Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
<TABLE>
<CAPTION>
<S> <C>
BUDGET GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 59-3327576
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
4225 Naperville Road
Lisle, Illinois 60532
(Address of principal executive offices)
BUDGET RENT A CAR CORPORATION
SAVINGSPLUS PLAN
(as Amended and Restated Effective January 1, 1993)
(Full title of the plan)
Brenda P. Johnson
Benefits Manager
4225 Naperville Road
Lisle, Illinois 60532
(Name and address of agent for service)
(630) 955-7373
(Telephone number, including area code, of agent for service)
Copies to:
Steven K. Humke
Ice Miller Donadio & Ryan
One American Square, Box 82001
Indianapolis, Indiana 46282
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration-
Registered(1) Registered Per Share(2) Price(2) Fee(2)
Class A Common Shares, 70,866 Shares $ 31.75 $ 2,250,000 $ 687.50
par value $.01 per share
<FN>
1) In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
registration statement also covers an indeterminate amount of interests to be offered
or sold pursuant to the employee benefit plan described herein.
2) The registration fee has been calculated pursuant to Rule 457(c) and (h) based
upon the closing price for the Class A Common Shares on July 9, 1998.
</TABLE>
The Index to Exhibits is located at page ____ in the sequential numbering
system.
<PAGE>
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
BUDGET GROUP, INC.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following information heretofore filed with the Commission pursuant
to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is
incorporated herein by reference:
(a) The registrant's latest Annual Report on Form 10-K.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the fiscal year covered by the Annual Report
referred to in (a) above, including the Form 8-K filed on July 2, 1998 and the
Form 8-K filed on May 13, 1997.
(c) The description of the registrant s Class A Common Stock
contained in the registrant s Registration Statement on Form 8-A dated April
15, 1997, including any amendment or report filed for the purpose of updating
such description.
All documents filed by the registrant or the Plan pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act after the date of this
Registration Statement, and prior to the filing of a post-effective amendment
which indicates that all securities offered have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be a part
hereof from the date of filing of those documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
<PAGE>
Item 6. Indemnification of Directors and Officers.
The following summary is qualified in its entirety by reference to the
complete statute, Certificate of Incorporation, Bylaws and agreement referred
to below.
Section 145 of the General Corporation Law of the State of Delaware (
DGCL ) provides that a corporation has the power to indemnify any director or
officer, or former director or officer, who was or is a party or is threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation) against the expenses,
(including attorney s fees), judgments, fines or amounts paid in settlement
actually and reasonably incurred by them in connection with the defense of any
action by reason of being or having been directors or officers, if such person
shall have acted in good faith and in a manner reasonably believed to be in or
not opoosed to the best interest of the corporation, and, with respect to any
criminal action or proceeding, provided that such person had no reasonable
cause to believe his conduct was unlawful, except that, if such action shall
be in the right of the corporation, no such indemnification shall be provided
as to any claim, issue or matter as to which such person shall have been
judged to have been liable to the corporation unless and to the extent that
the Court of Chancery of the State of Delaware, or any court in which such
suit or action was brought, shall determine upon application that, in view of
all of the circumstances of the case, such person is fairly and reasonably
entitled to indemnify for such expenses as such court shall deem proper.
As permitted by Section 102(b)(7) of the DGCL, the Amended and Restated
Certificate of Incorporation of the Registrant (the Restated Certificate of
Incorporation ) provides that no director shall be liable to the Registrant or
its stockholders for monetary damages for breach of fiduciary duty as a
director other than (i) for breaches of the director s duty of loyalty to the
Registrant and its stockholders, (ii) for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation of law, (iii)
for the unlawful payment of dividends or unlawful stock purchases or
redemptions under Section 174 of the DGCL, and (iv) for any transaction from
which the director derived an improper personal benefit.
The Registrant s Bylaws provide indemnification of the Registrant s
directors and officers, both past and present, to the fullest extent permitted
by the DGCL, and allow the Registrant to advance or reimburse litigation
expenses upon submission by the director or officer of an undertaking to repay
such advances or reimbursements if it is ultimately determined that
indemnification is not available to such director or officer pursuant to the
Bylaws. The Registrant s Bylaws will also authorize the Registrant to
purchase and maintain insurance on behalf of an officer or director, past or
present, against any liability asserted against him in any such capacity
whether or not the Registrant would have the power to indemnify him against
such liability under the provisions of the Restated Certificate of
Incorporation or Section 145 of the DGCL.
<PAGE>
The Registrant has entered into indemnification agreements with each of
its directors and certain of its executive officers. The indemnification
agreements require the Registrant, among other things, to indemnify such
directors and officers against certain liabilities that may arise by reason of
their status or service as directors or officers (other than liabilities
arising from willful misconduct of a culpable nature), and to advance their
expenses incurred as a result of any proceeding against them as to which they
could be indemnified.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
See Index to Exhibits.
No opinion of counsel as to the legality of the securities being issued
is required because the securities are not original issuance securities.
The Internal Revenue Service issued a determination letter that the Plan
is qualified under Section 401 of the Internal Revenue Code; however, the Plan
has been amended since such letter was issued. The registrant will submit the
Plan and all amendments to the Plan since the date of the determination letter
to the Internal Revenue Service in a timely manner and will make all of the
changes required by the IRS in order to qualify the Plan.
Item 9. Undertakings.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range may
be reflected in the form of prospectus filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the changes in volume and price represent no
more than 20 percent change in the maximum aggregate offering price set forth
in the Calculation of Registration Fee table in the effective registration
statement;
<PAGE>
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
provided, however, that paragraphs (l)(i) and (l)(ii) shall not apply if
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant
to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual report pursuant
to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 that
is incorporated by reference in the registration statement shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
<PAGE>
SIGNATURES
The Registrant
Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Lisle, State of Illinois, on July 8,
1998.
BUDGET GROUP, INC.
By: /s/ Sanford Miller
Sanford Miller, Chairman and
Chief Executive Officer
POWER OF ATTORNEY
Know all men by these presents, that each person whose signature appears
below constitutes and appoints Sanford Miller, John P. Kennedy and Jeffrey D.
Congdon and each of them (with full power to act alone), his true and lawful
attorneys-in-fact and agents with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments to this Registration Statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto those
attorneys-in-fact and agents full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that those attorneys-in-fact and
agents, or their substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed on July 8, 1998 by the following
persons in the capacities indicated:
<TABLE>
<CAPTION>
<S> <C>
/s/Sanford Miller Chairman of the Board of Directors;
Sanford Miller Chief Executive Officer
/s/John P. Kennedy Director; President and
John P. Kennedy Chief Operating Officer
/s/Jeffrey D. Congdon Director; Chief Financial Officer
Jeffrey D. Congdon
/s/Ronald D. Agronin Director
Ronald D. Agronin
/s/James F. Calvano Director
James F. Calvano
/s/ Martin P. Gregor Director
Martin P. Gregor
/s/ F. Perkins Hixon Director
F. Perkins Hixon
/s/ Jeffrey R. Mirkin Director
Jeffrey R. Mirkin
/s/ Dr. Stephen L. Weber Director
Dr. Stephen L. Weber
</TABLE>
<PAGE>
The Plan
Pursuant to the requirements of the Securities Act of 1933, the Committee
charged with the administration of the Plan had duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Lisle, State of Illinois, on July 8, 1998.
BUDGET RENT A CAR CORPORATION
SAVINGSPLUS PLAN
By: /s/ Robert L. Aprati
Its: Executive Vice President, General Counsel
and Secretary
<PAGE>
BUDGET GROUP, INC.
Registration Statement
on
Form S-8
<TABLE>
<CAPTION>
INDEX TO EXHIBITS
<S> <C> <C> <C>
Exhibit Number
Assigned in Page Number
Regulation S-K in Sequential
Item 601 Description of Exhibit Numbering System
(4) 4.1 Specimen certificate for Class A
Common Shares, par value $.01
per share. (Incorporated by
reference to Exhibit 4.1 to
Annual Report on Form 10-K for
the year ended December 31,
1995)
4.2 Budget Rent a Car Corporation
SavingsPlus Plan (as Amended
and Restated Effective January 1,
1993).
(23) 23.1 Consent of KPMG Peat Marwick
LLP
23.2 Consent of Arthur Anderson
LLP
23.3 Consent of Deloitte & Touche
LLP
(24) 24.1 Power of Attorney (see Signature
Page).
</TABLE>
BUDGET RENT A CAR CORPORATION
SAVINGSPLUS PLAN
(As Amended and Restated Effective January 1, 1993)
<PAGE>
BUDGET RENT A CAR CORPORATION
SAVINGSPLUS PLAN
ARTICLE I
INTRODUCTION
The Budget Rent a Car Corporation SavingsPlus Plan is amended and
restated effective January 1, 1993 as provided herein. The Plan was
originally established effective January 1, 1987, as a spinoff from the Prior
Plan. The Plan is intended to qualify under Code Section 401(a) and to
satisfy the requirements of Code Section 401(k). Except as may be required by
ERISA or the Code, the rights of any person whose status as an Employee has
terminated shall be determined pursuant to the Plan as in effect on the date
such employment terminated, unless a subsequently adopted provision of the
Plan is made specifically applicable to such person.
ARTICLE II
DEFINITIONS
The following terms have the respective meanings set forth below when
capitalized in the Plan, unless another meaning is specified in the Plan:
"Accounts" means the following accounts (and any subaccounts established
thereunder) established and maintained for each Participant pursuant to
Article VI, representing a Participant's allocable share of the Trust Fund:
(a) "Participant Deferral Account," for amounts attributable to
Compensation Deferral Contributions;
(b) "After-Tax Contributions Account," for amounts attributable
to After-Tax Contributions;
(c) "Matching Contributions Account," for amounts attributable
to Matching Contributions;
(d) "Retirement Plan Contributions Account," for amounts
attributable to Retirement Plan Contributions;
(e) "Transfer Account," for amounts transferred to the Plan
pursuant to Section 4.5; and
(f) "Rollover Account," for amounts attributable to rollovers of
amounts rolled over to the Plan pursuant to Section 4.6.
"Active Participant" means any Eligible Employee who has satisfied the
participation requirements set forth in Article III and has either (a) entered
into a currently or previously effective Compensation deferral agreement under
Section 4.1 or become entitled to an allocation of Retirement Plan
Contributions under Section 5.1(d).
"Actual Deferral Percentage Tests" means the tests described in Section
4.2.
"Affiliated Company" means any corporation or enterprise which is a
member of the same controlled group of corporations, group of trades or
businesses under common control or affiliated service group, determined in
accordance with Code Sections 414(b), (c), (m) or (o), as the Company. For
purposes of Article XIII, Code Sections 414(b) and (c) are modified by Code
Section 415(h).
"After-Tax Contributions" means the voluntary non-tax-deferred
contributions made by a Participant under Section 4.4.
"Beneficiary" means the person or persons designated under Section 8.3(b)
to receive the interest of a deceased Participant.
"Board of Directors" means the Board of Directors of the Sponsor as it
may from time to time be constituted or the Executive Committee of the Board
of Directors (if duly authorized to act for and in place of the Board of
Directors).
"Break in Service" means a Computation Period during which an Employee
does not complete more than 500 Hours of Service. A Break in Service shall
occur on the last day of such Computation Period if the Employee is not then
employed by the Company or an Affiliated Company.
(a) Solely for purposes of determining whether an Employee
incurs a Break in Service, the following provisions of this definition shall
apply with respect to an Employee who is absent from work for any period by
reason of the pregnancy of the Employee, by reason of the birth of a child of
the Employee, by reason of the placement of a child with the Employee in
connection with the adoption of the child by the Employee, or for purposes of
caring for the child for a period beginning immediately following the birth or
placement. Such Employee shall provide the Committee with such timely
information as it shall reasonably require to establish the number of days in
the period of absence and that the absence is for the reasons described in
this paragraph
(b) The Hours of Service credited to an Employee described in
paragraph (a) shall be the Hours of Service which otherwise would have been
credited to the Employee but for the absence or, if the Committee determines
that such number is not capable of being determined, eight Hours of Service
per day; provided that the total number of Hours of Service credited under
this paragraph shall not exceed 501, and these Hours of Service shall be taken
into account solely for purposes of determining whether or not the Employee
has incurred a Break in Service.
(c) The Hours of Service credited under paragraph (b) shall be
credited to the Computation Period in which the absence begins if needed to
prevent a Break in Service in that Plan Year, and in any other case, in the
immediately following Computation Period.
"Code" means the Internal Revenue Code of 1986, as in effect on the
Effective Date and as thereafter amended from time to time.
"Committee" shall mean the committee described in Article IX.
"Company" shall mean the Sponsor and any Affiliated Company which adopts
this Plan pursuant to Section 16.1.
"Company Contributions" means contributions described in Section 5.1.
"Compensation" means:
(a) All remuneration payable on periodic paydays to a
Participant during a Plan Year by reason of services performed as an Active
Participant, including regular earnings, overtime, commissions, short-term
incentive bonuses, lump sum merit increases and sick pay (to the extent
includible in taxable income of the Participant) paid by the Company and any
elective pre-tax contribution made on his or her behalf by the Company under a
Code Section 401(k) plan or a Code Section 125 cafeteria plan, but excluding
any quarterly, annual and long-term incentive bonuses, short-term disability
payments, long-term disability payments, clothing allowances, moving
allowances, amounts paid to employees who decline medical and dental or reduce
life insurance, the value of any life insurance, the value of any
non-qualified retirement benefits, and the value of any special incentive
benefits for executives.
(b) For purposes of Article XIII, all wages, salaries, fees for
professional services and other amounts received by an Employee for personal
services actually rendered in the course of employment with the Company and
any Affiliated Company to the extent that the amounts are included in gross
income; such term shall include those items listed in Treasury Regulation
Section 1 .415-2(d)(1) but shall not include those items listed in Treasury
Regulation Section 1.415-2(d)(2).
(c) For purposes of the definitions of Highly Compensated
Employee, Family Group and Family Member and Sections 4.2, 5.2 and Article XV,
"Compensation" means "Compensation" as defined in paragraph (b) plus any
elective pre-tax contributions made on the Employee's behalf by the Company
under a Code Section 401(k) plan or a Code Section 125 cafeteria plan
(d) For purposes of Section 5.1(d) "Compensation" means
"Compensation" as defined in paragraph (a) plus all bonuses and incentives,
except long-term incentive bonuses, paid to an Employee during a Plan Year by
reason of services performed as an Active Participant
Notwithstanding the foregoing for Plan Years commencing prior to January
1, 1994, Compensation shall not include any amount in excess of $200,000, or
such other limit imposed under Code Section 401(a)(17) (as adjusted by the
Secretary of the Treasury for increases in the cost of living); and the rules
of Code Section 414(q)(6) shall apply, except that the term "family" shall
only include the spouse of the Employee and any lineal descendants of the
Employee who have not attained age 19 before the close of the year. 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 Secretary of Treasury for increases in the cost
of living in accordance with Code Section 401(a)(17)(B). The cost-of-living
adjustment in effect for a calendar year applies to any period, not exceeding
12 months, over which Compensation is determined (determination period)
beginning in such calendar year. If a determination period consists of fewer
than 12 months, the OBRA '93 annual compensation limit will be multiplied by a
fraction, the numerator of which is the number of months in the determination
period, and the denominator of which is 12.
For Plan Years beginning on or after January 1, 1994, any reference in
this Plan to the limitation under Code Section 401(a)(17) shall mean the OBRA
'93 annual compensation limit set forth in this provision.
"Compensation Deferral Contributions" means contributions described in
Section 4.1(a).
"Computation Period" means, for purposes of determining eligibility to
participate in the Plan, the 12 month period commencing on an Employee's
Employment Commencement Date and, in the case of an Employee who does not
complete 1,000 Hours of Service during such 12 month period, each 12 month
period thereafter beginning on the first day of the Plan Year which includes
the first anniversary of his Employment Commencement Date. For purposes of
determining vesting, "Computation Period" means the Plan Year.
"Contribution Percentage Tests" means the tests described in Section 5.2.
"Early Retirement Date" means the date on which a Participant has
attained age 55 and completed five Years of Service.
"Effective Date" means January 1, 1993.
"Eligible Employee" means any Employee of the Company who has completed
1,000 Hours of Service during a Compensation Period except (a) any Employee
who is a member of a collective bargaining unit and who is covered by a
collective bargaining agreement which does not specifically provide for
coverage under the Plan, and (b) any Leased Employee. In the case of an
Employee who is employed by a company on the date of its acquisition by the
Company or an Affiliated Company, except to the extent that the Board of
Directors provides otherwise, such Employee shall become an Eligible Employee
on the Entry Date coinciding with or next following the first anniversary of
the date on which such company was acquired by the Company or an Affiliated
Company, provided that the Employee has completed 1,000 Hours of Service
during a Computation Period, and provided the Employee is not excluded under
paragraph (a) or (b) above.
"Employee" means:
(a) any person actively employed as a common law employee in any
capacity by the Company or an Affiliated Company; and
(b) any Leased Employee; provided, that if Leased Employees
constitute less than 20% of the Company's "nonhighly compensated work force"
(within the meaning of Code Section 414(n)(5)(C)(ii)), "Employee" shall not
include Leased Employees covered by a plan described in Code Section 414(n)(5)
unless otherwise provided by the terms of the Plan.
"Employment Commencement Date" means the date on which an Employee first
performs an Hour of Service. In the case of an Employee who is reemployed
after he incurs a Break in Service, "Employment Commencement Date" means the
date on which the Employee again performs an Hour of Service.
"Entry Date" means the first day of each month.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Family Group" means all Family Members of a Highly Compensated Employee
who is a Five-Percent Owner or who is a member of the group consisting of the
ten employees of the Company and all Affiliated Companies paid the greatest
Compensation during the Plan Year. If two or more Family Groups include
common Family Members, such Family Groups shall be aggregated as one Family
Group.
"Family Member" means a Highly Compensated Employee who is a Five-Percent
Owner or who is a member of the group consisting of the ten employees of the
Company and all Affiliated Companies paid the greatest Compensation during the
Plan Year, and any individual who is the spouse, lineal ascendant or
descendant, or the spouse of a lineal ascendant or descendant, of such
Five-Percent Owner or a member of the group consisting of the ten employees of
the Company and all Affiliated Companies paid the greatest Compensation during
the Plan Year.
"Five-Percent Owner" means an Employee described in Code Section
416(i)(1).
"Gap Period" means the period of time between the end of the Plan Year
and the last day of the month immediately preceding the date on which excess
Compensation Deferral Contributions and After-Tax Contributions are
distributed to a Highly Compensated Employee and excess Matching Contributions
are treated as forfeitures.
"Highly Compensated Employee" means, for the current Plan Year (the
"Determination Year"), an Employee who was an Active Participant at any time
during the Plan Year and who:
(a) during the preceding Plan Year:
(i) was a Five-Percent Owner; or
(ii) received Compensation in excess of $75,000 (as
adjusted annually for increases in the cost of living by the Secretary of the
Treasury); or
(iii) received Compensation in excess of $50,000 (as
adjusted annually for increases in the cost of living by the Secretary of the
Treasury) and was among the top 20% of Employees when ranked on the basis of
Compensation paid for that year; or
(iv) was an officer of the Company or an Affiliated Company
and received Compensation in excess of one-half of the amount in effect under
Code Section 415(b)(1)(A) for that year (provided that for this purpose, no
more than 50 Employees (or if lesser the greater of three or ten percent of
all Employees) shall be treated as officers), or if there is no such officer,
was the highest paid officer of the Company or an Affiliated Company for that
year; or
(b) at any time during the Determination Year:
(i) is a Five-Percent Owner; or
(ii) is a member of a group consisting of the 100 Employees
who received the greatest Compensation during that Plan Year and would be a
member of the group of Employees described in paragraph (a)(ii), (iii) or (iv)
for the Determination Year. For any Plan Year, the Committee may, to the
extent permitted by law, elect to apply the provisions of this paragraph
(b)(ii) without regard to the limitation of the group to 100 Employees.
To the extent required by Code Section 414(q)(9), a former Employee who
was a Highly Compensated Employee when he separated from service with the
Company and all Affiliated Companies or at any time after attaining age 55
shall be treated as a Highly Compensated Employee.
"Highly Compensated Family Member" means a Family Member who is a Highly
Compensated Employee without application of the family aggregation rules of
Code Section 414(q)(6).
"Hour of Service" means:
(a) Each hour for which an Employee is paid or entitled to
payment by the Company or an Affiliated Company for the performance of
services as an Employee. For purposes of this definition, overtime work shall
be credited as straight time.
(b) Each hour in or attributable to a period of time during
which the Employee performs no duties (irrespective of whether he has
terminated his employment) due to a vacation, holiday, illness, incapacity,
Leave of Absence, jury duty or military duty for which he is so paid or so
entitled to payment, whether direct or indirect. However, no such hours shall
be credited if the Employee is directly or indirectly paid or entitled to
payment for such hours under a plan maintained solely for the purpose of
complying with applicable worker's compensation, unemployment compensation or
disability insurance laws.
(c) Each hour in or attributable to a period of time during
which the Employee is not paid or entitled to payment and performs no duties
due to Leave of Absence or service in the Armed Forces of the United States
(other than by voluntary enlistment or commission), if such Employee's duties
for the Company are resumed immediately upon the expiration or termination of
Leave of Absence or within 90 days after release from the Armed Forces. With
respect to any such unpaid absence, an Employee shall be deemed to complete
Hours of Service at his customary work schedule prior to the commencement of
such absence.
(d) Each hour for which the Employee is entitled to back pay,
irrespective of mitigation of damages, whether awarded or agreed to by the
Company, provided that such Employee is not also credited with an Hour of
Service with respect to such hour under paragraph (a), (b)or (c) above.
The Hours of Service, if any, for which an Employee is credited for a
period in which he performs no duties shall be calculated in accordance with
Department of Labor Regulation 2530.200b-2 and other applicable regulations
promulgated by the Secretary of Labor. Hours of Service shall be credited to
the appropriate Computation Period according to Department of Labor Regulation
2530.200b-2(c). However, an Employee will not be considered as being entitled
to payment until the date the Company would normally make payment to the
Employee for such Hour of Service. In lieu of any other method of crediting
Hours of Service, in the case of an Employee for whom records of hours worked
are not required by applicable law to be kept, 45 Hours of Service shall be
deemed earned for each week for which one or more Hours of Service would be
credited pursuant to the preceding provisions of this definition; provided,
however, that no more than 501 Hours of Service shall be credited to an
Employee pursuant to this definition on account of any single continuous
period during which the Employee performs no duties.
"Leased Employee" means any individual who is not a common law employee
of the Company or an Affiliated Company who provides services for the Company
or an Affiliated Company if:
(a) such services are provided pursuant to an agreement between
the Company or an Affiliated Company and any other person;
(b) such individual has performed such services for the Company
or an Affiliated Company (or a related person within the meaning of Code
Section 144(a)(3)) on a substantially full- time basis for a period of at
least one year; and
(c) such services are of a type historically performed by
employees in the business field of the Company or an Affiliated Company.
"Leave of Absence" means a period of temporary absence approved by the
Company in accordance with Company policy.
"Matching Contributions" means the Company Contributions described in
Section 5.1(c).
"Nonhighly Compensated Employee" means, for any Plan Year, any Employee
who (a) was an Active Participant at any time during the Plan Year, and (b)
was not a Highly Compensated Employee for such Plan Year.
"Normal Retirement Date" means a Participant's 65th birthday.
"One-Percent Owner" means an Employee described in Code Section
416(i)(1).
"Participant" means any person for whom an Account is maintained under
this Plan and whose vested Account balance has not been distributed in full.
"Plan" means the Budget Rent a Car Corporation SavingsPlus Plan herein
set forth, and as it may be amended from time to time.
"Plan Administrator" means the administrator of the Plan, within the
meaning of ERISA Section 3(16)(A). The Plan Administrator shall be the
Committee provided for in Article IX.
"Plan Year" means the period beginning on the Effective Date and ending
on December 31, 1993, and each 12 month period thereafter.
"Prior Plan" means the Transamerica Corporation Employees Stock Savings
Plan.
"Retirement Plan Contribution" means the Company Contribution described
in Section 5.1(d).
"Rollover Contribution" means (i) all or a portion of an eligible
rollover distribution received by an Employee from another qualified plan
which is transferred by the Employee to this Plan within 60 days following his
receipt thereof, or which is paid directly from the other qualified plan to
this Plan at the election of the Employee; (ii) amounts transferred to this
Plan from a conduit individual retirement account which has no assets other
than assets (and the earnings thereon) which were previously distributed to
the Employee by another qualified plan as an eligible rollover distribution
and deposited in such conduit individual retirement account within 60 days of
receipt thereof; and (iii) amounts distributed to the Employee from a conduit
individual retirement account meeting the requirements of clause (ii) above,
and transferred by the Employee to this Plan within 60 days of his receipt
thereof.
"Sponsor" means Budget Rent a Car Corporation, a Delaware corporation.
"Spouse" means the person to whom a Participant is legally married.
"The 1.25 Test" is the test described in Sections 4.2 and 5.2.
"The 2.0 Test" is the test described in Sections 4.2 and 5.2.
"Total and Permanent Disability" exists if the Committee determines that
the individual is unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment expected to
either result in death or be of long continued duration. An individual's
disabled status shall be determined by the Committee, based on the certificate
of a medical doctor satisfactory to the Committee.
"Trust" or "Trust Fund" means the assets of the trust established under
the Trust Agreement.
"Trust Agreement" means the one or more trust agreements entered into by
the Sponsor with the Trustees in accordance with the provisions of Article VII
for the purpose of holding contributions and earnings under the Plan.
"Trustee" means any bank or insurance company with whom the Sponsor has
entered into an agreement for the purpose of holding assets of the Trust Fund,
and any successor acting as a trustee of the Trust Fund. Any Trustee shall be
appointed or removed by the Board of Directors.
"Valuation Date" means the last day of each month, and such other dates
as the Committee may determine, as of which dates the value of the Trust Fund
and of Accounts shall be determined.
"Year of Service" means:
(a) A Computation Period during which an Employee completes
1,000 or more Hours of Service. An Employee shall in no event be deemed to
accrue more than one full Year of Service with respect to any Computation
Period. An Employee's Years of Service shall include service in Computation
Periods beginning prior to the Effective Date. An Employee who completes
1,000 Hours of Service in the Computation Period including the day before the
Effective Date (under the terms of the Plan immediately prior to the Effective
Date and without regard to the change in the definition of Computation Period
hereunder) and 1 ,000 Hours of Service in the Computation Period beginning on
the Effective Date shall accrue two Years of Service for such Computation
Periods.
(b) Unless otherwise specified by the Committee, for purposes of
vesting under the Plan, an Employee shall be credited with service for a
company (which becomes an Affiliated Company) for periods prior to the date on
which such company becomes an Affiliated Company or part of an Affiliated
Company or the Company. In no event, however, shall an Employee be credited
with service for a franchise of the Company for a period during which he is
not an Employee.
(c) Notwithstanding the foregoing provisions of this definition,
in the case of any Employee who incurs a Break in Service and is reemployed by
the Company or an Affiliated Company, but who, immediately preceding such
Break, did not have any nonforfeitable right under the Plan to his Accounts
attributable to Company Contributions, if the number of such Employee's
consecutive Breaks in Service equals or exceeds the greater of (i) five, or
(ii) the number of his Years of Service accrued prior to said Breaks in
Service, then such prior Years of Service shall not be taken into account
under this Plan for any purpose. In applying this definition, an Employee's
Years of Service prior to a Break shall be deemed not to include any Years of
Service that are not required to be taken into account under this definition
by reason of any prior Break in Service.
ARTICLE III
ELIGIBILITY AND PARTICIPATION
3.1 Commencement of Participation.
(a) Except as provided in Section 3.1(b), every Eligible
Employee who was eligible to participate in this Plan on December 31, 1992
shall continue as an Eligible Employee, and every Active Participant on
December 31, 1992 shall continue as an Active Participant, on the Effective
Date subject to the provisions of the Plan. Every other Eligible Employee
shall become an Active Participant on the first Entry Date:
(i) as of which he is an Eligible Employee and
(ii) as of which he has either (A) entered into a
Compensation deferral agreement under Section 4.1 or (B) become entitled to an
allocation of Retirement Plan Contributions under Section 5.1(d).
(b) If an Employee ceases to be an Eligible Employee he shall
cease to be an Active Participant in the Plan. If he shall later again become
an Eligible Employee, he shall (or again become an Active Participant):
(i) on the Entry Date coinciding with or next following the
date he becomes, or again becomes an Eligible Employee,
(ii) as of which he has either (A) entered into a
Compensation deferral agreement under Section 4.1 or (B) become entitled to an
allocation of Retirement Plan Contributions under Section 5.1(d).
3.2 Amounts Transferred from Prior Plan. An Eligible Employee who
transfers amounts from the Prior Plan to this Plan in accordance with Section
4.5 is not an Active Participant unless he has satisfied the participation
requirements of Section 3.1.
ARTICLE IV
EMPLOYEE CONTRIBUTIONS
4.1 Compensation Deferral Agreement.
(a) Each Eligible Employee may enter into a Compensation
deferral agreement to have an amount equal to a fixed whole percentage up to
15 percent of his Compensation contributed to the Plan on his behalf from each
regular paycheck within the period that such Compensation deferral agreement
is in effect, except that the Committee shall determine the frequency of
payroll deductions for a Participant whose Compensation is paid less
frequently than monthly. A Compensation deferral agreement must be delivered
to the Committee at the time, in the form and in accordance with procedures
established by the Committee before the payroll date as of which Compensation
deferral is to commence.
(b) The Compensation deferral agreement shall remain in effect
until it is revoked or modified or the Participant terminates employment. Any
modification of a Compensation deferral agreement shall be effective on the
coinciding or next January 1, April 1, July 1 or October 1 or, in the case of
Participants paid more frequently than monthly, the payroll date coinciding
with or next following such date, except that a Participant may completely
cease making Compensation Deferral Contributions as soon as such revocation
can be processed by the Company's payroll system. Any such revocation or
modification shall be effective upon 30 days' written notice. An Active
Participant who revokes his Compensation deferral agreement may enter into a
new Compensation deferral agreement after three full calendar months have
elapsed (the "Three-Month Suspension") on the coinciding or any following
Entry Date following the Three-Month Suspension, or, in the case of
Participants paid more frequently than monthly, any payroll date coinciding
with or following such Entry Date following the Three-Month Suspension, upon
30 days' written notice. A Compensation deferral agreement or any revocation
or modification shall be made in such form and manner as the Committee shall
prescribe or approve. A Participant who makes a hardship withdrawal shall
automatically cease making Compensation Deferral Contributions as of the end
of the payroll period coinciding with or immediately preceding the date he
makes such hardship withdrawal, and the Participant may not make further
Compensation Deferral Contributions until at least 12 full calendar months
have elapsed since he last made a hardship withdrawal (the "Twelve- Month
Suspension"). The Participant may enter into a new Compensation deferral
agreement to resume making Compensation Deferral Contributions as of any Entry
Date coinciding with or following the Twelve-Month Suspension, or, in the case
of Participants paid more frequently than monthly, any payroll date coinciding
with or following the Entry Date following the Twelve-Month Suspension, unless
he revokes or modifies his Compensation deferral agreement pursuant to the
provisions of this section.
4.2 Limitations on Compensation Deferral Contributions. Solely for
purposes of satisfying one of the tests prescribed in this Section, the
Committee may prescribe such rules as it deems necessary or appropriate
regarding the maximum amount that a Participant may defer under Section 4.1(a)
and the timing of such an election. These rules may provide that the maximum
percentage of Compensation that a Participant may defer will be a lower
percentage of his Compensation above a certain dollar amount of Compensation
than the maximum deferral percentage below that dollar amount of Compensation.
These rules shall apply to all Active Participants, except to the extent that
the Committee prescribes special or more stringent rules applicable only to
Highly Compensated Employees.
(a) In no event shall a Participant's Compensation Deferral
Contributions exceed $7,000 (as adjusted annually for increases in the cost of
living by the Secretary of the Treasury) for any calendar year. Such
limitation shall apply to the combined Compensation Deferral Contributions of
the calendar year in which a Participant makes a hardship withdrawal and the
next following calendar year. If any amount is included in a Participant's
income for any calendar year by reason of the limitation in this paragraph,
the Participant may notify the Committee of the amount of such excess
allocable to this Plan by March 1 of the following year, and such excess, and
any earnings allocable thereto, shall be distributed to the Participant by
April 15 of such following year. A Participant is deemed to have notified
the Plan of Compensation Deferral Contributions in excess of the limitation in
this paragraph to the extent he has excess Compensation Deferral Contributions
for a calendar year under this Plan and any other plans of the Company and all
Affiliated Companies.
(b) Notwithstanding any other provision of the Plan:
(i) The Compensation Deferral Contributions for a Plan Year
of the Highly Compensated Employees shall be reduced and refunded if neither
of the Actual Deferral Percentage Tests set forth in (A) or (B) below is
satisfied:
(A) The 1.25 Test. The Actual Deferral Percentage of
the Highly Compensated Employees is not more than the Actual Deferral
Percentage of the Nonhighly Compensated Employees multiplied by 1.25.
(B) The 2.0 Test. The Actual Deferral Percentage of
the Highly Compensated Employees is not more than two percentage points
greater than the Actual Deferral Percentage of the Nonhighly Compensated
Employees and the Actual Deferral Percentage of the Highly Compensated
Employees is not more than the Actual Deferral Percentage of the Nonhighly
Compensated Employees multiplied by 2.0.
(ii) (A) "Actual Deferral Percentage" means the average
of the ratios of each Highly Compensated Employee's or Nonhighly Compensated
Employee's, as the case may be, Compensation Deferral Contributions which were
allocated to the Participant's Participant Deferral Account with respect to
the Plan Year, to each such Participant's Compensation for the Plan Year.
(B) If a Highly Compensated Employee is a member of a
Family Group, such Family Group shall constitute a single Highly Compensated
Employee. The Actual Deferral Percentage of such Family Group shall be the
aggregate Actual Deferral Percentage of all Family Members and the Actual
Deferral Percentage of each Family Member shall be disregarded for purposes of
the Actual Deferral Percentage Tests.
(iii) The Committee may elect to treat all or any portion
of a Retirement Plan Contribution to the extent allocated to Nonhighly
Compensated Employees' Accounts as Compensation Deferral Contributions for
purposes of the Actual Deferral Percentage Tests. If the Committee so elects,
such Retirement Plan Contribution (or portion designated) shall be a qualified
nonelective contribution ("QNEC") regardless of whether it is actually taken
into account for the Actual Deferral Percentage Tests, and the following
provisions shall apply:
(A) The QNEC shall be immediately 100% vested without
regard to a Participant's Years of Service.
(B) The QNEC may be distributed only under
circumstances that also permit the distribution of Compensation Deferral
Contributions (excluding withdrawals under Section 8.6).
(C) The QNEC that will be treated as Compensation
Deferral Contributions shall be limited to the amount of such contributions
made with respect to Active Participants.
(D) The QNEC will be treated as Compensation Deferral
Contributions only if the requirements specified in Treasury Regulations Sec.
1.401(k)-1(b)(5), the provisions of which are incorporated herein by
reference, are satisfied.
(iv) If neither Actual Deferral Percentage Test is
satisfied as of the end of the Plan Year, the Committee shall cause the
Compensation Deferral Contributions for the Highly Compensated Employees to be
reduced and refunded to each such Highly Compensated Employee until either
Actual Deferral Percentage Test is satisfied. The sequence of such reductions
and refunds shall begin with Highly Compensated Employees who elected to defer
the greatest percentage, then the second greatest percentage, continuing until
either Actual Deferral Percentage Test is satisfied. Once either Actual
Deferral Percentage Test is satisfied, the Committee shall direct the Trustee
to distribute to the appropriate Highly Compensated Employees the amount of
the reduction of the Compensation Deferral Contributions of each such Highly
Compensated Employee together with the net earnings or losses allocable
thereto prior to the end of the Plan Year following the Plan Year in which the
excess Compensation Deferral Contributions were made.
(c) (i) Net earnings or losses to be refunded with the
Compensation Deferral Contributions shall be equal to the net earnings or
losses on such contributions for the Plan Year in which the contributions were
made plus the net earnings or losses on such contributions during the Gap
Period.
(ii) The net earnings or losses allocable to the excess
Compensation Deferral Contributions for the Plan Year shall be determined by
multiplying the net earnings or losses allocable to the Participant's
Participant Deferral Account for the Plan Year by a fraction, the numerator of
which is the amount of the Participant's Compensation Deferral Contributions
to be refunded and the denominator of which is the balance of the
Participant's Participant Deferral Account as of the last day of the Plan
Year, reduced by the net earnings (or increased by the net loss) allocable to
the Participant's Participant Deferral Account for the Plan Year.
(iii) The net earnings or losses allocable to the excess
Compensation Deferral Contributions for the Gap Period shall be the amount
determined in accordance with (A) or (B)below, as the Committee shall select:
(A) The amount determined by applying the formula
described in (ii) above except that the phrase "Gap Period" shall be
substituted for the phrase "Plan Year."
(B) The amount determined by multiplying the net
earnings or losses for the Plan Year determined in subsection (ii) above times
one-tenth for each month in the Gap Period, including the month in which the
refunds are distributed if the refund is distributed after the 15th day of
such month.
(d) Any excess contributions distributed to a Family Group
pursuant to the reductions in paragraph (b)(iv) above shall be allocated to
each Family Member in the same proportion that such Family Member's
Compensation Deferral Contributions bear to the aggregate Compensation
Deferral Contributions of the Family Group.
4.3 Return of Deferrals Over $7,000.
(a) If a Participant's Compensation Deferral Contributions
exceed the limitation described in Section 4.2(a) the excess Compensation
Deferral Contributions, together with income allocable thereto (or reasonably
estimated to be allocable thereto), shall be returned to the Participant
(after withholding applicable federal, state and local taxes) on or before the
April 15 following the close of the calendar year in which such excess
contribution is made; provided, however, if there is a loss allocable to the
excess Compensation Deferral Contributions, the amount distributed shall be
the amount of the excess as adjusted to reflect such loss. Any Matching
Contributions which are attributable to any excess Compensation Deferral
Contributions and any income allocable thereto, shall either be returned to
the Company or applied to reduce future Matching Contributions.
(b) In accordance with rules and procedures as may be
established by the Committee, not later than March 1 of a calendar year a
Participant may submit a claim to the Committee in which he certifies in
writing the specific amount of his Compensation Deferral Contributions for the
preceding calendar year which, when added to amounts deferred for such
calendar year under other plans or arrangements described in Section 401(k),
408(k) or 403(b) of the Code, will cause the Participant to exceed the
limitation described in Section 4.2(a) for such preceding calendar year.
Notwithstanding the amount of the Participant's Compensation Deferral
Contributions for such preceding calendar year, the Committee shall treat the
amount specified by the Participant in his claim as a Compensation Deferral
Contribution in excess of the limitation described in Section 4.2(a) for such
calendar year and return it to the Participant in accordance with this
section.
(c) Any Compensation Deferral Contributions in excess of the
limitation described in Section 4.2(a) which are distributed to a Participant
in accordance with this section shall, to the extent required by regulations
issued by the Secretary of the Treasury, be treated as Annual Additions under
Article XIII for the Plan Year for which the excess Compensation Deferral
Contributions were made.
4.4 After-Tax Contributions. For each payroll period for which a
Participant has entered into a Compensation deferral agreement, such
Participant may also elect to contribute amounts as After-Tax Contributions
under the Plan. After-Tax Contributions shall be designated by the
Participant in writing on the form required by the Committee in whole number
percentages up to ten percent of his Compensation. An agreement to make
After-Tax Contributions to the Plan shall become effective on the next Entry
Date, or, in the case of Participants paid more frequently than monthly, the
payroll date coinciding with or next following the next Entry Date, by
completing and submitting such agreement at the time, in the form and in
accordance with procedures established by the Committee, and shall remain in
effect unless revoked or changed by the Participant under the same terms and
conditions as those set forth in Section 4.1(b) for revocation or modification
of Compensation deferral agreements; provided that such contributions shall
automatically be revoked if the Participant terminates or revokes his
Compensation deferral agreement and the Participant shall only again be able
to make After-Tax Contributions only if he enters into a new Compensation
deferral agreement. Solely for purposes of satisfying one of the tests
prescribed in Section 5.2 or 5.3, the Committee may prescribe such rules as it
deems necessary or appropriate regarding the maximum amount that a Participant
may contribute under this Section. These rules may provide that the maximum
percentage of Compensation that a Participant may contribute will be a lower
percentage of his Compensation above a certain dollar amount of Compensation
than the maximum contribution percentage below that dollar amount of
Compensation. These rules shall apply to all Active Participants, except to
the extent that the Committee prescribes special or more stringent rules
applicable only to Highly Compensated Employees.
4.5 Amounts Transferred from Prior Plan. An Eligible Employee who
was a participant in the Prior Plan as of September 30, 1986 may transfer his
entire account balance thereunder to his Transfer Account. Amounts held in a
Participant's Transfer Account may be withdrawn prior to the Participant's
termination of employment with the Company and Affiliated Companies in
accordance with the rules governing withdrawals set forth in the Prior Plan.
4.6 Rollovers. Subject to the Committee's approval, any amount which
an Employee who may become an Eligible Employee upon completion of 1,000 Hours
of Service in a Compensation Period has received from any other employee
benefit plan (the "Other Plan") which is qualified under Code Section 401(a)
may, in accordance with uniform and nondiscriminatory procedures adopted by
the Committee, be transferred to the Committee as a Rollover Contribution.
Such Rollover Contribution shall be paid to the Trust Fund and allocated to
the Participant's Rollover Account. A Rollover Contribution is subject to the
following conditions:
(a) The amounts received under the Other Plan must qualify for
rollover treatment under Code Section 402;
(b) The transfer of such amounts to the Committee be made
directly from the other Plan or must occur on or before the 60th day following
such Participant's receipt of the distribution from the Other Plan, or if such
Other Plan distribution has been previously deposited in an Individual
Retirement Account (as described in Code Section 408), the transfer of such
amounts to the Committee must occur on or before the 60th day following the
receipt by such Participant of the balance of such Individual Retirement
Account;
(c) The amounts transferred to the Committee must not represent
any deposits or contributions deemed made by such Participant under the Other
Plan (other than voluntary deductible contributions described in Code Section
219(e)(2)) or to the Individual Retirement Account; and
(d) The amounts transferred to the Committee must not represent
rollovers from any plan which is subject to the requirements of Code Section
401(a)(11).
Amounts held in a Participant's Rollover Account may not be withdrawn
under Section 8.6 prior to the Participant's termination of employment with
the Company and Affiliated Companies.
ARTICLE V
COMPANY CONTRIBUTIONS
5.1 Amount and Allocation of Contributions. Subject to the
requirements and restrictions of the Plan:
(a) The Company shall make Compensation Deferral Contributions
as elected by Participants pursuant to Section 4.1, so long as such amounts
qualify for treatment under Code Section 401(k).
(b) The Company shall make Company Contributions as necessary to
restore amounts forfeited as provided in Section 8.4(b).
(c) The Company shall make a Matching Contribution on behalf of
each Participant who made Compensation Deferral Contributions during the Plan
Year equal to a percentage of such Participant's Compensation Deferral
Contributions which qualify for treatment under Code Sections 401(k) and
402(g), determined in accordance with the following table:
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Percentage of Compensation Percentage of Compensation
Contributed as Compensation Deferral Contribution
Deferral Matched
1 - 2 75
3 - 4 50
5 - 6% 25%
</TABLE>
(d) The Company shall make for each Plan Year a Retirement Plan
Contribution in such amount, if any, as may be determined by the Board of
Directors in its sole discretion. Any Retirement Plan Contribution for a Plan
Year shall be allocated to the Retirement Plan Contributions Account of each
Participant (i) who was credited with not less than 1,000 Hours of Service in
such Plan Year and who was an Active Participant or on a Leave of Absence on
the last day of the Plan Year, or (ii) whose employment with the Company
terminated during the Plan Year due to death, retirement on or after Normal
Retirement Date or as a result of Total and Permanent Disability. Such
allocation shall be in an amount which bears the same ratio to such Retirement
Plan Contribution as the Participant's Compensation for such Plan Year bears
to the Compensation of all such Participants for the Plan Year.
(e) All Compensation Deferral Contributions shall be paid to the
Trust Fund as soon as practicable but in no event later than 90 days following
the date such deferrals are made. All Matching Contributions and Retirement
Plan Contributions with respect to a Plan Year shall be paid to the Trust Fund
no later than the time prescribed by law (including extensions) for filing the
Company's federal income tax return for the Company's taxable year during or
within which the Plan Year ended (without any earnings or other adjustment in
such amounts).
5.2 Code Section 401(m) Limitation on After-Tax Contributions and
Matching Contributions. Notwithstanding any provision in the Plan to the
contrary:
(a) The After-Tax Contributions and Matching Contributions of
the Highly Compensated Employees shall be reduced if neither of the
Contribution Percentage Tests set forth in (i) or (ii) below is satisfied:
(i) The 1.25 Test. The Contribution Percentage of the
Highly Compensated Employees is not more than the Contribution Percentage of
all Nonhighly Compensated Employees multiplied by 1.25.
(ii) The 2.0 Test. The Contribution Percentage of the
Highly Compensated Employees is not more than two percentage points greater
than the Contribution Percentage of all Nonhighly Compensated Employees, and
the Contribution Percentage of the Highly Compensated Employees is not more
than the Contribution Percentage of all Nonhighly Compensated Employees
multiplied by 2.0.
(b) (i) "Contribution Percentage" means the average of the
ratios of each Highly Compensated Employee's or Nonhighly Compensated
Employee's, as the case may be, share of the Matching Contribution and
After-Tax Contributions plus Designated Compensation Deferral Contributions
(as defined in paragraph (c)), if any, which were allocated to the
Participant's Accounts with respect to the Plan Year, to each such
Participant's Compensation for the Plan Year.
(ii) If a Highly Compensated Employee is a member of a
Family Group, such Family Group shall constitute a single Highly Compensated
Employee. The Contribution Percentage of such Family Group shall be the
aggregate Contribution Percentage of all Family Members and the Contribution
Percentage of each Family Member shall be disregarded for purposes of the
Contribution Percentage Tests.
(c) To the extent necessary, and solely for the purpose of
satisfying the Contribution Percentage Test in Section 5.2(a), all or part of
Compensation Deferral Contributions may be treated by the Committee as
After-Tax Contributions ("Designated Compensation Deferral Contributions"),
provided that:
(i) Compensation Deferral Contributions, including
Designated Compensation Deferral Contributions, satisfy the requirements of
Section 4.2(b); and
(ii) Compensation Deferral Contributions, excluding
Designated Compensation Deferral Contributions, satisfy the requirements of
Section 4.2(b).
(d) If neither Contribution Percentage Test is satisfied as of
the end of the Plan Year, the Committee shall cause the After-Tax
Contributions, and if necessary, Matching Contributions, of Highly Compensated
Employees to be reduced and refunded to each affected Highly Compensated
Employee until either Contribution Percentage Test is satisfied. The sequence
of such reductions and refunds shall begin with Highly Compensated Employees
who elected the greatest percentage and then shall proceed with each lesser
percentage until either Contribution Percentage Test is satisfied. Once
either Contribution Percentage Test is satisfied, the Committee shall direct
the Trustee to distribute to the appropriate Highly Compensated Employees the
amount of the reduction of the After-Tax Contributions and, if necessary,
Matching Contributions of each such Highly Compensated Employee, together with
the net earnings or losses allocable thereto, prior to the end of the Plan
Year following the Plan Year in which such excess After-Tax Contributions and
excess Matching Contributions were made. Any reduction and refund made to a
Highly Compensated Employee in accordance with the Section shall be withdrawn
first from his After-Tax Account, and then, if necessary, from his Matching
Account. Notwithstanding the foregoing:
(i) if a Participant is not 100% vested in his Matching
Account, the forfeitable portion of any amount withdrawn from his Matching
Account shall be forfeited and only the vested portion shall be distributed to
the Participant, insofar as is required pursuant to this Section; and
(ii) any Matching Contributions related to excess
Compensation Deferral Contributions shall be forfeited without regard to the
Participant's vested percentage.
(e) Net earnings or losses to be refunded with the excess
After-Tax Contributions shall be equal to the net earnings or losses on such
Contributions for the Plan Year in which the Contributions were made plus the
net earnings or losses on such After-Tax Contributions during the Gap Period.
Net earnings or losses shall be determined in the same manner as in Section
4.2(c), except that the phrases "After-Tax Contributions" and "After-Tax
Account" shall be substituted for the phrases "Compensation Deferral
Contributions" and "Participant Deferral Account" wherever used therein.
(f) Net earnings or losses refunded or forfeited with the
Matching Contributions shall be equal to the net earnings or losses on such
contributions for the Plan Year in which the contributions were made plus the
net earnings or losses on such Matching Contributions during the Gap Period.
Net earnings or losses shall be determined in the same manner as in Section
4.2(c), except that the phrases "Matching Contribution" and "Matching Account"
shall be substituted for the phrases "Compensation Deferral Contribution" and
"Participant Deferral Account" wherever used therein.
(g) Any excess contributions attributable to a Family Group and
distributed or forfeited pursuant to the reductions in paragraph (d) above
shall be allocated to each Family Member in the same proportion that such
Family Member's After-Tax Contributions and Matching Contributions bear to the
aggregate After-Tax Contributions and Matching Contributions of the Family
Group.
(h) Any Matching Contributions which are treated as forfeitures
pursuant to paragraph (d) above shall be used to reduce future Matching
Contributions.
5.3 Multiple Use.
(a) This section will apply if The 2.0 Test is used to satisfy
both the Actual Deferral Percentage Test and the Contribution Percentage Test.
If this section applies, the Committee shall determine whether a Multiple Use
has occurred, and if such a Multiple Use has occurred, the After-Tax
Contributions of the Highly Compensated Employees shall be reduced and
refunded in accordance with the provisions of paragraph (c).
(b) A "Multiple Use" occurs when for the Highly Compensated
Employees, the sum of the Actual Deferral Percentage used to satisfy The 2.0
Test plus the Contribution Percentage used to satisfy The 2.0 Test exceeds the
"Aggregate Limit." The Aggregate Limit is the greater of (i) or (ii) below,
determined as follows:
(i) (A) First, multiply 1.25 by the greater of (I) the
Actual Deferral Percentage, or (II) the Contribution Percentage of the
Nonhighly Compensated Employees;
(B) Second, add 2.0 to the lesser of (I) or (II) above
provided that such sum shall not exceed two times the lesser of (I) or (II)
above;
(C) Finally, add the results from (A) and (B) to
determine the Aggregate Limit;
(ii) (A) First, multiply 1.25 by the lesser of (I) the
Actual Deferral Percentage, or (II) the Contribution Percentage of the
Nonhighly Compensated Employees;
(B) Second, add 2.0 to the greater of (I) or (II)
above provided that such sum shall not exceed two times the greater of (I) or
(II) above;
(C) Finally, add the results from (A) and (B) to
determine the Aggregate Limit.
(c) If a Multiple Use has occurred, such Multiple Use shall be
corrected by reducing the Contribution Percentage of Highly Compensated
Employees in accordance with the provisions of Section 5.2(d) until the sum of
the Actual Deferral Percentage plus the Actual Contribution Percentage for the
Highly Compensated Employees equals the Aggregate Limit.
(d) Net earnings or losses to be refunded with the excess
After-Tax Contributions shall be equal to the net earnings or losses on such
contributions for the Plan Year in which the contributions were made plus the
net earnings or losses on such After-Tax Contributions during the Gap Period.
Net earnings or losses shall be determined in the same manner as in Section
4.2(c), except that the phrases "After-Tax Contributions" and "After-Tax
Account" shall be substituted for the phrases "Compensation Deferral
Contributions" and "Participant Deferral Account" wherever used therein.
(e) Net earnings or losses refunded or forfeited with the
Matching Contributions shall be equal to the net earnings or losses on such
contributions for the Plan Year in which the contributions were made plus the
net earnings or losses on such Matching Contributions during the Gap Period.
Net earnings or losses shall be determined in the same manner as in Section
4.2(c), except that the phrases "Matching Employer Contribution" and "Matching
Account" shall be substituted for the phrases "Compensation Deferral
Contribution" and "Participant Deferral Account" wherever used therein.
(f) Any Matching Contributions which are treated as forfeitures
pursuant to paragraph (c), and any income allocable thereto, shall be used to
reduce future Matching Contributions.
ARTICLE VI
PARTICIPANT ACCOUNTS
6.1 Accounting Procedures. The Committee and the Trustee shall
establish accounting procedures for the purpose of making the allocations,
valuations and adjustments to Accounts provided for in this Article VI. From
time to time the Committee and Trustee may modify such accounting procedures
for the purpose of achieving equitable, nondiscriminatory, and
administratively feasible allocations among Accounts in accordance with the
general concepts of the Plan and the provisions of this Article VI.
Allocations of all assets shall be made on the basis of, and expressed in
terms of, dollar value.
6.2 Valuation of Accounts. As of each Valuation Date, the Trustee
shall value the assets of the Trust on the basis of fair market value. Upon
receipt of this valuation, the Committee shall revalue the Accounts in the
following order: (I) each Account shall be adjusted to reflect any withdrawals
or distributions made therefrom since the last preceding Valuation Date; (2)
each Account shall be adjusted to reflect a proportionate share in any
increase or decrease in the fair market value of the assets in the Trust Fund
since the last preceding Valuation Date; (3) any Compensation Deferral
Contributions made on behalf of a Participant since the last preceding
Valuation Date shall be credited to his Participant Deferral Account; (4) any
After-Tax Contributions made by a Participant since the last preceding
Valuation Date shall be credited to his After-Tax Contributions Account; (5)
Matching Contributions shall be allocated to the Matching Contributions
Account of each Participant who made Compensation Deferral Contributions since
the last preceding Valuation Date, and if such Valuation Date is the last day
of a Plan Year, Matching Contributions shall be allocated to the Matching
Contributions Account of any Participant who made Compensation Deferral
Contributions for such year who did not receive the full amount of Matching
Contributions to which he is entitled for such year; (6) any Retirement Plan
Contribution made since the last preceding Valuation Date will be allocated to
the Retirement Plan Contributions Account of each Participant entitled to such
an allocation under Section 5.1(d); and (7) any Plan administrative expenses
shall be allocated to and deducted from Participants' Accounts, pursuant to
Section 9.16. The Committee shall distribute to each Participant a quarterly
statement showing the value of his Account as of a stated Valuation Date.
The valuation and allocation provisions of this section shall be applied
and implemented in accordance with the following rules:
(a) All gains, losses, dividends and other property acquisitions
and/or transfers that occur with respect to the Trust Fund shall be held,
charged, credited, debited or otherwise accounted for on an unallocated basis
until allocated to Accounts or otherwise used or applied in accordance with
the provisions of the Plan.
(b) The share of the net income (or loss) that will be allocated
to each Account shall reflect the respective net values of the applicable
investment funds established under Section 7.2, based on the Participant's
investment selections for his Account.
(c) The net income (or loss) shall include the increase (or
decrease) in the fair market value of Trust assets; all cash income of the
Trust, whether in the form of interest, cash dividends, or otherwise; and all
expenses not paid by the Company attributable to Trust assets since the
preceding Valuation Date.
(d) The net income (or loss) shall not include any Company or
Employee Contributions to be credited to Accounts as of the current or a later
Valuation Date.
(e) If the Company shall make any payment or payments on account
of a Retirement Plan Contribution with respect to any Plan Year prior to the
last day of such year, such payment or payments shall be held by the Trustee
in a subaccount separate from the general assets of the Plan and shall be
invested in accordance with Section 7.2(c). No Participant shall acquire any
interest in the assets of such subaccount until the last day of the Plan Year,
as of which date such assets will become a part of the general assets of the
Plan and be allocated in accordance with this section and any increase or
decrease in the fair market value of such assets shall be reflected in the
Accounts then invested under Section 7.2(c).
ARTICLE VII
TRUST FUND
7.1 Trust Fund. The Sponsor has entered into a Trust Agreement for
the establishment of a Trust Fund to hold the assets of the Plan. The Trustee
has agreed to hold and administer all funds and assets that may be deposited
with the Trustee pursuant to the terms of this Plan. The Trust Fund shall
also hold funds and assets transferred from the Prior Plan pursuant to Section
4.5, and funds attributable to rollovers from other qualified plans made
pursuant to Section 4.6.
7.2 Investment of Trust Assets.
(a) Initially, the assets of the Trust Fund shall be invested in
the two investment funds established as part of the Trust Fund: (i) the
"Guaranteed Fund" to be invested in assets with a fixed rate of return, and
(ii) the "Equity Fund" to be invested either in the shares of one or more
registered investment companies, or a diversified portfolio of equity
securities and other assets at the discretion of the Trustee or other
fiduciary having responsibility for the management of such fund, or both.
Investment funds may be added, suspended or terminated from time to time at
the direction of the Board of Directors. All or any part of an investment
fund may from time to time be invested in cash or money market instruments.
(b) A Participant shall specify the investment funds in which
his Account except his Retirement Plan Contributions Account are to be
invested. A Participant may change the investment of (i) amounts already
allocated to such Account to the extent that they are not invested in a
guaranteed investment contract or (ii) future contributions to such Account
effective on the next January 1, April 1, July 1 or October I or on such other
dates as the Committee may specify, at the time, and in accordance with
procedures established by the Committee. Future contributions and previously
allocated amounts need not be invested in the same proportion in each
investment fund. The provisions of this section shall be subject to such
additional limitations as the Committee may specify, from time to time,
including any withdrawal or transfer restrictions imposed by the issuer of any
investment contract.
(c) Retirement Plan Contributions shall be invested by the
Committee in one or more investment funds provided under this Section 7.2 as
directed by the Board of Directors.
7.3 Irrevocability. The Company shall have no right or title to, nor
interest in, the contributions made to the Trust Fund, and no part of the
Trust Fund shall revert to the Company, except as follows:
(a) If a Company Contribution is made by a mistake of fact, at
the Company's written request that contribution may be returned to the Company
within one year after it is made.
(b) All Company Contributions are conditioned upon deductibility
under Code Section 404. To the extent a deduction is disallowed, at the
written request of the Sponsor or Affiliated Company making the contribution,
such contribution shall be returned to the Sponsor or such Affiliated Company
within one year after the disallowance.
7.4 Company, Committee and Trustee Not Responsible for Adequacy of
Trust Fund. Neither the Company, the Committee nor the Trustee shall be
liable or responsible for the adequacy of the Trust Fund to meet and discharge
any or all payments and liabilities hereunder. All Plan benefits will be paid
only from the Trust assets. Except as required under the Plan or Trust or
under Part 4 of Title I of ERISA, the Company shall not be responsible for any
decision, act or omission of the Trustee, the Committee, or any Investment
Manager.
ARTICLE VIII
VESTING; PAYMENT OF PLAN BENEFITS
8.1 Vesting. Each Participant shall at all times be 100% vested in
his Participant Deferral Account, his Transfer Account, his After-Tax
Contributions Account, and his Rollover Account. If a Participant's
employment with the Company terminates prior to his Normal Retirement Date for
a reason other than death, retirement after his Early Retirement Date or Total
and Permanent Disability, the nonforfeitable percentage of his Matching
Contributions Account shall be determined in accordance with the following
table:
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Number of Years of Service Vested Percentage
Less than two 0
At least two but less than three 40
At least three but less than four 60
At least four but less than five 80
Five or more 100%
</TABLE>
and the nonforfeitable percentage of his Retirement Plan Contributions Account
shall be determined in accordance with the following table:
<TABLE>
<CAPTION>
<S> <C>
Number of Years of Service Vested Percentage
Less than five 0
Five or more 100%
</TABLE>
A Participant shall become 100% vested in his Matching Contributions and
Retirement Plan Contributions Accounts upon attainment of his Normal
Retirement Date while employed by the Company, as of the date of his
termination of employment with the Company as a result of his Early Retirement
Date, Total and Permanent Disability, or as of the date of his death.
8.2 Distribution Upon Retirement or Disability.
(a) A Participant whose employment with the Company and all
Affiliated Companies terminates on or after he has attained his Early
Retirement Date or his Normal Retirement Date or as a result of Total and
Permanent Disability shall be entitled to a distribution of his Account as
soon as practicable after the date of his termination. Such Participant's
Account shall be valued as of the Valuation Date coinciding with or
immediately following his termination of employment, and shall be paid to him
in a lump sum, subject to the provisions of Section 8.5.
(b) In no event will amounts be distributed to a Participant
prior to his 65th birthday without his written consent if the value of his
vested Account exceeds, or at the time of any prior distribution exceeded,
$3,500.
8.3 Distribution Upon Death.
(a) Upon the death of a Participant prior to commencement of the
distribution of benefits hereunder, distribution shall be made to the
Participant's Beneficiary as soon as practicable after the value of the
Participant's Account is determined. Such distribution shall be a lump sum in
cash of the value of the Participant's Account as of the Valuation Date
coinciding with or immediately following the date on which the Committee has
been furnished with all documents and information necessary to distribute such
Participant's Account.
(b) Each Participant shall have the right to designate or to
change or revoke such designation of a Beneficiary or Beneficiaries to receive
his interest in the Trust Fund in the event of his death. This designation or
redesignation is to be made on the form prescribed by and delivered to the
Committee. If a married Participant designates a Beneficiary other than his
Spouse, no effect shall be given to such designation unless such Spouse
provides written consent in such form as the Committee may require, witnessed
by a notary public, and such designation names a Beneficiary which may not be
changed without the Spouse's consent (or the consent expressly permits
designations by the Participant without requirement of further consent by the
Spouse). A Spouse's consent to a Beneficiary designation is not required if
it is established to the satisfaction of the Committee that there is no Spouse
or the Spouse cannot be located. The Committee shall have absolute discretion
as to whether the consent of a Spouse shall be required. If a deceased
Participant shall have failed to designate a Beneficiary, or if the Committee
shall be unable to locate a designated Beneficiary after reasonable efforts
have been made, or if the designated Beneficiary shall have predeceased the
Participant without the Participant having designated a successor Beneficiary,
the Participant's Beneficiary shall be the person or persons having the
highest priority as listed below, in order of priority: (A) the Participant's
surviving Spouse; (B)the Participant's surviving children, including adopted
children; (C) the Participant's surviving parents; or (D) the Participant's
estate.
(c) The Committee shall not be required to authorize any payment
to be made to any person following a Participant's death, whether or not such
person has been designated by the Participant as a Beneficiary, if the
Committee determines that the Plan may be subject to conflicting claims in
respect of said payment for any reason. In the event the Committee determines
in accordance with this Section 8.3(c) not to make payment to a designated
Beneficiary, the Committee shall take such steps as it determines appropriate
to resolve such potential conflict.
8.4 Distribution Upon Termination of Employment Prior to Retirement.
(a) The Account of a Participant whose employment with the
Company terminates prior to his Normal Retirement Date for a reason other than
his death, retirement on his Early Retirement Date, or Total and Permanent
Disability, shall be valued as of the Valuation Date coinciding with or
immediately following the date on which the Participant's request for
distribution of his Account is received by the Committee. Any unvested
amounts in his Account shall be forfeited immediately upon the complete
distribution of the vested portion of the Participant's Account, or, if the
Participant does not consent to an immediate distribution, then any such
unvested amounts shall be forfeited on the date on which he sustains five
consecutive Breaks in Service. Subject to the provisions of Section 8.2(b),
a Participant's entire nonforfeitable interest in his Account shall be paid to
him as soon as practicable after his termination of employment in a lump sum
in cash.
(b) Any Participant whose employment terminates and who receives
a distribution of the nonforfeitable percentage of his Account when he is not
fully vested in his Matching Contributions Account and his Retirement Plan
Contributions Account, and who again becomes an Employee prior to incurring
five consecutive Breaks in Service, will have the forfeited portions of his
Matching Contributions Account and his Retirement Plan Contribution Account
restored; provided, however, that his Matching Contributions Account shall be
restored only if he repays to the Plan the amount of his Matching
Contributions Account so distributed prior to the earlier of (i) the date on
which he sustains five consecutive Breaks in Service commencing on or after
such distribution, or (ii) five years after the date of his reemployment.
Upon such restoration, the portions of such Participant's Matching
Contributions Account and Retirement Plan Contributions Account which were
forfeited shall be reinstated without adjustment for gain or loss between the
time of forfeiture and the time of reinstatement. No restoration shall be
made if the Participant is reemployed by the Company after incurring five (5)
consecutive Breaks in Service.
(c) Any restoration required by Section 8.4(b) shall be made out
of the amounts forfeited by Participants in any Plan Year. If forfeitures are
insufficient, the Company shall contribute such additional amount as is
required to make restoration. If such forfeitures exceed the amounts required
to make restoration, the remainder shall be used to reduce the amount of
Company Contributions required for that Plan Year, or applied to offset
administrative expenses, pursuant to Section 9.16.
(d) If a benefit is forfeited because the Participant or
Beneficiary cannot be found, such benefit will be reinstated if a claim is
made by the Participant or Beneficiary.
8.5 Timing of Distribution.
(a) Benefits payable under the Plan shall be distributed as soon
as practicable but, unless the Participant elects to do otherwise in
accordance with provisions of the Plan, not later than the 60th day after the
Plan Year in which, with respect to the Participant, occurs the later of his
(i) attainment of age 65 or (ii) termination of employment with the Company.
(b) Notwithstanding anything to the contrary contained in the
Plan, a Participant's benefit will be distributed in a single payment no later
than April I of the calendar year following the calendar year in which the
Participant attains age 70-1/2, whether or not his employment has terminated.
8.6 Withdrawals.
(a) Twice in each Plan Year a Participant may withdraw amounts
from his After- Tax Contributions Account, if any, subject to the right of the
Committee to require reasonable advance notice or reasonable minimum amounts.
The amount of a Participant's After-Tax Contributions available for withdrawal
shall be the lesser of the total of such After-Tax Contributions, less any
such amounts previously withdrawn, or the value of the Participant's After-
Tax Contributions as of the Valuation Date immediately following the
Committee's determination authorizing such withdrawal. Notwithstanding the
foregoing, as required by law, any distribution hereunder shall be deemed to
be made first from the Participant's After-Tax Contributions made prior to
January 1, 1987, if any, second pro rata from After-Tax Contributions made
after December 31, 1986 and from the earnings on such After-Tax Contributions,
and third from the earnings on After-Tax Contributions made prior to January
1, 1987, if any.
(b) Each Participant may twice in each Plan Year upon written
request make a hardship withdrawal from his Participant Deferral and/or
Rollover Accounts in an amount determined by the Committee after finding that
the withdrawal is both made on account of an immediate and heavy financial
need of the Participant and necessary to satisfy the financial need, and that
the Participant has exhausted all other sources available to him under all
plans maintained by the Company. A distribution is on account of an immediate
and heavy financial need of the Participant only if it is for the purpose of
(a) expenses for medical care described in Code Section 213(d) of the
Participant or his Spouse or dependents (as defined in Code Section 152),
including expenses for medical care previously incurred as well as expenses
necessary to obtain medical care, which are not covered by insurance, (b)
payment of tuition and related educational fees for the next 12 months of
post-secondary education of the Participant or his Spouse or dependents (as
defined in Code Section 152), (c) costs directly related to the purchase
(excluding mortgage payments) of a principal residence for a Participant, or
(d) preventing the eviction of the Participant from his principal residence or
the foreclosure on the mortgage on that residence. The existence of a
Participant's financial hardship, and the amount required to meet the need
created by the hardship as well as to pay taxes and penalties resulting from a
hardship distribution, shall be determined by the Committee on the basis of
all relevant facts and circumstances and in accordance with rules of uniform
application which the Committee may from time to time prescribe.
Hardship withdrawals shall be made according to the following provisions:
(i) The amount of a Participant's Compensation Deferral
Contributions available for withdrawal shall be the lesser of: (A) the total
of such Compensation Deferral Contributions, less any such amounts previously
withdrawn, or (B) the value of the Participant's Compensation Deferral
Contributions as of the Valuation Date immediately following the Committee's
determination authorizing such withdrawal. The amount of a Participant's
Rollover Contributions available for withdrawal shall be the value of such
contributions as of the Valuation Date immediately following the Committee's
determination authorizing such withdrawal. In no event shall the amount
available for withdrawal exceed the amount required to meet the immediate and
heavy financial need.
(ii) Withdrawals from the Guaranteed Fund will be allocated
proportionately among all contracts in which the Guaranteed Fund is invested
as follows: the proportionate share allocated to an investment contract will
be equal to the ratio of the value of the Participant's fixed dollar
investment under the Guaranteed Fund in that investment contract over the
total value of the Participant's fixed dollar investment in the Guaranteed
Income Fund in all investment contracts.
(iii) The amount so withdrawn shall be paid to the
Participant in a lump sum in cash as soon as practicable after the Committee's
determination.
(iv) Each time a Participant makes a hardship withdrawal he
shall be placed on a Twelve-Month Suspension from making future Compensation
Deferral Contributions.
(v) A Participant may not make a subsequent hardship
withdrawal until at least six months after making a previous hardship
withdrawal.
(c) After attaining age 59-1/2 a Participant may withdraw
amounts from his Participant Deferral and/or Rollover Accounts.
(d) A Participant may withdraw amounts in his Transfer Account
in accordance with the rules of the Prior Plan governing withdrawals.
(e) A Participant may specify the investment fund or funds from
which a withdrawal under this section will be taken, and the percentage of the
withdrawal which shall be taken from each fund. All withdrawals shall be
subject to the reasonable administrative rules and procedures established by
the Committee, including reasonable advance notice and minimum amounts.
Amounts withdrawn under this section may not be returned to the Plan.
(f) Except as provided in this section, no amounts may be
withdrawn by a Participant prior to his or her termination of employment. In
no event may a withdrawal be made under this Section 8.6 by a Participant
after termination of employment; rather, in such cases distribution shall be
made under other provisions of Article VIII.
8.7 Facility of Payment. If any payee under the Plan is a minor or
if the Committee reasonably believes that any payee is legally incapable of
giving a valid receipt and discharge for any payment due him, the Committee
may have the Payment, or any part thereof, made to the person (or persons or
institution) whom it reasonably believes is caring for or supporting the
payee, unless it has received due notice of claim therefor from a duly
appointed guardian of the payee. Any payment shall be a payment from the
Account of the payee and shall, to the extent thereof, be a complete discharge
of any liability under the Plan to the payee.
8.8 Additional Documents. The Committee or Trustee, or both, may
require the execution and delivery of such documents, papers and receipts as
the Committee or Trustee may determine necessary or appropriate in order to
establish the fact of death of the deceased Participant and of the right and
identity of any Beneficiary or other person or persons claiming any benefits
under this Article VIII.
8.9 Participant Loans. Upon submission by an Active Participant or
an Employee who had made a Rollover Contribution pursuant to Section 4.6
(collectively described in this Section as a "Borrowing Participant") of a
written form as prescribed by the Committee, the Committee shall grant a loan
to such Borrowing Participant from his vested Account balance (excluding his
Retirement Plan Contributions Account); provided, however, that if the
Committee reasonably believes that the Borrowing Participant either does not
intend to repay the loan or lacks proper financial ability to repay the loan,
it shall not grant such a loan. Loans shall be subject to the provisions of
this Section 8.9. In accordance with regulations promulgated by the U.S.
Department of Labor, loans shall be made available on a reasonably equivalent
basis to all Participants and Beneficiaries who have vested Account balances
in the Plan (excluding Retirement Plan Contributions Accounts) and who are
"parties in interest" as defined in Section 3(14) of ERISA.
(a) Each Borrowing Participant may obtain a loan either for the
purchase of a primary residence (a "Residential Loan") or for any other
purpose (a "General Loan"). The minimum amount which can be borrowed shall be
$1,000. A Borrowing Participant may request one loan per calendar quarter and
may at any time have outstanding not more than one Residential Loan and one
General Loan. Prior to August 1, 1993, if a Borrowing Participant repaid an
existing loan in order to obtain a new loan, the new loan would not be
available for three months after the existing loan was repaid. Effective
August 1, 1993, if a Borrowing Participant repays an existing loan to obtain a
new loan, the new loan shall be available as soon as practicable after the
repayment of the existing loan is processed. Notwithstanding the foregoing
sentence, but subject to the other provisions of this section, effective
January 1, 1995, an existing loan may be recharacterized as a new loan without
repayment of the existing loan.
(b) In no event shall any loan be made under this Section 8.9
if, after the making of such loan, the aggregate amount of all current and
prior outstanding loans to the Borrowing Participant (and all loans from any
other qualified plans maintained by the Company or any Affiliated Company to a
Borrowing Participant) would exceed the lesser of:
(1) $50,000, reduced by the excess (if any) of:
(i) the highest outstanding balance of all previous loans
to the Borrowing Participant from any qualified plan maintained by the Company
or any Affiliated Company during the one year period ending on the day before
the date on which any such subsequent loan from the Plan would be made, over
(ii) the outstanding balance of all such previous loans on
the date on which any such subsequent loan from the Plan would be made; or
(2) 50% of the vested balance of the Borrowing
Participant's Account (excluding his Retirement Plan Contributions Account).
(c) All loans made from the Plan to a Borrowing Participant
shall:
(1) be secured by the Borrowing Participant's Segregated
Loan Account and such other security as the Committee in its discretion deems
appropriate;
(2) bear interest at a rate that is commensurate with the
interest rates charged by persons in the business of lending money for loans
which would be made under similar circumstances;
(3) by their terms be required to be repaid in
substantially equal payments not less frequently than quarterly through
payroll deduction or other means acceptable to the Committee;
(4) by their terms be required to be repaid over a term not
to exceed five years; provided, however, that Residential Loans shall be
repaid over a term not to exceed 25 years; provided further that the minimum
term for any loan shall be one year; and
(5) be subject to such additional terms, conditions and
charges as the Committee in its sole discretion deems appropriate.
(d) Any loan made pursuant to this Section 8.9 shall be
evidenced by a promissory note signed by the Borrowing Participant, setting
forth the date or dates of principal repayment, the interest rate and interest
payment dates, and such other terms and conditions as the Committee deems
appropriate. All such notes shall be held in the custody of the Trustee until
discharged.
(e) Loans may be prepaid if the balance of the loan is paid in
full.
(f) Any amounts loaned to a Borrowing Participant pursuant to
this Section 8.9 shall be treated as an investment of the Plan on behalf of
such Borrowing Participant, and shall be deemed to be an asset of the Active
Participant's Segregated Loan Account. When a loan is made, the balance
credited to a Borrowing Participant's Segregated Loan Account shall be charged
to the Borrowing Participant's subaccounts in the following order: (1)
After-Tax Contributions Account, (2) Rollover Account, (3) Transfer Account,
(4) Participant Deferral Account, and (5) Matching Contributions Account.
Amounts charged to each Account shall be charged proportionately to each
investment fund in which the Account is invested at the time the loan is
obtained. To the extent amounts borrowed are credited and charged as
previously described, such Account (and any subaccounts relating to such
Account) shall not participate in the net gains or net losses of the Plan, but
it shall be credited with the interest paid on such loan. As amounts are
repaid, they shall be credited to the subaccounts from which they were
obtained in the reverse of the order in which they were charged, and credited
to each investment fund in accordance with the Borrowing Participant's then
current investment election for future contributions to his Account.
(g) Notwithstanding any other provisions of this Plan, no
distribution of a Participant's Account shall be made until all interest and
principal of any loan or loans made to such Participant is paid and discharged
in full. Upon the failure of a Participant to make loan payments or other
event of default set forth in the promissory note, or upon the occurrence of
the Valuation Date used to determine the amount distributable to the
Participant, such loan shall become due and payable, and the unpaid balance of
such loan, including any unpaid interest, may in the Committee's discretion be
charged against the Participant's Segregated Loan Account; provided, that any
unpaid balance of such loan shall be charged against the Participant's
Segregated Loan Account before any distribution to the Participant. If the
Participant's Segregated Loan Account has been so charged, and there remains
an unpaid balance of any such loan and interest, then the remaining unpaid
balance of such loan shall be charged against any property pledged as security
with respect to such loan. If any distribution of an Account is otherwise due
but for this Section 8.9, all interest and principal then owing on any loan or
loans made to the Participant shall be repaid to the Plan out of one-half of
such Participant's Account balance, and the remaining Account balance shall
then be distributed as otherwise provided by Article VIII.
8.10 Direct Rollover of Eligible Rollover Distributions. (a)
Notwithstanding any provision of the Plan to the contrary that would otherwise
limit a Distributee's election under this section for distributions made on or
after January 1, 1993, a Distributee may elect, at the time and in the manner
prescribed by the Committee, to have any portion of an Eligible Rollover
Distribution paid directly to an Eligible Retirement Plan specified by the
Distributee in a Direct Rollover.
(b) For purposes of this Section 8.10, the following definitions
shall apply:
(1) "Eligible Retirement Plan" means an individual
retirement account described in Code Section 408(a), an individual retirement
annuity described in Code Section 408(b), an annuity plan described in Code
Section 403(a), or a qualified trust described in Code Section 401(a) that
accepts the Distributee's Eligible Rollover Distribution. However, in the
case of an Eligible Rollover Distribution to the surviving Spouse, an Eligible
Retirement Plan is an individual retirement account or individual retirement
annuity.
(2) "Eligible Rollover Distribution" means any distribution
of all or any portion of a Participant's Accounts except (i) any distribution
to the extent such distribution is required under Code Section 401(a)(9), and
(ii) the portion of any distribution that is not includable in gross income.
(3) "Direct Rollover" means a payment by the Plan to the
Eligible Retirement Plan specified by the Distributee.
(4) "Distributee" includes an Employee or former Employee.
In addition, the Employee's or former Employee's surviving Spouse and the
Employee's or former Employee's Spouse or former Spouse who is the alternate
payee under a qualified domestic relations order, as defined in Section 414(p)
of the Code, are Distributees with regard to the interest of the Spouse or
former Spouse.
(c) The Committee shall provide a written explanation of the
Direct Rollover provisions to a Distributee no more than 90 days and no less
than 30 days prior to the date of distribution. Distribution may not commence
until 30 days has elapsed after such notice is provided to the Distributee,
unless such 30 day period is waived pursuant to Section 8.10(d) below.
(d) If a distribution is one to which Code Sections 401(a)(11)
and 417 do not apply, such distribution may commence less than 30 days after
the notice required under Section 1.411(a)-11(c) of the Income Tax Regulations
is given, provided that:
(1) The Committee clearly informs the Distributee that the
Distributee 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 Distributee, after receiving the notice,
affirmatively elects a distribution.
ARTICLE IX
OPERATION AND ADMINISTRATION OF THE PLAN
9.1 Plan Administration. Authority to control and manage the
operation and administration of the Plan shall be vested in a Committee as
provided in this Article IX. The members of the Committee (the number of
which shall be determined by the Sponsor) shall be appointed by the Sponsor
and shall hold office until resignation, death or removal by the Sponsor.
For purposes of ERISA Section 402(a), the members of the Committee shall be
the named fiduciaries of the Plan. Notwithstanding the foregoing, a Trustee
with whom Plan assets have been placed in trust or an investment manager
appointed pursuant to Section 9.3 may be granted exclusive authority and
discretion to manage and control all or any portion of the assets of the Plan.
Actions by the Sponsor under this section shall be by written instrument
executed by an authorized officer of the Sponsor.
9.2 Committee Powers. The Committee shall have all powers and
discretion necessary to supervise the administration of the Plan and control
its operations. In addition to any powers and authority conferred on the
Committee elsewhere in the Plan or by law, the Committee shall have the
following powers, discretion and authority:
(a) To allocate fiduciary responsibilities (other than trustee
responsibilities) among its members and to designate one or more other persons
to carry out fiduciary responsibilities (other than trustee responsibilities).
However, no allocation or delegation under this Section 9.2(a) shall be
effective until the person or persons to whom the responsibilities have been
allocated or delegated agree to assume the responsibilities. The term
"trustee responsibilities" as used herein shall have the meaning set forth in
ERISA Section 405(c).
(b) To designate agents to carry out responsibilities relating
to the Plan, other than fiduciary responsibilities.
(c) To employ such legal, medical, accounting, clerical and
other assistance as it may deem appropriate in carrying out the provisions of
the Plan, including one or more persons to render advice with regard to any
responsibility any named fiduciary or any other fiduciary may have under the
Plan.
(d) To establish rules and regulations from time to time for the
conduct of the Committee's business and the administration and effectuation of
this Plan.
(e) To administer, interpret, construe and apply this Plan and
to decide all questions which may arise or which may be raised under this Plan
by any Employee, Participant, former Participant, Beneficiary or other person,
including but not limited to all Participant, and the amount of benefits to
which any Participant or his Beneficiary may be entitled.
(f) To perform or cause to be performed such further acts as it
may deem to be necessary, appropriate or convenient in the efficient
administration of the Plan. Any action taken in good faith by the Committee
in the exercise of authority conferred upon it by this Plan shall be
conclusive and binding upon the Participants and their Beneficiaries. All
discretionary powers conferred upon the Committee shall be absolute. However,
all discretionary powers shall be exercised in a uniform and nondiscriminatory
manner.
9.3 Investment Manager. The Board of Directors may appoint one or
more "Investment Managers", as defined in ERISA Section 3(38), to manage all
or a portion of the assets of the Plan. An Investment Manager shall have full
power to manage the assets of the Plan for which it has responsibility, and
neither the Company, nor any member of the Committee, nor any Trustee, nor any
member of the Board of Directors shall, while such appointment is in effect,
have any responsibility for the management of those assets.
9.4 Committee Procedure. A majority of the members of the Committee
as constituted at any time shall constitute a quorum, and any action by a
majority of the members present at any meeting, or authorized by a majority of
the members in writing without a meeting, shall constitute the action of the
Committee. The Committee may designate certain of its members to execute any
document on behalf of the Committee to the extent of its authority, in which
event the Committee shall notify each Trustee of this action and the name or
names of the designated members. The Trustees, Company, Participants,
Beneficiaries, and any other party dealing with the Committee may accept and
rely upon any document executed by the designated members as representing
action by the Committee until the Committee shall file with each Trustee a
written revocation of the authorization of the designated members.
9.5 Compensation of Committee. Members of the Committee shall serve
without compensation unless the Board of Directors shall otherwise determine.
However, in no event shall any member of the Committee who is an Employee
receive compensation from the Plan for his services as a member of the
Committee. All members shall be reimbursed by the Company for any necessary
or appropriate expenditures incurred in the discharge of duties as members of
the Committee.
9.6 Resignation and Removal of Members. Any member of the Committee
may resign at any time by giving written notice to the other members and to
the Board of Directors effective as therein stated. Any member of the
Committee may, at any time, be removed by the Board of Directors.
9.7 Appointment of Successors. Upon the death, resignation, or
removal of any Committee member, the Board of Directors may appoint a
successor. Notice of appointment of a successor member shall be given by the
Secretary of the Sponsor in writing to each Trustee and to the members of the
Committee. Upon termination, for any reason, of a Committee member, the
member's status as a named fiduciary shall be terminated, and upon the
appointment of a successor Committee member the successor shall assume the
status of a named fiduciary.
9.8 Records. The Committee shall keep a record of all its
proceedings and shall keep, or cause to be kept, all such books, accounts,
records or other data as may be necessary or advisable in its judgment for the
administration of the Plan and to properly reflect the affairs thereof.
9.9 Reliance Upon Documents and Opinions. The members of the
Committee, the Board of Directors, the Company and any person delegated under
the provisions hereof to carry out any fiduciary responsibilities under the
Plan ("delegated fiduciary"), shall be entitled to rely upon any tables,
valuations, computations, estimates, certificates and reports furnished by any
consultant, any opinions furnished by legal counsel, and any reports furnished
by any Trustee. The members of the Committee, the Board of Directors, the
Company and any delegated fiduciary shall be fully protected and shall not be
liable in any manner whatsoever for anything done or action taken or suffered
in reliance upon any such consultant, Trustee, or counsel. Any and all such
things done or actions taken or suffered by the Committee, the Board of
Directors, the Company and any delegated fiduciary shall be conclusive and
binding on all Employees, Participants, Beneficiaries, and any other persons
except as otherwise provided by law. The Committee and any delegated
fiduciary may, but are not required to, rely upon all records of the Company,
and may likewise treat those records as conclusive with respect to all
Employees, Participants, Beneficiaries, and any other persons except as
otherwise provided by law.
9.10 Requirement of Proof. The Committee or the Company may require
satisfactory proof of any matter under this Plan from or with respect to any
Employee, Participant, or Beneficiary, and no person shall acquire any rights
or be entitled to receive any benefits under this Plan until the required
proof shall be furnished.
9.11 Reliance on Committee Memorandum. Any person dealing with the
Committee may rely on and shall be fully protected in relying on a certificate
or memorandum in writing signed by any Committee member or other person so
authorized, or by the majority of the members of the Committee, as evidence of
any action taken or resolution adopted by the Committee.
9.12 Multiple Fiduciary Capacity. Any person or group of persons may
serve in more than one fiduciary capacity with respect to the Plan.
9.13 Limitation on Liability. Except as provided in Part 4 of Title
I of ERISA, no person shall be subject to any liability with respect to his
duties under the Plan unless he acts fraudulently or in bad faith. No person
shall be liable for any breach of fiduciary responsibility resulting from the
act or omission of any other fiduciary or any person to whom fiduciary
responsibilities have been allocated or delegated, except as provided in Part
4 of Title I of ERISA.
9.14 Indemnification. To the extent permitted by law, the Sponsor
shall indemnify each member of the Board of Directors and the Committee, and
any other Employee with duties under the Plan, and saved harmless from claims,
and the expenses reasonably incurred by him in defending against such claims
(including any amount paid in settlement) incurred or resulting from any
action or conduct in the performance of his duties under the Plan, except
claims arising from his gross negligence, willful neglect or willful
misconduct. The preceding right of indemnification shall pass to the estate
of such a person. The preceding right of indemnification shall be in addition
to any other right to which the Board member or Committee member or such other
Employee may be entitled as a matter of law or otherwise.
9.15 Bonding. Except as is prescribed by the Board of Directors, as
provided in ERISA Section 412, or as may be required under any other
applicable law, no bond or other security shall be required by any member of
the Committee, or any other fiduciary under this Plan. Notwithstanding the
foregoing, for purposes of satisfying its indemnity obligations under Section
9.14, the Company may (but need not) purchase and pay premiums for one or more
policies of insurance. However, this insurance shall not release the Sponsor
of its liability under the indemnification provisions.
9.16 Plan Expenses. All usual and reasonable expenses of
administration shall be paid from the Plan, first, as provided by Section
8.4(c) from any forfeitures in excess of amounts required to make restoration
of accounts, and then from investment earnings of the Plan, and finally, if
necessary, from Participant's Accounts, ratably in proportion to the value of
the Accounts determined as of the most recent Valuation Date. All expenses
incurred in the administration and operation of the Plan shall, to the extent
not paid by the Plan, be paid by the Company.
ARTICLE X
MERGER OF COMPANY; MERGER OF PLAN
10.1 Effect of Reorganization or Transfer of Assets. In the event of
a consolidation, merger, sale, liquidation, or other transfer of substantially
all of the operating assets of the Sponsor to any other company, the ultimate
successor or successors to the business of the Sponsor shall automatically be
deemed to have elected to continue this Plan in full force and effect, in the
same manner as if the Plan had been adopted by resolution of its Board of
Directors, unless the successor(s), by resolution of its Board of Directors,
shall elect not to so continue this Plan in effect, in which case the Plan
shall automatically be deemed terminated as of the applicable effective date
set forth in the Board resolution.
10.2 Merger Restriction. Notwithstanding any other provision in this
Article, this Plan shall not in whole or in part merge or consolidate with, or
transfer its assets or liabilities to any other plan unless each affected
Participant in this Plan would receive a benefit immediately after the merger,
consolidation, or transfer (if the Plan then terminated) which is equal to or
greater than the benefit he would have been entitled to receive immediately
before the merger, consolidation, or transfer (if the Plan had then
terminated).
ARTICLE XI
PLAN TERMINATION AND
DISCONTINUANCE OF CONTRIBUTIONS
11.1 Plan Termination.
(a) The Board of Directors may terminate the Plan at any time by
an instrument in writing executed in the name of the Sponsor by an officer or
officers duly authorized to execute such an instrument and delivered to the
Trustee.
(b) Upon and after the effective date of the termination, the
Company shall make no further contributions under the Plan and no
contributions need be made by the Company applicable to the Plan Year in which
the termination occurs, except as may otherwise be required by law. The
termination shall not accelerate any Participant's or Beneficiary's
entitlement to the distribution of benefits hereunder except as may be
determined by the Board of Directors in accordance with applicable law.
Assets of the Trust Fund shall be managed in accordance with the direction of
the Committee.
(c) The rights of all affected Participants to benefits accrued
to the date of termination of the Plan, to the extent funded as of the date of
termination, shall automatically become fully vested as of that date.
11.2 Discontinuance of Contributions.
(a) In the event the Sponsor decides it is impossible or
inadvisable for business reasons to continue to make Company Contributions
under the Plan, the Sponsor by resolution of its Board of Directors may
discontinue contributions to the Plan. Upon and after the effective date of
this discontinuance, no further contributions shall be made under the Plan and
no Company Contributions need be made with respect to the Plan Year in which
the discontinuance occurs, except as may otherwise be required by law.
(b) The discontinuance of contributions shall not terminate the
Plan as to the funds and assets then held by the Trustee, or operate to
accelerate any payments of distributions to or for the benefit of Participants
or Beneficiaries, and the Trustee shall continue to administer the Trust Fund
in accordance with the provisions of the Plan until all of the obligations
under the Plan shall have been discharged and satisfied.
(c) If discontinuance of contributions shall cause the Plan to
lose its status as a qualified plan under Code Section 401(a), the Plan shall
be terminated in accordance with the provisions of this Article XI.
(d) On and after the effective date of a discontinuance of
contributions, the rights of all affected Participants to benefits accrued to
that date, to the extent funded as of that date, shall automatically become
fully vested as of that date.
11.3 Rights of Participants. In the event of the termination of the
Plan, all assets of the Plan, after payment of expenses, shall be used for the
exclusive benefit of Participants and their Beneficiaries and no part thereof
shall be returned to the Company, except as provided in Article IV.
Termination of the Plan will not accelerate the right of any Participant to
receive a distribution under the Plan. In no event will amounts attributable
to a Participant's Compensation Deferral Contributions be distributed except
to the extent allowed by Code Section 401(k).
11.4 Partial Termination. In the event of a partial termination of
the Plan within the meaning of Code Section 411(d)(3), the interests of
affected Participants in the Trust Fund shall become fully vested as of the
date of the partial termination.
11.5 Failure to Contribute. The failure of the Company to contribute
to the Trust in any year, if contributions are not required or permitted under
the Plan for that year, shall not constitute a discontinuance of contributions
to the Plan.
11.6 Distributions Upon Sale of Assets or Subsidiary. Upon the sale,
to an entity that is not an Affiliated Company of either (a) substantially all
of the assets used by the Company in the trade or business in which a
Participant is employed or (b) the Company's interest in a subsidiary that is
also an Affiliated Company, the Committee may, subject to the consent
requirements of Code Section 411(a)(11), direct the Trustee to make a
distribution of the Participant's distributable benefit in the Trust Fund as
soon as administratively feasible.
ARTICLE XII
APPLICATION FOR BENEFITS
12.1 Application for Benefits. The Committee may require any person
claiming benefits under the Plan to submit an application therefor, together
with such documents and information as the Committee may require. In the case
of any person suffering from a disability which prevents the claimant from
making personal application for benefits, the Committee may, in its
discretion, permit another person acting on his behalf to submit the
application.
12.2 Action on Application.
(a) Within 90 days following receipt of an application and all
necessary documents and information, the Committee shall furnish the claimant
with written notice of its decision. The 90-day period may be extended at the
discretion of the Committee for a second 90 day period provided that written
notice of the extension is furnished to the claimant prior to the termination
of the initial period, indicating that special circumstances requiring such
extension of time. In the case of a denial of the claimant's application, the
notice shall set forth: (i) the specific reasons for the denial, with
reference to the Plan provisions upon which the denial is based; (ii) a
description of any additional information or material necessary for perfection
of the application (together with an explanation specifying why the material
or information is necessary); and (iii) an explanation of the Plan's claim
review procedure.
(b) A claimant who wishes to contest the denial of his
application for benefits or the amount of benefits payable to him shall follow
the procedures for an appeal of benefits as set forth in Section 12.3, and
shall exhaust such administrative procedures prior to seeking any other form
of relief.
12.3 Appeals.
(a) A claimant may appeal the decision on his claim to the
Committee, in writing, within 60 days after the date of the Committee's
decision. If the application has been neither approved nor denied within the
90 day period provided in Section 12.2, the appeal shall be made within 60
days after the expiration of the 90 day period.
(b) The request for appeal shall be given full and fair review
by the Committee. The claimant may review all pertinent documents and submit
issues and comments in writing in connection with the appeal.
(c) The decision of the Committee shall be made promptly, and
not later than 60 days after the Committee's receipt of a request for review,
unless special circumstances require an extension of 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.
(d) The decision on review shall be in writing and shall include
specific reasons for the decision, written in a manner calculated to be
understood by the claimant with specific reference to the pertinent Plan
provisions upon which the decision is based.
ARTICLE XIII
LIMITATIONS ON CONTRIBUTIONS
13.1 General Rule.
(a) Notwithstanding anything to the contrary contained in the
Plan, and except as provided in Paragraph (b) below, the total Annual
Additions under the Plan to a Participant's Account for any Plan Year shall
not exceed the lesser of:
(i) the Defined Contribution Dollar Limitation; or
(ii) 25% of the Participant's Compensation for the
Limitation Year.
(b) The "Defined Contribution Dollar Limitation" shall mean
$30,000 or, if greater, one-fourth of the defined benefit dollar limitation
set forth in Code Section 415(b)(1) in effect for the Limitation Year.
(c) The "Limitation Year" is the Plan Year.
(d) The Compensation limitation referred to in Section
13.1(a)(ii) shall not apply to:
(i) any contribution for medical benefits (within the
meaning of Code Section 419A(f)(2)) after separation from service which is
otherwise treated as an Annual Addition; or
(ii) any amount otherwise treated as an Annual Addition
under Code Section 415(l)(1).
13.2 Annual Additions. For purposes of Section 13.1, the term
"Annual Additions" shall mean, for any Limitation Year, the sum of all
Compensation Deferral Contributions, Matching Contributions, Retirement Plan
Contributions, After-Tax Contributions, and forfeitures which are allocated to
a Participant's Account and to a Participant's account under any other defined
contribution plan maintained by the Company or any Affiliated Company. The
term "After-Tax Contributions," for purposes of the preceding sentence, shall
mean amounts considered contributed by the Employee and which do not qualify
for tax deferral treatment under Code Section 401(k).
13.3 Other Defined Contribution Plans. If the Company or any
Affiliated Company is contributing to any other defined contribution plan (as
defined in Code Section 415(i)) for Employees, some or all of whom may be
Participants in this Plan, then contributions to the other plan shall be
aggregated with contributions under this Plan for the purposes of applying the
limitations of Section 13.1.
13.4 Combined Plan Limitation (Defined Benefit Plan). In the event a
Participant hereunder also is a participant in any qualified defined benefit
plan (within the meaning of Code Section 415(k)) of the Company or an
Affiliated Company, then the benefit payable under such other defined benefit
plan, or any of them, shall be reduced for so long and to the extent necessary
to provide that the sum of the "defined benefit fraction" as defined in
paragraph (a) below and the "defined contribution fraction" as defined in
paragraph (b) below, for any Plan Year shall not exceed 1.
(a) "Defined Benefit Fraction" shall be a fraction, the
numerator of which is the projected benefit of a Participant under all
qualified defined benefit plans adopted by the Company
and Affiliated Companies expressed as either an annual straight life annuity
or a qualified joint and survivor annuity providing the maximum permissible
survivor benefit (determined as of the close of the Plan Year), and the
denominator of which is the lesser of (i) the maximum dollar amount otherwise
allowable for such Plan Year under applicable law times 1.25 or (ii) the
Percentage of Compensation limit for such Plan Year times 1.4.
(b) "Defined Contribution Fraction" shall be a fraction, the
numerator of which is the sum of the Annual Addition of the Participant's
Account under this Plan and any other defined contribution plans adopted by
the Company or an Affiliated Company for each Plan Year, and the denominator
of which is the lesser for each such Plan Year of (i) the maximum Annual
Addition which could have been made under this Plan and any other defined
contribution plans adopted by the Company or an Affiliated Company for such
Plan Year and for each prior Plan Year of Service with the Company times 1.25
or (ii) the amount determined under the percentage of Compensation limit for
such Plan Year times 1.4.
Notwithstanding anything to the contrary in this Plan, in the case of a
Participant who was also a participant before January 1, 1982 in a defined
benefit plan which was in existence on July 1, 1982, and with respect to which
the requirements of Code Section 415(b) had been met for all Plan Years, if
such Participant's current accrued benefit under such plan exceeds the
limitation of Code Section 415(b) for Plan Years commencing after January 1,
1983, then for purposes of that plan and for purposes of this Section 13.4,
the limitations of Code Sections 415(b) and (c) with respect to such
individual shall be equal to the Participant's current accrued benefit under
said plan. Solely for purposes of determining the amount of such limitation,
the term "current accrued benefit" shall mean the Participant's accrued
benefit under the defined benefit plan as of the close of the last Plan Year
beginning before January 1, 1983 when expressed as an annual benefit, within
the meaning of Code Section 415(b)(2) as in effect for such Plan Year;
provided, however, that such Participant's current accrued benefit is not
changed after July 1, 1982, and no cost of living adjustment occurring after
July 1, 1982 is taken into account.
In applying the provisions of this Section 13.4 in the case of a defined
benefit plan which satisfied the requirements of Code Section 415 for the last
Plan Year commencing prior to January 1, 1983, any reduction in a
Participant's benefit shall be in accordance with Code Section 415(e) and any
regulations promulgated thereunder by the Secretary of the Treasury. The
reduction of a Participant's benefit due from qualified defined benefit plans
shall be made in accordance with uniform rules adopted jointly by the parties
responsible for the control and management of the operation and administration
of such plans.
13.5 Adjustments for Excess Annual Additions. In general, the amount
of excess for any Plan Year under this Plan and any other defined contribution
plan (as defined in Code Section 414(i)) or defined benefit plan (as defined
in Code Section 414(j)) maintained by the Company and any Affiliated Company
will be determined so as to avoid Annual Additions in excess of the
limitations set forth in Sections 13.1 through 13.4. However, if, as a result
of an administrative error in calculating contributions, the Annual Additions
to a Participant's Accounts under this Plan (after giving effect to the
maximum permissible adjustments under the other plans) would exceed the
applicable limitations described in Sections 13.1 through 13.4, the excess
amount shall be subject to the following rules:
(a) If the Participant made any voluntary after-tax
contributions to this or any other defined contribution plan that is
maintained by the Company, these contributions shall be returned to the
Participant to the extent of any excess Annual Additions, together with income
allocable thereto (or reasonably estimated to be allocable thereto).
(b) Any remaining excess Annual Additions allocated to the
Participant's Account shall be reduced to the extent necessary to eliminate
the remaining excess Annual Additions.
13.6 Disposition of Excess Amounts. Any excess amounts contributed
by the Company on behalf of a Participant for any Plan Year shall be held
unallocated in a suspense account for the Plan Year and applied to reduce the
Company Contribution on behalf of such Participant for succeeding Plan Years.
Any amounts held in this suspense account shall not participate in any
allocation of forfeitures, or net income or loss of other assets of the Trust
Fund under Article VI.
Notwithstanding the foregoing, any excess amounts attributable to
Compensation Deferral Contributions on behalf of a Participant for a Plan
Year, together with income allocable thereto (or reasonably estimated to be
allocable thereto), shall be distributed to the Participant to the extent that
the distribution will reduce the excess amounts in the Participant's Account.
Such distribution shall be made in accordance with procedures determined by
the Committee.
ARTICLE XIV
PLAN AMENDMENTS
14.1 Amendments. The Board of Directors may at any time, and from
time to time, amend the Plan by an instrument in writing executed in the name
of the Sponsor by an officer or officers duly authorized to execute such
instrument, and delivered to the Trustee. However, no amendment shall (a)
cause any assets of the Trust Fund to be used for or diverted to purposes
other than providing benefits to Participants and their Beneficiaries, and
defraying reasonable expenses of administering the Plan, except as provided in
Articles IV and V; or (b) increase the responsibilities or liabilities of the
Trustee or an Investment Manager without his written consent.
14.2 Retroactive Amendments. Notwithstanding any provision of this
Article XIV to the contrary, the Plan may be amended prospectively or
retroactively (as provided in Code Section 401(b)) to make the Plan conform to
any provision of ERISA, any Code provisions dealing with tax- qualified
employees' trusts, or any corresponding regulation.
14.3 Amendment of Vesting Provisions. If the Plan is amended in any
way that directly or indirectly affects the computation of a Participant's
vested interest in his Account, each Participant who has completed at least
three Years of Service may elect, within a reasonable time after the adoption
of the amendment, to continue to have his vested interest computed under the
Plan without regard to such amendment.
ARTICLE XV
TOP-HEAVY PLAN RULES
15.1 Applicability. Notwithstanding any contrary provision in the
Plan, the provisions of this Article XV shall apply in the case of any Plan
Year in which the Plan is determined to be a Top-Heavy Plan.
15.2 Definitions.
(a) For purposes of this Article XV, the term "Key Employee"
shall mean any Employee who, at any time during the Plan Year or any of the
four preceding Plan Years, is or was:
(i) An officer of the Company or an Affiliated Company
having an annual Compensation greater than 150% of the amount in effect under
Code Section 415(c)(1)(A) for this Plan Year. However, no more than 50
Employees (or, if less, the greater of three or ten percent of the Employees)
shall be treated as officers;
(ii) One of the ten Employees having annual Compensation
from the Company or an Affiliated Company of more than the limitation in
effect under Code Section 415(c)(1)(A) and owning (or considered as owning
within the meaning of Code Section 318) the largest interests in the Company.
For this purpose, if two Employees have the same interest in the Company, the
Employee having greater annual Compensation from the Company shall be treated
as having a larger interest;
(iii) A Five-Percent Owner of the Company; or
(iv) A One-Percent Owner of the Company having an annual
Compensation from the Company and all Affiliated Companies of more than
$150,000.
(b) For purposes of this Section 15.2, the term "Five-Percent
Owner" means any person who owns (or is considered as owning within the
meaning of Code Section 318) more than five percent of the outstanding stock
of the Company or stock possessing more than five percent of the total
combined voting power of all stock of the Company. The rules of paragraphs
(b), (c), and (m) of Code Section 414 shall not apply for purposes of applying
these ownership rules.
(c) For purposes of this Section 15.2, the term "One-Percent
Owner" means any person who would be described in paragraph (b) if "one
percent" were substituted for "five percent" each place where it appears
therein.
(d) For purposes of this Section 15.2, the rules of Code Section
318(a)(2)(C) shall be applied by substituting "five percent" for "50%."
(e) For purposes of this Article XV, the term "Non-Key Employee"
shall mean any Employee who is not a Key Employee.
(f) For purposes of this Article XV, the terms "Key Employee"
and "Non-Key Employee" include their Beneficiaries.
15.3 Top-Heavy Status.
(a) The term "Top-Heavy Plan" means, with respect to any Plan
Year:
(i) Any defined benefit plan if, as of the Determination
Date, the present value of the cumulative accrued benefits under the plan for
Key Employees exceeds 60% of the present value of the cumulative accrued
benefits under the plan for all Employees; and
(ii) Any defined contribution plan if, as of the
Determination Date, the aggregate of the account balances of Key Employees
under the plan exceeds 60% of the aggregate of the account balances of all
Employees under the plan.
For purposes of this Subsection (a), the term "Determination Date" means, with
respect to any Plan Year, the last day of the preceding Plan Year.
The account balances under a defined contribution plan shall be
determined as of the most recent valuation date that falls within or ends on
the Determination Date. The present value of accrued benefits under a defined
benefit plan shall be determined as of the same valuation date used for
computing plan costs for minimum funding.
(b) Each plan maintained by the Company or an Affiliated Company
required to be included in an Aggregation Group shall be treated as a
Top-Heavy Plan if the Aggregation Group is a Top-Heavy Group.
(i) The term "Aggregation Group" means (A) each plan of the
Company or an Affiliated Company in which a Key Employee is a participant, and
(B) each other plan of the Company or an Affiliated Company which enables any
plan described in Subparagraph (A) to meet the requirements of Code Section
401(a)(4) or 410. Also, any plan not required to be included in an
Aggregation Group under the preceding rules may be treated as being part of
such group if the group would continue to meet the requirements of Code
Sections 401(a)(4) and 410 with the plan being taken into account.
(ii) The term "Top-Heavy Group" means any Aggregation Group
if the sum (as of the Determination Date) of (A) the present value of the
cumulative accrued benefits for Key Employees under all defined benefit plans
included in the group, and (B) the aggregate of the account balances of Key
Employees under all defined contribution plans included in the group exceeds
60% of a similar sum determined for all Employees.
(iii) For purposes of determining (A) the present value of
the cumulative accrued benefit of any Employee, or (B) the amount of the
account balance of any Employee such present value or amount shall be
increased by the aggregate distributions made with respect to the Employee
under the plan during the five-year period ending on the Determination Date.
The preceding rule shall also apply to distributions under a terminated plan
which, if it had not been terminated, would have been required to be included
in an Aggregation Group. Also, any rollover contribution or similar transfer
initiated by the Employee and made after December 31, 1983 to a plan shall not
be taken into account with respect to the transferee plan for purposes of
determining whether such plan is a Top-Heavy Plan (or whether any Aggregation
Group which includes such plan is a Top-Heavy Group).
(c) If any individual is a Non-Key Employee with respect to any
plan for any Plan Year, but the individual was a Key Employee with respect to
the Plan for any prior Plan Year, any accrued benefit for the individual (and
the account balance of the individual) shall not be taken into account for
purposes of this Section 15.3.
(d) If any individual has not received any Compensation from the
Company or an Affiliated Company (other than benefits under the Plan) at any
time during the five year period ending on the Determination Date, any accrued
benefit for such individual (and the account balance of the individual) shall
not be taken into account for purposes of this Section 15.3.
15.4 Minimum Contributions. For each Plan Year in which the Plan is
Top-Heavy, the minimum contributions for that year shall be determined in
accordance with the rules of this Section 15.4.
(a) Except as provided below, the minimum contribution for each
Non-Key Employee who has not separated from service as of the last day of the
Plan Year shall be not less than three percent of his Compensation, regardless
of whether the Non-Key Employee has completed 1,000 Hours of Service during
such Plan Year, or whether the Non-Key Employee has made any withdrawals
pursuant to Section 8.6 during such Plan Year.
(b) Subject to the following rules of this paragraph (b), the
percentage set forth in paragraph (a) above shall not be required to exceed
the percentage at which contributions (including amounts deferred under a cash
or deferred arrangement under Code Section 401(k)) are made (or are required
to be made) under the Plan for the year for the Key Employee for whom the
percentage is the highest for the year. For purposes of this paragraph (b),
all defined contribution plans required to be included in an Aggregation Group
shall be treated as one plan. However, the rules of this paragraph (b) shall
not apply to any plan required to be included in an Aggregation Group if the
plan enables a defined benefit plan to meet the requirements of Code Section
401(a)(4) or 410.
(c) The requirements of this Section 15.4 must be satisfied
without taking into account contributions under Chapters 2 or 21 of the Code,
Title II of the Social Security Act, or any other Federal or State law.
(d) In the event a Participant is covered by both a defined
contribution and a defined benefit plan maintained by the Company or an
Affiliated Company, both of which are determined to be Top-Heavy Plans, the
defined benefit minimum, offset by the benefits provided under the defined
contribution plan, shall be provided under the defined benefit plan.
15.5 Maximum Annual Addition.
(a) Except as set forth below, in the case of any Top-Heavy Plan
the rules of Sections 13.4(a)(i) and 13.4(b)(i) shall be applied by
substituting "1.0" for "1.25."
(b) The rule set forth in paragraph (a) above shall not apply if
the requirements of both paragraphs (i) and (ii) below are satisfied.
(i) The requirements of this paragraph are satisfied if the
rules of Section 15.4(a) above would be satisfied after substituting "four
percent" for "three percent" where it appears therein with respect to
Participants covered only under a defined contribution plan.
(ii) The requirements of this paragraph are satisfied if
the Plan would not be a Top-Heavy Plan if "90%" were substituted for "60%"
each place it appears in Sections 15.3(a)(ii) and 15.3(b)(ii).
(c) The rules of paragraph (a) shall not apply with respect to
any Employee as long as there are no:
(i) Company Contributions, forfeitures, or voluntary
nondeductible contributions allocated to the Employee under a defined
contribution plan maintained by the Company or an Affiliated Company, nor
(ii) accruals by the Employee under a defined benefit plan
maintained by the Company or an Affiliated Company.
ARTICLE XVI
ADOPTION BY AFFILIATED COMPANIES
16.1 Adoption of Plan. An Affiliated Company may, with the consent
of the Board of Directors, adopt this Plan for the benefit of its Eligible
Employees by resolution of such Affiliated Company's board of directors, a
certified copy of which shall be filed with the Sponsor, the Committee and the
Trustee.
16.2 The Sponsor as Agent for the Company. Each Affiliated Company
which has adopted this Plan hereby irrevocably grants to the Sponsor full and
exclusive power conferred upon it to take or refrain from taking any and all
action which such Affiliated Company might otherwise take or refrain from
taking with respect to the Plan and the Trust, and each such Affiliated
Company, by adopting this Plan, irrevocably appoints the Sponsor its agent for
such purposes. Neither the Trustee nor the Committee nor any other person
shall have any obligation to account to any such Affiliated Company or to
follow the instructions of or otherwise deal with any such Affiliated Company,
the intention being that all persons shall deal solely with the Sponsor as if
it were the sole company which had adopted this Plan. Each such Affiliated
Company shall contribute such amounts as determined under Article V.
16.3 Adoption of Amendments. Any Affiliated Company which adopts the
Plan may, with the consent of the Board of Directors, amend the Plan with
respect to its own employees by resolution of its board of directors.
16.4 Termination. Any Affiliated Company which adopts the Plan may,
with the consent of the Board of Directors, terminate this Plan with respect
to its own employees by resolution of its board of directors.
16.5 Data to Be Furnished by Employers. Each Affiliated Company
which adopts this Plan shall furnish information and maintain such records
with respect to its Participants as called for hereunder, and its
determinations and notifications with respect thereto shall have the same
force and effect as comparable determinations by the Sponsor with respect to
its Participants.
16.6 Joint Employees. If a Participant receives Compensation during
a Plan Year from more than one employer which is part of the Company the total
amount of such Compensation shall be considered for the purposes of the Plan,
and the respective employers shall share in contributions to the Plan on
account of said Participant based on the Compensation paid to such Participant
by the employer.
16.7 Expenses. Each employer which is part of the Company shall pay
such part of the necessary expenses incurred in the administration of the Plan
as the Sponsor shall determine.
16.8 Withdrawal. An employer which is part of the Company may
withdraw from the Plan by giving 60 days' written notice to the Sponsor and
the Trustee, unless a shorter notice shall be agreed to by the Sponsor.
16.9 Prior Plans. If an employer adopting the Plan already maintains
a defined contribution plan covering employees who will be covered by the
Plan, it may, with the consent of the Sponsor, provide in its resolution
adopting the Plan for the termination of its own plan or for the merger,
restatement and continuation of its own plan by the Plan.
ARTICLE XVII
MISCELLANEOUS
17.1 No Enlargement of Employee Rights. Nothing contained in this
Plan or the Trust shall be deemed to give any Employee the right to be
retained in the employ of the Company or an Affiliated Company or to interfere
with the right of the Company or an Affiliated Company to discharge or retire
any Employee at any time. No Employee, nor any other person, shall have any
right to or interest in any portion of the Trust Fund other than as
specifically provided in this Plan.
17.2 Nonalienation.
(a) The interest of any Participant in the benefits hereunder
shall not in any event be subject to sale, assignment, hypothecation, or
transfer. In the event any person attempts to take any action contrary to
this Article XVII, that action shall be void and the Company, the Committee,
the Trustees and all Participants shall suffer no liability for any disregard
of that action, and shall be reimbursed on demand out of the Trust Fund for
the amount of any loss, cost or expense incurred as a result of disregarding
or of acting in disregard of that action.
(b) The rules set forth in paragraph (a) shall not apply with
respect to a Qualified Domestic Relations Order.
(i) A "Qualified Domestic Relations Order" is a judgment,
decree, or order (including approval of a property settlement agreement) that:
(A) creates or recognizes the existence of an
Alternate Payee's right to, or assigns to an Alternate Payee the right to,
receive all or a portion of the benefits payable with respect to a
Participant;
(B) relates to the provision of child support, alimony
payments, or marital property rights to a spouse, child or other dependent of
a Participant;
(C) is made pursuant to a state domestic relations law
(including a community property law); and
(D) clearly specifies:
(I) the name and last known mailing address (if
any) of the Participant and the name and mailing address of each Alternate
Payee covered by the order;
(II) the amount or percentage of the
Participant's benefits to be paid to each Alternate Payee, or the manner in
which the amount or percentage is to be determined;
(III) the number of payments or period to which
the order applies; and
(IV) each plan to which the order applies.
For purposes of this section, the term "Alternate Payee" means any spouse,
former spouse, child or other dependent of a Participant who is recognized by
a domestic relations order as having a right to receive all, or a portion of,
the benefits payable with respect to the Participant.
(ii) A domestic relations order is not a Qualified Domestic
Relations Order if it requires:
(A) the Plan to provide any type or form of benefit,
or any option, not otherwise provided under the Plan;
(B) the Plan to provide increased benefits,
(determined on the basis of actuarial value); or
(C) the payment of benefits to an Alternate Payee that
are required to be paid to another Alternate Payee under a previous Qualified
Domestic Relations Order.
(iii) A domestic relations order shall not be considered to
fail to satisfy the requirements of this paragraph solely because the order
requires that payment of benefits be made to an Alternate Payee:
(A) on or after the date on which the Participant
attains (or would have attained) age 50;
(B) as if the Participant had retired on the date on
which such payment is to begin under the order (based on the value of the
Participant's Account balances at that time); and
(C) in any form in which the benefits may be paid
under the Plan to the Participant.
(iv) In the case of any domestic relations order received
by the Plan:
(A) the Plan Administrator shall promptly notify the
Participant and any Alternate Payee of the receipt of the order and the Plan's
procedures for determining the qualified status of domestic relations orders;
and
(B) within a reasonable period after the receipt of
the order, the Plan Administrator shall determine whether the order is a
Qualified Domestic Relations Order and shall notify the Participant and each
Alternate Payee of the determination.
(v) The Committee shall establish reasonable procedures to
determine the qualified status of domestic relations orders and to administer
distributions under Qualified Domestic Relations Orders.
(A) During any period in which the issue of whether a
domestic relations order is a Qualified Domestic Relations Order is being
determined, the Plan Administrator shall separately account for the amounts
which would have been payable to the Alternate Payee during the period if the
order had been determined to be a Qualified Domestic Relations Order.
(B) If within 18 months the order (or modification
thereof) is determined to be a Qualified Domestic Relations Order, the Plan
Administrator shall pay the segregated amounts (plus any interest thereon) to
the Alternate Payee entitled thereto.
(C) If within 18 months:
(I) it is determined that the order is not a
Qualified Domestic Relations Order; or
(II) the issue as to whether Qualified Domestic
Relations Order is not resolved, the Committee shall pay the segregated
amounts (plus any interest thereon) to the person or persons who would have
been entitled to the amounts if there had been no order.
(D) Any determination that an order is a Qualified
Domestic Relations Order that is made after the close of the 18 month period
shall be applied prospectively only.
17.3 Mailing of Payments; Lapsed Benefits.
(a) All payments under the Plan shall be delivered in person or
mailed to the last address of the Participant or Beneficiary furnished
pursuant to Section 17.4.
(b) In the event that a benefit is payable under the Plan to a
Participant or any other person and after reasonable efforts such person
cannot be located for a period of seven years, the person shall be presumed
dead and the benefit shall be paid to the Participant's Beneficiary. If no
Beneficiary can be located, upon the termination of such seven year period the
benefit shall be forfeited and allocated in the same manner as forfeitures
under the Plan.
(c) A Participant's Account shall continue to be maintained
until it is paid to the Participant or his Beneficiary. Notwithstanding the
foregoing, in the event that the Plan is terminated, the following rules shall
apply:
(i) all Participants (including Participants who have not
previously claimed their benefits under the Plan) shall be notified of their
right to receive a distribution of their interests in the Plan;
(ii) all Participants shall be given a reasonable length of
time, which shall be specified in the notice, in which to claim their
benefits; and
(iii) all Participants (and their Beneficiaries) who do not
claim their benefits within the designated time period shall be presumed to be
dead. The Accounts of such Participants shall be forfeited at such time.
These forfeitures shall be disposed of according to rules prescribed by the
Committee, which rules shall be consistent with applicable law.
(d) Should it be determined that the preceding rules relating to
forfeiture of benefits upon Plan termination are inconsistent with any of the
provisions of the Code or ERISA, these provisions shall become inoperative
without the need for a Plan amendment and the Committee shall prescribe rules
that are consistent with the applicable provisions of the Code and ERISA.
17.4 Addresses. Each Participant shall be responsible for
furnishing the Committee with his correct current address and the correct
current name and address of his Beneficiary or Beneficiaries.
17.5 Notices and Communications. All communications from
Participants shall be in writing, on forms prescribed by the Committee and
shall be mailed or delivered to the office designated by the Committee, and
shall be deemed to have been given when received by that office. Each
communication directed to a Participant or Beneficiary shall be in writing and
may be delivered in person or by mail. An item shall be deemed to have been
delivered and received by the Participant when it is deposited in the United
States Mall with postage prepaid, addressed to the Participant or Beneficiary
at his last address of record with the Committee.
17.6 Reporting and Disclosure. The Plan Administrator shall be
responsible for the reporting and disclosure of information required to be
reported or disclosed by the Plan Administrator pursuant to ERISA or any other
applicable law.
17.7 Governing Law. The Plan shall be governed by the laws of the
United States of America and, to the extent permitted by such laws, by the
laws of the State of Illinois. All contributions made hereunder shall be
deemed to have been made in Illinois.
17.8 Interpretation. Article and section headings are for convenient
reference only and shall not be deemed to be part of the substance of this
instrument or in any way to enlarge or limit the contents of any article or
section. Unless the context clearly indicates otherwise, masculine gender
shall include the feminine, and the singular shall include the plural and the
plural the singular. The provisions of the Plan shall in all cases be
interpreted in a manner that is consistent with the Plan satisfying the
requirements of Code Sections 401(a) and 401(k) and related statutes for a
qualified cash or deferred arrangement.
17.9 Withholding for Taxes. Any payments out of the Trust Fund shall
be subject to withholding for taxes as may be required by any applicable
Federal or State law.
17.10 Limitation on Company, Committee and Trustee Liability. Any
benefits payable under the Plan shall be paid or provided for solely from the
Trust Fund and neither the Company, the Committee nor the Trustee shall assume
any responsibility for the sufficiency of the assets of the Trust to provide
the benefits payable hereunder.
17.11 Successors and Assigns. This Plan and the Trust shall inure to
the benefit of, and be binding upon, the parties hereto and their successors
and assigns.
17.12 Counterparts. This Plan document may be executed in any number
of identical counterparts, each of which shall be deemed a complete original.
IN WITNESS WHEREOF, Budget Rent A Corporation has caused this instrument
to be executed by its duly authorized officers this ____ day of ____________,
1994, effective, however, as of January 1, 1993.
BUDGET RENT A CAR CORPORATION
By:
<PAGE>
FIRST AMENDMENT OF
BUDGET RENT A CAR CORPORATION SAVINGSPLUS PLAN
(As Amended and Restated Effective January l, 1993)
WHEREAS, Budget Rent a Car Corporation (the "Corporation") maintains the
Budget Rent a Car Corporation SavingsPlus (the "Plan"); and
WHEREAS, amendment of the Plan now is considered desirable;
NOW, THEREFORE, by virtue and in exercise of the powers reserved to the
Corporation under Section 14.1 of the Plan, and pursuant to authority
delegated to the officers of the Corporation by resolution of its Board of
Directors, Section 5.1(d) of the Plan is hereby amended, effective December l,
1995, by deleting in its entirety phrase (I) and inserting the following in
lieu thereof:
"(i) who was credited with not less than 1,000 Hours of Service in such
Plan Year and who was an Active Participant or on a Leave of Absence on the
last day of the Plan Year (or, for the 1995 Plan Year, who was an Active
Participant on December l, 1995), or"
IN WITNESS WHEREOF, the Corporation has caused this amendment to be
executed by its duly authorized officers this _____ day of _____________,
1995.
BUDGET RENT A CAR CORPORATION
By:
Its:
<PAGE>
SECOND AMENDMENT OF
BUDGET RENT A CAR CORPORATION
SAVINGSPLUS PLAN
(As Amended and Restated Effective January l, 1993)
WHEREAS, Budget Rent a Car Corporation (the "Company" maintains Budget
Rent a Car Corporation SavingsPlus Plan (the "Plan"); and
WHEREAS, the Plan has been amended from time to time and further
amendment of the Plan now is considered desirable;
NOW, THEREFORE, pursuant to the powers reserved to the Company by Section
14.1 of the Plan, and the authority delegated to the undersigned by the Board
of Directors of the Company, the Plan is hereby amended, effective July 1,
1996, in the following respects:
1. By replacing "Compensation Period" with "Computation Period" in
the definition of "Eligible Employee" in Article II.
2. By replacing the definition of "Valuation Date" in Article II with
the following:
"Validation Date" means each day the New York Stock Exchange
and the Trustee are open for business."
3. By substituting the following for Section 4.1(b):
"(b) The Compensation deferral agreement shall remain in effect
until it is revoked or modified or the Participant terminates employment. Any
such modification or revocation shall be effective as of the first payroll
period of any month if made, in such form and manner as the Committee shall
prescribe or approve, by the 20th day of the preceding month. An Active
Participant who revokes his Compensation deferral agreement may enter into a
new Compensation deferral agreement as of the first payroll period of any
month following the month in which the revocation was effective. A
Participant who makes a hardship withdrawal shall automatically cease making
Compensation Deferral Contributions as of the end of the payroll period
coinciding with or immediately preceding the date he makes such hardship
withdrawal, and the Participant may not make further Compensation Deferral
Contributions until at least 12 full calendar months have elapsed since he
last made a hardship withdrawal (the 'Twelve-Month Suspension'). The
Participant may enter into a new Compensation deferral agreement as of the
first payroll period of any month coinciding with or following the Twelve-
Month Suspension."
4. By deleting the second sentence of Section 4.2.
5. By substituting the following for Section 4.4:
"4.4 After-Tax Contributions. For each payroll period for
which a Participant has entered into a Compensation deferral agreement, such
Participant may also elect to make After-Tax Contributions. After-Tax
Contributions shall be designated by the Participant in the manner required by
the Committee in whole number percentages up to ten percent of his
Compensation. An agreement to make After-Tax Contributions to the Plan shall
become effective on the first payroll period of the month, and shall remain in
effect unless revoked or modified by the Participant under the same terms and
conditions as those set forth in Section 4.1(b); provided that such agreement
shall automatically be revoked if the Participant revokes his Compensation
deferral agreement and the Participant shall again be able to make After-Tax
Contributions only if he enters into a new Compensation deferral agreement
Solely for purposes of satisfying one of the tests prescribed in Section 5.2
or 5.3, the Committee may prescribe such rules as it deems necessary or
appropriate regarding the maximum amount that a Participant may contribute
under this section. These rules shall apply to all Active Participants,
except to the extent that the Committee prescribes special or more stringent
rules applicable only to Highly Compensated Employees."
6. By deleting the last sentence of Section 4.6.
7. By substituting the following for paragraph (c) of Section 5.1
prior to the table therein:
"(c) The Company shall make for each month a Matching Contribution
on behalf of each Participant who made Compensation Deferral Contributions
during such month equal to a percentage of such Participant's Compensation
Deferral Contributions which qualify for treatment under Code Sections 401(k)
and 402(g), determined in accordance with the following table:"
8. By substituting the following for the last sentence of Section
6.1:
"A Participant's interest in his Accounts shall be his respective
interests in the Investment Funds which are represented by units of
participation."
9. By substituting the following for the first sentence of Section
6.2:
"On each Valuation Date the Trustee shall determine the value of a
unit in each Investment Fund by first subtracting the payment out of that Fund
of all brokerage fees and transfer taxes applicable to purchases and sales for
that Fund made since the previous Valuation Date, then dividing the current
market value of assets in that Fund by the total number of units in that
Fund."
10. By substituting the following for clause (5) of Section 6.2:
"(5) Matching Contributions shall be allocated to the Matching
Contributions Account of each Participant who had Compensation Deferral
Contributions allocated to his Participant Deferral Account since the last
preceding Valuation Date."
11. By substituting the following for the second sentence of Section
7.2(b):
"A Participant's investment elections under this section shall be
made in 1% multiples in accordance with procedures established by the
Committee. A Participant may change the investment of amounts already
allocated to his Account on any Valuation Date. A Participant may change the
investment of future contributions to his Account as of the first payroll
period of the following month by giving notice prior to 4:00 p.m., eastern
time, on the last Valuation Date of the month."
12. By substituting the following for the last sentence of Section
8.2(a):
"Such Participant's Account shall be valued as soon as practicable
following his termination of employment, and shall be paid to him in a lump
sum, subject to the provisions of Section 8.5."
13. By substituting the following for Section 8.3(a):
"Upon the death of a Participant prior to commencement of the
distribution of benefits hereunder, distribution shall be made to the
Participant's Beneficiary in a lump sum in cash as soon as practicable after
the value of the Participant's Account has been determined. Such valuation
shall be made as soon as practicable after the date on which the Committee has
been furnished with all documents and information necessary to distribute such
Participant's Account."
14. By substituting the following for the first sentence of Section
8.4(a):
"The Account of a Participant whose employment with the Company
terminates prior to his Normal Retirement Date for a reason other than his
death, retirement on his Early Retirement Date, or Total and Permanent
Disability, shall be valued as soon as practicable after the date on which the
Participant's request for distribution of his Account is received by the
Committee."
15. By deleting the last sentence of Section 8.9(a).
IN WITNESS WHEREOF, the Company has caused this instrument to be executed
by its duly authorized officers this day of
, .
BUDGET RENT A CAR CORPORATION
By:
Its:
<PAGE>
THIRD AMENDMENT OF
BUDGET RENT A CAR CORPORATION SAVINGSPLUS PLAN
(As Amended and Restated Effective January 1, 1993)
WHEREAS, Budget Rent A Car Corporation (the "Corporation") maintains the
Budget Rent A Car Corporation SavingsPlus Plan (the "Plan"); and
WHEREAS, the Plan has been amended from time to time and further
amendment of the Plan now is considered desirable;
NOW, THEREFORE, by virtue and in exercise of the powers reserved to the
Corporation under Section 14.1 of the Plan, and pursuant to authority
delegated to the officers of the Corporation by resolution of its Board of
Directors, the Plan is hereby amended, effective December 1, 1996, by
substituting the following for Section 5.1(d):
"(d) The Company shall make for each Plan Year a Retirement Plan
Contribution in such amount, if any, as may be determined by the Board of
Directors in its sole discretion. Any Retirement Plan Contribution for a Plan
Year shall be allocated to the Retirement Plan Contributions Account of each
Participant (i) who was credited with not less than 1,000 Hours of Service in
such Plan Year and who was an Active Participant or on a Leave of Absence on
the last day of the Plan Year, or (ii) whose employment with the Company
terminated during the Plan Year due to death, retirement on or after Normal
Retirement Date or as a result of Total and Permanent Disability. Such
allocation shall be in an amount which bears the same ratio to such Retirement
Plan Contribution as the Participant's Compensation for such Plan Year bears
to the Compensation of all such Participants for the Plan Year.
Notwithstanding anything to the contrary contained in this Section
5.1(d), for the 1995 and 1996 Plan Years the following clause (i) shall be
substituted for the foregoing clause (i): "(i) who was credited with not less
than 1,000 Hours of Service in such Plan Year and who was an Active
Participant on December 1 of such Plan Year or on a Leave of Absence on the
last day of such Plan Year, or"."
IN WITNESS WHEREOF, the Corporation has caused this amendment to be
executed by its duly authorized officers this _____ day of ____________,
________.
BUDGET RENT A CAR CORPORATION
By:
Its:
<PAGE>
FOURTH AMENDMENT OF
BUDGET RENT A CAR CORPORATION SAVINGSPLUS PLAN
(As Amended and Restated Effective January 1, 1993)
WHEREAS, Budget Rent a Car Corporation (the "Corporation") maintains the
Budget Rent a Car Corporation SavingsPlus Plan (the "Plan"); and
WHEREAS, the Plan has been amended from time to time and further
amendment of the Plan now is considered desirable;
NOW, THEREFORE, by virtue and in exercise of the powers reserved to the
Corporation under Section 14.1 of the Plan, and pursuant to authority
delegated to the officers of the Corporation by resolution of its Board of
Directors, the Plan is hereby amended in the following respects:
1. By adding the following definition to Article II at the end of the
definition for "Company Contributions" effective July 1, 1997:
"Company Stock" means the common stock of Budget Group, Inc.
(BD)."
2. By substituting the following for the table in Section 5.1(c)
effective for months beginning on or after July 1, 1997:
<TABLE>
<CAPTION>
<S> <C>
"Percentage of Percentage of
Compensation Compensation
Contributed as Deferral
Compensation Contribution
Deferral Matched
1 - 2 50%
3 - 4 25%"
</TABLE>
3. By adding the following at the end of the first sentence of
Section 7.2(b) effective July 1, 1997:
"; provided, however, that all Matching Contributions shall
initially be invested in the Company Stock Fund."
4. By inserting the following at the end of Section 7.4 effective
July 1, 1997:
"7.5 Company Stock Fund.
(a) Effective July 1, 1997, the "Company Stock Fund,"
investments in which shall be invested in Company Stock, shall be added to the
Trust Fund; provided, however, that (i) no amount shall be invested in this
fund unless the Company Stock to be acquired with such amount is covered by an
effective registration statement on Form S-8 under the Securities Act of 1933,
as amended, and (ii) the Committee may impose limits on the amounts that may
be used to acquire Company Stock.
(b) Notwithstanding anything to the contrary contained in
this article, with respect to Participants subject to Section 16 of the
Securities Exchange Act of 1934, as amended, to the extent necessary to comply
with SEC Rule 16b-3(c), any transfer to or from the Company Stock Fund shall
be made at least six months after the date of the most recent election, with
respect to any plan of the Company, that effected a "discretionary
transaction" of the opposite way under such rule.
(c) If a Participant's Account is invested in the Company
Stock Fund, he (or in the event of his death, his Beneficiary) shall have the
right to direct the Trustee on how to vote any Company Stock attributable to
the investment of his Account, and the Trustee shall act in accordance with
those instructions. If the Trustee does not receive timely instruction on how
to vote, the Trustee shall vote such Company Stock in the same proportion as
Company Stock with respect to which it has received instructions, and the
Trustee shall have no discretion in such matter.
(d) If a Participant's Account is invested in the Company
Stock Fund, he (or in the event of his death, his Beneficiary) shall have the
right to direct the Trustee on how to respond to a tender or exchange to the
investment of his Account, and the Trustee shall act in accordance with those
instructions. If the Trustee does not receive timely direction from a
Participant (or Beneficiary) on how to respond to the tender or exchange
offer, the Trustee shall tender or exchange such Company Stock in the same
proportion as Company Stock with respect to which the Trustee has received the
right of direction, and the Trustee shall have no discretion in such matter."
IN WITNESS WHEREOF, the Corporation has caused this amendment to be
executed by its duly authorized officer this ____ day of _____________,
_______.
BUDGET RENT A CAR CORPORATION
By:
Its:
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C> <C>
PAGE
ARTICLE I INTRODUCTION 1
ARTICLE II DEFINITIONS 1
ARTICLE III ELIGIBILITY AND PARTICIPATION 15
3.1 Commencement of Participation 15
3.2 Amounts Transferred from Prior Plan 16
ARTICLE IV EMPLOYEE CONTRIBUTIONS 16
4.1 Compensation Deferral Agreement 16
4.2 Limitations on Compensation Deferral Contributions 18
4.3 Return of Deferrals Over $7,000 22
4.4 After-Tax Contributions 23
4.5 Amounts Transferred from Prior Plan 24
4.6 Rollovers 25
ARTICLE V COMPANY CONTRIBUTIONS 26
5.1 Amount and Allocation of Contributions 26
5.2 Code Section 401(m) Limitation on After-Tax Contributions 27
and Matching Contributions
5.3 Multiple Use 31
ARTICLE VI PARTICIPANT ACCOUNTS 33
6.1 Accounting Procedures 33
6.2 Valuation of Accounts 33
ARTICLE VII TRUST FUND 35
7.1 Trust Fund 35
7.2 Investment of Trust Assets 36
7.3 Irrevocability 37
7.4 Company, Committee and Trustee Not Responsible for 37
Adequacy of Trust Fund
ARTICLE VIII VESTING; PAYMENT OF PLAN BENEFITS 37
8.1 Vesting 37
8.2 Distribution Upon Retirement or Disability 38
8.3 Distribution Upon Death 39
8.4 Distribution Upon Termination of Employment Prior to Retirement 40
8.5 Timing of Distribution 42
8.6 Withdrawals 42
8.7 Facility of Payment 45
8.8 Additional Documents 45
8.9 Participant Loans 46
8.10 Direct Rollover of Eligible Rollover Distributions 50
ARTICLE IX OPERATION AND ADMINISTRATION OF THE PLAN 51
9.1 Plan Administration 51
9.2 Committee Powers 52
9.3 Investment Manager 53
9.4 Committee Procedure 53
9.5 Compensation of Committee 54
9.6 Resignation and Removal of Members 54
9.7 Appointment of Successors 54
9.8 Records 55
9.9 Reliance Upon Documents and Opinions 55
9.10 Requirement of Proof 55
9.11 Reliance on Committee Memorandum 56
9.12 Multiple Fiduciary Capacity 56
9.13 Limitation on Liability 56
9.14 Indemnification 56
9.15 Bonding 56
9.16 Plan Expenses 57
ARTICLE X MERGER OF COMPANY; MERGER OF PLAN 57
10.1 Effect of Reorganization or Transfer of Assets 57
10.2 Merger Restriction 58
ARTICLE XI PLAN TERMINATION AND DISCONTINUATION OF 58
CONTRIBUTIONS
11.1 Plan Termination 58
11.2 Discontinuance of Contributions 59
11.3 Rights of Participants 60
11.4 Partial Termination 60
11.5 Failure to Contribute 60
11.6 Distributions Upon Sale of Assets or Subsidiary 60
ARTICLE XII APPLICATION FOR BENEFITS 60
12.1 Application for Benefits 60
12.2 Action on Application 61
12.3 Appeals 61
ARTICLE XIII LIMITATIONS ON CONTRIBUTIONS 62
13.1 General Rule 62
13.2 Annual Additions 63
13.3 Other Defined Contribution Plans 63
13.4 Combined Plan Limitation (Defined Benefit Plan) 64
13.5 Adjustments for Excess Annual Additions 66
13.6 Disposition of Excess Amounts 66
ARTICLE XIV PLAN AMENDMENTS 67
14.1 Amendments 67
14.2 Retroactive Amendments 67
14.3 Amendment of Vesting Provisions 67
ARTICLE XV TOP-HEAVY PLAN RULES 68
15.1 Applicability 68
15.2 Definitions 68
15.3 Top-Heavy Status 69
15.4 Minimum Contributions 72
15.5 Maximum Annual Addition 73
ARTICLE XVI ADOPTION BY AFFILIATED COMPANIES 74
16.1 Adoption of Plan 74
16.2 The Sponsor as Agent for the Company 74
16.3 Adoption of Amendments 74
16.4 Termination 74
16.5 Data to Be Furnished by Employers 75
16.6 Joint Employees 75
16.7 Expenses 75
16.8 Withdrawal 75
16.9 Prior Plans 75
ARTICLE XVII MISCELLANEOUS 75
17.1 No Enlargement of Employee Rights 75
17.2 Nonalienation 76
17.3 Mailing of Payments; Lapsed Benefits 79
17.4 Addresses 81
17.5 Notices and Communications 81
17.6 Reporting and Disclosure 81
17.7 Governing Law 81
17.8 Interpretation 81
17.9 Withholding for Taxes 82
17.10 Limitation on Company, Committee and Trustee Liability 82
17.11 Successors and Assigns 82
17.12 Counterparts 82
</TABLE>
Exhibit 23.1
CONSENT OF KPMG MARWICK LLP
The Board of Directors of
Budget Rent a Car Corporation:
We consent to the incorporation by reference in this Registration Statement of
Budget Group, Inc. on Form S-8 of our report dated February 18, 1997, related
to the Budget Rent a Car Corporation consolidated financial statements as of
December 31, 1995 and 1996 and for the each of the years in the three-year
period ended December 31, 1996, from Budget Group, Inc. s current report on
Form 8-K dated May 13, 1997.
/s/ KPMG Marwick LLP
July 10, 1998
Chicago, Illinois
Exhibit 23.2
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
As independent certified public accountants, we hereby consent to the
incorporation by reference in this registration statement of our report on the
consolidated financial statements of Budget Group, Inc. (formerly known as
Team Rental Group, Inc.) and subsidiaries as of December 31, 1996 and 1997,
and for each of the three years in the period ended December 31, 1997, dated
March 20, 1998 (except with respect to the matters discussed in Note 17, as to
which the date is June 19, 1998), included in Budget Group, Inc. s Current
Report on Form 8-K filed July 2, 1998, and to all references to our firm
included in or made a part of this Registration Statement.
/s/ Arthur Anderson LLP
July 10, 1998
Orlando, Florida
Exhibit 23.3
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Budget Group, Inc. (formerly Team Rental Group, Inc.) on Form S-8 of our
report dated April 12, 1996, appearing in the Annual Report on Form 10-K of
Budget Group, Inc. for the year ended December 31, 1997.
DELOITTE & TOUCHE LLP
Indianapolis, Indiana
July 10, 1998
