities
Exchange Act of 1934, as amended, pursuant to which an employee benefit
plan which is not subject to shareholder approval under Rule 16b-3 need
not set forth in writing the amount of securities to be awarded or the
method by which such amount is to be determined in order for the
exemption provided by Rule 16b-3 to be available, the maximum number of
shares of stock of Blyth Industries, Inc. which may be purchased pursuant
to the Plan in any one year is 1,000,000 shares. After such adoption,
there shall be no such limitation.
13.12 TRANSFERS BETWEEN INVESTMENT FUNDS. A Participant and/or Beneficiary may
designate amounts invested pursuant to Section 13.10 to be transferred
between the investment funds four times per Plan Year, once during each
calendar quarter, in accordance with the procedures established by the
Plan Administrator; provided that no amounts may be transferred into the
Participant's Employer Stock Account.
Notwithstanding the above, the transfer of amounts between investment
funds shall be subject to the rules of the investment funds in which the
Participant's Account is invested or is to be invested and shall also be
subject to rules established by the Employer with respect to transactions
by Participants and/or Beneficiaries subject to Section 16 of the
Securities Exchange Act of 1934, as amended.
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ARTICLE XIV
AMENDMENT OR TERMINATION OF THE PLAN
14.1 AMENDMENT OF PLAN. The Employer shall have the right from time to time to
modify or amend, in whole or in part, any or all provisions of the Plan,
provided that a Board of Directors' resolution pursuant to such
modification or amendment shall first be adopted and provided further
that the modification or amendment is signed by the Employer, the
Administrator and the Trustee. Upon any such modification or amendment
the Administrator and the Trustee shall be furnished a copy thereof. No
amendment shall deprive any Participant or Beneficiary of any Vested
Interest hereunder. Any Participant having not less than three Years of
Service shall be permitted to elect, in writing, to have his Vesting
Percentage computed under the Plan without regard to such amendment.
The period during which the election must be made by the Participant
shall begin no later than the date the Plan Amendment is adopted and end
no later than after the latest of the following dates:
(A) The date which is 60 days after the day the amendment is adopted;
or
(B) The date which is 60 days after the day the amendment becomes
effective; or
(C) The date which is 60 days after the day the Participant is issued
written notice of the amendment by the Employer or Administrator.
Such written election by a Participant shall be made to the
Administrator.
No amendment to the Plan shall decrease a Participant's Account balance
or eliminate an optional form of distribution. Notwithstanding the
preceding sentence, a Participant's Account balance may be reduced to the
extent permitted under Internal Revenue Code section 412(c)(8).
Furthermore, no amendment to the Plan shall have the effect of decreasing
a Participant's Vested Interest determined without regard to such
amendment as of the later of the date such amendment is adopted or the
date it becomes effective.
14.2 CONDITIONS OF AMENDMENT. The Employer shall not make any amendment which
would cause the Plan to lose its status as a qualified plan within the
meaning of section 401(a) of the Code.
14.3 TERMINATION OF THE PLAN. The Employer intends to continue the Plan
indefinitely for the benefit of its Employees, but reserves the right to
terminate the Plan at any time by resolution of its Board of Directors.
Upon such termination, the liability of the Employer to make
contributions hereunder shall terminate.
14.4 FULL VESTING. Upon the termination or partial termination of the Plan, or
upon complete discontinuance of Employer contributions, the rights of all
affected Participants in and to the amounts credited to each such
Participant's Account shall be 100% vested and nonforfeitable.
14.5 DISTRIBUTIONS UPON PLAN TERMINATION. If this Plan is terminated and the
Employer does not maintain or establish another defined contribution
plan, pursuant to Code section 401(k)(10)(A)(i), each Participant shall
receive a total distribution, in the form of a lump-sum distribution as
defined in Code section 401(k)(10)(B)(ii), of his Participant's Account
in accordance with the terms and conditions of Article VI.
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However, if this Plan is terminated and the Employer does maintain or
establish another defined contribution plan as discussed in the above
paragraph, or if the Plan is only partially terminated, each Participant
shall receive a total distribution of his Participant's Account,
excluding any amounts attributable to Elective Deferral Contributions and
contributions made by the Employer designated as 401(k) contributions in
accordance with the terms and conditions of Article VI. In such a
situation, any amounts in a Participant's Account attributable to
Elective Deferral Contributions and contributions made by the Employer
designated as 401(k) contributions may be distributed only upon the
occurrence of an event described in Article VI.
No Participant and/or spousal consent will be required for a distribution
where no successor plan exists. However, if the Employer does maintain a
successor plan, Participant and/or spousal consent is required for a
distribution exceeding $3,500. The Participant's Account will be
transferred to such successor plan if the required consents are not
received.
14.6 APPLICATION OF FORFEITURES. Upon the termination of the Plan, any
Forfeitures which have not been allocated as of such termination shall be
allocated and credited to each Participant's Account of the then Active
Participants in the same manner as the last contribution made by the
Employer under the Plan.
14.7 APPROVAL BY THE INTERNAL REVENUE SERVICE. Notwithstanding any other
provisions of this Plan, the Employer's adoption of this Plan is subject
to the condition precedent that the Employer's Plan shall be approved and
qualified by the Internal Revenue Service as meeting the requirements of
section 401(a) of the Internal Revenue Code and that the Trust
established hereunder shall be entitled to exemption under the provisions
of section 501(a). In the event the Plan initially fails to qualify and
the Internal Revenue Service issues a final ruling that the Employer's
Plan or Trust fails to so qualify as of the Effective Date, all liability
of the Employer to make further contributions hereunder shall cease. The
Plan Administrator, Trustee and any other Named Fiduciary shall be
notified immediately by the Employer, in writing, of such failure to
qualify. Upon such notification, the value of the Participants' Accounts
shall be distributed in cash to the Employer, subject to the terms and
conditions of Article VI.
That portion of such distribution which is attributable to Participant
Contributions as specified in Section 13.7, if any, shall be paid to the
Participant, and the balance of such distribution shall be paid to the
Employer.
14.8 SUBSEQUENT UNFAVORABLE DETERMINATION. If the Employer is notified
subsequent to initial favorable qualification that the Plan is no longer
qualified within the meaning of section 401(a) of the Internal Revenue
Code, or that the Trust is no longer entitled to exemption under the
provisions of section 501(a), and if the Employer shall fail within a
reasonable time to make any necessary changes in order that the Plan
and/or Trust shall so qualify, the Participants' Accounts shall be fully
vested and nonforfeitable and shall be disposed of as if the Plan had
terminated, in the manner set forth in this Article XIV.
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ARTICLE XV
SUBSTITUTION OF PLANS
15.1 SUBSTITUTION OF PLANS. Subject to the provisions of Section 13.8 the
Employer may substitute an individually designed plan or a master or
prototype plan for this Plan without terminating this Plan as embodied
herein and this shall be deemed to constitute an amendment and
restatement in its entirety of this Plan as heretofore adopted by the
Employer; provided, however, that the Employer shall have certified to
the Trustee that this Plan is being continued on a restated basis which
meets the requirements of section 401(a) of the Internal Revenue Code and
ERISA.
15.2 TRANSFER OF ASSETS. Upon 90 days' written notification from the Employer
and the Trustee that a different plan meeting the requirements set forth
in Section 15.1 above has been executed and entered into by the
Administrator and the Employer, and after the Trustee has been furnished
the Employer's certification in writing that the Employer intends to
continue the Plan as a qualified Plan under section 401(a) of the
Internal Revenue Code and ERISA, assets which represent the value of all
Participant's Accounts may be transferred in accordance with the
instructions received from or on behalf of the Employer. The Trustee may
rely fully on the representations or directions of the Employer with
respect to any such transfer and shall be fully protected and discharged
with respect to any such transfer made in accordance with such
representations, instructions, or directions.
ARTICLE XVI
MISCELLANEOUS
16.1 NON-REVERSION. This Plan has been established by the Employer for the
exclusive benefit of the Participants and their Beneficiaries. Except as
otherwise provided in Sections 14.7, 16.7, and 16.8, under no
circumstances shall any funds contributed hereunder, at any time, revert
to or be used by the Employer, nor shall any such funds or assets of any
kind be used other than for the benefit of the Participants or their
Beneficiaries.
16.2 GENDER AND NUMBER. When necessary to the meaning hereof, and except when
otherwise indicated by the context, either the masculine or the neuter
pronoun shall be deemed to include the masculine, the feminine, and the
neuter, and the singular shall be deemed to include the plural.
16.3 REFERENCE TO THE CODE AND ERISA. Any reference to any section of the
Internal Revenue Code, ERISA, or to any other statute or law shall be
deemed to include any successor law of similar import.
16.4 GOVERNING LAW. The Plan and Trust shall be governed and construed in
accordance with the laws of the state where the Trustee has its principal
office if the Trustee is a corporation or an association, otherwise under
the laws of the state where the Employer has its principal office.
16.5 COMPLIANCE WITH THE CODE AND ERISA. This Plan is intended to comply with
all requirements for qualification under the Internal Revenue Code and
ERISA, and 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.
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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.
16.6 NON-ALIENATION. It is a condition of the Plan, and all rights of each
Participant shall be subject thereto, that no right or interest of any
Participant in the Plan shall be assignable or transferable in whole or
in part, either directly or by operation of law or otherwise, including,
but without limitation, execution, levy, garnishment, attachment, pledge,
bankruptcy or in any other manner, and no right or interest of any
Participant in the Plan shall be liable for or subject to any obligation
or liability of such Participant. The preceding sentence shall not
preclude the enforcement of a federal tax levy made pursuant to section
6331 of the Code or the collection by the United States on a judgement
resulting from an unpaid tax assessment.
16.7 CONTRIBUTION RECAPTURE. Notwithstanding any other provisions of this
Plan, (1) in the case of a contribution which is made by an Employer by a
mistake of fact, Section 16.1 shall not prohibit the return of such
contribution to the Employer within one year after the payment of the
contribution, and (2) if a contribution is conditioned upon the
deductibility of the contribution under section 404 of the Code, then, to
the extent the deduction is disallowed, Section 16.1 shall not prohibit
the return to the Employer of such contribution (to the extent
disallowed) within one year after the disallowance of the deduction. The
amount which may be returned to the Employer is the excess of (1) the
amount contributed over (2) the amount that would have been contributed
had there not occurred a mistake of fact or a mistake in determining the
deduction. Earnings attributable to the excess contribution may not be
returned to the Employer, but losses attributable thereto must reduce the
amount to be so returned. Furthermore, if the withdrawal of the amount
attributable to the mistaken contribution would cause the balance of the
individual account of any Participant to be reduced to less than the
balance which would have been in the account had the mistaken amount not
been contributed, then the amount to be returned to the Employer would
have to be limited so as to avoid such reduction.
16.8 QUALIFIED DOMESTIC RELATIONS ORDERS. Notwithstanding any other provisions
of this Plan, the Participant's Account may be segregated and distributed
pursuant to a Qualified Domestic Relations Order within the meaning of
Internal Revenue Code section 414(p). The Plan Administrator shall
establish procedures for determining if a Domestic Relations Order is
qualified within the meaning of section 414(p).
ARTICLE XVI-A
TOP-HEAVY PROVISIONS
16A.1 DEFINITIONS. The following definitions are atypical terms used only in
this Article XVI-A.
(A) Compensation. The term Compensation, whenever used in this Article
XVI-A, means Compensation as defined in Article V of the Plan, but
includes the amount of any elective contributions made by the
Employer on the Employee's behalf to a cafeteria plan established
in accordance with the provisions of Code section 125, a qualified
cash or deferred arrangement in accordance with the provisions of
Code section 402(e)(3), a simplified employee pension plan in
accordance with the provisions of Code section 402(h), or a tax
sheltered annuity plan maintained in accordance with the
provisions of Code section 403(b).
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(B) Key Employee. The term Key Employee means any Employee or former
Employee (including deceased Employees) of the Employer who at any
time during the Plan Year or the four preceding Plan Years was:
(1) An officer of the Employer, but in no event if there are
more than 500 Employees, shall more than 50 Employees be
considered Key Employees. If there are less than 500
Employees, in no event shall the greater of three Employees
or 10% of all Employees, be taken into account under this
Subsection as Key Employees. If the number of officers is
limited by the terms of the preceding sentence, the
Employees with the highest Compensation will be considered
to be officers.
In no event shall an officer whose annual Compensation is
less than 50% of the dollar limitation in effect under Code
section 415(b)(1)(A) as adjusted from time to time, be a
Key Employee for any such Plan Year.
In making a determination under this Subsection, Employees
who have not completed six months of Service by the end of
the applicable Plan Year, Employees who normally work less
than 17-1/2 hours per week, Employees who normally work
less than six months during a year, Employees who have not
attained 21, and nonresident aliens who receive no earned
income from U.S. sources, shall be excluded.
Also excluded under the above paragraph are Employees who
are covered by an agreement which the Secretary of Labor
finds to be a collective bargaining agreement. Such
Employees will be excluded only if retirement benefits were
the subject of good faith bargaining, 90% of the Employees
of the Employer are covered by the agreement, and the Plan
covers only Employees who are not covered by the agreement.
(2) One of the 10 Employees who has annual Compensation greater
than the amount in effect under Internal Revenue Code
section 415(c)(1)(A) and who owns (or is considered to own
within the meaning of Internal Revenue Code section 318, as
modified by section 416(i)(1)(B)(iii)) both more than 1/2%
interest and the largest interest in the Employer. If two
or more Employees own equal interests in the Employer, the
ranking of ownership share will be in descending order of
such Employees' Compensation. If the Employer is other than
a corporation, the term "interest" as used herein shall
refer to capital or profits interest.
(3) An Employee who owns (or is considered to own within the
meaning of Internal Revenue Code section 318, as modified
by section 416(i)(1)(B)(iii)) more than 5% of the
outstanding stock of the Employer or stock possessing more
than 5% of the total combined voting power of all stock of
the Employer. If the Employer is other than a corporation,
an Employee who owns, or is considered to own, more than 5%
of the capital or profits interest in the Employer. The
determination of 5% ownership shall be made separately for
each member of a controlled group of corporations (as
defined in Code section 414(b)), or of a group of trades or
businesses (whether or not incorporated) that are under
common control (as defined in Code section 414(c)), or of
an affiliated service group (as defined in Code section
414(m)).
(4) An Employee who owns (or is considered to own within the
meaning of Internal Revenue Code section 318, as modified
by section 416(i)(1)(B)(iii)) more than 1% of the
outstanding stock of the Employer or stock possessing more
than 1% of the total combined voting power of all stock of
the Employer, and whose annual Compensation is more than
$150,000. If the Employer is other than a corporation, an
Employee who owns, or is considered to own, more
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than 1% of the capital or profits interest in the Employer,
and whose annual Compensation is more than $150,000.
For the purposes of paragraphs (2), (3) and (4) above, if an
Employee's ownership interest changes during a given Plan Year,
his ownership interest for that Plan Year is the largest interest
owned at any time during the Plan Year.
The Beneficiary of any deceased Employee who was a Key Employee
shall be considered a Key Employee for the same period as the
deceased Employee would have been so considered.
(C) Non-Key Employee. The term Non-Key Employee means any Employee or
former Employee of the Employer who is not a Key Employee. The
Beneficiary of any deceased Employee who is a Non-Key Employee
shall be considered a Non-Key Employee for the same period as the
deceased Employee would have been so considered.
(D) Determination Date. The term Determination Date means, with
respect to a Plan Year, the last day of the preceding Plan Year,
or, in the case of the first Plan Year of a plan, the last day of
the first Plan Year.
(E) Valuation Date. The term Valuation Date means, with respect to a
Plan Year, the last day of the preceding Plan Year and is the date
on which Account Balances are valued for the purpose of
determining the Plan's Top-Heavy status.
(F) Account Balance. The term Account Balance means the value of the
Participant's Account standing to the credit of a Participant, a
former Participant, or the Beneficiary of a former Participant, as
the case may be, as of the Valuation Date. Such Account Balance
shall include any contributions due as of the Determination Date
and all distributions made to the Participant (or former
Participant or Beneficiary, as the case may be) during the Plan
Year or the preceding four Plan Years, except for distributions of
Related Rollovers. However, the Account Balance shall not include
any deductible Employee Contributions made pursuant to Internal
Revenue Code section 219 or Unrelated Rollovers made to the Plan
after December 31, 1983.
A Related Rollover is a Rollover Contribution or Transfer that
either was not initiated by the Employee or was made to a plan
maintained by the same Employer.
An Unrelated Rollover is a Rollover Contribution or Transfer that
was initiated by the Employee and was made from a plan maintained
by one employer to a plan maintained by another employer.
For purposes of this Subsection (F), the term Employer shall
include all employers that are required to be aggregated in
accordance with Internal Revenue Code sections 414(b), (c) or (m).
(G) Required Aggregation Group. The term Required Aggregation Group
means all of the plans of the Employer which cover a Key Employee,
including any such plan maintained by the Employer pursuant to the
terms of a collective bargaining agreement, and each other plan of
the Employer which enables any plan in which a Key Employee
participates to satisfy the requirements of Internal Revenue Code
sections 401(a)(4) or 410.
(H) Permissive Aggregation Group. The term Permissive Aggregation
Group means all of the plans of the Employer which are included in
the Required Aggregation Group plus any plans of the Employer
which provide comparable benefits to the benefits provided by the
plans in the Required Aggregation
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Group and are not included in the Required Aggregation Group, but
which satisfy the requirements of Internal Revenue Code sections
401(a)(4) and 410 when considered together with the Required
Aggregation Group, including any plan maintained by the Employer
pursuant to a collective bargaining agreement which does not
include a Key Employee.
(I) Top-Heavy Plan. The Plan is Top-Heavy if it meets the requirements
of Section 16A.2.
(J) Super Top-Heavy Plan. The Plan is Super Top-Heavy if it meets the
requirements of Section 16A.3.
(K) Terminated Plan. A plan shall be considered to be a Terminated
Plan if it:
(1) has been formally terminated;
(2) has ceased crediting service for benefit accruals and
vesting; or
(3) has been or is distributing all plan assets to Participants
(or Beneficiaries) as soon as administratively possible.
With the exception of the Minimum Employer Contribution
Requirements and the Minimum Vesting Requirements, the Top-Heavy
provisions of this Article XVI-A will apply to any Terminated Plan
which was maintained at any time during the five years ending on
the Determination Date.
(L) Frozen Plan. A plan shall be considered to be a Frozen Plan if all
benefit accruals have ceased but all assets have not been
distributed to Participants or Beneficiaries. The Top-Heavy
provisions of this Article XVI-A will apply to any such Frozen
Plan.
16A.2 TOP-HEAVY PLAN STATUS. This Plan shall be determined to be Top-Heavy if,
as of the Determination Date, the aggregate of the Account Balances of
Key Employees exceeds 60% of the aggregate of the Account Balances of all
Employees covered by the Plan. The determination of whether the Plan is
Top-Heavy shall be made after aggregating all plans in the Required
Aggregation Group, and after aggregating any other plans which are in the
Permissive Aggregation Group, if such permissive aggregation thereby
eliminates the Top-Heavy status of any plan within such Required
Aggregation Group.
In determining whether this Plan is Top-Heavy, the Account Balance of a
former Key Employee who is now a Non-Key Employee will be disregarded.
Likewise, for Plan Years beginning after December 31, 1984, the Account
Balance of any Employee who has not performed an Hour of Service during
the five-year period ending on the Determination Date will be excluded.
16A.3 SUPER TOP-HEAVY PLAN STATUS. This Plan shall be determined to be Super
Top-Heavy if, as of the Determination Date, the Plan would meet the test
specified in Section 16A.2 above, if 90% were substituted for 60% in each
place where it appears. The Plan may be permissively aggregated in order
to avoid being Super Top-Heavy.
16A.4 TOP-HEAVY REQUIREMENTS. Notwithstanding anything in the Plan to the
contrary, if the Plan is Top-Heavy with respect to any Plan Year
beginning after December 31, 1983, then the Plan shall meet the following
requirements for such Plan Year:
(A) Compensation Limit. The annual Compensation of each Participant
taken into account under the Plan shall not exceed $150,000;
however, such dollar limitation shall be adjusted to take into
account any
67
<PAGE>
adjustments made by the Secretary of the Treasury or his delegate
pursuant to Internal Revenue Code section 416(d)(2).
(B) Minimum Employer Contribution Requirements. A Minimum Employer
Contribution of 3% of each Eligible Employee's Compensation will
be made on behalf of each Eligible Employee in the Plan.
If the actual Employer Contribution made or required to be made
for Key Employees is less than 3%, the Minimum Employer
Contribution required hereunder shall not exceed the percentage
contribution made for the Key Employee for whom the percentage of
Employer Contributions and Forfeitures relative to the first
$150,000 of Compensation is the highest for the Plan Year after
taking into account contributions or benefits under other
qualified plans in the Plan's Required Aggregation Group.
However, if a Participant in this Plan is also a participant in a
defined benefit plan maintained by the Employer, such Participant
shall receive the Top-Heavy minimum benefit under the defined
benefit plan in lieu of the Minimum Employer Contribution
described herein. Such minimum benefit will be equal to the
Participant's average yearly Compensation during his five
highest-paid consecutive years, multiplied by the lesser of 2% per
Year of Service or 20%. Compensation periods and Years of Service
to be taken into account in the calculation of this benefit shall
be subject to any limitations set forth in the defined benefit
plan.
For any Limitation Year in which this Plan is Top-Heavy but not
Super Top-Heavy, the Minimum Employer Contribution shall be
increased to 4% of each Eligible Employee's Compensation in order
to preserve the use of the factor 1.25 in the denominators of the
fractions described in Section 5.4 (B) (1) and Section 5.4 (D)
(1). A Participant who receives the Top-Heavy minimum benefit in
lieu of the Minimum Employer Contribution shall receive an
increased minimum benefit equal to the Participant's average
yearly Compensation during his five highest-paid consecutive
years, multiplied by the lesser of 3% per Year of Service or 20%
plus one percentage point (to a maximum of 10 percentage points)
for each year that this Plan is maintained. Compensation periods
and Years of Service to be taken into account in the calculation
of this increased minimum benefit shall be subject to any
limitations set forth in the defined benefit plan.
For any Limitation Year in which this Plan is Super Top-Heavy, the
factor of 1.25 in the denominators of the fractions described in
Sections 5.4 (B) (1) and 5.4 (D) (1) shall be reduced to 1.0. The
Minimum Employer Contribution payable in such years shall be 3% of
each Eligible Employee's Compensation and the defined benefit
Top-Heavy minimum benefit shall be average Compensation multiplied
by the lesser of 2% per Year of Service or 20%.
Eligible Employees are all Non-Key Employees who are Participants
in the Plan as of the last day of the Plan Year regardless of
whether they had completed 1,000 Hours of Service during the Plan
Year. Also included are Non-Key Employees who would have been
Participants as of the last day of the Plan Year except:
- The Employee's Compensation was below a required minimum
level; or
- The Employee chose not to make Elective Deferral
Contributions when he was eligible to do so. In computing
the Minimum Employer Contribution under this Subsection for
Plan Years beginning after December 31, 1984, Forfeitures
allocated to a Participant's Account shall be included in
the Minimum Employer Contribution.
68
<PAGE>
ARTICLE XVII
TRUST AGREEMENT
17.1 CREATION AND ACCEPTANCE OF TRUST. The Trustee, by joining in the
execution of the Plan and trust agreement, accepts the Trust hereby
created and agrees to act in accordance with the express terms and
conditions herein stated.
17.2 TRUSTEE CAPACITY; CO-TRUSTEES. The Trustee may be a bank, trust company
or other corporation possessing trust powers under applicable state or
federal law or one or more individuals or any combination thereof.
When two or more persons serve as Trustee, they are specifically
authorized, by a written agreement between themselves, to allocate
specific responsibilities, obligations or duties among themselves. An
original copy of such written agreement is to be delivered to the
Administrator.
17.3 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR TRUSTEE. Any Trustee
may resign at any time by delivering to the Administrator 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 Trustee may be removed with or without cause by the Board of
Directors by delivery of a written notice of removal, to take effect at a
date specified therein, which shall not be less than 30 days after
delivery thereof, unless such notice shall be waived.
In the case of the resignation or removal of a Trustee, the Trustee shall
have the right to a settlement of its account, which may be made, at the
option of the Trustee, either (1) by judicial settlement in an action
instituted by the Trustee in a court of competent jurisdiction, or (2) by
written agreement of settlement between the Trustee and the
Administrator.
Upon such settlement, all right, title and interest of such Trustee in
the assets of the Trust and all rights and privileges under this
Agreement theretofore vested in such Trustee shall vest in the successor
Trustee, and thereupon all future liability of such Trustee shall
terminate; provided, however, that the Trustee shall execute, acknowledge
and deliver all documents and written instruments which are necessary to
transfer and convey the right, title and interest in the Trust assets,
and all rights and privileges to the successor Trustee.
The Board of Directors, upon receipt of notice of the resignation or
removal of the Trustee, shall promptly designate a successor Trustee,
whose appointment is subject to acceptance of this Trust in writing and
shall notify in writing the insurance company of such successor Trustee.
17.4 TAXES, EXPENSES AND COMPENSATION OF TRUSTEE. The Trustee shall deduct
from and charge against the Trust fund any taxes paid by it which may be
imposed upon the Trust fund or the income thereof or which the Trustee is
required to pay with respect to the interest of any person therein.
The Trustee shall be paid such reasonable compensation as shall from time
to time be agreed upon in writing by the Employer and the Trustee. An
individual serving as Trustee who already receives full-time pay from the
Employer shall not receive compensation from the Plan. In addition, the
Trustee shall be reimbursed for any reasonable expenses, including
reasonable counsel fees incurred by it as Trustee. Such compensation and
expenses shall be paid from the Trust fund unless paid or advanced by the
Employer.
69
<PAGE>
17.5 TRUSTEE ENTITLED TO CONSULTATION. The Trustee shall be entitled to advice
of counsel, which may be counsel for the Plan or the Employer, in any
case in which the Trustee shall deem such advice necessary. With the
exception of those powers and duties specifically allocated to the
Trustee by the express terms of this Plan, it shall not be the
responsibility of the Trustee to interpret the terms of the Plan or Trust
and the Trustee may request, and is entitled to receive guidance and
written direction from the Administrator on any point requiring
construction or interpretation of the Plan documents.
17.6 RIGHTS, POWERS AND DUTIES OF TRUSTEE. The Trustee shall have the
following rights, powers, and duties:
(A) The Trustee shall be responsible for the safekeeping and
administering of the assets of this Plan and Trust in accordance
with the provisions of this Agreement and any amendments thereto.
The duties of the Trustee under this Agreement shall be determined
solely by the express provisions of this Agreement and no further
duties or responsibility shall be implied. Subject to the terms of
this Plan and Trust, the Trustee shall be fully protected and
shall incur no liability in acting in reliance upon the written
instructions or directions of the Administrator or a duly
designated Investment Manager or any other Named Fiduciary.
(B) The Trustee shall have all powers necessary or convenient for the
orderly and efficient performance of its duties hereunder,
including but not limited to those specified in this section. The
Trustee may appoint one or more administrative agents or contract
for the performance of such administrative and service functions
as it may deem necessary for the effective installation and
operation of the Plan and Trust.
(C) The Trustee shall have the power to collect and receive any and
all monies and other property due hereunder and to give full
discharge and acquittance therefor; to settle, compromise or
submit to arbitration any claims, debits or damages due or owing
to or from the Trust; to commence or defend suits or legal
proceedings wherever, in its judgment, any interest of the Trust
requires it; and to represent the Trust in all suits or legal
proceedings in any court of law or equity or before any other body
or tribunal. It shall have the power generally to do all acts,
whether or not expressly authorized, which the Trustee in the
exercise of its Fiduciary responsibility may deem necessary or
desirable for the protection of the Trust and the assets thereof.
(D) The Trustee may temporarily hold cash balances and shall be
entitled to deposit any such funds received in a bank account or
bank accounts in the name of the Trust in any bank or banks
selected by the Trustee, including the banking department of the
Trustee, pending disposition of such funds in accordance with the
Trust. Any such deposit may be made with or without interest.
(E) The Trustee shall deal with any assets of this Trust held or
received under this Plan only in accordance with the written
directions from the Administrator. The Trustee shall be under no
duty to determine any facts or the propriety of any action taken
or omitted by it in good faith pursuant to instructions from the
Administrator.
(F) If the whole or any part of the Trust shall become liable for the
payment of any estate, inheritance, income or other tax which the
Trustee shall be required to pay, the Trustee shall have full
power and authority to pay such tax out of any monies or other
property in its hands for the account of the person whose interest
hereunder is so liable. Prior to making any payment, the Trustee
may require such releases or other documents from any lawful
taxing authority as it shall deem necessary. The Trustee
70
<PAGE>
shall not be liable for any nonpayment of tax when it distributes
an interest hereunder on instructions from the Administrator.
(G) The Trustee shall keep a full, accurate and detailed record of all
transactions of the Trust which the Administrator shall have the
right to examine at any time during the Trustee's regular business
hours. Following the close of the fiscal year of the Trust, or as
soon as practical thereafter, the Trustee shall furnish the
Administrator with a statement of account. This account shall set
forth all receipts, disbursements and other transactions effected
by the Trustee during said year.
The Administrator shall promptly notify the Trustee in writing of
its approval or disapproval of the account. The Administrator's
failure to disapprove the account within 60 days after receipt
shall be considered an approval. The approval by the Administrator
shall be binding as to all matters embraced in any statement to
the same extent as if the account of the Trustee had been settled
by judgment or decree of a court of competent jurisdiction under
which the Trustee, Administrator, Employer and all persons having
or claiming any interest in the Trust were parties; provided,
however, that the Trustee may have its account judicially settled
if it so desires.
(H) If, at any time, there shall be a dispute as to the person to whom
payment or delivery of monies or property should be made by the
Trustee, or regarding any action to be taken by the Trustee, the
Trustee may postpone such payment, delivery or action, retaining
the funds or property involved, until such dispute shall have been
resolved in a court of competent jurisdiction or the Trustee shall
have been indemnified to its satisfaction or until it has received
written direction from the Administrator.
(I) Anything in this instrument to the contrary notwithstanding, it
shall be understood that the Trustee shall have no duty or
responsibility with respect to the determination of matters
pertaining to the eligibility of any Employee to become or remain
a Participant hereunder, the amount of benefit to which any
Participant or Beneficiary shall be entitled hereunder, all such
responsibilities being vested in the Administrator. The Trustee
shall have no duty to collect any contribution from the Employer
and shall not be concerned with the amount of any contribution nor
the application of the contribution formula.
17.7 EVIDENCE OF TRUSTEE ACTION. In the event that the Trustee is comprised of
two or more Trustees, then those Trustees may designate one such Trustee
to transmit all decisions of the Trustee and to sign all necessary
notices and other reports on behalf of the Trustee. All notices and other
reports bearing the signature of the individual Trustee so designated
shall be deemed to bear the signatures of all the individual Trustees and
all parties dealing with the Trustee are entitled to rely on any such
notices and other reports as authentic and as representing the action of
the Trustee.
17.8 INVESTMENT POLICY. This Plan has been established for the sole purpose of
providing benefits to the Participants and their Beneficiaries. In
determining its investments hereunder, the Trustee shall take account of
the advice provided by the Administrator as to funding policy and the
short and long range needs of the Plan based on the evident and probable
requirements of the Plan as to the time benefits shall be payable and the
requirements therefore.
17.9 PERIOD OF TRUST. If it shall be determined that the applicable state law
requires a limitation on the period during which the Employer's Trust
shall continue, then such Trust shall not continue for a period longer
than 21 years following the death of the last of those Participants
including future Participants who are living at the effective date
hereof. At least 180 days prior to the end of the twenty-first year as
described in the first sentence of this Section, the Employer, the
Administrator and the Trustee shall provide for the establishment
71
<PAGE>
of a successor trust and transfer of Plan assets to the successor
trustee. If the applicable state law requires no such limitation, then
this Section shall not be operative.
72
<PAGE>
AMENDMENT TO
BLYTH INDUSTRIES, INC. PROFIT SHARING RETIREMENT PLAN AND TRUST
WHEREAS, Candle Corporation of America, Partylite Gifts, Inc., Aromatic
Industries, Inc. and Candle Corporation of America Hong Kong, Ltd. (hereinafter
collectively referred to as the "Employer") established the Blyth Industries,
Inc. Profit Sharing Retirement Plan and Trust (hereinafter referred to as the
"Plan") effective April 30, 1980 for the benefit of its eligible Employees and
their Beneficiaries; and
WHEREAS, the Employer reserved the right to amend the Plan under the terms
thereof; and
WHEREAS, the Employer desires to delete the waiver of participation option under
the Plan;
WHEREAS, the Employer desires to change the Plan's definition of Compensation to
include only Compensation for the period of time that an Employee was eligible
to participate in the Plan;
WHEREAS, the Employer desires to change vesting to a more liberal schedule; and
WHEREAS, the Employer desires to increase the maximum amount which may be
contributed as an Elective Deferral Contribution; and
WHEREAS, the Employer desires to reflect that Elective Deferral Contributions
are being contributed weekly to the Plan; and
WHEREAS, the Employer desires to change the amount of Matching Contribution
being contributed to the Plan; and
WHEREAS, the Employer desires to clarify how forfeitures will be reallocated;
and
WHEREAS, the Employer desires to permit withdrawals at any time following
attainment of age 59-1/2; and
WHEREAS, the Employer desires to add a loan feature to the Plan; and
WHEREAS, the Employer desires to permit more frequent investment changes and
transfers; and
NOW THEREFORE, the Plan is hereby amended effective January 1, 1996 as follows:
1. Section 3.5 of the Plan is hereby deleted in its entirety.
NOW THEREFORE, the Plan is hereby amended effective January 1, 1997 as follows:
1. Section 1.15 (B) of the Plan is hereby deleted in its entirety and
replaced with the following:
"Compensation shall include only that Compensation which is actually paid
to the Participant during the determination period. Except as provided
elsewhere in the Plan, the determination period shall be the Plan Year.
However, for the Plan Year in which an Employee begins participation in
the Plan and the Plan Year in which an Employee ends participation in the
Plan, the determination period is the portion of the Plan Year during
which the Employee is a Participant in the Plan."
<PAGE>
NOW THEREFORE, the Plan is hereby amended effective February 1, 1997 as follows:
1. Section 1.67 of the Plan is hereby deleted in its entirety and replaced
with the following:
"VESTING PERCENTAGE. The term Vesting Percentage means the percentage
used to determine a Participant's Vested Interest in contributions made
by the Employer, plus the earnings thereon, credited to his Participant's
Account that are not 100% immediately vested. The Vesting Percentage for
each Participant shall be determined in accordance with the following
schedule based on Years of Service with the Employer:
<TABLE>
<CAPTION>
YEARS OF SERVICE VESTING PERCENTAGE
---------------- ------------------
<S> <C>
Less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 but less than 6 80%
6 or more 100%
</TABLE>
However, if an Active Participant dies or becomes disabled prior to
attaining his Normal Retirement Age, his Vesting Percentage shall be
100%."
2. The first paragraph of Section 4.1 is deleted in its entirety and
replaced with the following:
"ELECTIVE DEFERRAL CONTRIBUTIONS. Each Active Participant may enter into
a written Salary Deferral Agreement with the Employer in an amount equal
to not less than 1% nor more than 15% of his Compensation for the
Contribution Period. In consideration of such agreement, the Employer
will make a contribution for each Contribution Period on behalf of the
Participant in an amount equal to the total amount by which the
Participant's Compensation from the Employer was deferred during the
Contribution Period pursuant to the Salary Deferral Agreement then in
effect. Elective Deferral Contributions shall be paid by the Employer to
the Trust not less frequently than weekly, but in no event later than 90
days following the date the amounts were deferred."
3. Section 4.2 is amended by the addition of the following:
"The Employer may contribute a true-up contribution for each Participant
at the end of the Plan Year so that the total Matching Contribution for
each Participant is calculated on an annual basis rather than a quarterly
basis."
4. Section 4.8 is deleted in its entirety and replaced with the following:
"ALLOCATION OF FORFEITURES. Forfeitures available for reallocation in
accordance with Section 9.3 shall be allocated to each Participant,
eligible to receive a Nonelective Contribution as described in Section
4.4, in the proportion that the Participant's Compensation bears to the
Compensation of all such Participants, subject to the Limitations on
Allocations specified in Article V."
5. Section 10.1 is deleted in its entirety and replaced with the following:
<PAGE>
"WITHDRAWAL AFTER AGE 59-1/2. A Participant who has attained age 59-1/2,
may elect to withdraw from his Participant's Account, at any time, an
amount which is equal to any whole percentage (not exceeding 100%) of his
Vested Interest in his Participant's Account attributable to:
- Elective Deferral Contributions, including earnings
- Matching Contributions, including earnings
- Nonelective Contributions, including earnings
- Additional Matching Contributions, including earnings."
6. Article X-A is added to the Plan as follows:
"ARTICLE X-A
LOANS
10A.1 LOANS TO PARTICIPANTS. The Plan Administrator may make a bona fide loan
to a Participant, in an amount which, when added to the outstanding
balance of all other loans to the Participant from all qualified plans of
the Employer, does not exceed the lesser of $50,000 reduced by the excess
of the Participant's highest outstanding loan balance during the 12
months preceding the date on which the loan is made over the outstanding
loan balance on the date the new loan is made, or 50% of the
Participant's Vested Interest in his Participant's Account. Loans may be
taken from the Participant's Vested Interest in his Participant's Account
attributable to Elective Deferral and Rollover Contributions.
Notwithstanding any provisions in this paragraph to the contrary, loans
may not exceed a Participant's Vested Interest attributable to these
specific types of contributions.
The loan shall be made under such terms, security interest, and
conditions as the Plan Administrator deems appropriate, provided;
however, that all loans granted hereunder:
(A) are available to all Participants and Beneficiaries, who are
parties-in-interest pursuant to section 3(14) of ERISA, on a
reasonably equivalent basis;
(B) are not made available to Highly Compensated Employees on a basis
greater than the basis made available to other Employees;
(C) bear a reasonable rate of interest;
(D) are adequately secured;
(E) unless a Participant meets the requirements set forth in Sections
8.1 (A), (B) and (C), are made only after a Participant obtains
the consent of his Spouse, if any, to use his Participant's
Account as security for the loan. Spousal consent shall be
obtained no earlier than the beginning of the 90-day period that
ends on the date on which the loan is to be so secured. The
consent must be in writing, must acknowledge the effect of the
loan, and must be witnessed by a plan representative or notary
public. Such consent shall thereafter be binding with respect to
the consenting Spouse or any subsequent Spouse with respect to
that loan.
<PAGE>
A new consent shall be required if the Participant's Account is
used for renegotiation, extension, renewal or other revision of
the loan.
(F) are made in accordance with and subject to all of the provisions
of this Article.
10A.2 LOAN PROCEDURES. The Plan Administrator shall establish a written set of
procedures, set forth in the summary plan description, by which all loans
will be administered. Such rules, which are incorporated herein by
reference, will include, but not be limited to, the following:
(A) the person or persons authorized to administer the loan program,
identified by name or position;
(B) the loan application procedure;
(C) the basis for approving or denying loans;
(D) any limits on the types of loans permitted;
(E) the procedure for determining a "reasonable" interest rate;
(F) acceptable collateral;
(G) default conditions; and
(H) steps which will be taken to preserve Plan assets in the event of
default."
7. Section 13.10 is deleted in its entirety and replaced with the following:
"INVESTMENT OF CONTRIBUTIONS. Subject to the terms set forth herein, each
Participant and/or Beneficiary shall have the exclusive authority to
direct the investment of contributions made to his Participant's Account.
In accordance with the procedures established by the Plan Administrator,
the Participant and/or Beneficiary shall elect to have a specified
percentage invested in one or more investment funds, as long as the
designated percentage for each fund is a whole number, and the sum of the
percentages allocated is equal to 100%. In addition, the Participant
and/or Beneficiary may change such election from time to time pursuant to
the procedures established by the Plan Administrator and subject to rules
established by the Employer with respect to transactions by persons
subject to Section 16 of the Securities Exchange Act of 1934 as amended.
All investment changes are subject to the rules of the investment fund(s)
in which the Participant's Account is or is to be invested."
8. Section 13.12 is deleted in its entirety and replaced with the following:
"TRANSFERS BETWEEN INVESTMENT FUNDS. A Participant and/or Beneficiary may
designate amounts invested pursuant to Section 13.10 to be transferred
between the investment funds from time to time pursuant to the procedures
established by the Plan Administrator; provided that no amounts may be
transferred into the Participant's Employer Stock Account.
Notwithstanding the above, the transfer of amounts between investment
funds shall be subject to the rules of the investment funds in which the
Participant's Account is invested or is to be invested and shall also be
subject to rules established by the Employer with respect to transactions
by Participants and/or Beneficiaries subject to Section 16 of the
Securities Exchange Act of 1934, as amended."
<PAGE>
IN WITNESS WHEREOF, the Employer, the Administrator and the Trustee(s) have
hereunto affixed their signatures.
<TABLE>
<S> <C>
Executed at _______________________ on ____________________________________________
CANDLE CORPORATION OF AMERICA
___________________________________ By ____________________________________________
Witness
Title _________________________________________
Executed at _______________________ on ____________________________________________
PARTYLITE GIFTS, INC.
___________________________________ By ____________________________________________
Witness
Title _________________________________________
Executed at _______________________ on ____________________________________________
AROMATIC INDUSTRIES, INC.
___________________________________ By ____________________________________________
Witness
Title _________________________________________
Executed at _______________________ on ____________________________________________
CANDLE CORPORATION OF AMERICA HONG KONG, LTD.
___________________________________ By ____________________________________________
Witness
Title __________________________________________
<PAGE>
Accepted this _______ day of ___________________, ________.
__________________________________ By ____________________________________________
Witness Administrator
Accepted this _______ day of ___________________, ________.
__________________________________ By ____________________________________________
Witness Trustee
__________________________________ By ____________________________________________
Witness Trustee
</TABLE>
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
AMENDMENT TO
BLYTH INDUSTRIES, INC. PROFIT SHARING RETIREMENT PLAN AND TRUST
WHEREAS, Candle Corporation of America, Partylite Gifts, Inc., and Aromatic
Industries, Inc. (hereinafter collectively referred to as the "Employer")
established the Blyth Industries, Inc. Profit Sharing Retirement Plan and Trust
(hereinafter referred to as the "Plan") effective April 30, 1980 for the benefit
of its eligible Employees and their Beneficiaries; and
WHEREAS, the Employer reserved the right to amend the Plan under the terms
thereof; and
WHEREAS, the Employer desires to delete the waiver of participation option under
the Plan;
NOW THEREFORE, the Plan is hereby amended effective January 1, 1996 as follows:
1. Section 3.5 of the Plan is hereby deleted in its entirety.
IN WITNESS WHEREOF, the Employer and the Administrator have hereunto affixed
their signatures.
<TABLE>
<S> <C>
Executed at _______________________ on ____________________________________________
CANDLE CORPORATION OF AMERICA
___________________________________ By ____________________________________________
Witness
Title _________________________________________
Executed at _______________________ on ____________________________________________
PARTYLITE GIFTS, INC.
___________________________________ By ____________________________________________
Witness
Title _________________________________________
<PAGE>
Executed at _______________________ on ____________________________________________
AROMATIC INDUSTRIES, INC.
___________________________________ By ____________________________________________
Witness
Title _________________________________________
Accepted this _______ day of ___________________, ________.
__________________________________ By ____________________________________________
Witness Administrator
</TABLE>
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
AMENDMENT TO
BLYTH INDUSTRIES, INC. PROFIT SHARING RETIREMENT PLAN AND TRUST
WHEREAS, Candle Corporation of America, Partylite Gifts, Inc., Aromatic
Industries, Inc. and Candle Corporation of America Hong Kong, Ltd. (hereinafter
collectively referred to as the "Employer") established the Blyth Industries,
Inc. Profit Sharing Retirement Plan and Trust (hereinafter referred to as the
"Plan") effective April 30, 1980 for the benefit of its eligible Employees and
their Beneficiaries; and
WHEREAS, the Employer reserved the right to amend the Plan under the terms
thereof; and
WHEREAS, the Employer desires to change the Plan's definition of Compensation to
include only Compensation for the period of time that an Employee was eligible
to participate in the Plan;
NOW THEREFORE, the Plan is hereby amended effective January 1, 1997 as follows:
1. Section 1.15 (B) of the Plan is hereby deleted in its entirety and
replaced with the following:
"(B) Compensation shall include only that Compensation which is actually paid
to the Participant during the determination period. Except as provided
elsewhere in the Plan, the determination period shall be the Plan Year.
However, for the Plan Year in which an Employee begins participation in
the Plan and the Plan Year in which an Employee ends participation in the
Plan, the determination period is the portion of the Plan Year during
which the Employee is a Participant in the Plan. "
IN WITNESS WHEREOF, the Employer and the Administrator have hereunto affixed
their signatures.
<TABLE>
<S> <C>
Executed at _______________________ on ____________________________________________
CANDLE CORPORATION OF AMERICA
___________________________________ By ____________________________________________
Witness
Title _________________________________________
<PAGE>
Executed at _______________________ on ____________________________________________
PARTYLITE GIFTS, INC.
___________________________________ By ____________________________________________
Witness
Title _________________________________________
Executed at _______________________ on ____________________________________________
AROMATIC INDUSTRIES, INC.
___________________________________ By ____________________________________________
Witness
Title _________________________________________
Executed at _______________________ on ____________________________________________
CANDLE CORPORATION OF AMERICA HONG KONG, LTD.
___________________________________ By ____________________________________________
Witness
Title _________________________________________
Accepted this _______ day of ___________________, ________.
__________________________________ By ____________________________________________
Witness Administrator
</TABLE>
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
AMENDMENT TO
BLYTH INDUSTRIES, INC. PROFIT SHARING RETIREMENT PLAN AND TRUST
WHEREAS, Blyth Industries, Inc. (hereinafter referred to as the "Employer")
established the Blyth Industries, Inc. Profit Sharing Retirement Plan and Trust
(hereinafter referred to as the "Plan") effective April 30, 1980 for the benefit
of its eligible Employees and their Beneficiaries; and
WHEREAS, the Employer reserved the right to amend the Plan under the terms
thereof; and
WHEREAS, the Employer desires to change Vesting to a more liberal schedule and
to remove the Top Heavy Vesting Schedule, as it is no longer needed;
NOW THEREFORE, the Plan is hereby amended and restated in its entirety effective
February 1, 1997 as follows:
1. Section 1.67 of the Plan is hereby deleted in its entirety and replaced
with the following:
"1.67 VESTING PERCENTAGE. The term Vesting Percentage means the percentage used
to determine a Participant's Vested Interest in contributions made by the
Employer, plus the earnings thereon, credited to his Participant's
Account that are not 100% immediately vested. The Vesting Percentage for
each Participant shall be determined in accordance with the following
schedule based on Years of Service with the Employer:
<TABLE>
<CAPTION>
YEARS OF SERVICE VESTING PERCENTAGE
---------------- ------------------
<S> <C>
Less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 but less than 6 80%
6 or more 100%
</TABLE>
However, if an Active Participant dies or becomes disabled prior to
attaining his Normal Retirement Age, his Vesting Percentage shall be
100%."
2. Section 16A.4(C) is hereby deleted in its entirety.
IN WITNESS WHEREOF, the Employer, the Administrator and the Trustee have
hereunto affixed their signatures.
<TABLE>
<S> <C>
Executed at _______________________ on ____________________________________________
<PAGE>
CANDLE CORPORATION OF AMERICA
___________________________________ By ____________________________________________
Witness
Title _________________________________________
Executed at _______________________ on ____________________________________________
PARTYLITE GIFTS, INC.
___________________________________ By ____________________________________________
Witness
Title _________________________________________
Executed at _______________________ on ____________________________________________
AROMATIC INDUSTRIES, INC.
___________________________________ By ____________________________________________
Witness
Title _________________________________________
Accepted this _______ day of ___________________, ________.
__________________________________ By ____________________________________________
Witness Administrator
Accepted this _______ day of ___________________, ________.
__________________________________ By ____________________________________________
Witness Trustee
<PAGE>
__________________________________ By ____________________________________________
Witness Trustee
__________________________________ By ____________________________________________
Witness Trustee
</TABLE>
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
MERGER AMENDMENT TO
NEW IDEAS INTERNATIONAL, INC. 401(K) AND PROFIT SHARING PLAN
WHEREAS, Candle Corporation of America, Partylite Gifts, Inc., Aromatic
Industries, Inc. and Candle Corporation of America Hong Kong, Ltd. (hereinafter
collectively referred to as the "Employer") established the Blyth Industries,
Inc. Profit Sharing Retirement Plan and Trust (hereinafter referred to as the
"Plan") effective April 30, 1980 for the benefit of its eligible Employees and
their Beneficiaries; and
WHEREAS, New Ideas International, Inc. and Jeanmarie Creations, Inc.
(hereinafter referred to as the "Prior Employers") established respectively the
New Ideas International, Inc. 401(k) and Profit Sharing Plan and the Jeanmarie
Creations, Inc. Savings Plan (hereinafter referred to as the "Prior Plans")
effective January 1, 1992 and February 1, 1993, respectively, for the benefit of
its eligible Employees and their Beneficiaries; and
WHEREAS, the Prior Employers reserved the right to amend the Prior Plans under
the terms thereof; and
WHEREAS, the Prior Employers now desires to merge the Prior Plans into the Plan;
NOW THEREFORE, effective January 1, 1998 (hereinafter referred to as the "Merger
Date"), the Prior Plans are amended follows:
1. The terms of the Prior Plans shall no longer apply with respect to
Participants under the terms of the Prior Plans who have not yet
terminated employment (including terminations on account of retirement,
death or disability) and the terms of the Prior Plans with respect to
such Participants shall henceforth be as set forth in the Plan.
2. The Plan shall represent a continuation of the Prior Plans and shall not
abridge or curtail any rights or privileges accorded to Participants
under the Prior Plans.
3. In connection with the merger, all liabilities with respect to the Prior
Plans, and together with all assets of the Prior Plans shall be
transferred to and made a part of the Plan.
4. Notwithstanding any provision of the Plan to the contrary, a Participant
who was a Participant in one of the Prior Plans immediately prior to the
Merger Date shall have a Vested Interest in his Participant's account
under the Plan on or after the Merger Date of not less than his Vested
Interest in his account under the Prior Plan on the day immediately
preceding the Merger Date. Any Participant of one of the Prior Plans
having not less than three Years of Service shall be permitted to elect,
in writing, to have his Vesting Percentage computed under the Plan
without regard to this merger amendment.
In addition, notwithstanding any other provision of the Plan to the
contrary, the forms of payment and other Prior Plans' provisions that
were available under the Prior Plans immediately prior to the Merger Date
which may not be eliminated under Section 411(d)(6) of the Code shall
continue to be available to Participants who had an account under one of
the Prior Plans on the day immediately preceding the Merger Date with
respect to that portion of the Participant's account that is attributable
to his service prior to the Merger Date.
5. New Ideas International, Inc. does hereby adopt the Plan and agree to be
bound by all of its terms, conditions and amendments.
<PAGE>
IN WITNESS WHEREOF, the Employer, New Ideas International, Inc., the
Administrator and the Trustee(s) have hereunto affixed their signatures.
<TABLE>
<S> <C>
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
PARTYLITE GIFTS, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
AROMATIC INDUSTRIES, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA HONG KONG, LTD.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
<PAGE>
NEW IDEAS INTERNATIONAL,INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Administrator
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
</TABLE>
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
MERGER AMENDMENT TO
JEANMARIE CREATIONS, INC. SAVINGS PLAN
WHEREAS, Candle Corporation of America, Partylite Gifts, Inc., Aromatic
Industries, Inc. and Candle Corporation of America Hong Kong, Ltd. (hereinafter
collectively referred to as the "Employer") established the Blyth Industries,
Inc. Profit Sharing Retirement Plan and Trust (hereinafter referred to as the
"Plan") effective April 30, 1980 for the benefit of its eligible Employees and
their Beneficiaries; and
WHEREAS, New Ideas International, Inc. and Jeanmarie Creations, Inc.
(hereinafter referred to as the "Prior Employers") established respectively the
New Ideas International, Inc. 401(k) and Profit Sharing Plan and the Jeanmarie
Creations, Inc. Savings Plan (hereinafter referred to as the "Prior Plans")
effective January 1, 1992 and February 1, 1993, respectively, for the benefit of
its eligible Employees and their Beneficiaries; and
WHEREAS, the Prior Employers reserved the right to amend the Prior Plans under
the terms thereof; and
WHEREAS, the Prior Employers now desires to merge the Prior Plans into the Plan;
NOW THEREFORE, effective January 1, 1998 (hereinafter referred to as the "Merger
Date"), the Prior Plans are amended follows:
1. The terms of the Prior Plans shall no longer apply with respect to
Participants under the terms of the Prior Plans who have not yet
terminated employment (including terminations on account of retirement,
death or disability) and the terms of the Prior Plans with respect to
such Participants shall henceforth be as set forth in the Plan.
2. The Plan shall represent a continuation of the Prior Plans and shall not
abridge or curtail any rights or privileges accorded to Participants
under the Prior Plans.
3. In connection with the merger, all liabilities with respect to the Prior
Plans, and together with all assets of the Prior Plans shall be
transferred to and made a part of the Plan.
4. Notwithstanding any provision of the Plan to the contrary, a Participant
who was a Participant in one of the Prior Plans immediately prior to the
Merger Date shall have a Vested Interest in his Participant's account
under the Plan on or after the Merger Date of not less than his Vested
Interest in his account under the Prior Plan on the day immediately
preceding the Merger Date. Any Participant of one of the Prior Plans
having not less than three Years of Service shall be permitted to elect,
in writing, to have his Vesting Percentage computed under the Plan
without regard to this merger amendment.
In addition, notwithstanding any other provision of the Plan to the
contrary, the forms of payment and other Prior Plans' provisions that
were available under the Prior Plans immediately prior to the Merger Date
which may not be eliminated under Section 411(d)(6) of the Code shall
continue to be available to Participants who had an account under one of
the Prior Plans on the day immediately preceding the Merger Date with
respect to that portion of the Participant's account that is attributable
to his service prior to the Merger Date.
5. Jeanmarie Creations, Inc. does hereby adopt the Plan and agree to be
bound by all of its terms, conditions and amendments.
<PAGE>
IN WITNESS WHEREOF, the Employer, Jeanmarie Creations, Inc., the Administrator
and the Trustee(s) have hereunto affixed their signatures.
<TABLE>
<S> <C>
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
PARTYLITE GIFTS, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
AROMATIC INDUSTRIES, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA HONG KONG, LTD.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
<PAGE>
JEANMARIE CREATIONS,INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Administrator
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
</TABLE>
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
MERGER AMENDMENT TO
BLYTH INDUSTRIES, INC. PROFIT SHARING RETIREMENT PLAN AND TRUST
WHEREAS, Candle Corporation of America, Partylite Gifts, Inc., Aromatic
Industries, Inc. and Candle Corporation of America Hong Kong, Ltd. (hereinafter
collectively referred to as the "Employer") established the Blyth Industries,
Inc. Profit Sharing Retirement Plan and Trust (hereinafter referred to as the
"Plan") effective April 30, 1980 for the benefit of its eligible Employees and
their Beneficiaries; and
WHEREAS, New Ideas International, Inc. and Jeanmarie Creations, Inc.
(hereinafter referred to as the "Prior Employers") established respectively the
New Ideas International, Inc. 401(k) and Profit Sharing Plan and the Jeanmarie
Creations, Inc. Savings Plan (hereinafter referred to as the "Prior Plans")
effective January 1, 1992 and February 1, 1993, respectively, for the benefit of
its eligible Employees and their Beneficiaries; and
WHEREAS, the Employer reserved the right to amend the Plan under the terms
thereof; and
WHEREAS, the Employer now desires to merge the Prior Plans into the Plan; and
NOW THEREFORE, effective January 1, 1998 (hereinafter referred to as the "Merger
Date"), the Plan is amended follows:
1. The terms of the Prior Plans shall no longer apply with respect to
Participants under the terms of the Prior Plans who have not yet
terminated employment (including terminations on account of retirement,
death or disability) and the terms of the Prior Plans with respect to
such Participants shall henceforth be as set forth in the Plan.
2. The Plan shall represent a continuation of the Prior Plans and shall not
abridge or curtail any rights or privileges accorded to Participants
under the Prior Plans.
3. In connection with the merger, all liabilities with respect to the Prior
Plans, and together with all assets of the Prior Plans shall be
transferred to and made a part of the Plan.
4. Notwithstanding any provision of the Plan to the contrary, a Participant
who was a Participant in one of the Prior Plans immediately prior to the
Merger Date shall have a Vested Interest in his Participant's account
under the Plan on or after the Merger Date of not less than his Vested
Interest in his account under the Prior Plan on the day immediately
preceding the Merger Date. Any Participant of one of the Prior Plans
having not less than three Years of Service shall be permitted to elect,
in writing, to have his Vesting Percentage computed under the Plan
without regard to this merger amendment.
In addition, notwithstanding any other provision of the Plan to the
contrary, the forms of payment and other Prior Plans' provisions that
were available under the Prior Plans immediately prior to the Merger Date
which may not be eliminated under Section 411(d)(6) of the Code shall
continue to be available to Participants who had an account under one of
the Prior Plans on the day immediately preceding the Merger Date with
respect to that portion of the Participant's account that is attributable
to his service prior to the Merger Date.
5. The Employer does hereby elect to continue the Prior Plans.
6. Section 1.26 of the Plan is deleted in its entirety and is replaced with
the following:
<PAGE>
EMPLOYER. The term Employer means Candle Corporation of America,
Partylite Gifts, Inc., Aromatic Industries, Inc., Candle Corporation of
America Hong Kong, Ltd., New Ideas International, Inc., Jeanmarie
Creations, Inc. and any successor organization to such Employer which
elects to continue the Plan. In the case of a group of employers which
constitutes a controlled group of corporations (as defined in Code
section 414(b)), or which constitutes trades or businesses (whether or
not incorporated) which are under common control (as defined in Code
section 414(c)), or which constitutes an affiliated service group (as
defined in Code section 414(m)), all such employers shall be considered a
single employer for purposes of participation, vesting, Top-Heavy
provisions and determination of Highly Compensated Employees.
7. Section 2.8 of the Plan is amended by the addition of the following:
Service with a predecessor organization of the Employer shall be treated
as Service with the Employer provided the prior Service is with either a
company acquired by a member of the Employer's controlled group or a
company from which assets are purchased by the employer; and, provided
that the Employee was employed by the selling company at the time of the
acquisition of stock or assets by the Employer and that the Employee is
hired by the Employer.
8. Section 6.2 is deleted in its entirety and is replaced with the
following:
TIMING OF DISTRIBUTIONS. If the value of a Participant's Vested Interest
exceeds (or at the time of any prior distribution exceeded) $5,000 and is
immediately distributable (as defined in Section 8.5), the Participant
and his Spouse, if required, must consent to the distribution before it
is made.
Instead of consenting to a distribution, the Participant may make a
written election to defer the distribution for a specified period of time
ending no later than the Participant's Normal Retirement Age. Such
election to defer shall be irrevocable.
If the Participant and Spouse, if applicable, do not consent to a
distribution or if no election to defer is made within 90 days after
receiving a written explanation of the optional forms of benefit
available pursuant to Income Tax Regulation 1.411(a)(11), all benefits
shall be deferred to, and distribution shall be made as of the
Participant's Normal Retirement Age. The distribution will be made in the
form of a single sum cash payment (in the case of a Participant's meeting
the requirements of Section 8.1 (A)) or in accordance with Section 8.2
(in the case of a Participant's not meeting the requirements of Section
8.1 (A)), unless the Participant elects another form of benefit within
the 90-day period prior to the date the distribution is made.
A Participant whose actual retirement date is on or after his Normal
Retirement Age may not elect to defer distribution of his benefit beyond
the date of his actual retirement.
If the value of a Participant's Vested Interest is $5,000 or less at the
time it becomes payable, the distribution shall be made in the form of a
single sum cash payment and shall be made upon such Participant's
Termination of Employment. Such a distribution may not be deferred.
Unless the Participant elects otherwise, the payment of benefits under
this Plan to the Participant shall begin not later than the 60th day
after the close of the Plan Year in which the later of (A) or (B), below,
occurs:
(A) the date on which the Participant attains his Normal Retirement
Age or age 62, if later; or
(B) the date on which the Participant terminates his Service
(including Termination of Employment, death or Disability) with
the Employer.
<PAGE>
Notwithstanding the foregoing, the failure of a Participant and Spouse,
if required, to consent to a distribution while a benefit is immediately
distributable shall be deemed to be an election to defer commencement of
payment of any benefit sufficient to satisfy the above paragraph.
9. Section 6.7 is deleted in its entirety and is replaced with the
following:
DEATH DISTRIBUTION PROVISIONS. If the Participant dies before
distribution of his Vested Interest commences, the following provisions
shall apply:
(A) If a distribution is to be made to a Beneficiary other than the
Surviving Spouse:
(1) If the present value of the Participant's Vested Interest
exceeds (or at the time of any prior distribution exceeded)
$5,000, unless the Beneficiary elects another form of
distribution, that portion of the Participant's Vested
Interest payable to the Beneficiary will be distributed in
the form of a single sum cash payment within a reasonable
period of time after the Plan Administrator is notified of
the Participant's death.
(2) If the present value of the Participant's Vested Interest
is $5,000 or less at the time it becomes payable, the
distribution shall always be made in the form of a single
sum cash payment and shall be paid within a reasonable
period of time after the Plan Administrator is notified of
the Participant's death.
(B) If the distribution is to be made to a Beneficiary who is the
Surviving Spouse, such distribution will be made in accordance
with the following:
(1) If the Participant had never elected a life Annuity form of
distribution under the Plan:
(a) If the present value of the Participant's Vested
Interest exceeds (or at the time of any prior
distribution exceeded) $5,000, unless the surviving
spouse elects another form of distribution, that
portion of the Participant's Vested Interest payable
to the Surviving Spouse will be distributed in the
form of a single sum cash payment within a
reasonable period of time after the Plan
Administrator is notified of the Participant's
death.
(b) If the present value of the Participant's Vested
Interest payable to the Surviving Spouse is $5,000
or less at the time it becomes payable, the
distribution shall always be made in the form of a
single sum cash payment and shall be made within a
reasonable period of time after the Plan
Administrator is notified of the Participant's
death.
(2) If the Participant had previously elected a life Annuity
form of distribution under the Plan:
(a) If the present value of the Participant's Vested
Interest exceeds (or at the time of any prior
distribution exceeded) $5,000 and is immediately
distributable (as defined in Section 8.5), the
Surviving Spouse must consent to the distribution
before it is made. If the Surviving Spouse does not
consent to a distribution, all benefits shall be
deferred to a date that complies with the terms of
Section 6.8 (B).
The distribution shall be made in accordance with
the provisions of Section 8.3.
<PAGE>
(b) If the present value of the Participant's Vested
Interest is $5,000 or less at the time it becomes
payable, the distribution shall always be made in
the form of a single sum cash payment and shall be
paid within a reasonable period of time after the
Plan Administrator is notified of the Participant's
death.
IN WITNESS WHEREOF, the Employer, the Administrator and the Trustee(s) have
hereunto affixed their signatures.
<TABLE>
<S> <C>
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
PARTYLITE GIFTS, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
AROMATIC INDUSTRIES, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
<PAGE>
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA HONG KONG, LTD.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
NEW IDEAS INTERNATIONAL, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
JEANMARIE CREATIONS,INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Administrator
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
<PAGE>
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
</TABLE>
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
MERGER AMENDMENT TO
NEW IDEAS INTERNATIONAL, INC. 401(K) AND PROFIT SHARING PLAN
WHEREAS, Candle Corporation of America, Partylite Gifts, Inc., Aromatic
Industries, Inc. and Candle Corporation of America Hong Kong, Ltd. (hereinafter
collectively referred to as the "Employer") maintain the Blyth Industries, Inc.
Profit Sharing Retirement Plan and Trust (hereinafter referred to as the "Plan")
for the benefit of its eligible Employees and their Beneficiaries; and
WHEREAS, New Ideas International, Inc. and Jeanmarie Creations, Inc.
(hereinafter referred to as the "Prior Employers") established respectively the
New Ideas International, Inc. 401(k) and Profit Sharing Plan and the Jeanmarie
Creations, Inc. Savings Plan (hereinafter referred to as the "Prior Plans")
effective January 1, 1992 and February 1, 1993, respectively, for the benefit of
eligible Employees and their Beneficiaries; and
WHEREAS, the Prior Employers reserved the right to amend the Prior Plans under
the terms thereof; and
WHEREAS, the Plan is being amended simultaneously herewith to permit the merger
of the Prior Plans into it and the Prior Employers now desire to merge the Prior
Plans into the Plan;
NOW THEREFORE, effective January 1, 1998 (hereinafter referred to as the "Merger
Date"), the Prior Plans are amended follows:
1. The terms of the Prior Plans shall no longer apply with respect to
Participants under the terms of the Prior Plans who have not yet
terminated employment (including terminations on account of retirement,
death or disability) and the terms of the Prior Plans with respect to
such Participants shall henceforth be as set forth in the Plan.
2. (A) The Plan shall represent a continuation of the Prior Plans and
shall not abridge or curtail any rights or privileges accorded to
Participants under the Prior Plans.
(B) Each Employee of the Prior Employers who was a Participant in the
respective Prior Plan on December 31, 1997 shall automatically
become a Participant in the Plan on January 1, 1998. Each Employee
of the Prior Employers who would have become a Participant in a
Prior Plan but for the merger shall become a Participant in the
Plan when he satisfies the eligibility requirements of the Plan.
(C) The Service under the Plan of Employees described in (B) above
shall be determined in accordance with the provisions of the Plan;
provided, however, each such Participant's Service under the Plan
attributable to employment prior to January 1, 1998 shall be his
Service as determined in accordance with the provisions of the
Prior Plan as in effect on December 31, 1997.
3. In connection with the merger, all liabilities with respect to the Prior
Plans, and together with all assets of the Prior Plans shall be
transferred to and made a part of the Plan.
4. Notwithstanding any provision of the Plan to the contrary, a Participant
who was a Participant in one of the Prior Plans immediately prior to the
Merger Date shall have a Vested Interest in his Participant's account
under the Plan on or after the Merger Date of not less than his Vested
Interest in his account under the Prior Plan on the day immediately
preceding the Merger Date. Any Participant of one of the Prior Plans
having not less than three Years of Service shall be permitted to elect,
in writing, to have his Vesting Percentage computed under the Plan
without regard to this merger amendment.
<PAGE>
In addition, notwithstanding any other provision of the Plan to the
contrary, the forms of payment and other Prior Plans' provisions that
were available under the Prior Plans immediately prior to the Merger Date
which may not be eliminated under Section 411(d)(6) of the Code shall
continue to be available to Participants who had an account under one of
the Prior Plans on the day immediately preceding the Merger Date with
respect to that portion of the Participant's account that is attributable
to his service prior to the Merger Date.
5. (A) New Ideas International, Inc. does hereby adopt the Plan and agree
to be bound by all of its terms, conditions and amendments.
(B) All provisions of the Plan shall apply to Employees covered under
the Prior Plans and other persons entitled to benefits under the
Prior Plan immediately prior to its merger into the Plan to the
extent such provisions are not inconsistent with the provisions of
this amendment. Unless the context of the Plan or this amendment
clearly implies or indicates to the contrary, a word, term or
phrase used or defined in the Plan is similarly used or defined in
this amendment.
IN WITNESS WHEREOF, the Employer, New Ideas International, Inc., the
Administrator and the Trustee(s) have hereunto affixed their signatures.
<TABLE>
<S> <C>
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
PARTYLITE GIFTS, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
<PAGE>
Executed at _______________________ on _________________________________________
AROMATIC INDUSTRIES, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA HONG KONG, LTD.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
NEW IDEAS INTERNATIONAL,INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Administrator
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
<PAGE>
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
</TABLE>
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
MERGER AMENDMENT TO
JEANMARIE CREATIONS, INC. SAVINGS PLAN
WHEREAS, Candle Corporation of America, Partylite Gifts, Inc., Aromatic
Industries, Inc. and Candle Corporation of America Hong Kong, Ltd. (hereinafter
collectively referred to as the "Employer") maintain the Blyth Industries, Inc.
Profit Sharing Retirement Plan and Trust (hereinafter referred to as the "Plan")
for the benefit of its eligible Employees and their Beneficiaries; and
WHEREAS, New Ideas International, Inc. and Jeanmarie Creations, Inc.
(hereinafter referred to as the "Prior Employers") established respectively the
New Ideas International, Inc. 401(k) and Profit Sharing Plan and the Jeanmarie
Creations, Inc. Savings Plan (hereinafter referred to as the "Prior Plans")
effective January 1, 1992 and February 1, 1993, respectively, for the benefit of
eligible Employees and their Beneficiaries; and
WHEREAS, the Prior Employers reserved the right to amend the Prior Plans under
the terms thereof; and
WHEREAS, the Plan is being amended simultaneously herewith to permit the merger
of the Prior Plans into it and the Prior Employers now desire to merge the Prior
Plans into the Plan;
NOW THEREFORE, effective January 1, 1998 (hereinafter referred to as the "Merger
Date"), the Prior Plans are amended follows:
1. The terms of the Prior Plans shall no longer apply with respect to
Participants under the terms of the Prior Plans who have not yet
terminated employment (including terminations on account of retirement,
death or disability) and the terms of the Prior Plans with respect to
such Participants shall henceforth be as set forth in the Plan.
2. (A) The Plan shall represent a continuation of the Prior Plans and
shall not abridge or curtail any rights or privileges accorded to
Participants under the Prior Plans.
(B) Each Employee of the Prior Employers who was a Participant in the
respective Prior Plan on December 31, 1997 shall automatically
become a Participant in the Plan on January 1, 1998. Each Employee
of the Prior Employers who would have become a Participant in a
Prior Plan but for the merger shall become a Participant in the
Plan when he satisfies the eligibility requirements of the Plan.
(C) The Service under the Plan of Employees described in (B) above
shall be determined in accordance with the provisions of the Plan;
provided, however, each such Participant's Service under the Plan
attributable to employment prior to January 1, 1998 shall be his
Service as determined in accordance with the provisions of the
Prior Plan as in effect on December 31, 1997.
3. In connection with the merger, all liabilities with respect to the Prior
Plans, and together with all assets of the Prior Plans shall be
transferred to and made a part of the Plan.
4. Notwithstanding any provision of the Plan to the contrary, a Participant
who was a Participant in one of the Prior Plans immediately prior to the
Merger Date shall have a Vested Interest in his Participant's account
under the Plan on or after the Merger Date of not less than his Vested
Interest in his account under the Prior Plan on the day immediately
preceding the Merger Date. Any Participant of one of the Prior Plans
having not less than three Years of Service shall be permitted to elect,
in writing, to have his Vesting Percentage computed under the Plan
without regard to this merger amendment.
<PAGE>
In addition, notwithstanding any other provision of the Plan to the
contrary, the forms of payment and other Prior Plans' provisions that
were available under the Prior Plans immediately prior to the Merger Date
which may not be eliminated under Section 411(d)(6) of the Code shall
continue to be available to Participants who had an account under one of
the Prior Plans on the day immediately preceding the Merger Date with
respect to that portion of the Participant's account that is attributable
to his service prior to the Merger Date.
5. (A) Jeanmarie Creations, Inc. does hereby adopt the Plan and agree to
be bound by all of its terms, conditions and amendments.
(B) All provisions of the Plan shall apply to Employees covered under
the Prior Plans and other persons entitled to benefits under the
Prior Plan immediately prior to its merger into the Plan to the
extent such provisions are not inconsistent with the provisions of
this amendment. Unless the context of the Plan or this amendment
clearly implies or indicates to the contrary, a word, term or
phrase used or defined in the Plan is similarly used or defined in
this amendment.
IN WITNESS WHEREOF, the Employer, Jeanmarie Creations, Inc., the Administrator
and the Trustee(s) have hereunto affixed their signatures.
<TABLE>
<S> <C>
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
PARTYLITE GIFTS, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
<PAGE>
Executed at _______________________ on _________________________________________
AROMATIC INDUSTRIES, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA HONG KONG, LTD.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
JEANMARIE CREATIONS,INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Administrator
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
<PAGE>
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
</TABLE>
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
MERGER AMENDMENT TO
BLYTH INDUSTRIES, INC. PROFIT SHARING RETIREMENT PLAN AND TRUST
WHEREAS, Candle Corporation of America, Partylite Gifts, Inc., Aromatic
Industries, Inc. and Candle Corporation of America Hong Kong, Ltd. (hereinafter
collectively referred to as the "Employer") maintain the Blyth Industries, Inc.
Profit Sharing Retirement Plan and Trust (hereinafter referred to as the "Plan")
for the benefit of its eligible Employees and their Beneficiaries; and
WHEREAS, New Ideas International, Inc. and Jeanmarie Creations, Inc.
(hereinafter referred to as the "Prior Employers") established respectively the
New Ideas International, Inc. 401(k) and Profit Sharing Plan and the Jeanmarie
Creations, Inc. Savings Plan (hereinafter referred to as the "Prior Plans")
effective January 1, 1992 and February 1, 1993, respectively, for the benefit of
eligible Employees and their Beneficiaries; and
WHEREAS, the Employer reserved the right to amend the Plan under the terms
thereof; and
WHEREAS, the Employer now desires to merge the Prior Plans into the Plan; and
NOW THEREFORE, effective January 1, 1998 (hereinafter referred to as the "Merger
Date"), the Plan is amended follows:
1. The terms of the Prior Plans shall no longer apply with respect to
Participants under the terms of the Prior Plans who have not yet
terminated employment (including terminations on account of retirement,
death or disability) and the terms of the Prior Plans with respect to
such Participants shall henceforth be as set forth in the Plan.
2. (A) The Plan shall represent a continuation of the Prior Plans and
shall not abridge or curtail any rights or privileges accorded to
Participants under the Prior Plans.
(B) Each Employee of the Prior Employers who was a Participant in the
respective Prior Plan on December 31, 1997 shall automatically
become a Participant in the Plan on January 1, 1998. Each Employee
of the Prior Employers who would have become a Participant in a
Prior Plan but for the merger shall become a Participant in the
Plan when he satisfies the eligibility requirements of the Plan.
(C) The Service under the Plan of Employees described in (B) above
shall be determined in accordance with the provisions of the Plan;
provided, however, each such Participant's Service under the Plan
attributable to employment prior to January 1, 1998 shall be his
Service as determined in accordance with the provisions of the
Prior Plan as in effect on December 31, 1997.
3. In connection with the merger, all liabilities with respect to the Prior
Plans, and together with all assets of the Prior Plans shall be
transferred to and made a part of the Plan.
4. Notwithstanding any provision of the Plan to the contrary, a Participant
who was a Participant in one of the Prior Plans immediately prior to the
Merger Date shall have a Vested Interest in his Participant's account
under the Plan on or after the Merger Date of not less than his Vested
Interest in his account under the Prior Plan on the day immediately
preceding the Merger Date. Any Participant of one of the Prior Plans
having not less than three Years of Service shall be permitted to elect,
in writing, to have his Vesting Percentage computed under the Plan
without regard to this merger amendment.
<PAGE>
In addition, notwithstanding any other provision of the Plan to the
contrary, the forms of payment and other Prior Plans' provisions that
were available under the Prior Plans immediately prior to the Merger Date
which may not be eliminated under Section 411(d)(6) of the Code shall
continue to be available to Participants who had an account under one of
the Prior Plans on the day immediately preceding the Merger Date with
respect to that portion of the Participant's account that is attributable
to his service prior to the Merger Date.
5. (A) The Employer does hereby elect to continue the Prior Plans.
(B) All provisions of the Plan shall apply to Employees covered under
the Prior Plans and other persons entitled to benefits under the
Prior Plan immediately prior to its merger into the Plan to the
extent such provisions are not inconsistent with the provisions of
this amendment. Unless the context of the Plan or this amendment
clearly implies or indicates to the contrary, a word, term or
phrase used or defined in the Plan is similarly used or defined in
this amendment.
<PAGE>
6. Section 1.26 of the Plan is deleted in its entirety and is replaced with
the following:
EMPLOYER. The term Employer means Candle Corporation of America,
Partylite Gifts, Inc., Aromatic Industries, Inc., Candle Corporation of
America Hong Kong, Ltd., New Ideas International, Inc., Jeanmarie
Creations, Inc. and any successor organization to such Employer which
elects to continue the Plan. In the case of a group of employers which
constitutes a controlled group of corporations (as defined in Code
section 414(b)), or which constitutes trades or businesses (whether or
not incorporated) which are under common control (as defined in Code
section 414(c)), or which constitutes an affiliated service group (as
defined in Code section 414(m)), all such employers shall be considered a
single employer for purposes of participation, vesting, Top-Heavy
provisions and determination of Highly Compensated Employees.
7. Section 2.8 of the Plan is amended by the addition of the following:
Service with a predecessor organization of the Employer shall be treated
as Service with the Employer provided the prior Service is with either a
company acquired by a member of the Employer's controlled group or a
company from which assets are purchased by the employer; and, provided
that the Employee was employed by the selling company at the time of the
acquisition of stock or assets by the Employer and that the Employee is
hired by the Employer.
8. The first paragraph of Section 4.1 is deleted in its entirety and
replaced with the following:
ELECTIVE DEFERRAL CONTRIBUTIONS. Each Active Participant may enter into a
written Salary Deferral Agreement with the Employer in an amount equal to
not less than 1% nor more than 15% of his Compensation for the
Contribution Period. In consideration of such agreement, the Employer
will make a contribution for each Contribution Period on behalf of the
Participant in an amount equal to the total amount by which the
Participant's Compensation from the Employer was deferred during the
Contribution Period pursuant to the Salary Deferral Agreement then in
effect. Elective Deferral Contributions shall be paid by the Employer to
the Trust not less frequently than weekly, but in no event later than the
15th business day of the month following the month in which the amounts
would otherwise have been payable to the Participant in cash.
9. Section 6.2 is deleted in its entirety and is replaced with the
following:
TIMING OF DISTRIBUTIONS. If the value of a Participant's Vested Interest
exceeds (or at the time of any prior distribution exceeded) $5,000 and is
immediately distributable (as defined in Section 8.5), the Participant
and his Spouse, if required, must consent to the distribution before it
is made.
Instead of consenting to a distribution, the Participant may make a
written election to defer the distribution for a specified period of time
ending no later than the Participant's Normal Retirement Age. Such
election to defer shall be irrevocable.
If the Participant and Spouse, if applicable, do not consent to a
distribution or if no election to defer is made within 90 days after
receiving a written explanation of the optional forms of benefit
available pursuant to Income Tax Regulation 1.411(a)(11), all benefits
shall be deferred to, and distribution shall be made as of the
Participant's Normal Retirement Age. The distribution will be made in the
form of a single sum cash payment (in the case of a Participant's meeting
the requirements of Section 8.1 (A)) or in accordance with Section 8.2
(in the case of a Participant's not meeting the requirements of Section
8.1 (A)), unless the Participant elects another form of benefit within
the 90-day period prior to the date the distribution is made.
<PAGE>
A Participant whose actual retirement date is on or after his Normal
Retirement Age may not elect to defer distribution of his benefit beyond
the date of his actual retirement.
If the value of a Participant's Vested Interest is $5,000 or less at the
time it becomes payable, the distribution shall be made in the form of a
single sum cash payment and shall be made upon such Participant's
Termination of Employment. Such a distribution may not be deferred.
Unless the Participant elects otherwise, the payment of benefits under
this Plan to the Participant shall begin not later than the 60th day
after the close of the Plan Year in which the later of (A) or (B), below,
occurs:
(A) the date on which the Participant attains his Normal Retirement
Age or age 62, if later; or
(B) the date on which the Participant terminates his Service
(including Termination of Employment, death or Disability) with
the Employer.
Notwithstanding the foregoing, the failure of a Participant and Spouse,
if required, to consent to a distribution while a benefit is immediately
distributable shall be deemed to be an election to defer commencement of
payment of any benefit sufficient to satisfy the above paragraph.
10. Section 6.7 is deleted in its entirety and is replaced with the
following:
DEATH DISTRIBUTION PROVISIONS. If the Participant dies before
distribution of his Vested Interest commences, the following provisions
shall apply:
(A) If a distribution is to be made to a Beneficiary other than the
Surviving Spouse:
(1) If the present value of the Participant's Vested Interest
exceeds (or at the time of any prior distribution exceeded)
$5,000, unless the Beneficiary elects another form of
distribution, that portion of the Participant's Vested
Interest payable to the Beneficiary will be distributed in
the form of a single sum cash payment within a reasonable
period of time after the Plan Administrator is notified of
the Participant's death.
(2) If the present value of the Participant's Vested Interest
is $5,000 or less at the time it becomes payable, the
distribution shall always be made in the form of a single
sum cash payment and shall be paid within a reasonable
period of time after the Plan Administrator is notified of
the Participant's death.
(B) If the distribution is to be made to a Beneficiary who is the
Surviving Spouse, such distribution will be made in accordance
with the following:
(1) If the Participant had never elected a life Annuity form of
distribution under the Plan:
(a) If the present value of the Participant's Vested
Interest exceeds (or at the time of any prior
distribution exceeded) $5,000, unless the surviving
spouse elects another form of distribution, that
portion of the Participant's Vested Interest payable
to the Surviving Spouse will be distributed in the
form of a single sum cash payment within a
reasonable period of time after the Plan
Administrator is notified of the Participant's
death.
<PAGE>
(b) If the present value of the Participant's Vested
Interest payable to the Surviving Spouse is $5,000
or less at the time it becomes payable, the
distribution shall always be made in the form of a
single sum cash payment and shall be made within a
reasonable period of time after the Plan
Administrator is notified of the Participant's
death.
(2) If the Participant had previously elected a life Annuity
form of distribution under the Plan:
(a) If the present value of the Participant's Vested
Interest exceeds (or at the time of any prior
distribution exceeded) $5,000 and is immediately
distributable (as defined in Section 8.5), the
Surviving Spouse must consent to the distribution
before it is made. If the Surviving Spouse does not
consent to a distribution, all benefits shall be
deferred to a date that complies with the terms of
Section 6.8 (B).
The distribution shall be made in accordance with
the provisions of Section 8.3.
(b) If the present value of the Participant's Vested
Interest is $5,000 or less at the time it becomes
payable, the distribution shall always be made in
the form of a single sum cash payment and shall be
paid within a reasonable period of time after the
Plan Administrator is notified of the Participant's
death.
IN WITNESS WHEREOF, the Employer, the Administrator and the Trustee(s) have
hereunto affixed their signatures.
<TABLE>
<S> <C>
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA
___________________________________ By _________________________________________
Witness
Title_______________________________________
<PAGE>
Executed at _______________________ on _________________________________________
PARTYLITE GIFTS, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
AROMATIC INDUSTRIES, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
CANDLE CORPORATION OF AMERICA HONG KONG, LTD.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Executed at _______________________ on _________________________________________
NEW IDEAS INTERNATIONAL, INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
<PAGE>
Executed at _______________________ on _________________________________________
JEANMARIE CREATIONS,INC.
___________________________________ By _________________________________________
Witness
Title_______________________________________
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Administrator
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
Accepted this _______ day of ___________________, ________.
__________________________________ By _________________________________________
Witness Trustee
</TABLE>
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
<PAGE>
AMENDMENT TO
BLYTH INDUSTRIES, INC. PROFIT SHARING RETIREMENT PLAN AND TRUST
WHEREAS, Candle Corporation of America, Partylite Gifts, Inc., Aromatic
Industries, Inc. and Candle Corporation of America Hong Kong, Ltd. (hereinafter
collectively referred to as the "Employer") established the Blyth Industries,
Inc. Profit Sharing Retirement Plan and Trust (hereinafter referred to as the
"Plan") effective April 30, 1980 for the benefit of its eligible Employees and
their Beneficiaries; and
WHEREAS, the Employer reserved the right to amend the Plan under the terms
thereof; and
WHEREAS, the Employer desires to amend the Plan;
NOW THEREFORE, the Plan is hereby amended, effective July 1, 1998, as follows:
1. All references in Section 6.2 of the Plan to the irrevocability of an
election to defer distribution shall be null and void.
2. All references in Section 6.2 of the Plan to the ability to defer
distribution only to Normal Retirement Date shall be null and void.
3. Section 6.2 of the Plan shall be deleted and replaced in its entirety by
the following:
"TIMING OF DISTRIBUTIONS. If the value of a Participant's Vested Interest
exceeds (or at the time of any prior distribution exceeded) $5,000 and is
immediately distributable (as defined in Section 8.5), the Participant
and his Spouse, if required, must consent to the distribution before it
is made.
Instead of consenting to a distribution, the Participant may make a
written election to defer the distribution for a specified period of time
subject to the requirements of Section 6.4.
If the Participant and Spouse, if applicable, do not consent to a
distribution or if no election to defer is made within 90 days after
receiving a written explanation of the optional forms of benefit
available pursuant to Income Tax Regulation 1.411(a)(11), all benefits
shall be deferred to, and distribution shall commence, no later than
April 1 of the calendar year following the year the Participant attains
age 70 1/2.
Unless the Participant elects otherwise, the payment of benefits under
this Plan to the Participant shall begin no later than the 60th day after
the close of the Plan Year in which the latest of (A), (B) or (C), below,
occurs:
(A) the date on which the Participant attains the earlier of his
Normal Retirement Age or age 65, or
(B) the 10th anniversary of the year in which the Participant
commenced participation in the Plan, or
(C) the date on which the Participant terminates his Service
(including Termination of Employment, death or Disability) with
the Employer.
Notwithstanding the foregoing, the failure of a Participant and Spouse,
if required, to consent to a distribution while a benefit is immediately
distributable shall be deemed to be an election to defer distribution to
the April 1 of the calendar year following the year the Participant
attains age 70 1/2.
The Employer may elect that all Participants that defer distribution
shall be responsible for all fees and expenses associated with
maintaining his Participant's Account in a deferred status.
<PAGE>
By submitting a written request, a Participant, with his Spouse's
consent, if applicable, may elect at any time prior to the actual payment
of benefits to take a full distribution of his vested amount. The payment
of benefits shall be made as soon as practicable under the distribution
form the Participant has elected.
A Participant who continues to maintain an account balance under the Plan
may elect to withdraw an amount which is equal to any whole percentage
(not to exceed 100%) from his Participant's Account. Such an election may
be made in accordance with and subject to the provisions of Article X.
Such Participant as described herein shall have the authority to direct
the transfer of his Vested Interest in accordance with Article XIII of
the Plan.
If the value of a Participant's Vested Interest has always been $5,000 or
less, the distribution shall be made in the form of a single sum cash
payment and shall be made upon such Participant's Termination of
Employment. Such a distribution may not be deferred.
All distributions are subject to the provisions of Article VIII."
IN WITNESS WHEREOF, the Employer, the Administrator and the Trustee(s) have
hereunto affixed their signatures.
<TABLE>
<S> <C>
Executed at ______________________________ on ____________________
CANDLE CORPORATION OF AMERICA
__________________________________ By __________________________________
Witness
Title _______________________________
Executed at ______________________________ on ____________________
PARTYLITE GIFTS, INC.
__________________________________ By __________________________________
Witness
Title _______________________________
Executed at ______________________________ on ____________________
AROMATIC INDUSTRIES, INC.
<PAGE>
__________________________________ By __________________________________
Witness
Title _______________________________
Executed at ______________________________ on ____________________
CANDLE CORPORATION OF AMERICA HONG KONG, LTD.
__________________________________ By __________________________________
Witness
Title _______________________________
Accepted this __________ day of ______________________________, 19____.
__________________________________ By __________________________________
Witness Administrator
Accepted this __________ day of ______________________________, 19____.
__________________________________ By __________________________________
Witness Trustee
Accepted this __________ day of ______________________________, 19____.
__________________________________ By __________________________________
Witness Trustee
</TABLE>
IMPORTANT NOTE
Neither Connecticut General Life Insurance Company nor any of its employees can
provide you with legal advice in connection with the execution of this document.
Prior to execution of this document, you should consult your attorney on whether
this document is appropriate for you.
